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Over a year after the vote that handed Donald Trump a clear-cut comeback victory, the Democratic Party has still not issued its election autopsy. However, recently, an influential progressive lobby group released its own. The Harris campaign, its writers argued, failed to connect with key voter blocs because it did not focus enough on addressing basic economic anxieties. In focusing on the threat to democracy that Trumpist populism represented, liberals neglected the kitchen-table concerns that were foremost in many people’s minds.

A Lesson 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 understood in Brussels, Paris and Berlin. The White House, as its recently published national security strategy indicates, is hopeful that “patriotic” parties in Europe will soon replicate Mr Trump’s success. Within Europe's Franco-German engine room, Marine Le Pen’s National Rally (RN) and Alternative für Deutschland (AfD) top the polls, backed by significant segments of working-class voters. But among mainstream leaders and parties, it is hard to discern a strategy that is sufficient to troubling times.

Era-Defining Challenges and Costly Solutions

The challenges Europe faces are expensive and era-defining. They encompass the war in Ukraine, sustaining the momentum of the green transition, addressing demographic change and developing economies that are more resilient to pressure by Mr Trump and China. As per a European thinktank, the new age of geopolitical insecurity could necessitate an additional €250bn in annual EU defence spending. A significant report last year on European economic competitiveness called for massive 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.

However, at both the pan-European and national levels, there continues to be a deficit of courage when it comes to revenue raising. The EU’s so-called “frugal” nations oppose the idea of collective borrowing, and Brussels’ budget proposals 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 – while 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 testify to a developing struggle 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 foreign residents.

Avoiding a Political Gift 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 underlined. But 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 risk being torn apart. Policymakers must avoid giving this political gift to the populist movements already on the march in Europe.