Ideally, in a democracy, social power of the power-over variety is distributed broadly, fairly, and relatively evenly, so that it doesn’t distort our ability to make good public decisions and treat each other decently. This helps us ensure an appropriate level of freedom for all concerned. Decentralization, human rights, and social justice and equity[JE3] are all democratic principles that support the distribution of social power.
However, there is often need for social power to be centralized or concentrated. Some functions are naturally best handled at a particular level of society—personal, local, state, national, international. Ideally a function would be assigned to the lowest level at which it can be effectively handled For example, most people believe that a country's defense is best addressed at the national level, rather than at the county or individual citizen levels. Obviously, care for the oceans needs to be done at transnational, even global levels. On the other hand, the structure of your ongoing education is best left to you, personally, although local school boards and state and national legislatures may deem it appropriate to have certain broadly applied standards for a diploma or certificate that is recognized by the whole society.
When social power is centralized or concentrated it poses a potential threat to democracy. As Lord Acton famously said: “Power tends to corrupt and absolute power corrupts absolutely.” Two strategies help make concentrated power more benign. One is to balance it with other centers of concentrated social power. For example, the three branches of the U.S. government—legislative, administrative, and judicial—were designed to “check and balance” each other. Each branch has certain specified powers, but can be challenged, bypassed, or overruled by the other branches in specific ways and circumstances. Unions and corporate leaders have powers that balance each other, at least somewhat. Lately we’ve seen small groups and movements—from terrorists to nonviolent activists like Martin Luther King, Jr., from Occupy Wall Street to hackers and bloggers—balance[JE4] the concentrated power of giant national and transnational institutions, at least somewhat. In a healthy democracy, whenever power gets too concentrated, other powers show up to challenge and attempt to balance it.
The second strategy to make concentrated power more benign is to make it answerable to those over whom it is exercised. This is why government transparency, investigative journalism, whistleblowers, and civilian oversight of police, military, and intelligence services is so important. Elections also constitute a powerful form of answerability, if they are fair and done in a context where we, the people, actually know what public officials have been doing and who is funding their electoral campaigns. The answerability principle is also why corporations—some of which are arguably the best examples of concentrated power on earth today—are supposed to be chartered by the community or state, and their performance reviewed before the charter is periodically renewed or withdrawn.
If a group, organization or person with undue concentrated power resists all efforts to balance their power or make it answerable, that power needs be broken up and/or its functions distributed to others. This is usually quite difficult, but we've seen examples ranging from anti-trust laws to the American Revolution.
One way or another, if we wish to preserve our democracy we must mitigate the toxic tendencies of concentrated power.