Countering the Continent's Populist Movements: Protecting the Less Well-Off from the Winds of Change

Over a year after the vote that delivered Donald Trump a clear-cut comeback victory, the Democratic party has yet to released its election autopsy. But, recently, an prominent liberal advocacy organization released its own. The Harris campaign, its authors argued, failed to connect with key voter blocs because it did not focus enough on tackling everyday financial worries. By prioritising the menace to democracy that Trumpist populism represented, progressives overlooked the bread-and-butter issues that were foremost in many people’s minds.

A Warning 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 needs to be fully understood in Brussels, Paris and Berlin. The White House, as its newly released national security strategy makes clear, is optimistic that “patriotic” parties 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) lead the polls, supported by large swaths of working-class voters. Yet among establishment politicians and parties, it is difficult to see a strategy that is sufficient to challenging times.

Major Challenges and Expensive Solutions

The issues Europe faces are costly and historic. They encompass the war in Ukraine, maintaining the momentum of the green transition, dealing with demographic change and developing economies that are less vulnerable to pressure by Mr Trump and China. As per a European thinktank, the new age of global instability could necessitate an additional €250bn in yearly EU defence spending. A major report 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 flatlined for years.

However, 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 “budget hawks oppose the idea of collective borrowing, and Brussels’ budget proposals for the next seven years are deeply timid. In France, the idea of a wealth tax is widely supported with voters. Yet the embattled centrist government – though desperate to cut its budget deficit – will not consider such a move.

The Cost of Political Paralysis

The truth is that without such measures, the less affluent will pay the price of financial adjustment through spending cuts and increased inequality. Acrimonious recent disputes over pension cutbacks in both France and Germany testify to a developing struggle over the future of the European social model – 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 opposed moves to raise the retirement age and has said that it would target any benefit cuts at foreign residents.

Preventing a Political Gift for Populists

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. But without a convincing progressive counteroffer from the Harris campaign, they proved effective on the election circuit. Absent a radical shift in economic approach, societal agreements across the continent risk being torn apart. Governments must steer clear of giving this political gift to the Trumpian forces already on the rise in Europe.