This was Hobbes' original argument, that the mass of people were too immoral — venal, violent, selfish — to effectively govern themselves. They thus needed a strong, dominating government to create and enforce civil society. Of course, Hobbes wasn't overtly arguing for dictatorship or totalitarianism. He felt that choosing such a government was a rational choice, and that people should collectively choose to establish the government that would best restrain all for the benefit of everyone. In that sense he was echoing Aristotle's earlier distinction between a polity (community-centered government by virtuous citizens) and a democracy (senseless government by the unlettered, emotion-driven masses), with the twist that the emotion-driven masses could construct a polity for themselves by rationally adopting a set of oppressive institutions.
Of course, Hobbes' views were unpopular within the early Liberal movement, for all the obvious reasons, and most of early Liberal philosophy rejected his premise outright. They re-conceptualized people as, variously, rational individualists (Locke), community-oriented contractarians (Rousseau), or gregarious bargainers pulled together by their desire for trade and variety (Smith). The idea that people are 'too immoral to be free in their choice' is dismissed outright by the first two, and tempered into competitiveness by the last, so it ceased for a while to be a philosophical problem.
The issue wasn't revisited again until a century later, when political thinkers in the soon-to-be United States were faced with the task of implementing a pragmatic system of Liberal governance. Some of them, at least, were uncomfortable merely denying Hobbes' insight even as they clung to the more positive ideals, so they adopted a new strategy that was a bit of a mix of all of the earlier political thinking. They decided to create a system that leveraged all of these human weaknesses and follies. They came up with what we call Madisonian democracy, or sometimes agonistic democracy: a system in which people are expected to be self-interested and independent, but in which power is distributed so broadly, with so many checks and balances that pit each body and each individual against every other, that people will have to be cooperative and socially conscious merely to get the things that they selfishly want. It's a political version of Smith's economic 'Invisible Hand', combined with institutional and contractual controls on the accumulation of power into a small number of hands. It isn't a pretty system, and it's filled with numerous traps and dangers for the unwary, but it has stood the test of time thus far.