Combating Europe's Populist Movements: Protecting the Less Well-Off from the Winds of Transformation

More than a year following the vote that delivered Donald Trump a decisive return victory, the Democratic Party has still not issued its postmortem analysis. However, last week, an prominent progressive lobby group published its own. The Harris campaign, its writers contended, did not resonate with core constituencies because it failed to concentrate enough on tackling basic economic anxieties. In focusing on the threat to democracy that Trumpist populism represented, liberals overlooked the bread-and-butter issues that were uppermost in many people’s minds.

A Warning for European Capitals

As the EU braces for a tumultuous period of politics from now until the end of the decade, that is a message that must be fully absorbed in Brussels, Paris and Berlin. 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 Franco-German engine room, Marine Le Pen’s National Rally (RN) and Alternative für Deutschland (AfD) top the polls, backed by significant segments of working-class voters. Yet among mainstream leaders and parties, it is difficult to see a strategy that is adequate to troubling times.

Era-Defining Problems 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 bullying by Mr Trump and China. According to a European research institute, the new age of global instability could require an additional €250bn in annual EU defence spending. A major study last year on European economic competitiveness demanded substantial investment in public goods, to be financed in part by jointly held EU debt.

Such a fiscal paradigm shift would boost 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 oppose the idea of shared debt, 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 embattled centrist government – while desperate to cut its budget deficit – refuses to contemplate such a move.

The Price of Political Paralysis

The truth is that in the absence of such measures, the less well-off will pay the price of fiscal tightening through spending cuts and increased inequality. Acrimonious recent conflicts over pension cutbacks in both France and Germany highlight 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 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 Strategic Advantage for Populists

Across the Atlantic, Mr Trump’s promises to protect blue‑collar interests were largely insincere, as later Medicaid cuts and fiscal benefits for the wealthy demonstrated. But without a compelling progressive counteroffer from the Harris campaign, they proved effective on the campaign trail. Without a radical shift in economic approach, societal agreements across the continent risk being torn apart. Governments must avoid giving this electoral boon to the Trumpian forces already on the rise in Europe.