Reykjavík Grapevine - 01.02.2013, Blaðsíða 12

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Icesave | We won!
Unique, unfiltered
brewery from the North
Happy Hour every day from 17–20
Laugavegur 20B, 101 Reykjavík
“Congratulations!” This word was frequently
shouted this past Monday. Why? Did Iceland’s
national handball team win the European
Championship? Or did an Icelandic ‘musician’
win the Eurovision Song Contest? No. On this
day, at 10:30 AM, the EFTA Court had ruled Ice-
land victorious in the so-called “Icesave case.”
Iceland had won the European Championship
of Lawyering.
Icelanders were happy, and understandably
so. Picking up the bill, not to mention a rather
large one, is seldom an enjoyable affair. The is-
land’s most prominent female vocalist posted
on her Facebook wall that “sometimes justice
is fulfilled,” a notion that mostly all Icelanders
could agree with. The leaders of the govern-
ment called it “a great victory for us” and said
that “everyone should be merry and not seek
out culprits.”
One of the opposition leaders in parliament,
a great proponent of referendums, called the
court’s decision “a victory of the nation over
the tyranny of the government.” Another oppo-
sition leader noted that Iceland had prevailed
over the oppressive policies of foreign govern-
ment, adding that Iceland’s government should
“apologise to the Icelandic nation and that “we”
should learn from the whole affair to “always
stick together when it comes to defending Ice-
landic interests.”
So, the message from the folks in parliament
was simple. Government leaders said “phew”
and “don’t blame us,” while opposition lead-
ers said the verdict was a victory for the people
over Iceland’s government and over foreign su-
perpowers and institutions.
Yes. “Congratulations on the victory, Ice-
land!”
Seven long years after the Icelandic bank
Landsbankinn opened its Icesave branches in
the UK, the Icesave issue was finally resolved.
No more Icesave-Christmases. No more Ic-
esave-press conferences at the President’s
office. No more Icesave deals. No more refer-
endums. Everyone was happy. Still, the issue
hadn’t quite faded away.
GAMBLING WITH THE
NATION’S FUTURE
But how did an Icelandic bank opening a
branch in the UK eventually lead to Iceland be-
ing summoned to EFTA Court? Well, that was,
more or less, the result of the Icelandic nation’s
decision, a decision made in a referendum on
April 9, when “we” said no to the so-called
“Icesave III” deal, thus pushing the UK and the
Netherlands to take Iceland to court. So, Ice-
landers decided to take a risk by pursuing the
unknown, rather than taking the known, road
out of a given situation.
This is something Icelanders have been
keen on doing. A few years before—in 2005, to
be exact, a year before Landsbankinn opened
its first Icesave branch in the UK—a telling
speech was made at the Walbrook club in Lon-
don. The speaker was Iceland’s then and cur-
rent President, Mr. Ólafur Ragnar Grímsson,
and his speech touched on the special nature
of Icelanders and why they were so successful
in modern business. To quote:
“Icelanders are risk takers. They are daring
and aggressive. Perhaps this is because they
know that if they fail, they can always go back
to Iceland where everyone can enjoy a good life
in an open and secure society; the national fab-
ric of our country provides a safety-net which
enables our business leaders to take more risks
than others tend to do.”
The president was, and to some extent still
is, right about this. Icelanders are risk takers.
To bring the Icesave issue to court was, like the
decision to engage in the Cod Wars back in the
day, a risky endeavour. Amazingly, both risks
paid off. But is taking a risk always the right
thing to do? Where did this Icesave issue come
from anyway? Well, in short, it came from tak-
ing a risk.
When the Icelandic economic wonder faced
“a bit of a lull” during the so-called “mini-crisis”
of 2006, Landsbankinn decided to open the Ice-
save branch in the UK to resolve what they then
perceived as a short-term cash flow problem.
As Icesave was a branch, not a subsidiary, the
money could easily flow back to Iceland, where
it was promptly used to resolve the bank’s and
the bank owner’s cash problems, as well as
those of the bank’s most prized customers. This
worked out beautifully short term, but ultimate-
ly turned out to be a disaster; Landsbanki col-
lapsed in the fall of 2008, leaving depositors in
the UK and Netherlands unable to access their
funds.
Risk-taking is a strange beast. It can either
pay off or bite you in the ass. Games are often
all about taking risks. Just ask any member of
Iceland’s national handball team. In life, taking
risks is sometimes necessary. However, when
the welfare of others is at stake, many would
at least consider other safer options, or so one
would hope.
Let’s imagine a hypothetical scenario. Say
a man is driving his car to the airport at 170
kilometres per hour. With him are his wife and
their two children. They are about to miss their
flight to Tenerife, or some other sunny resort.
A few things can happen: 1) The family makes
it on time for the flight and gets to kick back
on a sunny beach. 2) The car is pulled over by
the police, and the driver is fined and loses his
license, and they miss their flight. 3) The driver
loses control of the car and veers off the road.
Whether he and his family ultimately survive
the ordeal is unknown.
Now let’s say that the first scenario plays
out. Would it be appropriate for her husband,
now safely aboard the airplane with his fam-
ily, to demand that his wife apologise for hav-
ing suggested that they simply rebook the flight
rather than take the risk of speeding to the
airport? I think I can safely assume most of us
would not find that demand fitting.
OSTRACIZING THOSE
WHO DIDN’T
Taking the Icesave issue to court, rather than
settling it out of court, was a huge risk for
Iceland—a risk that paid off. The instigators of
such risk-taking, namely the president of Ice-
land, the Progressive party MPs, the Citi-
zens Movement MPs, the InDefence
and Advice lobby groups and, last
but not least, 60% of the Icelan-
dic voters, were, last Mon-
day, along with the rest
of the country, saved
from the chop-
ping block by
the EFTA
C o u r t .
S o
w e
all woke up kicking back on a sunny beach.
The risk paid off, but that doesn’t mean that
those who played it safe were against Icelandic
interests. It was impossible beforehand, for the
most capable of legal experts, to foresee that
Iceland would win the case. And whatever peo-
ple thought of the “Icesave III” deal, that deal,
with all its faults, was still a rather foreseeable
and safe affair.
Wisdom in hindsight is of little worth if any—
something that the former Prime Minister Geir
H. Haarde should be all too familiar with. Few
people have had to sit through as many I-told-
you-sos as he did during his trial last summer—
more or less everybody who took the witness
stand claimed they had foreseen the Icelandic
economic collapse of 2008. And why was our
former prime minister in court? Well, he had
taken a risk. He had hoped that by doing as lit-
tle as possible, instead of perhaps endangering
his political career by making brisk and tough
decisions, that the crisis of 2008 would simply
pass Iceland by. It didn’t, and in the process Ice-
land’s economy and his political career came to
a crashing end. Had his risk-taking worked out,
however, he might still be prime minister, or
perhaps the whole thing would have gone up in
flames anyway. Who knows?
Several MPs from the opposition are now
demanding that the current government apolo-
gise to the nation, or even resign, all the while
patting themselves on the back for having in-
sisted that the Icesave case go to court. With
elections looming, one must ask if these same
people are fit for government. If they were in
power in a similar situation, will they think about
what’s best for the country, or will they always
opt for the risk, and hope against hope that
destiny is on their side, like our aforementioned
former prime minister did? And shouldn’t those
who created the problem, and did nothing to
resolve it, simply enjoy the victory like the rest
of us, rather than boisterously singing their own
undeserved praises while declaring those who
would have done the sensible thing opponents
of Icelandic interests?
That said, last Monday saw an unlikely vic-
tory for Iceland, and one we should assuredly
enjoy. “Congratulations, Iceland—
today is your day!”
Jón Trausti Sigurðarson
is a 31 year old student at
the University of Iceland.
The Game Of Risk
The Icesave song has ended, but the melody lingers
The risk paid off, but
that doesn’t mean
that those who played
it safe were against
Icelandic interests.
“
„
12The Reykjavík Grapevine Issue 2 — 2013