An impeached president who is up for re-election will this week deliver a State of the Union address to the most divided union in living memory.

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But why are we so divided? We’re not fighting a hugely unpopular war on the scale of Vietnam. We’re not in a deep economic crisis like the Great Depression. Yes, we disagree about guns, gays, abortion and immigration, but we’ve disagreed about them for decades. Why are we so divided now?

Part of the answer is Trump himself. The Great Divider knows how to pit native-born Americans against immigrants, the working class against the poor, whites against blacks and Latinos, evangelicals against secularists, keeping almost everyone stirred up by vilifying, disparaging, denouncing, defaming and accusing others of the worst. Trump thrives off disruption and division.

But that begs the question of why we have been so ready to be divided by Trump. The answer derives in large part from what has happened to wealth and power.

In the fall of 2015, I visited Michigan, Wisconsin, Ohio, Pennsylvania, Kentucky, Missouri and North Carolina, for a research project on the changing nature of work. I spoke with many of the people I had met 20 years before when I was secretary of labor, as well as with some of their grown children.

What I heard surprised me. Twenty years before, many said they’d been working hard and were frustrated they weren’t doing better. Now they were angry – angry at their employers, the government, Wall Street.

Something very big happened, and it wasn’t due to Sanders’ magnetism or Trump’s likability

Many had lost jobs, savings or homes in the Great Recession following the financial crisis of 2008, or knew others who had. Most were back in jobs but the jobs paid no more than they had two decades before, in terms of purchasing power.

I heard the term “rigged system” so often I began asking people what they meant. They spoke about flat wages, shrinking benefits, growing job insecurity. They talked about the bailout of Wall Street, political payoffs, insider deals, soaring CEO pay, and “crony capitalism”.

These complaints came from people who identified themselves as Republicans, Democrats and independents. A few had joined the Tea Party. A few had briefly been involved in the Occupy movement.

The 2016 rebellion is ongoing

With the 2016 political primaries looming, I asked which candidates they found most attractive. At the time, the leaders of the Democratic party favored Hillary Clinton and Republican leaders favored Jeb Bush. Yet no one I spoke with mentioned Clinton or Bush.

They talked instead about Bernie Sanders and Donald Trump. When I asked why, they said Sanders or Trump would “shake things up” or “make the system work again” or “stop the corruption” or “end the rigging”.

In the following year, Sanders – a 74-year-old Jew from Vermont who described himself as a democratic socialist and wasn’t even a Democrat until the primaries – came within a whisker of beating Clinton in Iowa, routed her in New Hampshire, and ended up with 46% of the pledged delegates from Democratic primaries and caucuses.

Facebook Twitter Pinterest Bernie Sanders speaks in Perry, Iowa. Photograph: Chip Somodevilla/Getty Images

Trump – a 69-year-old egomaniacal billionaire reality-TV star who had never held elective office or had anything to do with the Republican party and who lied compulsively about everything – won the primaries and went on to beat Clinton, one of the most experienced and well-connected politicians in modern America (although he didn’t win the popular vote, and had some help from the Kremlin).

Something very big had happened, and it wasn’t due to Sanders’ magnetism or Trump’s likability. It was a rebellion against the establishment. That rebellion is still going on, although much of the establishment still denies it. They prefer to attribute Trump’s rise solely to racism.

Racism did play a part. But to understand why racism had such a strong impact in 2016, especially on the voting of whites without college degrees, it’s important to see what drove it. After all, racism in America dates back long before the founding of the Republic, and even modern American politicians have had few compunctions about using racism to boost their standing.

What gave Trump’s racism – as well as his hateful xenophobia, misogyny and jingoism – particular virulence was his capacity to channel the intensifying anger of the white working class into it. It is hardly the first time in history that a demagogue has used scapegoats to deflect public attention from the real causes of distress.

Democrats did nothing to change a rigged system

Aided by Fox News and an army of rightwing outlets, Trump convinced many blue-collar workers feeling ignored by Washington that he was their champion. Clinton did not convince them that she was. Her decades of public service ended up being a negative, not a positive. She was indubitably part of the establishment, the epitome of decades of policies that left these blue-collar workers in the dust. (It’s notable that during the primaries, Sanders did far better than Clinton with blue-collar voters.)

Trump galvanized millions of blue-collar voters in communities that faced a tidal wave of factory closings

Trump galvanized millions of blue-collar voters living in communities that never recovered from the tidal wave of factory closings. He promised to bring back jobs, revive manufacturing and get tough on trade and immigration.

“We can’t continue to allow China to rape our country, and that’s what they’re doing,” he said at one rally. “In five, 10 years from now, you’re going to have a workers’ party. A party of people that haven’t had a real wage increase in 18 years, that are angry.”

Speaking at a factory in Pennsylvania in June 2016, he decried politicians and financiers who had betrayed Americans by “taking away from the people their means of making a living and supporting their families”.

Democrats had occupied the White House for 16 of the 24 years before Trump’s election, and in that time scored some important victories for working families: the Affordable Care Act, an expanded Earned Income Tax Credit and the Family and Medical Leave Act, for example. I take pride in being part of a Democratic administration during that time.

But Democrats did nothing to change the vicious cycle of wealth and power that had rigged the economy for the benefit of those at the top and undermined the working class. As Democratic pollster Stanley Greenberg concluded after the 2016 election, “Democrats don’t have a ‘white working-class’ problem. They have a ‘working class problem’ which progressives have been reluctant to address honestly or boldly.

“The fact is that Democrats have lost support with all working-class voters across the electorate.”

Clinton and Obama chose not to wrest power back from the oligarchy. Why?

In the first two years of the Bill Clinton and Barack Obama administrations, Democrats controlled both houses of Congress. Yet both Clinton and Obama advocated free trade agreements without providing millions of blue-collar workers who consequently lost their jobs any means of getting new ones that paid at least as well. Clinton pushed for Nafta and for China joining the World Trade Organization, and Obama sought to restore the “confidence” of Wall Street instead of completely overhauling the banking system.

Facebook Twitter Pinterest Bill and Hillary Clinton campaign in Nashua, New Hampshire, in 1992. Photograph: Cynthia Johnson/Getty Images

Both stood by as corporations hammered trade unions, the backbone of the white working class. They failed to reform labor laws to allow workers to form unions with a simple up-or-down majority vote, or even to impose meaningful penalties on companies that violated labor protections. Clinton deregulated Wall Street before the crash; Obama allowed the Street to water down attempts to re-regulate it after the crash. Obama protected Wall Street from the consequences of its gambling addiction through a giant taxpayer-funded bailout, but allowed millions of underwater homeowners to drown.

Both Clinton and Obama turned their backs on campaign finance reform. In 2008, Obama was the first presidential nominee since Richard Nixon to reject public financing in his primary and general election campaigns, and he never followed up on his re-election promise to pursue a constitutional amendment overturning Citizens United vs FEC, the 2010 supreme court opinion opening wider the floodgates to big money in politics.

Although Clinton and Obama faced increasingly hostile Republican congresses, they could have rallied the working class and built a coalition to grab back power from the emerging oligarchy. Yet they chose not to. Why?

There is no longer a left or right. There is no longer a moderate ‘center’

My answer is not just hypothetical, because I directly witnessed much of it: it was because Clinton, Obama and many congressional Democrats sought the votes of the “suburban swing voter” – so-called “soccer moms” in the 1990s and affluent politically independent professionals in the 2000s – who supposedly determine electoral outcomes, and turned their backs on the working class. They also drank from the same campaign funding trough as the Republicans – big corporations, Wall Street and the very wealthy.

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A direct line connects the four-decade stagnation of wages with the bailout of Wall Street, the rise of the Tea Party (and, briefly, Occupy), and the successes of Sanders and Trump in 2016. As Eduardo Porter of the New York Times notes, since 2000 Republican presidential candidates have steadily gained strength in America’s poorer counties while Democrats have lost ground. In 2016, Trump won 58% of the vote in the counties with the poorest 10% of the population. His share was 31% in the richest.

By 2016, Americans understood full well that wealth and power had moved to the top. Big money had rigged our politics. This was the premise of Sanders’s 2016 campaign. It was also central to Trump’s appeal – “I’m so rich I can’t be bought off” – although once elected he delivered everything big money wanted.

Facebook Twitter Pinterest Donald Trump walks on to the stage in Hershey, Pennsylvania, on 4 November 2016. Photograph: Spencer Platt/Getty Images

The most powerful force in American politics today continues to be anti-establishment fury at a rigged system. There is no longer a left or right. There’s no longer a moderate “center”. There’s either Trump’s authoritarian populism or democratic – small “d” – populism.

Democrats cannot defeat authoritarian populism without an agenda of radical democratic reform, an anti-establishment movement. Trump has harnessed the frustrations of at least 40% of America. Although he’s been a Trojan horse for big corporations and the rich, giving them all they’ve wanted in tax cuts and regulatory rollbacks, the working class continues to believe he’s on their side.

Democrats must stand squarely on the side of democracy against oligarchy. They must form a unified coalition of people of all races, genders, sexualities and classes, and band together to unrig the system.

Trump is not the cause of our divided nation. He is the symptom of a rigged system that was already dividing us. It’s not enough to defeat him. We must reform the system that got us here in the first place, to ensure that no future politician will ever again imitate Trump’s authoritarian demagoguery.