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Over a twelve months following the election that delivered Donald Trump a decisive return victory, the Democratic Party has still not released its postmortem analysis. But, last week, an prominent liberal advocacy organization published its own. Kamala Harris's campaign, its authors argued, did not resonate with key voter blocs because it failed to concentrate enough on addressing everyday financial worries. By prioritising the threat to democracy that Maga authoritarianism represented, progressives overlooked the kitchen-table concerns that were foremost in many people’s minds.

A Lesson for European Capitals

As the EU braces for a turbulent era of politics from now until the end of the decade, that is a message that must be fully absorbed in Brussels, Paris and Berlin. The White House, as its newly released national security strategy makes clear, is hopeful that “nationalist movements in Europe will soon replicate Mr Trump’s success. Within Europe's Franco-German engine room, Marine Le Pen’s National Rally (RN) and Alternative für Deutschland (AfD) top the polls, supported by significant segments of blue-collar voters. But among establishment politicians and parties, it is hard to discern a response that is sufficient to challenging times.

Major Challenges and Expensive Solutions

The challenges Europe faces are expensive and era-defining. They include the war in Ukraine, maintaining the momentum of the green transition, dealing with demographic change and building economies that are less vulnerable to pressure by Mr Trump and China. As per a Brussels-based 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 massive investment in public goods, to be financed in part 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 continues to be a deficit of courage when it comes to revenue raising. The EU’s so-called “budget hawks oppose the idea of shared debt, and EU spending plans for the next seven years are profoundly timid. 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 – will not consider such a move.

The Cost of Inaction

The truth is that in the absence of such measures, the less affluent will bear the brunt of fiscal tightening through austerity budgets and increased inequality. Bitter 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 resisted moves to raise the retirement age and has stated that it would focus any benefit cuts at non-French nationals.

Preventing a Political Gift for Populists

In the US, Mr Trump’s pledges to protect blue‑collar interests were deeply disingenuous, as later Medicaid cuts and tax breaks for the wealthy demonstrated. But in the absence of a compelling progressive alternative from the Harris campaign, they proved effective on the election circuit. Without a fundamental change in economic approach, social contracts across the continent are in danger of being ripped up. Policymakers must avoid handing this political gift to the populist movements already on the rise in Europe.