20090630 angela merkel 18
German Chancellor Angela Merkel walks past German and EU flags as she arrives for a statement on the ruling of the German Federal Constitutional Court with regards to the EU's Lisbon Treaty, at the chancellery in Berlin. - 

Steve Chiotakis: The Greek government today will talk about the latest round of cuts to make sure that country continues to get rescue loans from the international community. Meanwhile German chancellor Angela Merkel said today her country will continue to make every effort to preserve European unity, while holding troubled countries responsible for the crisis.

But one financial commentator says the trouble doesn't lie with just Greece and other debt countries -- it lies with Germany as well. Jeremy Warner is with The Daily Telegraph in London, and he joins us now. Hi Jeremy.

Jeremy Warner: Morning.

Chiotakis: So why should Germany be on the hook for this debt mess?

Warner: Germany is the great powerhouse of the European economy. It has the power either to break or save the euro, yet it doesn't seem prepared to do the things that would save it. And it's not prepared to break it either, by leaving itself and allowing the Southern periphery to go off on its own and do its own thing. So that is essentially the problem.

Chiotakis: When you move past the finger-pointing, we do know that Greece is on this unsustainable fiscal course -- as are other European countries. Can the eurozone come up with a solution?

Warner: I don't think they can in its current form. There just simply aren't the mechanisms to allow for the sort of fiscal transfers that are necessary -- the sort of stuff that you've got in the United States to re-balance things between more prosperous states and less prosperous ones. Those mechanisms don't exist in Europe at the moment. The problem you've got is Europe has moved towards monetary union without having political and fiscal union. They put the cart before the horse. And that's fundamentally what is causing the current crisis.

Chiotakis: Jeremy Warner, financial columnist with the Telegraph in London. Jeremy thanks.

Warner: My pleasure.