eleven thirty pm in moscow these are our tease headlines president putin calls on both sides in the israeli palestinian conflict to resume talks to break this stalemate the russian leader touring the middle east moscow also stepping up efforts to resolve the conflict in syria and ease tensions over iran. turkey claims syria's opened fire on another of its planes this time a rescue jet searching for the wreckage of a fighter downed by syria last week. more pain in the eurozone cyprus set to ask for a rescue citing exposure to struggling greece spain in turn formally request one hundred

billion euros worth of bailout cash to prop up its banks. whistleblower julian assange awaits ecuador's decision on whether it will grant him asylum if he remains ensconced in the country's london embassy meanwhile the latest edition of his groundbreaking interview show is set to air tuesday here on our t.v. . talk next stay with us. you know sometimes you see a story and it seems so you think you understand it and then you glimpse something else and you hear or see some other part of it and realize that everything you thought you knew you don't know i'm sorry welcome to the big picture. and if you. still. want

to. follow in the welcome to cross talk i'm people of all what is the future of the european union will be a federal union or will it continue to kick the hero down the road. to discuss this i'm joined by theodorus he's consul general of the helmick republic in st petersburg also we have philip kant he is chairman and i'll tear investment fund in luxembourg and you're welcome permits he is co-founder c i o and managing partner at asset management. all right theodore if i can start with you your country has a new government ok so you're right presumably your job is assured for a while until yes yes yes it's today's government today's government i do the

greeks want more europe or less europe as a result of the crisis and we we all know increases the country that's been hit the hardest since the euro crisis started yes indeed greece has been the heart of this this was the first to be hit and to be very hard i have to say. now we had two elections in a row in maine to june and that people voted good people voted and voted i think for the you will stay in you will and i think that this is a distinct unit if they vote for a stereotype as well are those two different things the know that more or less it goes with it goes together it goes together they know that's thinking you know he's a difficult boss but it's a path for them for perspective in the future and that's why i think personally that. the decision that was taken several years ago to enter the you and the decision late and the yunus on it was

a very serious decision national decision is thirty six for us and that's why we think that they also the people who want to stay if you will it seems to me you know. a lot of people have criticized the greeks because of the of their monetary and fiscal policy use ok in the european monetary union but maybe the greats now can lead the way we just heard from theodore that the greeks understand the austerity that they're going to have to deal with for greater union for a stronger european union with one currency do you think more people in the european union will say hey we're going to have to take a ten year ten year hit on growth is this something that's going to be widely accepted or is that still impossible right. well it will be quite difficult to make it understandable. the people in the euro that they have to take the hit. but i believe that the prices of here flip through agree it's a significant. significant hint of what has to be done in the other countries to so

you're saying the perception changes for the better while i think not for the better but but for the necessary steps to be taken. perhaps also in the direction of a fiscal union ok oh but see that's what this program is about this school union you know if i were an academic if i were professor of international relations and in finance and say well it's off his they have to have a fiscal union i mean we have a monetary union in a fiscal union it's simple there's no monetary union in the history of the world that i'm aware of never didn't have a fiscal union but the e.u. budget for a long time but you can't sell fiscal union by saying it's because we need it. i think that there's many europeans who like the european example the germans like to be more to be european than to be german you know history and i think very committed to keep the fiscal union and i think it's so humid you willing to pay for it absolutely i think so. really i would think the germans are having to pay for it

i think the you know we officially complain about the greeks the spanish the italians having a big party but actually you have to admit the germans like to work hard you know the german you know we germans like having their products spotfire you say well exactly we can only be working with the exports half if the greeks and spanish and italians buy our products and the euro is a big program to help us export so it's not the case that the greeks have a party and we work is that we sell go a lot of people say the germans go to greece to have a party a family you know but i think the way i see the crisis is that it will be the european union is never move forward without crisis well and they will usually have to me this is one of the interesting fill in one of the interesting things about the integration process of europe leading to the monetary union has always been through a crisis but each crisis is a lot more severe ok in one nine hundred fifty eight to war everybody you know no one could export their goods with european countries so they think establish the common we become in trading area ok that was

a big political decision and it was very very good decision but each crisis gets a little bit more worst than this once fundamentally the worst one. is this something that is people can be aware of i mean do you want to employ if you lose your job you lose your prospects can you intellectually say yes this is the crisis that we have to you know really square this or. yes fortunate thing is that the crisis became bigger the impacts of the crisis are more severe from from one crisis to the other and if we have an unemployment of fifty percent than in spain then under the us that's already much beyond everything what we have seen so the question is how long can the people in europe endure see this crisis before i see brief statement we you know there's a lot there's a perception that a generation has been lost in year in spain and in greece unemployment for young people is extremely high how long can they wait it out or they just leave and come back during better times i thought those days for europe were over. i think that

a place for greek people can wait for the best the future i don't know how many years this will take i don't know if you as you said it's about a generation but you know good people to come out of the austerity program certain very strong sacrifices and just let me tell you just three numbers not to take up your time from the public sector one hundred one hundred thirty thousand people out of the public sector and two thousand and fifteen would be one hundred fifty more now had three thirty percent reduction of the wages in the public sector and we have also ten to fifteen percent reduction in the pensions and we had also almost one hundred ten professionals let's say close to officially open with a little ok you're a spokesperson you know i just need to tell you is that this is how you sizes in greece is this is a real thing is taxation this is another issue which is very very strong the

efforts well made not sufficient should be made ever more but tax is also one of the main main pillars of this effort where thing because. when you see people sacrificing the numbers that i mentioned before this means that they want to get somewhere and this is what we need to hold about these nobody really knows. how much time this will. have to say there isn't a lot of time a lot of people think you are right that there's a need for a vision i think it's very painful to wait and wait and wait and i the way i see the vision is actually the vision of a human to dean of germany which says you could actually if you move the european economy to a new model of the circular economy up to take consumers throw away and pile to me where you really have to circular you can actually save some six and a billion euros already today. you could have solar power produced in italy greece saying there's a record a new solar power plant at six cents per kilowatt hour that's even less than in

russia gas gas fired electricity costs so there are ways of getting out of this and i think just austerity won't do this we all these are political will to do that i mean somebody that we you know if we look around the world look at major countries everybody knows who's president of russia everyone knows who's president of the united states people know who runs the u.k. who runs europe well i think there's a finance minister very be mr think things are going ok all right all right fine you know you didn't you know what i'm talking ok i mean we're is the very who leads here because what over the last two years we've seen eleven twelve governments in europe fail these people don't have the answer apparently ok we have flip flops we have going to the left going to the right the way i think that's the difference between in the germany for example this change foreign minister to stuff like that to decide these in place for twenty years and read the same policy does not i was and how up front i think only matters that mattered merkel said. chancellor merkel

. that's who counts. in machall and and so i can see work together now that i can no longer agree to increase the capital of the european vestment bank and that increasing capital can go to major infrastructure projects if you look at for example you know high speed rail connections in europe they don't exist in most. we did this better than say frankfurt so as not to be done let's use a real we this is again i think everybody would agree all these things have been but who can do it ok ok there's the european parliament which most people in the there are represented in the european parliament you do not know who represents them there ok i'm sorry it's not a real parliament yet it's got a long way to go we don't have a real we don't have a real president of the european union we have figureheads ok we did how do we get that how do we square the circle is there because a lot of people say there is a democratic deficit in. there let's not forget that the european union is

a political union apart from that this kind of the monday union the main thing that is a political union has in its editions and it's run. if i may say it's run by twenty seven governments which together and. decide all together that's not i know that is not the united states of here is it yet last night you know it went to several governments have signed the treaty for sort of diety and cohesion both are very important not just a little bit but have also tried to be coherent with the rest of you'll try the whole show that i want out of a crisis when you're trying trying to talk oh here. well i think you will come back where we started i mean it has to have a crisis you know to come to a higher conviction of institutions to be a selfless. how do you do that well. you know no no i'm

not trying to be facetious here ok because when you look at the united states had to fight a terrible awful civil war after being established for almost a century what ninety years ok we don't have a lot of time here now and the problems of people are very well aware of lawyer but i think we have the but also of course as in germany when we looked at the king we didn't always be like that the kaiser didn't always elect the strongest stuff so but it is the battles that's clearly understood for example that ninety percent of growth the next decade will come from outside the e.u. we have a clear policy in the european union for example to work with russia on what's called the motive as a shield treaty and that will give you companies access to a growing market you can also have a new economic model which the commission is no looking at is the circular called me which was what was going to jump in here we're going to go to a short break and turn from the break we'll continue discussions on new european federal state parks. and you can. start.

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the east so. lucky. lucky. slug the. slowest sledge the east so many. hello and welcome back to cross talk about to remind you we're talking about european federalism slept the.

sleep. in your mind if i can go back to you. you were giving us a historical example of how this might work ok but at that time democracy as we understand it didn't really exist we still have a really powerful elite how do how do europeans address this deficit of democracy because there is the perception the perception that it so then czar cozy and merkel chums came together and made some decisions ok maybe they were good ones maybe they were battling to do to people. ok and a lot of people who are there others would say it was a partnership of one and a half and you know there was that what people said about how do we expand that but you know i think one firstly would have direct elections of the president of the european union have direct competition i think that's a possibility you could also i think the parliament is actually working more or

less we have a more or less normal parliament there is the stuff travelling all the time and the travelling circus not very helpful. i think the commission gets stronger but the finance minister almost there i think a very old they're not almost there there's no fiscal union fiscal union the most important thing a fiscal union has the right to collect taxes not from individual sovereign states but direct ok who's going to organize that where is it going to be going to be in berlin it's going to be in vienna it could be in brussels it's going to be an anchor who decides. it's already in next. i think germany will have a major say in. that that's to be expected but on the on the other side. you think how do europeans feel about that about germany germany leaving the powerhouse of europe right now in for work for germany we'd be in a recession ross here to certain extent it's also expect the from germany to take

the lead and to show more presence on the european called that. that that's a very difficult thing for germany to step out of its historical role. because up to now you're in the confined itself to zone territory and that's also a perfect for a while but it's expected if you look for example if you call this initiative asking for germany to be yes yes you have this weekend it will not be not long before that fast reference reparations which was kind of a ridiculous thing to do you know this is i was a professor of modern european history and i mean germany has a very important unique role in europe right now but at times it's damned if it does damned if it doesn't it's ok because of history. germans have done very well the german economies and very well off the euro lot of people forget that there's always was you know the greeks did the wrong thing the spaniards had the wrong thing the italians had the wrong things but you tend to forget who has benefited very much from the euro where just too many stand on that health far will go

because we have a lot came to power we want growth goes out affecting merkel and her perception of the entire european economy i mean as i said my my view would be that. it's time for some new new new ideas one idea was because germany had for one war second war so it was the only way to deal with the somewhat unstable governments to create. the european union that was sort of to the west that we did something similar like that to the east where the moment really poland is that way quite nervous about germany and russia for example one project in the east would be to have hypo high power voltage lines connecting russia to western europe and have common institutions in poland then you have a growth area and if you have a new approach to the economy then you have a growth it was germans are concerned how far they're willing to go i believe germans very much want to see. the benefit they have to be we mean we benefit for free trade we benefit from human rights we do benefit from the american democracy

was all imposed on us we didn't become democracies we were made democrats we only example in history maybe japan i can think of where it actually works. that's a different program but this is so so we're very happy to have it i think we'll pay for it that's fine. but i'm a nobody really doubts about the leading role of germany as a super economy i like knowledge but there's a value before you look and you know you still i don't know what will happen if you two in the near future still i've been in the governmental you know level and you see at the political level every think martyrs you see seven of using you up and you saw after the elections in france and june of the lexus in company in greece how much discussion political discussion took place in the food of you will so i think that even the smaller nations like least media small nation we did debate you know that has during elections or after elections all without any kind of elections can be the whole debate in europe so that's why what i believe before they did this

all together i mean is a just society philip it's because i'm assessing because when master it was passed when other treaty passed it was the political project wasn't up front it was about the the the monetary union and how it would work ok have as europeans been tricked into a federal union pension all federal union because nobody signed up for that in the beginning and everyone was very skittish about how political would be we would still have burly and we'd still have paris we'd still have london etc etc now you're telling me maybe we're going to europe will have to build a separate new city somewhere to show some kind of neutrality i don't know but the thing is is that when european integration started after the second world war maybe in the in the genetic code of the founders political union was the ultimate goal but it was the people were told that the how do you feel about it being forced upon you because of necessity and that's not necessarily democratic it's really

difficult to understand the european integration process as a. steady pro. so you know that we really need crosses to come to different level of conscience works or hope needs to be done and i don't think that when you look back that there was a constant planning process not because it was and. perhaps it was a big mistake you know to introduce to europe before there was. a better form of a political system within the year. but i'm not so sure i mean very by nationality you know you're a skeptic the angles next few of you will be the skeptic what you found we are ok. it's just always always like there's a problem in europe of that when you have any problems i mean we're suffering out of a high level and in germany you know that just asking about is working and everything

is working and it would be have less growth i mean i see this painting greece but also suffering greece at a very high level when thirty percent you coming from a level twenty years ago it's unbelievable how wealthy with this we come after them big gains i mean so i don't think there's a problem and i think the solution is very simple once you have the fiscal pact the e.c.v. becomes a lead no means for that or you wouldn't have just governments and leaders meet in maastricht again and say this is what we do sign the papers and we have a fiscal union is that what the europeans want is not fair is that process fair because they think they're safe that perception that you have a very small elite very well connected to the banking elite excuse me gentlemen ok thanks for being taken in this week the perception is very important i think like a point on the program i think we all know what the solution is how do we get through this except if. but i think this is what people would vote for fiscal union because they want to see a stronger europe they say they understand that greece or even germany of germany

is a village right the eighty million people speaking german that's that's nothing it's a joke it's a little village like aslaksen open access like nobody out of eight million people soon as just a mere percent of the population german is an x. and forget about it we can you know you are less of a x. and so we have to be a powerful nation to play a role we have to the multipolar world to avoid people playing sheriff in places either side of the atlantic and so i think people global to this community and we have the finance minister and if we could fiscal union what will be a general staff of the european army are you guys going to go out fight wars. well that's so. there's a maybe there's a only on your realm there but i mean fiscal union has a little tough economy it comes with a lot of time i agree with you i'm right here because it does create a lot of responsibility consequently yes in the end in the end you will have all the attributes of the state which for us now the source of money are we spending i think five times more than we should because each of us has only lobbies just got

rid of all of the i mean think we got here just found out for example heroic army stopped the italians in world war two yes and made and allowed the victory of the allies because the division of the of the nazis into ansel's to do is to just tell you it wouldn't go forward so the small army could be very effective but there's no need to to replicate everything yes that's what i mean we haven't came between is there an appetite to be a global power and i think everybody wants to be a white house for what it wants us to be prosperous you want to be safe but you want to be like the united states were more powerful than versus already united states is a bankrupt mickey mouse economy missteps along with the united states has more of you and other programs. going to me is looks today like russia looked at ninety eight it has huge debt unsustainable pension deficit health of the visit everything of a citizen of the european union going to let us know yes but actually people say you know they are you know that's the u.s. propaganda machine how do you think that's turning the focus onto greece don't you

know greece is committed to europe we don't even if we sort of live is not the only big deal to european union the problem is in america the focus of the global attention is europe is probably that we don't have any problems to have a fiscal union is the very thing as the finance minister sits in luxembourg the e.c.b. is then the last resort we'll get rid of all the military expenditures we move to infrastructure that makes sense we finally work with russia life thank you and this is my passport to the united states of america would you like one that says united states of europe. we do have a way to get the same no i so it's not a fiscal union it's not a federal union we have only different and totally different let's not forget that fuel oil with the as a home of fall the sea of defense by and already has extended an auction of its european extern auction said it's a diplomatic service for you this is that spall those who go it's closer to you and i can of beans i can close here gentlemen thank you very much for a very interesting conversation and thanks to our viewers for watching us here are

deep and remember crosstalk.