This sort of isn’t the essence of the European financial situation, but at least an important part of the back drop is the objectively terrible economic performance of Italy over the past 10 years:
Italy also has slow population growth and low workforce participation, so put it all together and it’s not a very bright debt outlook. This has all been overwhelmingly under the leadership of Silvio Berlusconi who, as far as I know, has no particular economic reform agenda or indeed any kind of policy agenda at all except keeping himself out of jail. Today, however, Berlusconi is organizing an emergency cabinet meeting to consider some kind of putatively pro-growth reforms and even going so far as to have “skipped a scheduled court appearance in Milan on Monday, where he is on trial on charges of corrupting the course of justice, because of the crisis in Rome.”