Much like banks in America, European banks are struggling with legacy issues amid concerns about their funding. It’s actually worse over there, as the short-term lending spreads are starting to go up, making it more costly to borrow. In Euro nations, bank stocks are at their lowest point in two years.

Like America, European nations are also seeing declining GDP growth numbers and fears of a double dip recession. Europe embraced austerity more quickly than the US did, partially out of debt fears but in some countries because it was seen as a responsible, forthright thing to do. The exact same blunders are being carried out by elites all over the world. It’s predictably depressing, so the same results are occurring: Britain, which ushered in a mass austerity program, is paying the price with zero growth and now a sharp increase in unemployment.

The currency union in Euro nations makes things exponentially more difficult, as countries with different monetary needs are acting within a one-size-fits all framework. There are options for those countries, but some may involve the breakup of the Euro.

But Britain, which stayed on the pound sterling, doesn’t have those constraints. And finally, someone in Britain is coming to their senses: it’s American Adam Posen:

Bank of England policy maker Adam Posen’s 11-month push for more stimulus is now shaping the debate among officials as they consider whether the U.K. needs more quantitative easing to fight the danger of Europe’s crisis.

With no policy maker seeking an interest-rate increase after Spencer Dale and Martin Weale switched votes, the discussion on the Monetary Policy Committee has shifted toward Posen’s agenda.

We’re talking about monetary stimulus here, because the Tories have stubbornly rejected ending austerity programs on the fiscal/spending side.  And there’s reason to be concerned that quantitative easing is more a plan to help the rich in the hopes of trickle down than a plan with broad benefits. But it’s in the direction of aiding rather than actively harming the economy. The Bank of England is going along with this even despite some pressure from those concerned about inflation. We could use a little inflation, actually.

I don’t think there’s any question that solving the problem with fiscal measures so the government isn’t acting as a blanket dampening the recovery by reducing spending would be preferable. That’s as true in Britain as it is in this country, which is why I bring it up. Unfortunately, we have a plan for nasty spending cuts as far as the eye can see. So it’s unclear how we will break out of this. Maybe we won’t.