I think this is a a case of mass delusion, rather than stupidity. People are strikingly suspectible to propoganda and highly influenced by in-group, out-group "thinking." Naziism wasn't a blip; people really do buy into 'big ideas' in which blaming some group of people for their problems seems totally credible. When people are stressed, some go right to blame. Power players routinely exploit this characteristic. It's why religion, as irrational as it is, remains extremely popular.