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Over a year after the election that delivered Donald Trump a decisive return victory, the Democratic Party has still not issued its postmortem analysis. However, recently, an influential liberal advocacy organization released its own. The Harris campaign, its writers contended, failed to connect with key voter blocs because it did not focus enough on addressing basic economic anxieties. In focusing on the menace to democracy that Maga authoritarianism represented, liberals overlooked 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 from now until the end of the decade, that is a message that needs to be fully understood in Brussels, Paris and Berlin. The White House, as its recently published national security strategy makes clear, is hopeful that “nationalist movements in Europe will soon mirror 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 large swaths of working-class voters. Yet among establishment politicians 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 expensive 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 less vulnerable to bullying by Mr Trump and China. According to a Brussels-based thinktank, the new age of global instability could necessitate an additional €250bn in yearly EU defence spending. A major study last year on European economic competitiveness demanded massive investment in public goods, to be partly funded by collective EU debt.

Such a fiscal paradigm shift would boost growth figures that have stagnated for years.

However, at both the pan-European and national levels, there remains a deficit of courage when it comes to revenue raising. The EU’s so-called “frugal” nations resist the idea of collective borrowing, and EU spending plans for the next seven years are deeply timid. In France, the idea of a tax on the super-rich is overwhelmingly popular with voters. But the embattled centrist government – though desperate to cut its budget deficit – refuses to contemplate such a move.

The Cost of Inaction

The truth is that without such measures, the less affluent will bear the brunt of financial adjustment through spending cuts and greater inequality. Bitter recent disputes over retirement reforms in both France and Germany highlight a growing battle over the future of the European welfare state – a phenomenon that the RN and the AfD have eagerly leveraged to promote a politics of nativist social policy. Ms Le Pen’s party, for example, has resisted moves to raise the retirement age and has stated that it would target any benefit cuts at foreign residents.

Preventing a Strategic Advantage for Nationalists

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 compelling progressive alternative from the Harris campaign, they worked on the campaign trail. Absent a fundamental change in economic approach, social contracts across the continent risk being torn apart. Governments must avoid giving this electoral boon to the populist movements already on the march in Europe.