The idea of "open source governance" is hardly new. I'd imagine such a system in the form of a web app would be swamped with irrelevant queries. Assuming an idealistic direct democracy where citizens draft new laws or modify existing ones, the feedback loop of constantly changing legal information to its application would be overwhelming. On the flip side, too much unaddressed issues and slow or wasteful processes would create apathy.

Personally I always thought the most attractive model for such an endeavor is to store laws in a markup format, and go through the old school route of mailing lists and patches. You'd be making use of highly tested infrastructure and actually require for participants to put a little effort in learning.