It is not direct democracy because in a direct democracy the people decide on what to hold the referendum, not the government, the parliament or any other institution.
It can not be direct democracy because when the government calls the referendum it is not the people who decide. If the government decides not to hold a referendum on an issue then the people can not vote. It makes no sense in democracy that governments control the right of citizens to vote.
The vote leading to Brexit was not an example of direct democracy. It was not because the British Government decided to call it, not the citizens. The citizens could only ask for it.
Had the British Government decided not to hold the referendum, the British people would not have voted and the UK would not leave the EU, even if the vast majority of voters wanted to. The opposite would also have been possible.
There is another word often used to refer to popular votes, the plebiscite. The difference between referendum and plebiscite is the plebiscite is even weaker. In a plebiscite the government can ignore the results. Plebiscites are just like a poll where people express their opinion at the ballot box.
Referendums called by governments are just another tool to govern; governments decide the issue and the time. It is obvious a government will call for a referendum only if it feels it will win. Mr. Cameron, the British Prime Minister, was against leaving. It looks like he made a mistake by calling the referendum, but perhaps it was a “wise” mistake.
I do not know if Mr. Cameron feels he made a mistake. It is possible that the strong and long democratic history of the UK influenced his thinking. Perhaps he felt that given the significant opposition to the EU in the UK, the proper way to clear the air was to let the people decide.
If so, Mr. Cameron was right in the most important issue. In a democracy you can not govern with your backs to the people if you want your country to have a stable democracy.
Referendums called by governments are not direct democracy. They are not even democracy. If they were democracy, authoritarian and totalitarian rulers such as Franco, Pinochet, Castro, Chavez, Hitler, the Iranian clerics, etc., would not use them.
Some people in representative democracies refer to referendums as “the instruments of dictators”. Margaret Thatcher and the The Economist magazine are two examples of people who said that.
They are right if the refer only to referendums called by governments. If it is the people who call the referendum, such referendum is not the instrument of dictators. I am speaking of referendums in democracies because dictatorships have no difficulty with the machinations to make it appear that the people initiated the process. Those are fake referendums.
Conclusion: Do not accept that referendums called by governments are direct democracy. It is one important element of direct democracy that citizens do that, not governments. This criterion applies to federal, national, regional or local governments.
Plebiscites, where government can ignore the results, are not even worth the effort for voters to go to the voting station.
Direct democracy is about changing the distribution of power; more power to the average citizen and less for the politicians and elites. Such redistribution of power is good for everybody over the long term. Direct democracy produces more political stability, reduces uncertainty and generates more prosperity. Switzerland is proof of that.
I believe all stable representative democracies, such as those in Central and Northern Europe, most English-Speaking countries, Japan, Taiwan, South Korea, perhaps India and Singapore, and a few others too, are ready for direct democracy.
Political power is not like wealth. Wealth can grow and grow; there is no fixed size for the “pie”. We can see how the pie has grown around the World because in most of the World people have more freedom to start all sorts of business. Not just because economic socialism has retreated, “feudal capitalism” is also retreating, although more slowly.
Political power is a fixed quantity; if the politicians, the wealthy and the lobbies have more power, the average citizen has less.
Referendums called by the people mean the people have more power. If you want that, for it to happen you have to do something.