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Over a year following the vote that delivered Donald Trump a decisive comeback victory, the Democratic Party has yet to issued its election autopsy. However, last week, an influential liberal advocacy organization released its own. The Harris campaign, its authors argued, failed to connect with core constituencies because it failed to concentrate enough on addressing everyday financial worries. In focusing on the menace to democracy that Trumpist populism represented, progressives neglected the bread-and-butter issues that were uppermost in many people’s minds.

A Warning for Europe

While Europe prepares for a turbulent era of politics from now until the end of the decade, that is a lesson that must be fully understood in Brussels, Paris and Berlin. The White House, as its recently published national security strategy makes clear, is hopeful 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. But among establishment politicians and parties, it is difficult to see a strategy that is adequate to troubling times.

Major Problems and Costly Solutions

The challenges Europe faces are costly 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 pressure by Mr Trump and China. As per a Brussels-based research institute, the new age of geopolitical insecurity could necessitate an additional €250bn in annual EU defence spending. A major study last year on European economic competitiveness demanded massive investment in public goods, to be partly funded by jointly held EU debt.

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

However, at both the pan-European and national levels, there continues to be a deficit of courage when it comes to generating funds. The EU’s so-called “budget hawks resist the idea of shared debt, and EU spending plans for the next seven years are deeply unambitious. In France, the idea of a wealth tax is overwhelmingly popular with voters. Yet the embattled centrist government – though desperate to cut its budget deficit – will not consider such a move.

The Price of Inaction

The reality is that in the absence of such measures, the less affluent will bear the brunt of fiscal tightening through austerity budgets and greater inequality. Bitter recent conflicts over pension cutbacks in both France and Germany highlight a developing struggle over the future of the European social model – a phenomenon that the RN and the AfD have happily exploited 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 target any benefit cuts at non-French nationals.

Preventing a Political Gift for Nationalists

In the US, Mr Trump’s pledges to protect working-class interests were deeply disingenuous, as later healthcare reductions and tax breaks for the wealthy demonstrated. Yet without a convincing progressive counteroffer from the Harris campaign, they worked on the election circuit. Absent a fundamental change in fiscal policy, social contracts across the continent risk being ripped up. Governments must avoid handing this electoral boon to the Trumpian forces already on the march in Europe.