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Over a year after the election that delivered Donald Trump a clear-cut comeback victory, the Democratic Party has yet to issued its postmortem analysis. However, recently, an prominent progressive lobby group released its own. The Harris campaign, its writers argued, did not resonate with key voter blocs because it did not focus enough on tackling everyday financial worries. By prioritising the menace to democracy that Trumpist populism represented, progressives neglected the bread-and-butter issues that were uppermost in many people’s minds.

A Warning for European Capitals

While Europe prepares for a turbulent era of politics between now and the end of the decade, that is a message that must be fully absorbed in Brussels, Paris and Berlin. The White House, as its newly released national security strategy indicates, is optimistic that “nationalist movements in Europe will soon replicate Mr Trump’s success. Within Europe's core nations, Marine Le Pen’s National Rally (RN) and Alternative für Deutschland (AfD) top the polls, supported by large swaths of working-class voters. Yet among establishment politicians and parties, it is hard to discern a response that is adequate to challenging times.

Era-Defining Challenges and Costly Solutions

The issues Europe faces are expensive and historic. They include the war in Ukraine, maintaining the momentum of the green transition, dealing with demographic change and developing economies that are more resilient to bullying 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 report last year on European economic competitiveness called for massive investment in shared infrastructure, to be financed in part by jointly held EU debt.

Such a fiscal paradigm shift 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 wealth tax is widely supported with voters. Yet 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 financial adjustment through spending cuts and increased inequality. Bitter recent disputes over pension cutbacks in both France and Germany highlight 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 resisted moves to raise the retirement age and has stated that it would focus any benefit cuts at foreign residents.

Preventing a Political Gift for Populists

Across the Atlantic, Mr Trump’s pledges to protect blue‑collar interests were deeply disingenuous, as later Medicaid cuts and fiscal benefits for the wealthy demonstrated. Yet in the absence of a convincing progressive alternative from the Harris campaign, they worked on the campaign trail. Without a radical shift in fiscal policy, societal agreements across the continent risk being torn apart. Governments must steer clear of giving this political gift to the Trumpian forces already on the rise in Europe.