Huffington, speaking in a panel of authors and journalists on CBS' "Face the Nation" Sunday, said people are sensing doom, and that this frustration can threaten American stability.
"It's beyond left and right anger. No party can claim that it really is going to ultimately benefit them because it's very unpredictable and potentially very dangerous for our political stability," Huffington said.
Her new book has the provocative title "Third World America," in which she describes the disillusionment faced by the nation.
"I wanted to sound the alarm because as an immigrant to this country, as somebody who has lived the American dream, I see dying all around me," she said.
"When we have two-thirds of Americans right now who expect their children to be worse off than they are, when we have America ranked number ten in upward mobility - behind France and Scandinavia countries and Spain - when we have 25 percent of young people out of work and 27 million people unemployed or underemployed, we know there is something fundamentally wrong.
"People are sensing that. That's why we have that sense of collective anxiety and fear about the future that in many profound ways is very un-American, because we are such a deeply optimistic country at heart."
Huffington also said that, despite the anger or disenfranchisement felt by many, she has seen an "incredible outpouring of compassion and creativity all around the country, that's using social media to do an enormous amount of good. What has been missing is the kind of magnifying glass that we in the media can put on all the creative stuff happening out in the country."
Pulitzer-prize winning biographer Edmund Morris, whose new book "Colonel Roosevelt" completes his trilogy on President Theodore Roosevelt, said "one can see the present in the past," when looking at the progressive middle class movement which erupted, "volcanically," in 1910:
"The passion that drew them together was rather similar to the passion that links the Tea Party people now," Morris said. "That is this feeling of exclusion - exclusion from the privileged interplay of a conservative Congress, financial institutions, the corporate elite. The middle class feels disenfranchised, angry, overtaxed and perplexed.
"This anger is something quite formidable. I would not be surprised if it doesn't crest over the next two years and give us real trouble in 2012."
Morris, who was born in Kenya and lived for many years in England before immigrating to the U.S. in 1968, said Americans have also become insular.
"I'm particularly sensitive to this, as I suppose Ariana is as an immigrant," Morris said. "I come from another culture. I can call myself legitimately an African-American. I'm aware of the fact that people elsewhere in the world think differently from us. I can sort of see 'us' Americans with their eyes.
"Not all that I see is attractive," Morris said. "I see an insular people who are insensitive to foreign sensibilities, who are lazy, obese, complacent, and increasingly perplexed as to why we are losing our place in the world, to people who are more dynamic than us and more disciplined."
Huffington, unlike Morris, defended the American people, and instead put the blame on institutions that are failing the middle class.
"There is a lot of legitimate anger out there. The sense that somehow the game is rigged, that if you are powerful enough, if you are running institutions that are too big to fail, you can get away with anything," she said.
"That lack of accountability, that lack of identifying what needs to fundamentally change and how we're going to go about turning our lives and our communities around is, I think, what is perpetuating that anger and putting us in that state that Edmund described, which is a very un-American state in very profound ways."
But journalist Bob Woodward, whose new book is "Obama's Wars," said American politics always had an element of anger in it.
"If you look at the Declaration of Independence, two-thirds of it is a list of angry grievances against King George III," Woodward said. "I think it's a matter of political leaders finding a way to use this in a constructive way. I think that's quite possible. I think the leaders are out there. I wouldn't give up on them just because there are divisions.
"I think now we have a lot of conflict, a lot of disagreement. I don't see hate in our politics," he said.
Ron Chernow, the author of "Washington: A Life," a new 904-page biography of George Washington, agreed. He said the founding of America was divisive and turbulent.
"It was every bit as nasty and partisan as things are today. George Washington, for instance, was accused of everything as president from plotting to restore the monarchy to having been a British double agent during the Revolutionary War," Chernow said.