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If we limit ourselves to Sunnis and Shiites (there are several other little-known trends), then we can very conditionally say that Sunnis are democrats, and Shiites are monarchists.
The key point of division is the question of who should lead the Muslim community, the Ummah. Sunnis believe that the caliph should be chosen by the community, while Shiites believe that only a descendant of Muhammad can be one. On a deeper level, it is a question of the distribution of divine grace – is the entire family of Muhammad blessed, or is the grace personal? Is grace necessary, or is it enough to be wise and have a deep understanding of the Qur'an? Further discrepancies are mostly due to the fact that the theological problems that arose were solved differently in different currents, and such differences accumulated from century to century.