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Over a year after the vote that handed Donald Trump a decisive comeback victory, the Democratic Party has yet to issued its postmortem analysis. However, recently, an influential progressive lobby group released its own. The Harris campaign, its authors contended, did not resonate with core constituencies because it did not focus enough on tackling everyday financial worries. In focusing on the menace to democracy that Trumpist populism represented, liberals overlooked the kitchen-table concerns that were uppermost in many people’s minds.

A Warning for Europe

As the EU braces 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 European capitals. The White House, as its newly released national security strategy makes clear, is hopeful that “nationalist movements in Europe will quickly replicate Mr Trump’s success. Within Europe's core nations, Marine Le Pen’s National Rally (RN) and Alternative für Deutschland (AfD) lead the polls, backed by significant segments of working-class voters. But among establishment politicians and parties, it is difficult to see a strategy that is adequate to challenging times.

Major Challenges and Costly Solutions

The issues Europe faces are expensive and era-defining. They include the war in Ukraine, maintaining the momentum of the green transition, dealing with demographic change and building economies that are less vulnerable to bullying by Mr Trump and China. According to a Brussels-based research institute, the new age of geopolitical insecurity could require an additional €250bn in yearly EU defence spending. A significant study last year on European economic competitiveness demanded substantial 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.

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 “budget hawks oppose the idea of collective borrowing, and Brussels’ budget proposals for the next seven years are profoundly timid. In France, the idea of a tax on the super-rich is overwhelmingly popular with voters. But the beleaguered centrist government – while desperate to cut its budget deficit – refuses to contemplate such a move.

The Price of Inaction

The truth is that in the absence of such measures, the less well-off will pay the price of financial adjustment through austerity budgets and increased inequality. Bitter recent conflicts over pension cutbacks in both France and Germany highlight a developing struggle over the future of the European welfare state – a phenomenon that the RN and the AfD have happily exploited to promote a politics of nativist social policy. 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 Political Gift for Populists

Across the Atlantic, Mr Trump’s pledges to protect working-class interests were largely insincere, as subsequent Medicaid cuts and fiscal benefits for the wealthy underlined. Yet without a compelling progressive alternative from the Harris campaign, they proved effective on the campaign trail. Absent a radical shift in fiscal policy, societal agreements across the continent risk being torn apart. Policymakers must steer clear of giving this political gift to the Trumpian forces already on the march in Europe.