What comes after democracy?

I found this great quote this morning:

A democracy cannot exist as a permanent form of government. It can only exist until the voters discover that they can vote themselves money from the Public Treasury. From that moment on, the majority always votes for the candidate promising the most benefits from the Public Treasury with the result that a democracy always collapses over loose fiscal policy always followed by dictatorship. The average age of the world's greatest civilizations has been two-hundred years. These nations have progressed throught this sequence: From bondage to spiritual faith; from spiritual faith to great courage; from courage to abundance; from abundance to complacency; from complacency to apathy; from apathy to dependence; from dependence back again into bondage.
—Alexander Fraser Tyler, 1700

Loose fiscal policy. Apathy. Dependence. Voting for the candidate promising the most benefits. All too familiar, unfortunately. This is what Tyler predicted well before the "founding fathers" established democracy. Is he right in his final prediction - is the next step dictatorship? And how long do we have?