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Over a year after the vote that handed Donald Trump a decisive comeback victory, the Democratic Party has still not released its postmortem analysis. But, last week, an influential liberal advocacy organization published its own. The Harris campaign, its writers contended, failed to connect with key voter blocs because it failed to concentrate enough on addressing basic economic anxieties. In focusing on the threat to democracy that Trumpist populism represented, liberals neglected the kitchen-table concerns that were uppermost in many people’s minds.

A Warning for Europe

As the EU braces for a turbulent era of politics from now until the end of the decade, that is a message that needs to be fully absorbed 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 replicate Mr Trump’s success. Within Europe's Franco-German engine room, Marine Le Pen’s National Rally (RN) and Alternative für Deutschland (AfD) lead the polls, supported by significant segments of working-class voters. Yet among establishment politicians and parties, it is hard to discern a response that is sufficient to challenging times.

Major Problems and Expensive Solutions

The issues Europe faces are costly and historic. They include the war in Ukraine, sustaining the momentum of the green transition, dealing with demographic change and developing economies that are more resilient to bullying by Mr Trump and China. According to a Brussels-based thinktank, the new age of global instability could necessitate an additional €250bn in annual EU defence spending. A major report 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 flatlined for years.

But, at both the pan-European and national levels, there remains a lack of boldness when it comes to generating funds. The EU’s so-called “budget hawks oppose the idea of shared debt, and EU spending plans for the next seven years are deeply timid. In France, the idea of a wealth tax is widely supported with voters. But the beleaguered centrist government – while desperate to cut its budget deficit – refuses to contemplate such a move.

The Cost of Political Paralysis

The truth is that without such measures, the less well-off will pay the price of fiscal tightening through spending cuts and increased inequality. Acrimonious recent conflicts over retirement reforms in both France and Germany highlight a growing battle 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 opposed moves to raise the retirement age and has said that it would focus any benefit cuts at foreign residents.

Avoiding a Political Gift for Populists

In the US, Mr Trump’s pledges to protect blue‑collar interests were deeply disingenuous, as subsequent Medicaid cuts and fiscal benefits for the wealthy demonstrated. Yet without a convincing progressive counteroffer from the Harris campaign, they worked on the election circuit. Without a fundamental change in fiscal policy, societal agreements across the continent are in danger of being ripped up. Governments must steer clear of giving this political gift to the populist movements already on the march in Europe.