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More than a twelve months after the election that handed Donald Trump a clear-cut comeback victory, the Democratic Party has still not issued its postmortem analysis. However, last week, an prominent liberal advocacy organization released its own. The Harris campaign, its writers contended, did not resonate with core constituencies because it did not focus enough on addressing basic economic anxieties. By prioritising the menace to democracy that Trumpist populism represented, liberals overlooked the bread-and-butter issues that were foremost in many people’s minds.

A Lesson for Europe

As the EU braces for a turbulent era of politics between now and the end of the decade, that is a lesson that needs to be fully absorbed in European capitals. The White House, as its newly released national security strategy indicates, is optimistic that “patriotic” parties in Europe will soon mirror 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. But among mainstream leaders and parties, it is hard to discern a response that is sufficient to challenging times.

Era-Defining Problems and Costly Solutions

The challenges Europe faces are costly and historic. 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 European thinktank, the new age of global instability could necessitate an additional €250bn in annual EU defence spending. A major report last year on European economic competitiveness demanded substantial investment in shared infrastructure, to be partly funded by jointly held EU debt.

Such a economic transformation would boost growth figures that have flatlined for years.

But, at both the pan-European and national levels, there remains a lack of boldness when it comes to revenue raising. The EU’s so-called “budget hawks oppose the idea of collective borrowing, and EU spending plans for the next seven years are deeply unambitious. In France, the idea of a wealth tax is widely supported with voters. Yet 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 well-off will bear the brunt of fiscal tightening through spending cuts and increased inequality. Acrimonious recent disputes over retirement reforms in both France and Germany highlight 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 focus any benefit cuts at foreign residents.

Avoiding a Strategic Advantage for Populists

Across the Atlantic, Mr Trump’s pledges to protect working-class interests were largely insincere, as later Medicaid cuts and tax breaks for the wealthy demonstrated. Yet without a convincing progressive alternative from the Harris campaign, they worked on the election circuit. Without a radical shift in fiscal policy, societal agreements across the continent are in danger of being torn apart. Governments must steer clear of handing this electoral boon to the populist movements already on the rise in Europe.