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Over a year after the vote that delivered Donald Trump a clear-cut return victory, the Democratic Party has yet to issued its election autopsy. However, recently, an influential progressive lobby group published its own. The Harris campaign, its writers contended, did not resonate with key voter blocs because it failed to concentrate enough on addressing everyday financial worries. In focusing on the threat to democracy that Trumpist populism represented, liberals overlooked the bread-and-butter issues that were foremost in many people’s minds.

A Warning for European Capitals

As the EU braces for a turbulent era of politics from now until the end of the decade, that is a lesson that needs to be fully understood in European capitals. The White House, as its recently published national security strategy indicates, is hopeful that “patriotic” parties in Europe will soon mirror Mr Trump’s success. Within Europe's core nations, Marine Le Pen’s National Rally (RN) and Alternative für Deutschland (AfD) lead the polls, supported by large swaths of working-class voters. Yet among mainstream leaders and parties, it is hard to discern a strategy that is adequate to challenging times.

Major Challenges and Costly Solutions

The issues Europe faces are costly and historic. They include the war in Ukraine, maintaining the momentum of the green transition, dealing with demographic change and developing economies that are less vulnerable to pressure by Mr Trump and China. As per a Brussels-based research institute, the new age of geopolitical insecurity could require an additional €250bn in annual EU defence spending. A major study last year on European economic competitiveness called for substantial investment in shared infrastructure, to be partly funded by collective EU debt.

Such a fiscal paradigm shift would boost growth figures that have stagnated for years.

However, at both the pan-European and national levels, there remains a lack of boldness when it comes to revenue raising. The EU’s so-called “frugal” nations oppose the idea of shared debt, and Brussels’ budget proposals for the next seven years are deeply unambitious. In France, the idea of a wealth tax is widely supported with voters. But the beleaguered centrist government – though desperate to cut its budget deficit – will not consider such a move.

The Cost of Inaction

The reality is that in the absence of such measures, the less affluent will bear the brunt of financial adjustment through spending cuts and increased inequality. Bitter recent conflicts over pension cutbacks in both France and Germany testify to a developing struggle over the future of the European welfare state – a phenomenon 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 focus any benefit cuts at non-French nationals.

Preventing a Political Gift for Nationalists

Across the Atlantic, Mr Trump’s pledges to protect working-class interests were deeply disingenuous, as later Medicaid cuts and tax breaks for the wealthy demonstrated. Yet without a convincing progressive alternative from the Harris campaign, they worked on the campaign trail. Absent a radical shift in fiscal policy, societal agreements across the continent risk being torn apart. Governments must steer clear of giving this electoral boon to the populist movements already on the march in Europe.