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Over a year after the vote that delivered Donald Trump a decisive comeback victory, the Democratic Party has yet to issued its election autopsy. But, recently, an prominent progressive lobby group published its own. The Harris campaign, its writers argued, failed to connect with core constituencies because it did not focus enough on addressing everyday financial worries. 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 Lesson for European Capitals

While Europe prepares for a tumultuous period of politics from now until the end of the decade, that is a lesson that needs to be fully absorbed in Brussels, Paris and Berlin. The White House, as its newly released national security strategy makes clear, is optimistic that “nationalist movements in Europe will soon mirror Mr Trump’s success. Within Europe's core nations, Marine Le Pen’s National Rally (RN) and Alternative für Deutschland (AfD) lead the polls, supported by significant segments of blue-collar voters. But among mainstream leaders and parties, it is difficult to see a response that is sufficient to challenging times.

Major Problems and Expensive Solutions

The challenges Europe faces are costly and era-defining. They encompass the war in Ukraine, sustaining the momentum of the green transition, dealing with demographic change and building economies that are more resilient to bullying by Mr Trump and China. As per 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 demanded substantial investment in shared infrastructure, to be partly funded by jointly held EU debt.

Such a economic transformation would stimulate growth figures that have stagnated for years.

But, 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 “frugal” nations resist the idea of collective borrowing, and EU spending plans for the next seven years are profoundly timid. In France, the idea of a tax on the super-rich 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 Political Paralysis

The reality is that without such measures, the less well-off will pay the price of fiscal tightening through spending cuts and increased inequality. Acrimonious recent disputes over pension cutbacks in both France and Germany testify to a growing battle over the future of the European social model – a phenomenon 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 target any benefit cuts at non-French nationals.

Avoiding a Strategic Advantage for Nationalists

Across the Atlantic, Mr Trump’s promises to protect working-class interests were deeply disingenuous, as subsequent healthcare reductions and fiscal benefits for the wealthy underlined. Yet in the absence of a compelling progressive alternative from the Harris campaign, they proved effective on the campaign trail. Without a fundamental change in fiscal policy, social contracts across the continent are in danger of being ripped up. Policymakers must avoid handing this electoral boon to the populist movements already on the rise in Europe.