Combating the Continent's National Populists: Protecting the Less Well-Off from the Winds of Change

More than a year following the election that handed Donald Trump a decisive return victory, the Democratic Party has still not issued its election autopsy. However, recently, an prominent progressive lobby group published its own. The Harris campaign, its authors argued, failed to connect with core constituencies because it did not focus enough on tackling basic economic anxieties. By prioritising the menace to democracy that Trumpist populism represented, liberals neglected the bread-and-butter issues that were foremost in many people’s minds.

A Warning for Europe

While Europe prepares for a tumultuous period 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 indicates, is hopeful that “patriotic” parties in Europe will quickly mirror Mr Trump’s success. Within Europe's core nations, Marine Le Pen’s National Rally (RN) and Alternative für Deutschland (AfD) top the polls, supported by significant segments of blue-collar voters. Yet among establishment politicians and parties, it is difficult to see a strategy that is sufficient to troubling times.

Major Problems and Expensive Solutions

The challenges Europe faces are costly and historic. They encompass the war in Ukraine, sustaining the momentum of the green transition, dealing with demographic change and developing economies that are more resilient to pressure by Mr Trump and China. According to a Brussels-based thinktank, the new age of global instability could require an additional €250bn in yearly EU defence spending. A major study last year on European economic competitiveness called for substantial investment in shared infrastructure, to be financed in part by collective EU debt.

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

However, at both the EU-wide and national levels, there remains a lack of boldness when it comes to generating funds. The EU’s so-called “frugal” nations oppose the idea of collective borrowing, and EU spending plans for the next seven years are profoundly timid. In France, the idea of a tax on the super-rich is widely supported with voters. Yet the embattled centrist government – though desperate to cut its budget deficit – will not consider such a move.

The Price of Inaction

The truth is that in the absence of such measures, the less affluent will bear the brunt of fiscal tightening through austerity budgets and increased inequality. Bitter recent disputes over pension cutbacks in both France and Germany testify to a developing struggle over the future of the European welfare state – 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 opposed moves to raise the retirement age and has stated that it would target any benefit cuts at non-French nationals.

Avoiding a Political Gift for Nationalists

In the US, Mr Trump’s promises to protect blue‑collar interests were deeply disingenuous, as later Medicaid cuts and fiscal benefits for the wealthy underlined. Yet without a convincing progressive alternative from the Harris campaign, they worked on the election circuit. Without a radical shift in economic approach, social contracts across the continent risk being torn apart. Policymakers must steer clear of giving this political gift to the populist movements already on the rise in Europe.