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More than a twelve months following the election that delivered Donald Trump a clear-cut comeback victory, the Democratic party has still not issued its postmortem analysis. But, last week, an prominent progressive lobby group released its own. The Harris campaign, its writers argued, did not resonate with core constituencies because it did not focus enough on addressing basic economic anxieties. In focusing on the threat to democracy that Trumpist populism represented, progressives neglected the bread-and-butter issues that were foremost in many people’s minds.

A Lesson for European Capitals

As the EU braces for a tumultuous period of politics from now until the end of the decade, that is a lesson that needs to be fully understood in Brussels, Paris and Berlin. The White House, as its recently published national security strategy makes clear, is optimistic that “nationalist movements in Europe will quickly 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) top the polls, supported by significant segments of blue-collar voters. Yet among establishment politicians and parties, it is difficult to see a response that is sufficient to troubling times.

Era-Defining Problems 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 developing economies that are more resilient to pressure by Mr Trump and China. According to a Brussels-based thinktank, the new age of global instability could require an additional €250bn in yearly EU defence spending. A significant report last year on European economic competitiveness called for substantial investment in public goods, 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 EU-wide and national levels, there remains a lack of boldness when it comes to generating funds. The EU’s so-called “frugal” nations oppose the idea of collective borrowing, and EU spending plans for the next seven years are deeply timid. In France, the idea of a wealth tax is overwhelmingly popular with voters. But the beleaguered centrist government – though desperate to cut its budget deficit – will not consider such a move.

The Cost of Inaction

The truth is that in the absence of such measures, the less affluent will pay the price of fiscal tightening through spending cuts and greater inequality. Bitter recent conflicts over pension cutbacks in both France and Germany testify to a developing struggle over the future of the European welfare state – 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 foreign residents.

Avoiding a Strategic Advantage for Populists

In the US, Mr Trump’s promises to protect blue‑collar interests were deeply disingenuous, as subsequent Medicaid cuts and fiscal benefits for the wealthy demonstrated. But without a compelling progressive counteroffer from the Harris campaign, they proved effective on the election circuit. Absent a radical shift in economic approach, social contracts across the continent risk being torn apart. Policymakers must steer clear of handing this political gift to the populist movements already on the march in Europe.