If European Union finance ministers and the International Monetary Fund (IMF) have turned away from austerity as a means to help the region’s economy, the action has not affected Greece, where the government has elected to fire 15,000 public officials.

Bloomberg’s news service reported on the softening on austerity:

Europe may accelerate a shift away from its austerity-first agenda this week as the new Italian government changes course and a German-Spanish investment pact underscores a renewed focus on combating record unemployment.

The observation is one of many made by media and economists, which is that leaders have discovered that austerity probably causes recessions more than it helps balance budgets.

The Greek parliament must not have gotten the message. Its vote to approve massive job cuts among government employees by the end of 2014 is done. The move is meant to trigger $3.65 billion in bailout loans, which had been blocked because lenders want more proof of Greece’s commitment to austerity.

Eurostat recently released data that showed the February unemployment across the euro area reached 12%, which was a record. Greece’s jobless rate was highest on the list at 26.4%. However, the data from Greece lags, so its numbers are from December. The 15,000 government layoffs will raise that figure by a meaningful amount, because it goes hand-in-hand with other government efforts to downsize. There are already about 1.35 million unemployed people in Greece.

The debate about how to fix the deteriorating foundations of Europe’s most troubled economies continues to be marked by schizophrenia. The antagonism among the most powerful parties — the IMF on one hand and Germany on the other — has not changed much in recent months. Greece could have been thrown a life preserver before its parliament was forced to prove its commitment to austerity by increasing its unemployment. It is a commitment that will undermine future productivity for certain.

It may be that the tide against austerity and toward stimulus will need to wait until the economy of Greece has reached a point of perhaps as much as a 10% contraction per year. At that point, however, the 15,000 government workers will have been added to hundreds of thousands of unemployed who will be hopelessly beyond any approved aid. The 26% unemployment is too big a hurdle to overcome, at least until years of stimulus have been in place.

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