Anakin and Padme are having a picnic when they start discussing systems of government. Anakin thinks that occasionally, politicians should be made to agree, whereas Padme values democracy above progress.
Chancellor Palpatine is given emergency dictatorial powers by the Galactic Senate to build an army to fight the Republic's enemies. Before these powers were established, he could not legally do so. This army will eventually be used to wipe out the Jedi.
Emperor Palpatine formally announces his plans to turn the representative Galactic Republic into the autocratic Galactic Empire. He also announces his plans to wipe out the Jedi, and lies by claiming they were plotting to destroy the Republic.