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More than a year following the election that handed Donald Trump a clear-cut return victory, the Democratic Party has yet to issued its postmortem analysis. However, recently, an influential progressive lobby group published its own. Kamala Harris's campaign, its authors argued, did not resonate with core constituencies because it did not focus enough on tackling 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 Warning for European Capitals

As the EU braces for a tumultuous period of politics between now and 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 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. But among establishment politicians and parties, it is difficult to see a strategy that is sufficient to troubling times.

Era-Defining Challenges and Expensive Solutions

The challenges Europe faces are costly and historic. They encompass the war in Ukraine, sustaining the momentum of the green transition, dealing with demographic change and developing economies that are less vulnerable to pressure by Mr Trump and China. As per a Brussels-based research institute, the new age of global instability could require an additional €250bn in annual EU defence spending. A significant report last year on European economic competitiveness called for massive investment in public goods, to be partly funded by jointly held EU debt.

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

However, at both the EU-wide and national levels, there continues to be a deficit of courage when it comes to revenue raising. The EU’s so-called “budget hawks 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 overwhelmingly popular with voters. Yet the embattled centrist government – though desperate to cut its budget deficit – will not consider such a move.

The Price of Political Paralysis

The truth is that in the absence of such measures, the less affluent will bear the brunt of fiscal tightening through spending cuts and greater inequality. Acrimonious recent disputes over retirement reforms 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 focus any benefit cuts at non-French nationals.

Preventing a Strategic Advantage for Nationalists

Across the Atlantic, Mr Trump’s pledges to protect blue‑collar interests were deeply disingenuous, as later 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. Absent a fundamental change in economic approach, societal agreements across the continent are in danger of being torn apart. Policymakers must steer clear of handing this electoral boon to the Trumpian forces already on the rise in Europe.