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Over a year after the election that delivered Donald Trump a decisive comeback victory, the Democratic party has still not released its postmortem analysis. However, recently, an prominent 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 tackling basic economic anxieties. In focusing on the threat to democracy that Maga authoritarianism represented, liberals overlooked the kitchen-table concerns that were uppermost in many people’s minds.

A Lesson for Europe

While Europe prepares for a turbulent era of politics between now and the end of the decade, that is a lesson that must be fully understood in European capitals. The White House, as its recently published national security strategy makes clear, is optimistic that “patriotic” parties in Europe will soon mirror Mr Trump’s success. In the EU’s core nations, Marine Le Pen’s National Rally (RN) and Alternative für Deutschland (AfD) top the polls, supported by significant segments of working-class voters. Yet among establishment politicians and parties, it is difficult to see a response that is adequate to challenging times.

Major Challenges and Costly Solutions

The issues Europe faces are costly and era-defining. 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 European research institute, the new age of global instability could necessitate an additional €250bn in yearly EU defence spending. A major report last year on European economic competitiveness demanded substantial investment in shared infrastructure, to be partly funded by collective EU debt.

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

However, at both the EU-wide and national levels, there remains a deficit of courage when it comes to generating funds. The EU’s so-called “budget hawks oppose the idea of shared debt, and Brussels’ budget proposals for the next seven years are deeply timid. In France, the idea of a wealth tax is widely supported with voters. Yet the embattled centrist government – though desperate to cut its budget deficit – refuses to contemplate such a move.

The Price of Inaction

The reality is that in the absence of such measures, the less affluent 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 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 focus any benefit cuts at non-French nationals.

Avoiding a Strategic Advantage for Populists

In the US, Mr Trump’s pledges to protect working-class interests were largely insincere, as subsequent healthcare reductions and tax breaks for the wealthy demonstrated. Yet without a compelling progressive counteroffer from the Harris campaign, they proved effective on the election circuit. Without a fundamental change in fiscal policy, societal agreements across the continent risk being torn apart. Policymakers must steer clear of giving this political gift to the populist movements already on the march in Europe.