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Over a year following the vote that handed Donald Trump a clear-cut return victory, the Democratic Party has still not issued its postmortem analysis. However, last week, an influential progressive lobby group released its own. The Harris campaign, its writers contended, did not resonate with core constituencies because it failed to concentrate enough on tackling everyday financial worries. By prioritising the menace to democracy that Trumpist populism represented, liberals neglected the kitchen-table concerns that were uppermost in many people’s minds.

A Lesson for European Capitals

As the EU braces for a turbulent era of politics between now and the end of the decade, that is a lesson that needs to be fully absorbed in European capitals. The White House, as its newly released national security strategy indicates, is optimistic that “nationalist movements in Europe will quickly replicate Mr Trump’s success. In the EU’s core nations, Marine Le Pen’s National Rally (RN) and Alternative für Deutschland (AfD) top the polls, backed by significant segments of blue-collar voters. Yet among mainstream leaders and parties, it is hard to discern a response that is sufficient to challenging times.

Era-Defining Challenges and Costly Solutions

The challenges Europe faces are expensive and era-defining. They encompass the war in Ukraine, maintaining the momentum of the green transition, addressing demographic change and building economies that are less vulnerable to pressure by Mr Trump and China. As per a European research institute, the new age of global instability could require an additional €250bn in yearly EU defence spending. A significant study last year on European economic competitiveness called for substantial investment in public goods, to be financed in part by collective EU debt.

Such a economic transformation would stimulate growth figures that have stagnated for years.

But, at both the EU-wide and national levels, there continues to be a deficit of courage when it comes to generating funds. The EU’s so-called “frugal” nations resist the idea of collective borrowing, and EU spending plans for the next seven years are deeply timid. In France, the idea of a tax on the super-rich is overwhelmingly popular with voters. Yet the embattled centrist government – while desperate to cut its budget deficit – will not consider such a move.

The Price of Political Paralysis

The reality is that in the absence of such measures, the less affluent will pay the price of financial adjustment through austerity budgets and increased inequality. Acrimonious recent disputes over pension cutbacks in both France and Germany testify to a growing battle over the future of the European social model – a trend that the RN and the AfD have eagerly leveraged to promote a politics of nativist social policy. Ms Le Pen’s party, for example, has opposed moves to raise the retirement age and has said that it would target any benefit cuts at non-French nationals.

Avoiding a Strategic Advantage for Nationalists

Across the Atlantic, Mr Trump’s promises to protect blue‑collar interests were largely insincere, as later healthcare reductions and fiscal benefits for the wealthy underlined. But in the absence of a convincing progressive alternative from the Harris campaign, they worked on the election circuit. Without a fundamental change in fiscal policy, social contracts across the continent risk being ripped up. Governments must avoid giving this electoral boon to the populist movements already on the march in Europe.