The Republicans were the party of war under Bush. Thousands of Americans and Iraqis and Afghans died thanks to the Bush regime. War budgets were passed that hollowed out the economy, false puffed-up Wall Street notwithstanding. Finally, Americans chose differently in 2008 and they got different--rhetoric.
Obama could have met Bush's economic disaster with a jobs program that put all Americans to work. He and the Democrats failed to do that. Instead of bailing out the people, they bailed out the wealthy just as blatantly as did Bush.
Obama and the Ds could have radically dialed back military spending--the kind of spending that produces the fewest jobs and the most moral offenses per $billion spent--but they actually increased it, starting with a surge into Afghanistan's doomed occupation. They actually spent MORE on nukes, which is way beyond belief.
Failing to create a peace economy that is sustainable and offers full employment and a lower Gini index of economic inequality made the Democrats losers. Somehow believing that if they just went along with the hawks that they could create more equality in health care was a doomed notion that provided the Rs with all the ammo they needed.
Yes, the fearmongers have been working overtime at Fox News and across the land. Americans are deathly afraid of their own shadows, which ironically and tragically has them buying guns willy-nilly and using them on each other. The frightened ones, rather than really opening up to ideas about how to get along in our world, are building fortified walls, sending troops out to conquer others, and stomping the heads of domestic dissenters.
The Democrats have shown themselves to be Republican-Lite rather than a true alternative, and the country is afraid, so they want the Real Thing. This will be tragic for Americans and everyone else, but the Democrats simply failed to provide a real alternative. Thus, they lost.