Internet Governance Forum is a site and organization that really is talking about using the internet for democracy. Most of what I've found there so far is using social networks for campaigning, but it's fair to say that the world is just in the early stages of using the Web for running government.
What's important is that these guys have been around for awhile. Here in the U.S. we have the tendency to be alerted to issues for the short term, such as the current Occupy Wall Street Movement, which uses Twitter on the model of the recent Arab Spring movement. But other places have been working on internet governance for years.
Let's all be aware of this trend and learn more about it. Certainly internet governing should have huge advantages over our 250 year old system (older than that if you consider what it was based upon.)