Earlier quoted context omitted.
In the case of the military I'd say the real reason is political. After the fall of the Berlin wall, Europe collectively agreed (knowingly or not) that war is now a thing of the past and the goal should be the complete dismantling of militaries worldwide, starting with Europe. Lead by example, etc.
It's subtler than that. Europe was just constantly reminded by its big brother not to duplicate NATO structures, which are dependent on the US.
Plus, of course, each European country has to support their own defense industry, so each one of them needs to have their own howitzer/tank/whatever and they can't agree on common approach that would actually allow for the economy of scale.