Reykjavík Grapevine - 24.09.2010, Síða 10

10
The Reykjavík Grapevine
Issue 15 — 2010 Egill Helgason is a man of many talents, in case you were wonder-
ing. Besides running a political talk show on Icelandic State TV,
he also runs a literary programme there. And he blogs a lot for
website Eyjan.is. Busy man!
Analysis | Egill Helgason
Iceland has gone through several phases
since the crash of October 2008, when the
country's banking system collapsed in the
space of a week and the currency lost half its
value. first there was total astonishment that
such things could happen in a supposedly ad-
vanced Nordic state, then came a period of
anger, culminating in the-so called ‘Pots And
Pans Revolution’ of January 2009. There was
even a period of optimism when we thought
a new kind of society might emerge from this
ordeal.
This might be called the phase of revolutionary fer-
vour, when spontaneous citizens’ assemblies got
staged in cinemas and theatres where government
ministers got booed down. But since then things
have become rather more longwinded. We have
gone through a stage of a total lack of trust—a left
wing government that took over after elections in
April 2009 is considered a huge disappointment—
and now we seem to be drifting into a period of
apathy.
MEGALOMANIA AND GLOOM
It came as a shock to many Icelanders to realise that
they lived in a corrupt society. The people of this
large but sparsely inhabited island have often nour-
ished strange ideas about themselves. They tend to
think of themselves as being quite unique in the
universe—so outbursts of extreme optimism, even
megalomania, are not infrequent, alternating with
periods of gloom and insecurity. Icelanders are not
of a stable mindset like the neighbouring peoples of
Scandinavia, for example.
During the boom years, Iceland experienced the
greatest stock market boom in history, and the size
of the collapse is also unprecedented: Icelanders
thought of themselves as being better, more clever,
than the Scandinavians. This is even written up in
a now infamous 2006 report from Iceland’s Cham-
ber of Commerce, which stated that Icelanders had
nothing to learn from their Scandinavian counter-
parts as they were better than them in every sense.
NATIONALISTIC SENTIMENTS
Thus it has always been easy to play upon national-
istic sentiments in Iceland, even after the collapse.
In fact, some claim that Iceland was a victim of an
international conspiracy to bring down its economy.
They refer to this alleged plot as "the siege"—it is a
rather outlandish claim considering the losses in-
curred by Icelandic banks on foreign lenders, inves-
tors and savers. All the same it can be said that the
Icelandic public was the victim of its own inexperi-
ence and cupidity.
During the great boom years from 2002 to
2008, most people were quite proud of the bank-
sters, hailed by many, including the President of
Iceland, as being financial wizards of a new kind.
So people did not understand what was behind the
facade: That the banks had been privatised into the
hands of cronies of the political parties, that they
were getting fat on cheap credit, that the financial
institutions had been allowed to grow into twelve
times the size of the economy—and this based on
the króna, one of the smallest currencies in the
world—and that finally the banks were robbed from
the inside with huge bonuses and loans to their
owners and their friends.
AMBITIOuS PLANS fOR CHANGE
The bankers are now outcasts, perceived as being
crooks. After the crash there was a sense of pur-
pose, things had to be investigated and put right.
The new government was ambitious; this was a
time of reckoning and renewal. A criminal inves-
tigation of the banks was started under the direc-
tion of the French/Norwegian prosecutor Eva Joly,
a special committee of the Parliament researched
the banks as well as the failures
of the government and the of-
ficialdom, an application was
sent to join the European Union,
it was thought necessary to change
the constitution—which is an ar-
chaic piece of paper from colonial
times, given to us by a Danish
king in the 19th century—and
there were plans to overturn the
system of how fishing quotas
are distributed, a very touchy
subject in a country so depen-
dent on fisheries.
All this was to be accomplished while at the
same time restoring the economy and paying
off huge debts, albeit under the auspices of the
International Monetary Fund.
A RETuRN TO THE OLD WAyS
This was very promising indeed, but now,
two years after the crash, things seem a bit
different. Maybe revolutionary fatigue has set in.
A constitutional assembly is scheduled for this win-
ter, but not many seem to be interested anymore.
Interest groups have regained their confidence,
including the powerful owners of fishing quotas—
these quotas being one of the most important sourc-
es of wealth in Iceland.
The banks are being revived, mainly on the
shoulders of the common debtor, there are just as
many employees in the banks as before—while
common people are struggling with their moun-
tains of debt, the legal profession prospers. Tradi-
tional party bickering has returned after a period
when the political parties seemed a bit subdued.
The Independence Party, the party most responsible
for the crash, is on the rise again.
IS NO ONE RESPONSIBLE?
What is also interesting is that nobody seems to ac-
cept any responsibility. Of almost 150 people who
appeared before a committee of the parliament,
not one politician or official—I repeat not one—ac-
cepted any blame for how they managed to allow the
economy to run into such troubles, collapse, while
apparently sleepwalking through the whole sordid
affair.
Politicians also seem to share the ideas that
the bankers and financiers are solely to blame, not
those who set the rules and were supposed to en-
force them. This is of course very convenient, as it
absolves the whole political class as well as the civil
service.
At the moment Parliament is debating whether
to press charges for gross negligence against gov-
ernment ministers who are
certainly responsible for the
crash: Prime Minister Geir H.
Haarde, Minister of Finance
Árni M. Mathiesen, Minister
of Business affairs Björgvin
G. Sigurðsson and Minister
of Foreign Affairs Ingibjörg Sólrún Gísladóttir.
They have all resigned from politics. For the Parlia-
ment this is a rather agonizing process, as these
people are fellow party members and old friends.
Many of those who sit in the parliament at the mo-
ment—and even in government—might also, para-
doxically, share some of the responsibility for the
crash.
So most likely this will come to nought. Due
to statutes of limitation this court case—which
should be held before a special court as stipulated
in the constitution but never before convened—only
reaches back to 2007, whereas the course of events
that ended in the crash was put in motion much
earlier, in the first years of the decade, during the
privatisation of the banks and the ensuing weaken-
ing of regulation. So it seems that some of the main
culprits—including former Prime Ministers Davíð
Oddsson and Halldór Ásgrímsson—will get off
quite lightly.
THE POLISH WAy?
Another way that has been mentioned is the Polish
one. In 2003, during the reign of Davíð Oddsson,
parliament voted for huge increases in pensions,
especially for government ministers. In Poland, old
politicians and government officials from commu-
nist times have had their pensions slashed. It might
be an educating and edifying experience for some
of these people to live on the pension of average Ice-
landers—which have had to be cut because of their
misguided policies and incompetence.
Words
Egill Helgason
Illustration
Lóa Hjálmtýsdóttir
Iceland Two years After The Crash
A Case Of Revolutionary Fatigue
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