ican, the master of the totally inaccurate cut-and-paste strikes again, having posted the same completely mistaken quote already twenty or thirty times.
First, Tytler never said that, nor did he ever write the book from which that quote is supposed to have come. As far as can be dteermined, it was originally used by a business executive who recycled his various speeches and first used that passage in his speeches around 1946., apparently to lend an air of spurious antiquity to his words. No one has ever been able to find it in Tytler's writings.
http://www.lorencollins.net/tytler.html
Second, if he is supposed to have said it in 1787 he used a test case of just one: Athens. We have many more to draw from today, and we know that the supposed conclusions and supposed inevitable stages are just flatly not true. He didn't even use the obvious counterexample, Switzerland, which has been a form of republic for over 700 years, a direct democracy since the 1840's, and is today one of the richest, most stable countries, in the world, somehow managing not to spend itself into the quote's supposed inevitable oblivion for more than seven centuries. The supposed Woodhouselee statement completely fails, even on the evidence available in 1787, let alone today.
If ican were really interested in the actual causes of economic problems in democracies, he would look at the greed and gaming of the system by the financial institutions he so adores, which came close to bringing thw world down, until those governments re-stabilized things with measures like Obama's stimulus plans. It is those dangers inherent in the boom-and-bust cycles that the free marketeer's hubris seems to inevitably bring on that can prove to be our downfall, rather than ican's and whoever-it-was who actually wrote his quote's MYTHICAL attempt to pin it on citizens' endless feeding from public funds.