Reykjavík Grapevine - 08.01.2010, Page 22

The Reykjavík Grapevine
Issue 01 — 2010
22
2009 | Pawel Bartozsek
Mathematician / Teacher
at Reykjavík University
What I notice the most is that a
lot of nationalism, even chauvin-
ism, has been spreading over the
country. One could see it relatively
early in the year, and it becomes very
apparent in regards to the whole Icesave de-
bacle. The prevailing attitude may be likened
to that of a person that breaks into a garage,
steals a car and totals it, along with many oth-
ers, on the way out, then claims that it’s all the
fault of the garage’s lax security, and that the
road rails weren’t strong enough.
Hardheaded Icelanders have managed
to present this idea that everything that hap-
pened is Gordon Brown’s fault, or the foreign-
ers’ fault, or lax EEA regulations’ fault. I think
this is a questionable interpretation of our
woes. I think our only defence should be that
we cannot really afford paying these amounts,
or that they are simply too high. To maintain
with a straight face that we are in no way re-
sponsible for Landsbankinn’s debt is absurd.
We could ask ourselves what we would think
if a British bank went heads up and the UK
government announced every Brit’s savings
account was safe while telling us we couldn’t
get anything. It is very doubtful that we would
take such declarations lightly.
I am flabbergasted by the party play that
went on around the Icesave affair. I find it hard
to believe that if any other party—except for
maybe The Movement [formerly The Citizen’s
Movement]—would be handling Icesave any
different than the current government is. I feel
the parties that filibustered and opposed the
deal the hardest are just trying to score politi-
cal points, which is understandable to a point.
Still, nobody is going to play hardball with the
international community on this one. We have
had some insights into our international rank-
ing, with our failed bid for the UN Security
Council. It is... very poor. It is perhaps under-
standable that people would initially react by
claiming that the world is being mean to us,
and we hate it anyway, but it’s not likely to go
on forever. Perhaps Iceland will be like the US
post-9/11, we’ll see a few years of harsh reac-
tions before settling down into sanity anew.
If we go in the opposite direction, how-
ever, I am very afraid. I sometimes worry about
things like the EEA agreement, not that the
members will oust us, but that say Icesave
goes wrong and we wind up in a business war.
A large part of our economy is based on in-
teractions with other nations, and they could
absolutely squeeze us dry if that were in their
interest.
Looking at 2009 from my perspective,
being a right-winger—and a pro-EU one at
that—there aren’t many things to celebrate. Of
course, we did apply for membership and I do
applaud that, but it doesn’t seem like our ap-
plication is faring well at the moment. These
guys, Davíð Oddson and his friends, they
played their cards well at the Independence
Parties’ latest national convention and have,
if anything, tightened their grip on the party.
While their leadership is not direct, and not
unquestioned, I do believe that the editor of
Morgunblaðið has a lot to say about what goes
on in the party. This is my estimate of the politi-
cal climate on the right wing.
Not A Lot To
celebrate
2009 | Þórður Snær Júlíusson, Journalist
The first thing that comes to mind about 2009, as a sort of milestone event for the
year, is the hiring of Davíð Oddsson as editor for Morgunblaðið. It can reasonably
be likened to a bankster being appointed to the Supreme Court to rule on his own
case. Fittingly, the historical analyses that have been appearing in Morgunblaðið over
the past few months seem to be put forth by a man that has a great interest in how history is
written, and that it will be written a certain way— entirely ignoring on how far from reality those
writings are.
Aside from that, Davíð has never worked a real job in the media, and thus has neither the
knowledge nor the experience to lead any part of it. It is unfair to the journalists of Morgunblaðið
to work under a man that knows the answers to most of their questions, but neither can nor will
answer them. As a former employee of Morgunblaðið I find it very sad to witness how the news-
paper has evolved over the past few months, and the circumstances its able professionals are
forced to work in. Alas, private companies can hire whomever they want to hire.
Another great point of interest is the information we obtained on how insurance company
Sjóvá was handled. Its former owners seem to have treated the company like a piggy bank; one
they eventually found new use for as a garbage bin once it was all emptied out. The results were
that the state had to supply Sjóvá with 16 billion ISK. That is an incredibly high amount when you
consider the fact that their claims reserve fund once amounted to around 22–23 billion ISK. They
nearly managed to empty it. Investor group Milestone, who owned Sjóvá for two years, managed
to increase the company’s debt by 40 billion ISK in that time. During these two years, the shame-
less owners didn’t hesitate to reimburse themselves 19 billion ISK in dividends. The investigation
in Sjóvá’s affairs and the Special Prosecutor’s raid on their premises last summer are thus clearly
one of the year’s main events.
Lastly, I would like to mention the bankruptcy of DeCODE Genetics in November as a very
memorable event, especially in a historical context. When DeCODE stock went up for bids on
the so-called Grey Market around a decade ago, it marked the start of the Icelandic public’s first
stock trading-gold digging adventure. Respected people appeared in the media telling people
that not buying DeCODE stock would be a grave mistake. Likely, no Icelandic government in
history has gone as far for any company as the one that ensured DeCODE exclusive permits to a
database made up of the nation’s collective medical histories—adding to that a $ 200 million state
guarantee. Even though both the database and the state guarantee eventually fell through, the
state’s promise of both ensured DeCODE’s then VP, the young business-hero Hannes Smárason,
was able to register the company to the US NASDAQ-market. DeCODE is to this day the only
Icelandic company that has been listed there. As trading commenced, their stock was valued at
$ 30, but quickly plummeted to next to nothing. For the past few seasons, they were valued well
under a dollar.
An Invitation To Historical Forgery
2009 | Íris Erlingsdóttir, Journalist / Writer
In 2009, Iceland became the poster child of the global economic downturn. The precipitous
collapse of Iceland’s banks and the ensuing popular overthrow of the Independence Party-
led government were seen as possible precursors of the fall of Western civilization.
Fortunately, the situation in Iceland (and elsewhere) has stabilized—at least for now—and
already we are forgetting what exactly led to the kreppa in the first place. Was it the result of
fraudulent investment schemes created by foreign flim-flam artists like Bernie Madoff? George Bush’s
fiscal irresponsibility? Hank Paulson’s decision not to rescue Lehman Brothers? The market’s irrational
exuberance?
Certainly not the policies of Iceland’s Central Bank by Davíð Oddsson, the harebrained business prac-
tices of the New Viking raiders, the complete failure of Icelandic regulators, the government’s incompe-
tence, or the absence of sound lending guidelines at the banks. And certainly not the system of nepotism,
cronyism, and political patronage that came to define the business atmosphere in Iceland.
As a result of this collective amnesia, we are already seeing the rats emerge from their holes to point
the finger at those who have been stuck with the task of cleaning up their mess. Oddsson is back in the
public eye as the editor-in-chief of Morgunblaðið. The Independence Party is again polling as the country’s
most popular political party. Kaupþing refuses to permit outsiders to take over the business empire of Jón
Ásgeir Jóhannesson. The banks are still run by much the same people who caused this mess in the first
place.
The cockiness that characterised Icelanders during the good times has been replaced by anger, more
directed at the post-party cleaning crews than the political and financial “elite” whose reckless actions
have seriously compromised Iceland’s sovereignty.
The world has changed, however. The cockiness that characterised Icelanders during the good times
is gone. Iceland’s sovereignty has been compromised as a result of the reckless actions of this “elite.” I
am not referring to the movement to have Iceland join the European Union. I am referring to the fact that
the positions of authority and nearly all of Iceland’s treasures have been—or soon will be—handed over to
foreigners.
The International Monetary Fund (IMF) has been placed in charge of restructuring of Iceland’s econ-
omy. The investigation of the financial crimes that led to the kreppa is led by Eva Joly, a Norwegian-French
politician. The genetic research firm deCODE—which was probably the best known Icelandic company
abroad—was sold in bankruptcy liquidation proceedings to a consortium of American investment funds.
The right to exploit geothermal energy in Reykjanes was sold for a pittance to a Canadian company.
Despite all of this, however, there are hopeful signs. The kreppa has given rise to a truly independent
media—from the website Eyjan to bloggers such as Daði Rafnsson‘s Economic Disaster Area, and Lára
Hanna Einarsdóttir—to challenge the privileged class monopoly on the news. A new political party obtained
seats in the Alþingi. A national assembly (Þjóðfundur) was held to try to reach a consensus on how to re-
build our broken society. The Icelandic people have refused to allow the British and Dutch governments to
force them to pay for the sins and omissions of the bankers and their own regulators. The outflow of work-
ers had stopped, for the most part, and the unemployment rate is slowly descending. The first prosecutions
appear imminent.
Now that the crazy days of the 00’s appear to be behind us, we have an unprecedented opportunity to
redefine ourselves. We’ve been humbled in 2009, but it’s still not clear whether we learned our lesson.
The Humbling of Iceland
2009: Politics & Life
2009 in Pictures bALDUR KRISTJÁNS