From Matthew Yglesias » Will Greece Get a Bailout?:

If the Greece moral hazard play winds up not working, then investors will start demanding higher interest payments from Ireland. And if they go down, you could have the equivalent of a bank runs start to endanger medium-sized countries like Spain and Italy. At that point, everyone’s screwed. So, yes, it would be crazy for Germans to let some kind of spiteful attitude toward fun-loving and overly-indebted southern Europeans allow an economic catastrophe to sweep across the continent.