Iceland's President Is Still No Hero

It appears that many Icelandic readers of my last Huffington Post piece, Iceland's President Is No Hero, didn't get beyond the first couple of paragraphs. Readers, who posted numerous comments on my Icelandic blog at in response to the post, especially wanted to know what I meant by this: "Ólafur Ragnar is merely protecting his Icelandic oligarch friends against actions by the British and Dutch authorities to recoup funds lost by depositors -- individuals, pension funds, municipalities -- in their countries as a result of the fraud and incompetence of Icelandic regulators and bankers."

I said this because, as outlined in the article, Ólafur, at the time he decided to do what he did, must have realized that the most likely consequence of his action would be the fall of the current government. It is not unlikely, considering the country's Tea Party mood, that the Independence Party and their buddies - the people most responsible for the situation Iceland is in today - would get back into power. What about other consequences of Ólafur's veto? Will it bring us out from the Icesave debt? No. Will it increase our standing in the international community? No. Will it endear us to the British and the Dutch so they'll give us a better deal if we can get them to renegotiate? No. The government might very well fall; the thieves and their cronies get back into power. Will we have justice then? No. Then we'll have whitewash for the thieves and no relief for the people, and what already has begun to happen - but much faster - will happen for sure: The whitewashing of the collapse. Its investigation would be put to sleep, slowly suffocated; perhaps with a few sacrificial lambs that the Independence Party deems dispensable led to the slaughter.

But Icesave is a constructive step in the right direction to normalizing our relations with the world, to show the world that we intend to honor our commitments and that we intend to work with our creditors and that we can be trusted. In a previous article on this site months ago, Iceland Must Renegotiate, I suggested that "Iceland should reopen discussions, and request the assistance of a neutral third party (such as the United States or the Scandinavian countries) in negotiating a more equitable agreement. It cannot be in the long-term interests of any of the parties to these agreements to reduce the entire Icelandic nation to utter destitution." But this matter has now gone on in Alþingi for many months, and at some point you have to trust your elected representatives -- unless there's proof of corruption and incompetence -- evidence of which was plenty before and no one complained.

The current wave of sympathy from abroad towards Iceland first and foremost stems from public disgust and rightful anger over the fact that all over the world, ordinary taxpayers have been made to bail out a financial system driven into the ground by greedy, irresponsible bankers who've been handed a blank check by their governments to clean up their mess and who continue to pay themselves massive paychecks and bonuses, courtesy of taxpayers.

Several people have insinuated that I'm writing this for political reasons. I'm not a member of any political party although I was happy to see the Citizen's Movement win four seats in Alþingi and equally disillusioned when the movement dissolved in bickering and infighting.

I believe that none of the Icelandic political parties are actually standing up for the average Icelandic person. But among the parties that do have seats in Alþingi the current coalition is the best we can do. As unhappy as we may be with Steingrímur and Jóhanna, they're ten times better than the thieves who got us into this in the first place.

I certainly don't think the Icelandic people should pay for Icesave; it should be the people who exploited the depositors, and we can only hope that the prosecutions start coming out and the culprits will be brought to justice. However, if you look at who they are and what political parties they belong to, you can make your own conclusions about what would happen to the prosecutions if the Independence Party came back into power. Who received the banks on a silver platter? Independence Party insiders. Who were the politicians who allowed this to happen? Independence Party people (along with the Progressive Party and a few Social Democratic neo-liberal cheerleaders). Who were the enablers in the regulatory bodies and the Central Bank? Independence Party people. Who stand to lose the most by investigations and prosecutions? Who do you think?

Finally, if Ólafur Ragnar really thought this was the right thing to do, if he is so proud of this, then why wasn't he standing in front of the people afterwards? Why didn't he inform the Prime Minister? Why didn't he give an interview on Icelandic television? Is this someone who is proud of his achievements? He didn't even stick around to bask in the glow but acted like a thief in the night.

If he was acting on behalf of the people, if he is so concerned about the freedom and welfare of his countrymen, why hasn't he stepped forward and suggested other positive things that would be much more beneficial to the average Icelander than the Icesave veto? Bankruptcy reform. Mortgage relief -- why are the banks writing off corporate loans en masse and not individual loans? Increased funding to the Special Prosecutor and Eva Joly. The need to abolish indexing of loans (and everything except salaries), a modern day debt bondage that no civilized government in the world, except the Icelandic one, enslaves its people with.

Ólafur referred in the BBC interview to Iceland's long and strong democratic traditions. What BS. Our strongest political tradition has nothing to do with democracy. Iceland is and has always been governed on one political tradition, which is the firmly grounded tripod of cronyism, nepotism and political patronage.