"I inherited a mess. We're going to fix it."

Trump is doing what Obama failed to do strongly enough: blame his predecessor.

Yes, Obama blamed Bush and the Republicans.  "They drove the economy into a ditch," he said.  But Obama had a problem and it proved fatal for him.   The economy was, in fact, in a ditch.  I was an eyewitness.   I was in the ditch.

In the fall of 2008 and the first months of 2009, in the middle of Obama's election and inauguration, the financial institutions of the US came to the realization that they were insolvent.  Their liabilities were worth more than their assets because their assets consisted in part of mortgage pools that were impossible to value because they were so complicated and because there was no market for them, but which everyone understood were worth--in an orderly market--much less than their stated value.  I was personally in the ditch because I was a financial advisor, watching local and national banks collapse and disappear, because I watched investors panic to sell all long term investments to try to go to cash, and I watched the vehicles to hold cash--money market funds--become risky.

I was there to watch the contagion. At risk were not simply banks.  General Electric, a conglomerate, needed federal backing.  AIG, an insurer, needed federal backing, without which the banks whose mortgages it guaranteed, would fail.  General Motors and Chrysler needed federal support.  Local developers in my community went from rich to bankrupt, bringing down the banks that had lent to them.   Investors were in a panic.  My own employer--Citigroup--disintegrated and needed federal bailout.

The largest local business, Lithia Motors, an owner of over a hundred car dealerships, had stock selling for $2 to $3 a share for weeks as the fate of car manufacturers was uncertain.  It is in the 80s now.   For the price of a single midsize sedan or pickup truck--$30,000-- one could now have stock worth $1,200,000.

Political Mistake

Amid the gloom Obama did not talk down the economy.  He talked it up.  It may have been the proper duty of a president in a crisis but it was a political disaster.  The unemployment of 2009 was blamed on Obama, not Bush.  The bankruptcies of real estate developers and regular home buyers,  which took another year to ripen and go under, were Obama's fault.  

Worse, for Obama, he saved the financial institutions.  A modern capitalist economy cannot have a financial system without having financial institutions.  Loans are not "made"; they are made by somebody.  Commerce, whether big deal trades in Boeing jets or purchases of daily groceries at a supermarket, require financial intermediaries.   The policy of the Obama administration was to keep them alive and working, which meant that they could not punish them in the way the public wanted to see them punished.  Their executives did not go to jail.  Their stockholders were generally wiped out--the 401ks and pension funds of the little guy got hurt--but the executives not only were not charged criminally, a great many of them kept their bonuses and golden handcuffs.   

It fueled a populist revulsion and a political revolt, the Tea Party and Occupy Wall Street.

Yesterday:  "I inherited a mess."

"I inherited a mess."   Trump learned from Obama's mistakes:   His inaugural speech spoke to "this American carnage."  

      Things are a mess with Obamacare--in a death spiral.

      Things are a mess with NATO--they are ripping us off.

      Things are a mess with trade--terrible trade deals.

      Things are a mess with Korea--a nuclear crisis to deal with.

      Things are a mess with Iraq and Libya and Syria--never should have gone in there.

      Things are a mess with Russia--relations have never been worse.

      Things are a mess with oil and coal--regulations killed them.

      Things are a mess with illegal immigration--murderers and criminals taking our jobs.

Objectively things were much better in America in 2016 than they were in 2008.  Unemployment down, economy recovered, housing prices back to 2007 values, but a great many people felt discouraged and impatient.   Polls showed people thought the country was going in the wrong direction.

RT attacks status-quo Hillary.

Sanders pointed to a villain: the billionaires, who got away with destroying the economy and are doing it still.   RT, the Russian media source that worked to undercut support for Hillary Clinton, Obama, and the status quo, weighed in.   Hillary had adopted a continuation-of-Obama policy, in support of the existing establishment.  The Sanders message was as much against Hillary as it was against Trump.  He identified an enemy: the elites in the status quo.

Trump, too,  pointed to a villain: those foreigners who disrespect us, take advantage of us, and invade our country as immigrants both legal and illegal.  

Obama never did a good job of pointing out and identifying an outside enemy, and insofar as he did, he did not publicly punish them.  In hindsight, he was a dove.  He set the stage for a hawk.   It could be either from the left or the right but the stage was set for a person who made accusations and pointed the finger at the sources of our discontent.

Sanders and Trump said the villain was someone else; Obama and Hillary said the villain was the bad impulses inside ourselves, our racism, xenophobia, prejudices, our bad policies, our own mistakes that sabotaged our best selves.  

Trump and Sanders had an easier message to accept.  America has a problem:  it isn't me, it is them.