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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. But, recently, an influential progressive lobby group published its own. The Harris campaign, its writers contended, did not resonate with key voter blocs because it did not focus enough on tackling everyday financial worries. In focusing on the threat to democracy that Trumpist populism represented, liberals neglected the bread-and-butter issues that were uppermost in many people’s minds.

A Warning for Europe

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 absorbed in Brussels, Paris and Berlin. The White House, as its recently published national security strategy makes clear, is optimistic that “nationalist movements in Europe will soon 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, supported by large swaths of working-class voters. Yet among establishment politicians and parties, it is difficult to see a strategy that is sufficient to challenging times.

Era-Defining Challenges and Expensive Solutions

The issues Europe faces are expensive and era-defining. They include the war in Ukraine, maintaining the momentum of the green transition, addressing demographic change and developing economies that are more resilient to bullying by Mr Trump and China. As per 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 called for substantial investment in public goods, 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 generating funds. 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 widely supported with voters. Yet the beleaguered centrist government – though 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 affluent will pay the price of fiscal tightening through austerity budgets and greater inequality. Acrimonious recent conflicts over retirement reforms in both France and Germany testify to a developing struggle over the future of the European welfare state – a trend that the RN and the AfD have eagerly leveraged to promote a politics of welfare chauvinism. Ms Le Pen’s party, for example, has resisted moves to raise the retirement age and has said that it would target any benefit cuts at foreign residents.

Preventing a Political Gift for Nationalists

In the US, Mr Trump’s pledges to protect working-class interests were largely insincere, as subsequent Medicaid cuts and fiscal benefits for the wealthy demonstrated. Yet without a compelling progressive alternative from the Harris campaign, they worked on the campaign trail. Absent a fundamental change in economic approach, societal agreements across the continent are in danger of being ripped up. Governments must avoid giving this electoral boon to the Trumpian forces already on the march in Europe.