🔗 Share this article

More than a twelve months after the election that handed Donald Trump a decisive comeback victory, the Democratic Party has yet to released its election autopsy. However, recently, an prominent progressive lobby group 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. By prioritising the threat to democracy that Maga authoritarianism represented, liberals overlooked the bread-and-butter issues that were foremost in many people’s minds.

A Warning for European Capitals

As the EU braces for a turbulent era of politics from now until the end of the decade, that is a message that must be fully absorbed in European capitals. The White House, as its recently published 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 difficult to see a response that is sufficient to troubling times.

Major Challenges and Expensive Solutions

The issues Europe faces are expensive and era-defining. They include the war in Ukraine, sustaining 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 Brussels-based research institute, the new age of geopolitical insecurity could require an additional €250bn in annual EU defence spending. A significant report last year on European economic competitiveness called for substantial investment in shared infrastructure, to be financed in part by jointly held EU debt.

Such a fiscal paradigm shift would stimulate growth figures that have flatlined for years.

However, at both the EU-wide 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 unambitious. In France, the idea of a tax on the super-rich is widely supported with voters. But the beleaguered centrist government – though desperate to cut its budget deficit – refuses to contemplate 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 fiscal tightening through spending cuts and increased inequality. Bitter recent disputes over retirement reforms 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 welfare chauvinism. Ms Le Pen’s party, for example, has resisted moves to raise the retirement age and has stated that it would target 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 deeply disingenuous, as subsequent Medicaid cuts and fiscal benefits for the wealthy underlined. Yet without a compelling 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 torn apart. Policymakers must avoid giving this political gift to the Trumpian forces already on the march in Europe.