They've worked hard, they've worked long and, through prudence, they've borne the additional cost of absorbing East Germany and being a founder member of the euro zone. And now the German worker has had enough.

The mark provided the credibility the single currency needed to make it off the drawing board –- but still there must have been nagging doubts in the Bundesbank and the Chancellery about giving the Irish, the Spanish and the Italians access to a hard currency.

While the Germans worked and paid their taxes the Irish and southern European economies boomed on easy credit. While the Germans had their spending controlled through domestic fiscal policy, the rest of Europe appeared to pay lip service to spending rules.

On current guidance Ireland is likely to SUBSTANTIALLY exceed the 3 percent deficit to GDP target; France will probably be just under and Greece the same. Germany will most likely be in balance or will show a modest surplus.

So now the German taxpayer is expected to stand surety behind the banks of Spain, Ireland and every other euro-bloc country that has extended a blanket deposit protection scheme. No wonder the Germans are giving a cool response to entreaties from their spendthrift counterparts to join a Europe-wide scheme.

Less disciplined European governments have shown a lack of regard for the spending rules. Why would they be anymore restrained in dipping into a Berlin backed bailout fund?

As Nick Carn, our guest host on "Squawk Box Europe" from Odey Asset Management noted, this crisis is set to expose the structural weakness that has always lain at the heart of the euro: no centralized control over fiscal policy.

Sovereign debt prices and credit default swaps already display market concern at the higher default risk in the economies on the rim of Europe.

A Europe-wide bailout plan would explicitly do what Germany has always resisted –- give the market the impression that the Bund is no more creditworthy than the Italian BTP or French OAT.

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