Countering the Continent's Populist Movements: Protecting the Vulnerable from the Winds of Transformation

Over a twelve months following the election that delivered Donald Trump a decisive return victory, the Democratic party has yet to issued its postmortem analysis. But, recently, an prominent liberal advocacy organization published its own. Kamala Harris's campaign, its authors argued, did not resonate with core constituencies because it failed to concentrate enough on tackling everyday financial worries. By prioritising the threat to democracy that Maga authoritarianism represented, liberals overlooked the kitchen-table concerns that were foremost in many people’s minds.

A Lesson for European Capitals

As the EU braces for a turbulent era 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 hopeful that “patriotic” parties in Europe will quickly replicate Mr Trump’s success. In the EU’s Franco-German engine room, Marine Le Pen’s National Rally (RN) and Alternative für Deutschland (AfD) lead the polls, supported by significant segments of blue-collar voters. But among mainstream leaders and parties, it is difficult to see a response that is adequate to troubling times.

Major Challenges and Costly Solutions

The challenges Europe faces are costly and era-defining. They include the war in Ukraine, sustaining the momentum of the green transition, dealing with demographic change and developing economies that are less vulnerable to pressure by Mr Trump and China. According to a European thinktank, the new age of global instability could necessitate an additional €250bn in yearly EU defence spending. A significant report last year on European economic competitiveness demanded massive investment in shared infrastructure, to be partly funded by jointly held 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 continues to be 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 overwhelmingly popular with voters. Yet 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 in the absence of such measures, the less affluent will bear the brunt of financial adjustment through spending cuts and increased inequality. Bitter recent conflicts over retirement reforms in both France and Germany testify to a developing struggle over the future of the European welfare state – a phenomenon 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 resisted moves to raise the retirement age and has said that it would focus any benefit cuts at foreign residents.

Preventing a Strategic Advantage for Populists

Across the Atlantic, Mr Trump’s pledges to protect blue‑collar interests were largely insincere, as subsequent Medicaid cuts and tax breaks for the wealthy underlined. Yet without a convincing progressive alternative from the Harris campaign, they proved effective on the election circuit. Without a radical shift in fiscal policy, societal agreements across the continent are in danger of being ripped up. Governments must avoid giving this electoral boon to the Trumpian forces already on the march in Europe.