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More than a twelve months after the vote that handed Donald Trump a decisive return victory, the Democratic party has still not released its postmortem analysis. But, last week, an influential liberal advocacy organization published its own. Kamala Harris's campaign, its writers argued, did not resonate with key voter blocs because it did not focus enough on addressing everyday financial worries. In focusing on the threat to democracy that Trumpist populism represented, progressives overlooked the bread-and-butter issues that were uppermost in many people’s minds.

A Lesson for European Capitals

As the EU braces for a turbulent era of politics between now and the end of the decade, that is a message that needs to be fully absorbed in Brussels, Paris and Berlin. The White House, as its newly released national security strategy indicates, is hopeful 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) lead the polls, backed by significant segments of working-class voters. Yet among establishment politicians and parties, it is difficult to see a strategy that is adequate to troubling times.

Era-Defining Problems and Costly Solutions

The issues Europe faces are costly and era-defining. They encompass the war in Ukraine, maintaining the momentum of the green transition, addressing demographic change and developing 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 significant report last year on European economic competitiveness demanded substantial investment in public goods, to be partly funded by collective EU debt.

Such a economic transformation would boost growth figures that have stagnated 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 resist the idea of shared debt, and Brussels’ budget proposals for the next seven years are profoundly unambitious. In France, the idea of a wealth tax is overwhelmingly popular with voters. Yet the embattled centrist government – though desperate to cut its budget deficit – will not consider such a move.

The Cost of Political Paralysis

The reality is that without such measures, the less affluent will pay the price of fiscal tightening through spending cuts and greater inequality. Acrimonious recent disputes over pension cutbacks in both France and Germany testify to a developing struggle over the future of the European welfare state – 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 non-French nationals.

Avoiding a Strategic Advantage for Nationalists

In the US, Mr Trump’s pledges to protect working-class interests were largely insincere, as subsequent Medicaid cuts and tax breaks for the wealthy underlined. But in the absence of a convincing progressive counteroffer from the Harris campaign, they worked on the campaign trail. Without a radical shift in economic approach, social contracts across the continent risk being ripped up. Governments must steer clear of giving this political gift to the populist movements already on the march in Europe.