They predicted EU261 would crush the airline industry in Europe. What actually happened was the airlines did just fine and improved their operations. The refund option is actually already in place and the good US airlines are processing refunds in a reasonable fashion. Others not so much and those airlines will need to improve. There is zero reason to have to spend months arguing with a airline as my daughter did to get a refund after they canceled your flight with no rebooking options for 3 days. When a family of 5 has their 1 yearly vacation crushed and loses thousands it's simply not right when they could have been rebooked on another airline as EU261 would have required.
EU 261 is in effect for US airlines flying from Europe and any onward connections in the US. US airlines seem to be handling it fine and Europe is extremily profitable.