Iceland review - 2016, Page 39

ICELAND REVIEW 37
LUCK AND ECONOMIC BOOM
The exceptional number of protesters
outside parliament on April 4 shows an
underlying frustration with the state of
affairs in Iceland, and yet the economy
is booming, following a relatively speedy
turnaround since autumn 2008.
After the banking collapse in October
2008, most Icelanders had expected to
see major political changes. A left-wing
government (an exception in Icelandic
politics) took over from January 2009,
but the old parties returned to power
after the 2013 elections: the Progressive
Party formed a government with the
Independence Party.
The circumstances of the present
political upheaval differ fundamentally
from 2008: Iceland, enjoying econom-
ic stability and growth, is one of the
most prosperous countries in Europe, as
pointed out in an April statement from
the International Monetary Fund (IMF).
The economy has been managed
more or less sensibly; first by the
Independence-led coalition with the
Social Democrats from 2007 to 2009,
unflatteringly named the ‘collapse gov-
ernment,’ then by the left-wing govern-
ment, a Social Democratic-led coalition
with the Left Green Movement, which
came to power in January 2009 in the
wake of the ‘pots and pans revolution.’
In the spring of 2013, the left-wing
government, weakened by fierce internal
fighting, lost miserably to the two old
parties, the Progressive Party and the
Independence Party (both center-right
parties).
Steadily growing tourism during this
period brought Iceland what it needed
most: foreign currency. The benefit of
good fish catches, high fish prices on
international markets and low oil pric-
es has been vital. However, a jarring
note in the success story is the fact that
Icelanders are still emigrating, especially
educated ones, in spite of the good times.
SIMMERING WITH ANGER
Much is made of the anger driving vot-
ers to the political fringe, i.e. Donald
Trump and Bernie Sanders in the US and
Jeremy Corbyn in the UK. The anger
is aimed at the political elites for the
general sluggishness of the economy and
for ignoring the damaging effects of the
2008 banking crisis.
None of this applies to Iceland. On
the contrary. In addition to the boom-
ing economy, the Office of the Special
Prosecutor investigating financial fraud
has brought bankers to justice with
heavy prison sentences (though sever-
al have now been moved to a halfway
house). In 2010, the Special Investigative
Commission published a report both
clarifying the 2008 financial calamities
and drawing valuable lessons.
So why this simmering anger exposed
on April 4? In addition to the shock and
disgust following the Panama revelations,
some recent scandals indicate that lessons
from 2008 have not been learnt. Those
who hoped for a new Iceland rising as
a phoenix from the collapse in 2008 are
disappointed.
Honesty and transparency were clear-
ly out the window. People are angry
about the rising inequality between those
with money and political connections
on the one hand—who seem to consider
themselves above the law and capital
controls—and the general public on the
other.
Sigmundur Davíð, flanked by police officers, as he makes his way through the press pack and out of parliament, after stepping down.
NEWS ANALYSIS