Unfortunately, it's the Athens, Greece Chamber of Commerce, not the US Chamber of Commerce.
This is a very short diary -- really just a note.
I was listening to The Takeaway on NPR, and they were interviewing Constantine Nicholas, the head of the Athens, Greece Chamber of Commerce and Industry. I'm paraphrasing what I just heard. He was saying that the European Central Bank's and Europe's insistence (and the Greek government's acquiescence) in the policy that requires Greece to layoff massive numbers of government workers during the recession and financial crisis in a futile effort to balance its budget was leading to catastrophe. It would reduce demand leading to thousands of Greek businesses -- his constituents -- shutting their doors.
He says 80,000 businesses have already closed and another 180,000 Greek businesses could close. The present plan is to layoff 100,000 public sector workers. Each one supports at least three consumers, so there could be a withdrawal of demand of nearly half a million Greek consumers out of a small population of about 4 million.
He says that the emphasis should be on stabilizing employment because the more people who remain employed, the bigger the economy, the more Greek tax revenue and the more likely it will be for Greece to be able to service its debt.
By insisting on firing public sector workers and reducing employment, the creditors of Greece are actually making it more likely that Greece will default on its debt to those very same creditors. He also mentioned that Greece's debt is tiny compared to Europe's and the risk of Greek default to the rest of Europe in normal times wouldn't be important. But it's the fear-based contagion of other European defaults that makes it important for Greece not to default. The balancing of public sector and private sector employment has to happen but should happen slowly over a long period of time.
This makes perfect sense in Keynesian terms -- ie in terms of reality based economics. But it makes me wonder why this common sense prescription comes from the head of the Athens, Greece Chamber of Commerce while the US Chamber of Commerce generally advocates driving the US economic bus off a cliff -- even though US businesses are passengers.
Why has the US Chamber of Commerce, the Republican Party (party of business supposedly) and other business oriented groups become so ideological that they now advocate policies that destroy their own business supporters?
And why do so many businesses go along with this madness?
http://mediasearch.wnyc.org/...