Europe is still trying to crawl back to where it was in 2008.
That was the subtext of the economic data for the eurozone published Friday.
The 19-country eurozone, the core of Europe’s economy, grew at an annual rate of 1.1 percent in the last quarter of 2015. But total economic output remained just slightly lower than when the global economic crisis began in 2008.
Since then, much of the rest of the world, including the United States, has bounced back, however fitfully. But the eurozone as a bloc has been weighed down by huge numbers of problem loans held by its banks, a shortage of credit and a reluctance of governments to make politically unpopular economic changes. More recently, an influx of immigrants has heightened political tensions and further shaken the eurozone’s unity.
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And yet many of the eurozone’s problems are a result of policy missteps — or policies that simply could not be executed because of the fragmented nature of a loose affiliation of 19 countries that share a currency but have their own taxing and spending regimes.
Many eurozone governments responded to the crisis by cutting spending, engaging in austerity economics that thwarted growth.
Along the way, the European Central Bank, under its previous president, actually raised interest rates before reversing course. Even under its current president, Mario Draghi, who came to power in late 2011, the central bank was unable to mount a stimulus program comparable to the Fed’s until March 2015 — as the members of the bank’s Governing Council, coming from various eurozone countries, argued over when or whether to take action.
All of this has added up to growth so feeble that the eurozone economy is still not as big as it was 5 1/2 years ago. And unemployment is a stubbornly high 10.4 percent.