The influence of theology on politics has become a minor cottage industry in academic political science. The late Daniel Elazar wrote a multi-volume work on The Covenant Tradition in Politics, in which he argued that Reformed covenantalism played the key role in shaping the ideals of federalism and political cocmpact. While it is true that federalism and political compact sank deep roots into countries that were historically Reformed,covenantalism per se does not seem to be the most important element in shaping at least the ideal of political compact.
Elazar find most of his support in the Politics of Johannes Althusius, city syndic and Reformed church elder in the northwestern German city of Emden in the early 1600's. Althusius' argument holds that the Holy Roman Empire constitutes a federation of states and cities held together by a kind of compact, hence Emden should be allowed to stand as a Reformed city in the Lutheran Duchy of Oldenburg (East Friesland) within the still heavily Roman Catholic Empire. Elazar (a Sephardic Jew) duly notes the biblicism of early Reformed theology, its adherence to covenantal theology, and then concludes that it was the idea of covenant that gave rise to that of political compact and political federalism.
Elazar is, of course, correct in noting how the idea of covenant informs classical Reformed theology. But Elazar's excursions into the realm of classical Reformed theology are those of an outsider seriously misled by various streams of modern academic theology, which he rightly recognizes as deviations from Reformed Orthodoxy, but from whose guidance he cannot quite escape. For instance, in his volume Covenant and Commonwealth, dealing specifically with the continental Reformed and British Puritan theorists,he follows J. Wayne Baker in seeing "Calvinism" (identified as first, last, and always predestinarianism) and "Covenantaalism" as alternative Reformed "theologies" (in the plural), whose schism was averted by the Consensus Tigurinus of 1549. Unfortunately for Elazar's argument, the Consensus Tigurinus settled no debate between predestinarianism and covenantalism (which was non-existent, save in the minds of 19th century liberal theologians eager to live down their "Calvinist" past), but represents the theologians of German-speaking Switzerland accepting Calvin's doctrine of Christ's spiritual presence in the elements of the Lord's Supper as close enough to their own, and not a capitulation to the Lutheran doctrine of consubstantiation. Further, Elazar does not see how covenantalism in Reformed theology is the means whereby the eternal decree to save the elect enters into and takes effect in the time-bound world of finite human exisstence. Hence, Elazar's work requires correction.
However, from reading in a range of early Reformed political thinkers from the Huguenots on down to the Puritans, the doctrine of total depravity played a much larger role.
The number of early Reformed writers on politics is large, and virtually all (with the noteworthy exception of Thomas Erastes) oppose the state or civil magistrate impinging on the church's independence within its sphere and criticize the idea that the divine institution of government grants the monarch an unlimited power over his subjects. Rather, public law represents an agreement between rulers and people, and that if this law is broken, the lesser magistrate has both the right and duty to lead the people in rebellion against the monarch. Hence the title "monarchomach" given to the critics of royal absolutism by royalist writers of the 16th and 17th centuries.
One of the most common justifications for limited government was, as Samuel Rutherford said, that unlimited power in one that can sin is an "accursed power". Rutherford, as a devout Calvinist, saw sinfulness as the natural heritage of all descended from Adam by ordinary generation, hence its taint affects all members of the human race save Jesus Christ. However, government is a divine institution to protect mankind. Hence, there had to be compact between people, rulers, and God to prevent the rulers from having a power that might destroy rather than preserve the people.
By the same token, Calvin himself urged the best government as a mix of democracy and aristocracy in the last chapters of his Institutes of the Christian Religion. His reasoning was simply that kings could not always be trusted to do what is right. While Calvin differs from many of his disciples--Knox, Buchanan, Marnix van St. Aldegonde, Hotman, Junius Brutus, and others--in shying away from declaring a right of rebellion against a tyrant, his conclusions about the best constitution are remarkably similar to theirs.
The Reformed doctrine of total depravity grates on modern, democratic sensibilities. Yet the seed of the constitutional, limited governments that marked the North Atlantic countries were planted by something quite unlike the sunnier estimate of human nature springing from the French Enlightenment.