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More than a twelve months after the vote that delivered Donald Trump a clear-cut comeback victory, the Democratic Party has still not released its postmortem analysis. But, last week, an prominent liberal advocacy organization published its own. Kamala Harris's campaign, its authors argued, failed to connect with key voter blocs because it did not focus enough on addressing basic economic anxieties. In focusing on the threat 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 from now until 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 “nationalist movements in Europe will quickly 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, supported by large swaths of working-class voters. Yet among mainstream leaders and parties, it is hard to discern a response that is adequate to challenging times.

Major Challenges and Expensive Solutions

The issues Europe faces are expensive and historic. They include 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 global instability could necessitate 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 jointly held EU debt.

Such a fiscal paradigm shift would boost growth figures that have stagnated for years.

But, at both the pan-European and national levels, there remains a deficit of courage when it comes to revenue raising. The EU’s so-called “budget hawks resist the idea of collective borrowing, and Brussels’ budget proposals for the next seven years are profoundly timid. In France, the idea of a wealth tax is overwhelmingly popular with voters. Yet the embattled centrist government – while desperate to cut its budget deficit – will not consider such a move.

The Price of Inaction

The reality is that without such measures, the less well-off will bear the brunt of fiscal tightening through austerity budgets and increased inequality. Acrimonious recent conflicts over retirement reforms in both France and Germany highlight a growing battle over the future of the European social model – 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 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

In the US, Mr Trump’s promises to protect blue‑collar interests were largely insincere, as subsequent healthcare reductions and tax breaks for the wealthy underlined. Yet without a convincing progressive counteroffer from the Harris campaign, they worked on the campaign trail. Absent a fundamental change in fiscal policy, societal agreements across the continent risk being torn apart. Governments must avoid giving this electoral boon to the Trumpian forces already on the rise in Europe.