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More than a twelve months after the election that delivered Donald Trump a clear-cut return victory, the Democratic Party has yet to issued its postmortem analysis. But, recently, an influential liberal advocacy organization published its own. The Harris campaign, its writers argued, failed to connect with core constituencies because it did not focus enough on tackling basic economic anxieties. By prioritising the threat to democracy that Trumpist populism represented, progressives overlooked the bread-and-butter issues that were uppermost in many people’s minds.

A Warning 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 needs to be fully absorbed in Brussels, Paris and Berlin. The White House, as its recently published national security strategy makes clear, is optimistic that “patriotic” parties in Europe will quickly replicate Mr Trump’s success. In the EU’s core nations, 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 mainstream leaders and parties, it is difficult to see a strategy that is adequate to challenging times.

Era-Defining Challenges and Expensive Solutions

The challenges 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 less vulnerable to pressure by Mr Trump and China. As per a Brussels-based thinktank, the new age of geopolitical insecurity could necessitate an additional €250bn in yearly EU defence spending. A significant study last year on European economic competitiveness called for substantial investment in shared infrastructure, to be partly funded by collective EU debt.

Such a economic transformation would stimulate 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 revenue raising. The EU’s so-called “budget hawks resist the idea of shared debt, and Brussels’ budget proposals for the next seven years are deeply unambitious. In France, the idea of a tax on the super-rich is widely supported with voters. But the embattled centrist government – though desperate to cut its budget deficit – will not consider such a move.

The Price of Political Paralysis

The truth is that without such measures, the less well-off will pay the price of fiscal tightening through austerity budgets and increased inequality. Acrimonious recent conflicts over pension cutbacks in both France and Germany testify to a developing struggle over the future of the European social model – a trend 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 non-French nationals.

Preventing a Strategic Advantage for Nationalists

Across the Atlantic, Mr Trump’s promises to protect working-class interests were deeply disingenuous, as later Medicaid cuts and fiscal benefits for the wealthy underlined. Yet in the absence of a convincing progressive alternative from the Harris campaign, they worked on the campaign trail. Absent a radical shift in fiscal policy, social contracts across the continent risk being torn apart. Policymakers must steer clear of giving this political gift to the Trumpian forces already on the march in Europe.