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Over a twelve months after the vote that handed Donald Trump a clear-cut return victory, the Democratic party has still not released its postmortem analysis. However, recently, an prominent progressive lobby group released its own. Kamala Harris's campaign, its writers argued, did not resonate with core constituencies because it did not focus enough on addressing 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 Lesson 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 understood in European capitals. The White House, as its newly released national security strategy makes clear, is optimistic that “patriotic” parties in Europe will soon replicate 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, supported by large swaths of working-class voters. Yet among mainstream leaders and parties, it is hard to discern a response that is sufficient to challenging times.

Major Challenges and Costly Solutions

The challenges Europe faces are expensive and historic. They encompass the war in Ukraine, sustaining the momentum of the green transition, dealing with demographic change and developing economies that are more resilient to bullying by Mr Trump and China. According to a European research institute, the new age of global instability could require an additional €250bn in yearly EU defence spending. A significant study last year on European economic competitiveness demanded massive investment in shared infrastructure, to be partly funded by collective EU debt.

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

But, at both the pan-European and national levels, there continues to be a deficit of courage when it comes to revenue raising. The EU’s so-called “budget hawks 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 overwhelmingly popular with voters. But the embattled centrist government – though desperate to cut its budget deficit – will not consider 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 financial adjustment through austerity budgets and greater inequality. Acrimonious recent conflicts over retirement reforms in both France and Germany testify to a growing battle over the future of the European welfare state – a phenomenon 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 resisted moves to raise the retirement age and has said that it would target any benefit cuts at foreign residents.

Avoiding a Strategic Advantage for Nationalists

Across the Atlantic, Mr Trump’s promises to protect working-class interests were deeply disingenuous, as later Medicaid cuts and tax breaks for the wealthy demonstrated. But in the absence of a convincing progressive alternative from the Harris campaign, they proved effective on the election circuit. Without a fundamental change in fiscal policy, social contracts across the continent risk being ripped up. Policymakers must avoid giving this electoral boon to the Trumpian forces already on the march in Europe.