[NeverFade]

The EU economy fell way below the US (after being roughly equal) because they were never able to compete in the new digital economy. All the big tech companies are American. You also have to ask yourself why the ECB and European governments had to cut spending. Perhaps because the levels before weren't sustainable? Perhaps because you can't just keep living beyond your means, as eventually you'll run out of other people's money?

[RandomLensman]

It is now pretty much accepted that the European reaction to the financial crisis was massively worse than the American. A big and expensive error can have long lasting effects - perhaps no need for beyond means, digital etc. but that is rather a result not a cause.

[Detrytus]

The big and bad error that caused European bad reaction to the financial crisis was the introduction of common currency. Eurozone does not form Optimum Currency Area, under Mundell's definition (https://en.wikipedia.org/wiki/Optimum_currency_area), so any significant crisis is made worse by "asymmetric shocks".

[RandomLensman]

I disagree with that, the policy errors where far more direct (and well analyzed). For example: poor bank recapitalisation, wrong incentives about balance optimization, ECB even raising rates in the beginning of the GFC