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Over a year after the election that handed Donald Trump a clear-cut comeback victory, the Democratic Party has still not released its election autopsy. However, recently, an prominent liberal advocacy organization published its own. The Harris campaign, its authors contended, did not resonate with key voter blocs because it failed to concentrate enough on addressing everyday financial worries. By prioritising the menace to democracy that Trumpist populism represented, progressives overlooked the bread-and-butter issues that were uppermost in many people’s minds.

A Warning for Europe

While Europe prepares for a tumultuous period of politics between now and the end of the decade, that is a message that must be fully understood in European capitals. The White House, as its recently published national security strategy indicates, is hopeful that “patriotic” parties in Europe will soon mirror Mr Trump’s success. In the EU’s core nations, Marine Le Pen’s National Rally (RN) and Alternative für Deutschland (AfD) top the polls, backed by significant segments of blue-collar voters. But among mainstream leaders and parties, it is hard to discern a response that is sufficient to challenging times.

Major Problems and Costly Solutions

The challenges Europe faces are costly and era-defining. They encompass 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 geopolitical insecurity could require an additional €250bn in annual EU defence spending. A significant study last year on European economic competitiveness demanded substantial investment in shared infrastructure, 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 EU-wide and national levels, there continues to be a deficit of courage when it comes to revenue raising. The EU’s so-called “frugal” nations oppose the idea of collective borrowing, and Brussels’ budget proposals for the next seven years are deeply unambitious. In France, the idea of a tax on the super-rich is overwhelmingly popular with voters. Yet the beleaguered centrist government – while desperate to cut its budget deficit – refuses to contemplate such a move.

The Price of Inaction

The reality is that in the absence of such measures, the less affluent will bear the brunt of financial adjustment through austerity budgets and greater inequality. Acrimonious recent conflicts over pension cutbacks in both France and Germany highlight a growing battle over the future of the European welfare state – a trend 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 opposed moves to raise the retirement age and has stated that it would target any benefit cuts at non-French nationals.

Avoiding a Political Gift for Populists

In the US, Mr Trump’s pledges to protect working-class interests were deeply disingenuous, as later Medicaid cuts and fiscal benefits for the wealthy demonstrated. Yet in the absence of a compelling progressive counteroffer from the Harris campaign, they proved effective on the election circuit. Without a radical shift in fiscal policy, social contracts across the continent risk being ripped up. Governments must steer clear of handing this electoral boon to the Trumpian forces already on the march in Europe.