Addressing the Continent's National Populists: Shielding the Less Well-Off from the Forces of Change

More than a year following the vote that delivered Donald Trump a decisive return victory, the Democratic party has yet to released its postmortem analysis. But, last week, an influential liberal advocacy organization published its own. Kamala Harris's campaign, its authors argued, failed to connect with core constituencies because it failed to concentrate enough on addressing everyday financial worries. In focusing on the menace to democracy that Maga authoritarianism represented, liberals overlooked the bread-and-butter issues that were foremost 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 message that must be fully absorbed in European capitals. The White House, as its recently published national security strategy indicates, is optimistic that “nationalist movements in Europe will soon 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 blue-collar voters. Yet among establishment politicians and parties, it is difficult to see a response that is adequate to troubling times.

Era-Defining Challenges 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 more resilient to bullying by Mr Trump and China. According to a European research institute, the new age of global instability could necessitate an additional €250bn in annual EU defence spending. A major study last year on European economic competitiveness called for substantial investment in public goods, to be partly funded by collective EU debt.

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

However, 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 “frugal” nations resist the idea of collective borrowing, and EU spending plans for the next seven years are profoundly timid. In France, the idea of a wealth tax is widely supported with voters. But the beleaguered centrist government – while desperate to cut its budget deficit – refuses to contemplate such a move.

The Cost of Inaction

The truth is that without such measures, the less affluent will bear the brunt of financial adjustment through spending cuts and increased inequality. Acrimonious recent disputes over pension cutbacks 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 happily exploited 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 stated that it would focus any benefit cuts at foreign residents.

Preventing a Strategic Advantage for Populists

Across the Atlantic, Mr Trump’s promises to protect blue‑collar interests were largely insincere, as subsequent healthcare reductions and fiscal benefits for the wealthy underlined. But 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 ripped up. Governments must avoid giving this electoral boon to the Trumpian forces already on the march in Europe.