When you start looking at the top economies in Europe, it's clear, their fundamentals are mostly fine, especially around innovation. They need to tune their ways, but it's quite salvageable. Biotech?...Novo Nordisk is doing quite well, as are many other pharma giants.
Europe doesn't do much in the device/computer space, beyond maybe ASML & Europe sucks in software, but really everyone but the USA does. And honestly, they're probably #2. Japan is SHIIIIT on software. Seriously, WTF guys?...you do so much so well, but there's not a single Japanese software product I know of on the market and every UI in every Japanese device ranging from cameras to cars is dogshit...looks like it hasn't changed since the 80s and is unnecessarily complex and unintuitive. China?...same. Australia has a company or 2, but that's all I know of...beyond SAP...which is typically poorly regarded. No one "chooses" SAP...it's chosen for them by someone who will never use it...typically after being heavily bribed. They're regarded by most as a better version of IBM...which is far from a compliment.
America is awesome in most things, but the main reason is we've been so immigrant friendly for so long (not counting current administration). We're not only happy to take your best minds...we'll give them a fucking loan, great bankruptcy protection, and a huge talent pool as well as the best access to seasoned investors and mentors. Well over half of our recent best companies were founded or cofounded by immigrants. We're inherently great...but....out overall greatness is massively amplified by imported talent.
Once Europe can figure out how to support their entrepreneurs and immigrants and help them start businesses, they will have no problem competing, if not overtaking the USA in the innovation corner. IMO, that's why Japan never overtook us and China and India never will. All 3 of those societies are inherently racist and isolationist. They can only compete with their own minds.
Europe has recently changed their ways to welcome more immigrants recently. Just 10 years ago, if you moved to Sweden, spoke perfect Swedish, but had a foreign accent, you were not really accepted or integrated into society, especially if you weren't white...yeah, no one firebombed your house...but your kids had a stigma and would face resistance marrying locals, for example. You were never a "real Swede"...same with most of Europe beyond maybe Great Britain.
The reason Trump is so shitty to immigrants is that many in the USA never liked how welcoming we are of immigrants...and it can be shitty being an immigrant in the USA...until you compare it to the China, India, Norway, Romania, Greece, France, the Middle East, etc. You can not only live here, especially in urban areas...you can intermarry, be welcomed in communities, etc. If you learn the language and do minimal efforts to fit in (like follow the regional sports teams), you're 100% American to about 75% of the total population...probably 90% in urban/suburban areas. Here, in MA, immigrants with THICK accents do well in the suburbs simply with a Pats shirt (New England Patriots, our local football team) and basic friendliness. They and their kids are welcomed by the locals and integrated as much as they'd like to be...especially immigrants that make the effort to assimilate, like most Chinese and Filipino families.
I know about 10 years ago, that WAS NOT the case in most of Europe, especially the shitty parts, like Bulgaria, but even the wealthier nations as well. I've been told that's changing. But yeah...treat immigrants like shit and you're stuck with local talent.
So fix your cultural issues and then start giving everyone support in starting businesses, and then you'll catch up with the USA. Yeah, you got some dumb regulations, but that's a minor part of the story. The USA has plenty of stupid regulations and our most regulated states have historically had the most success. Our most unregulated states, like Texas and Florida are doing well now with great momentum, but have far to catch up with CA, MA, NY, and WA.
Complaining about regulations in Europe is like telling a morbidly obese person they need to eat more fiber. Yeah...true...but...you'll get a lot farther faster with diet changes...followed distantly by exercise. I don't think regulation is their top barrier to competing with the USA and China...well...I am not hopeful for their future, but time will tell. Europe? I think they're fine...they just got off track a bit. IMHO it's easy to correct.