Totally ambitious and unprecedented, I expect a lot of skepticism and resistance... but the potential is incredible so anyone who can help make this work please consider sharing your opinions.

The Great Democratic Game Design Experiment starts now! http://igg.me/at/gdgde/

I think this is a really cool idea and so long as you clearly identify the roles with some form of Tree Diagram that shows the chain of democracy then there really shouldn't be too many snags.

The only other thing that would be necessary is a global voting process perhaps to settle early on with some framework about the artistc approach, style and other critical elements that the game will be hinged from.

Sounds like a representative democracy is what you are suggesting. I was imagining something a little more organic.. but that would be up to the community to decide.. by voting. There certainly has to be some structure, for instance I have a structure as to which order to present certain topics for discussion so that we know some of the foundation before we go off into details but I'm certainly not picturing anything cohesive in terms of themes or style.. more of a zany mixed bag. Of course I'm not one to say.. that will be up to the voters.

The biggest hurdle isn't really the implementation so much as gaining traction and confidence early on. This project needs as many people on board as possible. Please consider sharing this as far and wide as you can reach and bringing up any questions or concerns on the campaign page as to encourage participation and discussion.
$500,000 sounds like a lot of money and that intimidates people, but again it's all about reach and participation. If we can get the greater gaming community involved the budget won't be a concern.

Another possibility to consider regarding a budget could be one where the game starts off with a very small budget demand and as the community grows, so will the number of ideas and contributions and so you could extend out the total budget required to remain commensurate with the size of the community involved.

$500,000 already limits the potential scale of the project quite a bit.

If I were to try it your way I'd be looking at something like the following...

8% right off the top for indiegogo and paypal's cut. (e.g. at $500,000 thats $40,000) Then you have web development and hosting with at least one employee for maintence so that the web portal can respond quickly to shortcomings and feedback. (A broken polling system for a week could kill the project's momentum.) Locally you absolutely need a programmer or there is no way all these community contributions could work together in a game engine so they have to get paid and they need a licence for the game engine. Hoping to get enough money from continued campaigning to keep that programmer on board could lead to the whole project stalling.. not a good idea for a project this scale. So paying well below industry standard cost/salary for a one year contract we're looking at somewhere between $15,000 - $40,000 for the web portal (hopefully including a year's services) and $50,000 - $80,000 for a decent programmer who can handle the weight of such a project. You could go with a couple of amature programmers to lower the burden and pay around $40,000 each. Either way we're looking at potentially $160,000 already before we even consider a space to work from, electricity bill, project manager (which I'm willing to do full-time for practically charity at $40,000/y), social media manager, animation "consulting" at the least, sound "consulting" at the least.. etc etc.. Each additional member that works directly with the game engine also requires their own seat license and hopefully already own their own tools.

My point is that if the dev team is also "winging it" without resources then there just isn't any chance the whole thing can come together. The idea of crowdsourcing the game on this scale brings so many potential inneffiencies that the point of the dev team is to be efficient enough to keep things on track. I've worked with enough mod teams to know that when the core team isn't secure the project just ends up in perpetual development with lots of stalls and roadblocks along the way, the general population won't have the patience for that. I see 18 months as the absolute maximum a project like this can keep everyone engaged.

But I understand what you are saying.. obviously the price tag induces sticker shock and that either needs to be explained to the laymen or addressed in some creative problem solving way. Thanks for continuing to engage me on the topic.. wish we could get more people in on the conversation.