Archive for February 18th, 2009

Wake up Iceland!

Every facet of bad government from institutionalised corruption to disobedient and obstructive politicians in times of crisis, colour their legacy. And yet, like victims of an abusive relationship, a large part of the Icelandic electorate seems addicted to the theory that only they can govern effectively.

In the United States the wheels of democracy worked against all of the conspiracy theories, prejudices and vested interests to produce the first black president in the history of a relatively young country; just a few hundred years from the dark days of slavery.

From Paul Nathan’s article at Nei

Global systemic crisis Alert – Summer 2009: The US government defaults on its debt

Studying the case of Iceland can give an idea of the upcoming stages of the crisis. That is what our team has been doing ever since the beginning of 2006. This country indeed provides a good illustration of what the US and the UK should be expecting. It can be considered – and that is what most Icelandic people do today – that the collapse of Iceland’s financial system came from the fact that it was disproportionate to the size of the country’s economy.

From Global Europe Anticipation Bulletin

Iceland: Time to reconsider national approach?

“The foreign debt of the Icelandic economy and the nation is beyond our power and the prospect is black,” said Haraldur L. Haraldsson, an economist, at a political debate hosted by the Organisation for Civic Action. 

From IceNews

Can Geothermal Power in Iceland Thaw a Frozen Economy?

GEA’s Gawell warns that even as Icelandic expertise becomes more competitive, demand for it could be drying up due to global financial distress. “On the other hand, in the long run I don’t think there’s any question we’re moving into a climate change regime for energy,” Gawell says. “Countries that rely on fossil fuels will have to invest in new technology and efficiency or will pay higher prices. I think Iceland will be in very good position in those markets.”

From the Scientific American 

Eric Weiner: Why Iceland is STILL happy (Video)

Despite the economic crisis, author Eric Weiner still defends an assertion in his recent bestseller, Geography of Bliss, that Iceland is one of the happiest countries on earth.

Given that the country has gone bankrupt can that still be true?

A video from The Huffington Post

The bailout is terrible

To see what happens when a banking system collapses, look no further than Iceland. Iceland’s no banana republic — in 2007, the United Nations called it the most developed country in the world. But in October, the country’s banking system collapsed.

As a result, Iceland’s currency has lost about half its value. Inflation is now 18.6% and rising. The central bank’s interest rate is 18%. Unemployment has quadrupled. The stock market is down 90% since the end of September. It’s ugly. And all this has happened before most of the aftershocks from second-order effects, like the results of skyrocketing interest rates.

From The Motley Fool

Iceland at the brink of failure

“Now after experiencing the fastest economic collapse in history, Iceland is suffering from soaring unemployment, as well as double-digit interest rates and inflation.”

According to Hennessee’s research, the primary contributor to the rise and fall of Iceland’s economy was its growth as an international lender.

From Investment News

The co-insuring grip of terror

In the run-in to the famous 2000 US Presidential elections, I was studying in Florida and had the chance to see Howard Zinn speak. 

From Wikipedia.org: 

As a historian, Zinn came to believe that the point of view expressed in traditional history books was often limited. He wrote a history textbook, A People’s History of the United States with the goal to provide other perspectives of American history. The textbook depicts the struggles of Native Americans against European and U.S. conquest and expansion, slaves against slavery, unionists and other workers against capitalists, women against patriarchy, and African-Americans for civil rights. In the years since the first edition of A People’s History was published in 1980, it has been used as an alternative to standard textbooks in many high school and college history courses, and is one of the most widely known examples of critical pedagogy. 

Zinn was an active supporter of Ralph Nader and as such was considered to be well out there on the left wing by American standards. The most important perspective he offered that night in Florida before that fateful election was after being asked whether Nader wasn’t ruining things for Al Gore. If Bush becomes president with a small margin, won’t it be Nader’s fault for taking away Democrat voters?

We all know what happened next with hanging chads and small margins. Bush won Florida on 537 votes over Gore. Nader recieved 97,421 votes in the state. 

Zinn replied that these votes were not under Democrat ownership. People should be allowed to think outside the box and have an alternative choice than only between Democrats and Republicans. Ralph Nader himself said, ”In the year 2000, exit polls reported that 25% of my voters would have voted for Bush, 38% would have voted for Gore and the rest would not have voted at all.”

Then Zinn asked us a question, “What is the real difference between the Democrats and Republicans?” 

My uncle became a member of parliament in the early seventies and after a couple of years became severely disillusioned with what he called “the co-insurance of politicians”. Whereby politicians from seemingly competing parties used each other to ensure themselves positions and status. A prime example is from the last Reykjavik council elections where the big news was how voters rejected the Progressive Party in style, but the Independent Party gained a one-seat majority with the single Progressive representative who then got access to powers way beyond his mandate. 

The same parties used the same logic to allow Halldor Asgrimsson of the Progressive Party a couple of years in the seat of Prime Minister, ending in disaster for the party with disillusioned voters running away from that obvious sharing of powers instead of checking of powers. 

Sharing instead of checking each other is something which comes easy to today’s politicians. Jon Baldvin Hannibalsson, Eidur Gudnason and Gudmundur Arni Stefansson of the People’s Party and Svavar Gestsson of the People’s Coalition to name a few became ambassadors while in opposition.

The parties of parliament have similarly agreed on different laws that allow them to keep newcomers at bay. A new party must have at least 5% of the vote to earn a seat in Parliament although 3-4% should be enough if you count seat vs. voters. And those parties who earn a place in parliament are granted massive amounts of stipends by parliament itself after the campaign, strengthening the position of those currently in power, and making it hard for anyone to offer alternatives, unless they have money. Effectively, it is either the old parties or new money who have a chance. 

The worst example is probably the one where members of all parties agreed on a pension-bill for themselves that was lavish to the extreme. 

The danger with holding elections in Iceland at the end of April is that voters will not have choices beyond those two. Either you vote for the parties who co-insured each other until the fiscal death of Iceland, or newcomers whose greatest asset is money.    

Now where is the Icelandic Howard Zinn?



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