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Over a year after the election that handed Donald Trump a decisive comeback victory, the Democratic Party has yet to issued its postmortem analysis. However, recently, an prominent 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 tackling basic economic anxieties. By prioritising the menace to democracy that Trumpist populism represented, liberals neglected the bread-and-butter issues that were uppermost in many people’s minds.

A Warning for European Capitals

As the EU braces for a tumultuous period of politics from now until the end of the decade, that is a lesson that needs to be fully understood in Brussels, Paris and Berlin. The White House, as its recently published national security strategy indicates, is optimistic that “nationalist movements in Europe will soon mirror Mr Trump’s success. In the EU’s Franco-German engine room, Marine Le Pen’s National Rally (RN) and Alternative für Deutschland (AfD) lead the polls, backed by significant segments of blue-collar voters. Yet among establishment politicians and parties, it is hard to discern a response that is adequate to challenging times.

Era-Defining Problems and Costly Solutions

The challenges Europe faces are expensive and historic. They encompass the war in Ukraine, maintaining the momentum of the green transition, dealing with demographic change and building economies that are more resilient to bullying by Mr Trump and China. According to a European research institute, the new age of global instability could necessitate an additional €250bn in annual EU defence spending. A major study last year on European economic competitiveness called for substantial investment in public goods, to be financed in part by jointly held EU debt.

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

But, at both the EU-wide and national levels, there remains a lack of boldness when it comes to generating funds. The EU’s so-called “frugal” nations oppose the idea of shared debt, and Brussels’ budget proposals for the next seven years are profoundly unambitious. In France, the idea of a tax on the super-rich is overwhelmingly popular with voters. But the beleaguered centrist government – though desperate to cut its budget deficit – refuses to contemplate such a move.

The Price of Inaction

The reality is that without such measures, the less well-off will pay the price of financial adjustment through spending cuts and increased inequality. Bitter recent conflicts over retirement reforms in both France and Germany highlight a developing struggle over the future of the European social model – a trend that the RN and the AfD have eagerly leveraged to promote a politics of welfare chauvinism. Ms Le Pen’s party, for example, has opposed moves to raise the retirement age and has stated that it would target any benefit cuts at foreign residents.

Avoiding a Strategic Advantage for Nationalists

In the US, Mr Trump’s pledges to protect blue‑collar interests were largely insincere, as later Medicaid cuts and tax breaks for the wealthy demonstrated. Yet without a compelling progressive alternative from the Harris campaign, they worked on the campaign trail. Without a fundamental change in fiscal policy, societal agreements across the continent are in danger of being torn apart. Governments must avoid giving this political gift to the populist movements already on the rise in Europe.