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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 issued its election autopsy. However, recently, an prominent liberal advocacy organization released its own. Kamala Harris's campaign, its authors argued, did not resonate with core constituencies because it did not focus enough on addressing everyday financial worries. In focusing on the threat to democracy that Maga authoritarianism 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 tumultuous period of politics from now until the end of the decade, that is a lesson that needs to be fully absorbed in Brussels, Paris and Berlin. The White House, as its recently published national security strategy makes clear, is hopeful that “nationalist movements in Europe will quickly replicate 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, backed by significant segments of working-class voters. But among establishment politicians and parties, it is difficult to see a response that is sufficient to challenging times.

Era-Defining Problems and Costly Solutions

The issues Europe faces are costly and historic. They include 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 called for massive investment in public goods, to be financed in part by jointly held EU debt.

Such a fiscal paradigm shift would boost 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 revenue raising. The EU’s so-called “frugal” nations resist the idea of shared debt, and EU spending plans for the next seven years are deeply timid. 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 – refuses to contemplate such a move.

The Price of Inaction

The truth is that without such measures, the less affluent will bear the brunt of fiscal tightening through austerity budgets and increased inequality. Acrimonious recent disputes over pension cutbacks in both France and Germany highlight 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 opposed moves to raise the retirement age and has said that it would target any benefit cuts at non-French nationals.

Avoiding a Political Gift for Populists

Across the Atlantic, Mr Trump’s promises to protect working-class interests were largely insincere, as subsequent Medicaid cuts and tax breaks for the wealthy underlined. But without a compelling progressive alternative from the Harris campaign, they worked on the election circuit. Without a fundamental change in fiscal policy, societal agreements across the continent are in danger of being torn apart. Governments must avoid handing this electoral boon to the populist movements already on the march in Europe.