The often-asserted relation of formal adequacy or elective affinity between capitalism and democracy is historically contingent on both sides of the relation. First, it holds for what Weber called formally rational capitalism - which is the form that Marx had previously investigated in Das Kapital - rather than others, such as traditional commercial capitalism or politically oriented capitalism. Second, it holds only to the extent that the comprehensive contradiction identified by Marx at the heart of the democratic constitution can be resolved: the contradiction between auniversal franchise that potentially gives subaltern classes control over legislative and executive powers and aconstitution that protects property rights favourable to capital. Building upon Poulantzas, it is then argued that these conditions are being undermined by the rise of new forms of political capitalism, especially finance-dominated accumulation, that are facilitated in turn by the consolidation of both neoliberalism and authoritarian statism. This involves the intensification of exceptional elements in aformally democratic shell, and the emergence of apermanent state of austerity. The article concludes with comments on the limits of finance-dominated accumulation and the austerity state.