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Over a twelve months after the vote that delivered Donald Trump a clear-cut comeback victory, the Democratic party has still not released its election autopsy. But, recently, an influential liberal advocacy organization released its own. The Harris campaign, its authors contended, failed to connect 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 bread-and-butter issues that were foremost in many people’s minds.

A Warning for European Capitals

While Europe prepares for a tumultuous period of politics between now and the end of the decade, that is a lesson that must be fully absorbed in European capitals. The White House, as its newly released national security strategy makes clear, is optimistic that “patriotic” parties in Europe will quickly 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, supported by significant segments of blue-collar voters. Yet among establishment politicians and parties, it is hard to discern a response that is sufficient to challenging times.

Era-Defining Challenges and Expensive Solutions

The issues Europe faces are expensive 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 pressure by Mr Trump and China. As per a European research institute, the new age of geopolitical insecurity could require an additional €250bn in yearly EU defence spending. A major report last year on European economic competitiveness demanded substantial investment in shared infrastructure, to be financed in part by collective EU debt.

Such a fiscal paradigm shift would stimulate 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 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 unambitious. In France, the idea of a wealth tax is widely supported with voters. But the embattled centrist government – though desperate to cut its budget deficit – will not consider such a move.

The Cost of Inaction

The reality is that without such measures, the less well-off will pay the price of fiscal tightening through austerity budgets and increased inequality. Bitter recent disputes over retirement reforms in both France and Germany highlight 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 resisted moves to raise the retirement age and has said that it would focus any benefit cuts at foreign residents.

Avoiding a Strategic Advantage for Nationalists

Across the Atlantic, Mr Trump’s pledges to protect blue‑collar interests were largely insincere, as subsequent Medicaid cuts and fiscal benefits for the wealthy underlined. Yet without a compelling progressive counteroffer from the Harris campaign, they worked on the election circuit. Without a fundamental change in economic approach, societal agreements across the continent risk being ripped up. Policymakers must steer clear of giving this political gift to the populist movements already on the rise in Europe.