While I agree that having a well-balanced life isn't necessarily the cause of Europe "falling behind", I'd like to point out that the US also shares some of those issues:

bad policies: massive tariffs, extreme spend of the military-industrial complex at the cost of education and healthcare, a completely pointless War on Drugs that just increases violence (to be fair, many states have more or less legalized cannabis at this point), war in foreign countries (if all the money spent of Afghanistan had just been distributed back to American taxpayers in the form of either tax cuts of stimulus checks, how might that have affected the economy?)

bad leaders: I think most historians would agree that president Trump is not exactly Mount Rushmore material

bad deployment of capital: at the state level, this would mirror 'bad policies', ie I don't think war the Afghanistan/war on drugs was a net gain for the US taxpayer. On the private side, the boom/bust nature of tech investments - how many were buying Pets.com stock in 1998? How many people bought trendy NFTs in 2019? How many completely unviable businesses get funded today just because "our product has AI"?

so there might be other factors.