IceSave: Really About Domestic Politics In Iceland – UK & Netherlands

January 7th, 2010 → 12:02 pm @

2


IceSave: Really About Domestic Politics In Iceland – UK & Netherlands

Has IceSave turned from an international dilemma into a domestic politics powder-keg?

Icelanders are furious that their government is willing to pay the IceSave debt, but meanwhile allowing the culprits who caused the mess to go scotch free and even negotiating tax-breaks for some of their new ventures. The public in Iceland is desperate for some real measures on household debt and restructuring in the economy, but nothing seems to get past the IceSave debate.

The government opposition has used this issue vehemently to distract from the larger issues such as the Central Bank’s “love letters” which will end up costing the nation IceSave many times over, and to strike as many blows as possible against bitter political opponents. Isn’t it all a power-game. Compare the stance the Independence Party has taken on IceSave when in opposition and when in government and you’ll find a Jekyll and Hyde. The same can be said about the government. Furious statements about IceSave, as well as the IMF were turned on their head when the Left Greens went from opposition to government. The political parties have turned the ability to change one’s mind from being a virtue into a mortal sin.

In the end it just seems to be so hard to introduce bi-partisanship into Icelandic politics when everyone is so used to the opposite.

Meanwhile, Gordon Brown is under siege in the UK and has so far benefited from a tough stance against a common enemy. What he might find coming towards him are more articles like this one in the Financial Times where he is painted as a bully:

When British and Dutch authorities balked at the guarantee possibly expiring with the debt still unpaid, changes were passed that were acceptable to the creditors – but not to Mr Grimsson or to most Icelanders. It is hard to fathom the need to make an example of Iceland. For the creditors, the loans are trivial: they sum to €3.9bn, one hundredth of what the UK alone will borrow this year and next. Neighbourly generosity would cost Amsterdam and London next to nothing. They are also not innocent victims. British and Dutch banks benefited greatly from the rules. Had they failed on the same scale, it is delusional to think their governments would take on hundreds of billions in debt to rescue foreign savers, and odious to force a weak neighbour to do the equivalent.

Correct me if I am wrong but aren’t there some elections forthcoming in the UK? And where does Financial Times reside on the UK political scale?

In the Netherlands, the Dutch government still has not answered why they allowed a failing bank, backed by a bleeding Central Bank to assault the savings of their countrymen. The question of partial responsibility could become a hot potato in Dutch domestic politics soon.

Related posts:

  1. IceSave Round II Might KO Government
  2. Was The IceSave Commotion Really About Local Power Struggles?
  3. ATTENTION ICELAND IS NOT SAYING IT WON’T PAY ICESAVE (Video)
  4. Complexity Of IceSave Too Much For Althingi?
  5. Landsbankinn Assured The Dutch That Iceland Would Pay
Tags: