Dr Alf and the Economist are both correct but the reason demagogues rise to prominence has to be looked at carefully as well.
Hitler, to take one example, did not build a massive war machine or rise to power on a shoestring, but rather was financed through Unionbank Corporation allegedly with the aid of Prescott Bush and Fritz Thyssen, the Nazi lift magnate. T(See Guardian article on Prescot Bush). Hitler rose to power because the conditions imposed on Germany at the end of World War 1 were so harsh that they were designed to use the quote in full “Squeeze the German orange until the pips squeak”.
Today, we have demagogues in Europe and in America because our so-called leaders have been allowing immigration to run unfettered, so that we in the UK face the prospect of more than 50% of new and existing houses will be taken by immigrants along with 80% of the jobs, partially because many of those jobs are not ones which the indigenous people of the UK want to do.
People find their Judeo-Christian heritage under threat from Islam in Europe and in the UK and because of higher rates of family formation by Muslims they find themselves strangers in their own land. Leicester, much of Birmingham, swathes of London around Tower Hamlets, Bury Park in Luton, parts of Liverpool and the Gladstone area of Peterborough, Slough in Buckinghamshire etc, etc, might as well be another country, possibly akin to a combination of Pakistan, India and in the case of Tower Hamlets, Bangladesh.
People like myself, who live in rural Hertfordshire, are unaffected by this phenomenon as the area is very much like the fictional television village of “Midsomer” where apart from Indian and Chinese restaurants, the local Thai restaurant and a local Turkish restaurant, all the residents are white British or European.
America is bigger but outsourcing and offshoring has destroyed jobs and Obama and his predecessor have done nothing to prepare people for the new conditions and has been dismissive of their fears and the fears they have for their children.
That studied indifference and even ill-disguised contempt for these people and the intelligence of practically everyone else shown by the media and chattering classes is why people like Donald Trump, Geert Wilders, Umberto Bossi in Northern Italy and Nigel Farage in the UK, Le Pen in France et al, are able to command the popularity they do.