I haven't decided yet if this is sheer brilliance or absolutely insane. On the one hand, bringing more transparency to the process of drafting laws, and increasing the ability of non-lobbyists to have an influence on that process, are unquestionably good things. Heck, forget for a minute about the ability of common people to suggest edits to a draft law—can you just imagine all of the voters being able to look at the "edit history" of a law and see what parts were inserted by which people when?
On the other hand, a big part of what makes Wikipedia work is that is has a dedicated core of editors who are interested in truth and balance over any partisan viewpoint, and those editors out-number and out-clout the partisans. This situation is much less likely to hold in a sphere that is partisan by definition, such as drafting laws. As Michael Mussa (a former economist with the International Monetary Fund at a level where even the economists have to be politicians) once commented, "In Washington, truth is just another special interest, and one that is not particularly well financed."