Links provide access to full documents over at Wikileaks:

September 30, 2008

Under the agreement, the Government will
purchase 75 percent of Glitnir at roughly $878 million.  This is the
first significant government intervention in the Icelandic economy
during the recent crisis and comes after a week of harsh criticism
for perceived inaction -- in particular, for not managing to include
Iceland in the 24 September exchange agreement between the U.S.
Federal Reserve and the central banks of the other Nordic countries
and Australia. 

October 8, 2008

Sturla Palsson, Director for International Affairs and Markets
at the Icelandic Central Bank told EconOff that the 4 billion Euro
loan offered by the Russians is 95 percent certain to happen.
October 8, 2010
The Icelandic economic crisis continues with no end
in sight.  The possibility of a Russian loan bailout as well as
concerns voiced by some American bankers raise the question of
whether greater USG involvement in the crisis is merited.

The U.S. has strategic interests in the high north and a
sturdy security relationship with post-Keflavik Iceland that both
sides have labored to develop.  Today the Embassy urged senior reps
in the PM's office and elsewhere to at least explore what
confidence-building cooperation (other than the credit swaps the Fed
turned down) may be possible to develop.  We doubt that it would be
in the interest of the U.S. or NATO for the Icelanders to be beholden
to Russia, however "friendly" the loan terms may be. 
October 9, 2008
The Russian loan is still part of Iceland's plan.  Prime
Minister Haarde said last night that the loans from the IMF and
Russia "are not mutually exclusive" though the government had not
asked IMF for a standby loan or an economic program.  He repeated
that statement in a press conference today.  Questions about the
influence the loan might give Russia continue to be met by assertions
that finances and foreign policy can and will be kept separate. 

6. (C) Minister of Finance Arni Mathiesen travels to Washington
tonight for World Bank meetings.  Post persuaded the Minister to
agree to meet with senior Treasury officials while in the U.S.
Mathiesen will meet with Treasury A/S Clay Lowery on October 10.  We
would hope this meeting will help the Icelanders think their way
through the present crisis and move from a stopgap reactive approach
to a durable comprehensive plan.  It should also make clear to them
how the U.S. can and cannot be of assistance and point them in the
direction of other options.
October 10, 2008
Two Icelandic bankers met with Econoff today to emphasize that
the Icelandic authorities have chosen the wrong path out of this
crisis and appealed for Washington to provide guidance to the GOI.
The bankers shared a graph that showed of the 11 billion euro
Landsbanki debt, 31 percent belonged to the U.S. and Canada.  They
emphasized that Landsbanki had the smallest foreign debt of the three
banks in Iceland and that American investors will lose billions.
They outlined a plan emphasizing the importance of bringing the
creditors to the table, getting the IMF involved and finding a
resolution through a multilateral approach.  They stressed the need
for the U.S. to become involved both to encourage the Icelandic
authorities to "be rational and swallow their pride" and for the U.S.
to build consensus within the IMF to allow Iceland access to the
supplemental reserve facility such as Korea, Turkey and Russia have
used in the past.  They believe that the IMF stamp of approval will
help bring creditors to the table and what is needed the most is a
coordinated multilateral approach.
October 20, 2008
Sturla Palsson, Director of International Affairs and Markets
at the Icelandic Central Bank and leader of the recent Icelandic
delegation to Moscow to negotiate a 4 billion Euro loan from Russia,
told Econoff that the Russian loan was still very much on the table
and that both sides are keeping in telephone and email contact.
Palsson said the two sides might meet possibly this week, and thought
that the loan could be finalized by Friday.  He said before the
Icelandic delegation left for Moscow, they had been told by the
Russian Ambassador to Iceland that the Russian Prime Minister had
signed off on the loan.  The discussions in Moscow centered around
details such as whether the money would be given as a bond or loan,
and what the maturity dates would be, etc.  The loan would be coming
from the Russian Development Agency.  Palsson said that Iceland is
considering IMF assistance and that initially the Russians had been
against Iceland involving the IMF "because of the Russians' own
negative experience with the IMF in 1997." 
Comment: Icelanders are aware that a loan from the Russians
may have implications.  The fact that they are proceeding anyway is
an indication of the seriousness of the financial situation here.
October 30, 2008
SUBJECT: ICELAND'S REQUEST FOR A LOAN:  WHAT'S IN IT FOR US
1.(C) The brutally sudden collapse of the Icelandic banking system
earlier this month threatens severe economic hardship for the
citizens of this import-dependent economy.  The government has
reached a tentative agreement with the IMF for a USD 2.1 billion
loan, but must raise an additional USD 4 billion from other sources
to conclude the arrangement.  They have asked us to join what they
hope will be a consortium of lending countries by providing USD 1
billion.  Despite the obvious hurdles - Iceland's status as a
developed European economy, the extent of its need, our own limited
resources - this request deserves the most careful consideration: we
have long-term national interests in the North Atlantic that a
negative response would jeopardize.  These include: 

2.(C)Iceland's strategic importance to U.S. security.  Iceland has
hosted an important American military outpost since World War II.
During the years before we redeployed our forces in 2006, the U.S.
poured a quarter of a billion dollars annually into our base at
Keflavik.  We turned the base over to Iceland's custody in September
2006, handing over responsibility to Iceland as NATO host nation for
maintaining the airport and long-range radar installations on behalf
of the alliance.  In the subsequent two years, the Icelanders have
provided outstanding support to two large multination NATO exercises,
two U.S. naval visits, and several deployments of NATO air policing.
French, Norwegian, and U.S. fighters have shadowed Russian bombers
and fighter planes from Keflavik.  Because the Icelandic government
has maintained the facilities at top-notch operational standards, the
base is immediately usable should circumstances warrant.  A nation
crushed by economic depression cannot be the self-sufficient partner
we have spent decades and huge amounts of U.S. taxpayer dollars to
develop. 

3.(C)A well-positioned friend in the High North.  If the U.S. doesn't
help out Iceland when it is flattened by the worst financial crisis
in its history, we shouldn't expect the country to see it our way
when we ask - as we undoubtedly will -- for cooperation in furthering
our own security and economic aims in this increasingly vital region. 
 The NATO conference that Iceland is hosting to discuss High North
issues this coming January underlines the uncertain implications of
the environmental changes occurring in Iceland's North Atlantic
neighborhood.  The melting Arctic ice means new trade routes and
increased competition for gas, petroleum, and other resources.  The
Russians - who are discussing a loan with the Icelanders - have
already signaled their interest in exploring and exploiting Iceland's
potential undersea oil and gas fields.  The Chinese - whom the
Icelanders are also approaching for a loan - will be big users of the
new sea lanes. Iceland may be small but it is valuable real estate in
a region that will only become more important to our economic welfare
and our national security.  We want a firm friend and a stable ally. 

4. (C) Clean energy partner and economic investment. Iceland is a
world leader in renewable energy and stands to play a significant
role in U.S. efforts to become energy independent.  They have
know-how and enterprise and their experience in harnessing
geo-thermal energy is second to none.  American firms are
capitalizing on Iceland's abundant clean energy and technical
expertise by investing close to USD 4 billion in the aluminum sector
here.  We want Iceland to be in a position to attract foreign
investment and continue to develop its energy sector outreach.  A
bankrupt economy would set our partnership back for years just when
we need Iceland's technical skills and entrepreneurial drive most. 

5.(C) Iceland is reaching out with increasing desperation to any
available source of help as it confronts one of the most trying
crises in its history. Assistance from the U.S. at this crucial time
would be a prudent investment in our own national security and
economic well being.  The Icelanders take fierce pride in their
flawless history of paying back their debt. Whatever the financial
turmoil and uncertainty of the moment, it's a good bet that this
economy of highly-educated, imaginative, and sophisticated people
will take off again.  And when it does, and when the competition in
the High North really gets underway, it may be more important than we
can yet suppose to have the Icelanders remember us as the kind of
friend who stands by in fair weather and foul. 

November 10, 2008
1.  (C/NF) Summary:  Public support for Iceland's government has
fallen below 50 percent in the wake of the financial crisis here, and
cracks are beginning to widen between the two coalition parties as
weekly demonstrations grow in size and fervor.  PM Haarde's
Independence Party (IP) has taken the brunt of criticism for the
failed economy, while Foreign Minister Gisladottir's Social
Democratic Alliance is polling higher than its election results last
year.  In the short term, a lack of viable (i.e., pro-EU) partners
and Gisladottir's good relationship with Haarde will likely keep the
FM from breaking up the coalition in the hope of new elections.
However, Gisladottir has said publicly she is pushing within the
cabinet for Iceland to explore EU membership, and polls show a
majority of the public agree with her.  Securing a $6 billion package
of IMF and bilateral financing will buy the government some time, but
if Haarde cannot convince his party to go along with exploring EU
membership we could see early elections called for the first time
since the 1960s.  Some form of reshuffle is almost inevitable,
however -- Haarde will not be able to answer the growing pro-EU group
in his party without lots of blood on the floor and the rousting of
several old IP chieftans (including the Minister of Justice and
Central Bank Chairman David Oddsson).  End Summary. 

2.  (SBU) Following the economic disaster of October and the collapse
of the country's banking sector, the government continues to take a
beating in the polls.  Public support for the government fell to 46
percent by the end of October, down 30 points from the beginning of
the year.  While support for the Social Democratic Alliance (the
junior coalition partner) has held steady or increased slightly,
Prime Minister Haarde's Independence Party (IP) has been hammered.
The IP, after nearly two continuous decades as Iceland's largest
political party, is now third behind the SDA and the opposition
Left-Greens, pulling only 22 percent in the polls.  The opposition
parties and a growing portion of the electorate are now calling for
elections before the current term ends in 2011.  A poll at the end of
October showed 60 percent support for early elections, and the
Chairman of the Left-Greens showed up at the Embassy's Election Night
event gleefully working the room with that encouraging datum.
Demonstrations calling for -- among other things -- a new government
continue to grow, with the latest protest on November 8 drawing over
3000 participants. 

3.  (C) That the public blames the IP specifically for the economic
crisis is no coincidence -- the Prime Minister and Minister of
Finance are both from the party, and the IP's 2007 campaign was based
on the notion that only the Independence Party could be counted on to
maintain Iceland's then-world-beating prosperity and quality of life. 
 More significantly, many domestic and international observers blame
former PM and Grand Old Man of the Independence Party David Oddsson
for Iceland's stunning loss of credibility in the financial world.
Oddsson has served as the highly controversial Chairman of the
Central Bank since 2005.  He made a number of ill-considered
statements to the media early in the crisis, and many suspect it was
at least partially due to his wounded pride that Iceland did not
immediately seek IMF assistance.  Haarde's apparent inability to
"control" or remove his predecessor as IP Chair has led many to blame
the Independence Party for the continuing economic bad news. 

4.  (C/NF) Indeed, Haarde missed a key opportunity to gain political
support by not replacing Oddsson early in the crisis.  Even among IP
stalwarts, Oddsson's standing has never been lower, with the party's
younger, more business-oriented members asserting to Emboffs and
journalists that it was time for Oddsson --rabidly anti-EU membership
for Iceland -- to finally exit the stage.  Only Haarde has the
authority to replace the Central Bank Chair, and speculation around
town is that the PM has not pulled the trigger thus far out of a deep
sense of personal loyalty to his old mentor.  The result is that
demonstrators now excoriate Haarde as well as Oddsson, the initial
target of public ire.  While Oddsson remains in the picture, it will
be almost impossible for Haarde to start his party and his country
moving towards the EU. 

5.  (C) Other IP members, however, are proving much more open to EU
membership, and are finding support from those who previously stayed
out of the debate.  IP Vice Chair and Minister of Education
Thorgerdur Katrin Gunnarsdottir, though cautioning that she was not
making any sort of leadership challenge, said in a highly publicized
late October interview that the her party had always pledged to take
the most pragmatic stand on EU membership in terms of what was best
for Iceland's interests.  Given that both the global and domestic
economic situation has changed so dramatically in recent months,
Gunnarsdottir continued, it is only logical that the IP reexamine its
stand.  Bjarni Benediktsson, Chair of the Althingi Foreign Affairs
Committee, quickly echoed this argument.  PolOff has heard separately
from IP sources that Benediktsson sees the party's old guard as
standing in the way of not only serious consideration of EU
membership for Iceland, but also Benediktsson's personal ambitions of
a cabinet post. 

6.  (C/NF) Foreign Minister Gisladottir's Social Democratic Alliance
(SDA), however, has become increasingly strident in its calls for
serious exploration of EU membership as well as the dismissal of
Central Bank Chair Oddsson.  Gisladottir said in a press interview
that she is pressing Haarde for a new policy on the EU, and other SDA
ministers have been equally active on this front.  However, to our
knowledge, she has not made the leap to a push for early elections,
though her party would be likely to benefit.  There may be a
practical explanation here, as Gisladottir's recovery from brain
surgery in September has kept her away from work for much of the
tumultuous fall.  Some here also credit her personal relationship
with the Prime Minister as a brake on a move to change the coalition.
 The two party heads have developed an unexpectedly close and
collaborative working relationship and clearly both like and respect
each other. Gisladottir may view Haarde as a useful ally in the
future should she be able to convince him to reexamine the EU
question. 

7.  (C/NF) Most probable, however, is the explanation that
Gisladottir simply does not see a viable alternative to the IP as a
coalition partner at the moment.  The Progressive Party -- Iceland's
only other pro-EU party -- has seen only marginal gains over the last
month, and would in all likelihood still be too small to form a
two-party coalition with the SDA.  The Liberal Party is even smaller,
leaving only the Left-Green Movement.  Although the Left-Greens have
polled significantly higher of late, they still do not endorse EU
membership for Iceland.  Gisladottir seems unwilling to go into
coalition with yet another party that is against joining the EU.
However, as with the IP, the Left-Greens are locked in an internal
struggle over their EU policy; the party's Vice Chair told PolOff
over the summer that she was sympathetic to the growing pro-EU wing
of the party and that she expected a reevaluation of the party's EU
policy by the end of 2008.  This dynamic may be what FM Gisladottir
meant in an interview when she said early elections would be a
distraction to the government now, "but then a new year is coming,
and people will have to assess the situation then." 

COMMENT
------- 

¶8.  (C/NF) In the short term, the Icelandic Government desperately
needs to finalize the $6 billion loan package with the IMF and other
bilateral donors.  If the IMF loan fails to come through, the
government will lose what little remaining credibility it has on the
economic front and may very well find it impossible to stay on.
Despite the protests and the speculation around town, however, we
note that there is little tradition here of disgraced politicians or
governments -- even those convicted of crimes -- resigning from their
posts.  Early elections have not been invoked since the 1960s, and
then only because a three-party coalition dissolved and no
replacement could be created.  No-confidence votes are virtually
unheard of. 

9.  (C/NF) If the IMF loan comes through, a likely scenario is that
after the new year SDA Chair Gisladottir and a group led by IP Vice
Chair Gunnarsdottir present the Prime Minister with their own
ultimatums, both calling for a serious look at EU membership, and
explicitly (SDA) or implicitly (IP) calling for Oddsson's removal.
In any event, a cabinet reshuffle -- either to give the SDA more
power over economic policymaking, to sweep out the IP old guard, or
both -- seems inevitable once the fate of the IMF loan is clear.

Related posts:

1. Situation in Iceland – The Fourfold Dilemma
2. Ross Beaty’s Perilous Situation
3. The Icelandic Situation Now

Beset with accusations of sexual harrasment and fighting to maintain its position within kindergartens and schools, the church suddenly had to justify its existence like probably never before.

I don’t think it is a coincidence after an economic and what many want to call a social crisis.

A lot of the debate has concentrated on economic issues, like the fact that the church draws 6 billion ISK annually from the state coffers, a huge amount by any measure considering that IceSave might eventually cost 50 billion and that the University of Iceland gets somewhere in the region of 10 billion.

Yet, with churches occupying valuable real estate in almost every neigborhood and every town in Iceland, they are mostly empty except for Christmas and Easter.

The economic issue is just a part of a much more important role the church has held onto, of power and influence.

Icelanders are a Christian nation because the King of Norway wanted us to be in the year 1.000. Before then we were heathen and worshipped Odin and Thor. A single Icelander decided that the nation would follow the cultural development in Europe, a reasonable choice given that it would enhance it’s security.  When Northern Europe became protestant, so Iceland followed suit. In one of Europe’s poorest nations, the church and its employers were amongst the most powerful and collected invaluable land and goods in the name of God through donations from its citizens.

In the last few decades, Icelanders have begun waking up from the spell of religion. Better education and social equality has those effects. It has become marginalized, yet held onto what it has by active political participation and propaganda. After more Icelanders begun criticizing the church in the media last year, the spin begun for real. Icelandic priests have now become unusually active bloggers.

The church’s leaders were outraged at the eggs pelted towards the members of Althingi and the priest Halldora J. Thorvardardottir this year. But that is what you have to deal with when you position yourself alongside the power. Something the church everywhere has always done before positioning itself with the people.

I want to claim that organized religion in Iceland plays a big part in the economic and social crisis.

It promotes lack of critical thought from an early age.

It promotes hierarchies and devotion to leaders.

It promotes rewards for blind obedience.

It promotes and maintains fear of power.

It divides people into us and them and seeks to exclude or bully those who don’t conform.

It detracts from science and therefore truth-seeking.

All elements clearly recognizable from the political culture since Iceland became a sovereign nation in 1944.

And elsewhere for that matter.

The attacks on organized religion in Iceland in 2010 were not only understandable.

They were absolutely necessary and long may they continue.

Hopefully without wasting perfectly good eggs.

Related posts:

1. Of Belief and Non-Belief
2. Religilous
3. Organized Crime Takes Root In Iceland

1. There was a demand of reform in the fishing industry. It was needed because the resource was gathering in the hands of very few who in turn used their wealth to borrow intensely against it and invest in other sectors. The profits of the sector have increasingly been disappearing abroad. Oh and the UN Human Rights Council had condemned the system and claimed it was in violation of human rights. The new government indicated that reform measures would be taken. Then it appointed a reform committee dominated by industry lobbyists and politicians whose career depends on the industry. The result..a fucking fuck solution which benefits the…fishing industry.

Finnbogi Vikar, a member of the committee delivered a special opinion. “As I have said before, the appointment of this committee was a mistake because from the beginning it was clear what the result of the majority would be. One needs only to examine the interests behind the members of the committee to realise that most representatives of the wage-earning public and employees in this country have long ago taken a stand with the representatives of the largest organizations of employers and against the public’s interests after the collapse of 2008. Together these parties form a formidable power-bloc which controls a great deal in our society with the bloated undemocratic pension funds behind them. It is unbelievable that there is no demand to be made of the political parties and the politicians on this committee that they reveal the amounts donated to them from interest groups in the fishing sector in recent years.”

2. There were demands of constitutional reform. Iceland copied the Danish constitution in1944 and then Althingi neglected review and reform for decades on end, despite promises and indications otherwise. Reform is for example needed in clearer seperation of the branches, re-examination of the role of the president and timely separation of church and state. Althingi is stuttering through with a constitutional congress for which elections are supposed to be held in the autumn. The way appears clear for demagogues, special interests and representatives of the politicalparties to deliver a loud and argumentative debate and a fucking fuck result.

3. There was outrage over campaign finances. Political parties and members of Althingi were awash in cash from the finance sector, the energy sector, the fishing sector to name a few that their loyalties were not just questionable but plain obvious. The way politicians bent over backwards to exploit public utilities for the benefit of shaky corporations and ignore regulation for the suicidal financial sector left a bitter taste in the mouths of voters stuck with higher utility bills and monumental sovereign debt. So a campaign finance reform committee was created and its results are an almighty erect middle finger in the fucking fuck direction of those voters. The party‘s don‘t want real change and have just made some minor inconsequential changes.

The Movement‘s announcement. “This issue is a clear example of how Althingi is not going to consider the work of the Special Investigation Committee and its conclusions. The eight chapter of the committee’s report is named “Morality and procedures connected to the collapse of the Icelandic banks in 2008”. In Chapter 2.3 it says “One of the most obvious tool of the business sector to influence politicians are direct donations, both to parties and individuals.” The conclusion of the chapter is where conlusions are drawn and the lessons of the past are examined. “Ways to draw a clearer line between the financial sector and the political sector must be found. It can not be tolerated that the guardians of public interest act on the behalf of private companies in such a manner as was done in the event of the banking collapse.” With this new legislation, Althingi has rejected the conclusions of the part of the Special Investigation report which criticizes harshly the connections of poltical parties to the business and financial sectors. Unfortunately the financial interests of the four parties are placed above the publics. Democracy and transparancy are of little use against the mixed up priorities of those in power.

4. There was great displeasure with the president, Olafur Ragnar Grimsson who had opened the doors of the presidential office to the bankers and financiers who in turn jetted him around the world to open doors to global business. The president had become a caricature who had brought the reputation of the office down. Then he managed to somehow please the special interest group InDefence by approving their call for a national referendum on sovereign debt and won some credibility back with the increasingly xenophobic, scared and confused public. So he still occupies the office, trying to reinvent his damaged image to the amazement of observers. A president who owes his people is suspectible to participate in plenty of fucking fuck demagoguery.

5. It became clear in the banking collapse that on the global stage Icelandic politicians had neglected making friends, forming alliances and providing shelter for their citizens. Timothy Geithner laughed at advances made by David Oddson, the Nordic countries offered concerned but sound advice and Britain offered solutions. Instead Icelanders followed the lead of the Independence Party‘s leaders and decided to sulk, play the victim and accuse the international community of a siege. When things were coming to a heat, the Social Democrats delivered a plan that could restore Iceland‘s credibility abroad and solutions to the volatile currency and mounting public and national debt. An application was made to join the EU. And then the xenophobes, cold war relics, special interests and racists hijacked the debate to the point that grown up, educated people want the IMF out without any alternative solutions to Iceland‘s currency and debt problems, a national referendum designed to exit NATO without any alternative solutions towards Iceland‘s defences and to retract the EU application without ever having to offer alternative plans to restore Iceland‘s economic viability and international credibility. Meanwhile in the real world, Iceland recently dropped almightily the World Economic Forum‘s Report on Global Competetiveness as far as macroeconomic environment goes and is ranked number 138. The Independence Party, the Centre Party and the Left Greens have offered no solutions or propositions on how to restore Iceland‘s standing. They are currently getting away with spewing venom all over the only realistic and credible plan available. Oh and fucking fuck IceSave is still unresolved.

6. The media came under plenty of scrutiny for not delivering scrutiny at all. Now it is in the hands of Jon Asgeir Johannesson and David Oddson. Editor in chief David Oddson even has the nerve to accuse the State Broadcasting Channel of bias because a reporter there is the sister of Exista‘s CEO, implying that her media can not be trusted with delivering news. Apart from maybe DV, the media is worse than before. When investigative reporting was needed, Channel 2 cut theirs from the program and gave the nation cooking lessons from the wife of Baugur‘s head of finance. Agenda, propaganda and fucking fuck through your mailbox and television screen every day.

7. There were loud calls for debt reform through restructuring and write-offs. For a moment, people actually believed that those who had accumulated the greatest debts would have to pay the most. Then reality bit hard and cold. The government‘s promise of a fortress around Icelandic households ended up in solutions which benefitted those who had geared themselves the greatest. Those with a 100-200% mortgage were bailed out, especially if they could find members of Althingi willing to do their bidding within the banks. Those who had saved and put down payments on their homes were left to rot with their inflated debt. And what about Jon Asgeir Johannesson, Bjorgolfur Thor and their kind? Well they have so far managed to score deals with the banks on massive write offs domestically so they can manouvre deals where they can get back their companies abroad. And they have been granted stand-still agreements where their debt collects no interest and is not gone after either. Many of the same people are still main actors in the business sector. Bjorgolfur Thor has been seeking tax-exemptions while wage-earners are experiencing higher taxes and higher utility bills. Did you think Sigurdur Einarsson, wanted by Interpol a few months ago was here to be questioned the other day? No he was here in talks to buy a fucking fuck financial institution.

8. There was need for someone to hit the refresh button in the political arena but so far it seems like the old guard has gotten away with a restart. The Social Dems were and still are unable to find anyone with remotely the same political credibility as Johanna Sigurdardottir. The ladder below is crowded with wallflowers and followers of men. If Johanna has enough then it does not bode well for the only party with a plan for the nation. Meanwhile the Independence Party, Left Greens and Centre Party are ablaze with infighting. All three parties are currently letting the monkeys run their circus and if it were not for Steingrimur J. Sigfusson‘s incredible turn from idealism to realism then all bets would probably be off. But it says all about the unruly waters of Icelandic politics that isolationist xenophobe Ogmundur Jonasson has had to be brought in to the government again to appease his followers. The Centre Party is currently in suicidal mode as requests for rampant demagoguery is fully provided elsewhere. And then there is the Independence Party which freed from the oppression of David Oddson almost managed to start a self-examination and reconciliation process, only to fall prey to the rampant partisanship and playground politics of their great leader again. The party‘s ladder is also crowded with hungover leftovers from the heady days. The only realistic challenger to the madness is former vice-chairman Thorgerdur Katrin Gunnarssdottir who has the financial freedom thanks to the former banks and little political reputation left to lose. New pretenders on the political scene have been pushed out by the Citizen‘s Movement which collapsed in record time and the Best Party‘s moves are under relentless attack from the four parties. It is not just an economic crisis anymore but an all out fucking fuck political crisis.

9. According to rumour there are people preparing to take the law into their own hands this weekend if the parliamentary committee charged with determining the responsibility of the elected officials named in the Special Report this spring comes up with a fucking fuck whitewash. It is to the Icelandic nation‘s outstanding credit that not one of the politicians or the businessmen most responsible for the ponzi economy which collapsed has been physically hurt so far. But it is to the incredible detriment of the political system‘s inability to appropriate blame that ordinary Icelanders are being heard in private conversations saying that “If I do it alone then it is murder, but if a group of us do it then it is a revolution. I am too angry.” The government and Althingi apparently now must be careful. An indebted and outtaxed public might cross new boundaries if they continue seeing Jon Asgeir and Bjorgolfur Thor parking their Range Rovers in Laugavegur, if Sigurdur Einarsson returns to Icelandic banking or if David Oddson claims his kingdom back. Lady Justice is in a fucking fuck pickle in Iceland these days.

10. The public is currently in an all-encompassing state of fucking fuck delusion. Serious, well meaning, well educated people are discussing between themselves in “revolutionary” terms. Yet, they still buy Morgunbladid, access Jon Asgeir‘s cable TV, vote for the Independence Party and nod when Ogmundur Jonasson talks of Nazi Europe. Currently letters are going out to 1.000 Icelanders selected for a National Meeting on constitutional reform. Yet again, a simulated process is given priority over weighty substance in the national debate. The public has already been lead on a ride by the Citizens‘ Movement (guilty), the National Meeting (not guilty), national referendum on IceSave (not guilty) and the Gudmundur Franklins‘ of Iceland are only beginning. Instead of taking responsibility for getting to know the issues of today, voting responsibly and holding their elected officials to their words, people are talking revolutions, Right Green parties and secession from NATO, EEA and the civilized world. Good, sensible people seriously need to start taking a stand in the fucking fuck that is Iceland.

Related posts:

1. The Icelandic Discourse in A Nutshell
2. Blue Handballs and Tackles From Behind
3. Iceland Will Say No To The EU

Finally, there are many big unsolved problems that face the government and people of Iceland.

First, the Icelandic Krona is not a viable currency in the world of free movement of capital. The Euro seems to be the only solution. That requires a membership in the European Union. Becoming member is a long and winding process of negotiations and self analysis.

Secondly, the problem of the public expenditure alluded to above must be solved.

Thirdly, the dispute with the Brits and the Netherlands over the IceSave problem must be solved.

Forth, debt relief for families and firms must be concluded in a satisfactory way avoiding the making of zombi firms and zombi banks but without committing to much of the public budget. No small tasks for a government with thin majority and gross internal disputes.

Related posts:

1. Wikileaks Iceland: The Seriousness Of The Situation
2. The Drunk In The Pond
3. Financial Times: Iceland criticises IMF, UK and Dutch

The full list in the It’s the economy section

1. crisis

2. cash for clunkers

3. iceland

4. california

5. recession

6. obama

7. unemployment rate

8. green

9. great depression

10. inflation

Related posts:

1. Brief Considerations after Visiting Iceland (March 9-13, 2009)
2. Sinking Finances Throw Iceland’s ‘Hydrogen-Based Economy’ Into the Freezer
3. The Worst Banking Crisis Of Any Country In 80 Years

On the day when we celebrate our sovereignty the people of Iceland would like to offer the condolences to the people of Europe, formerly known as Finns, Danes, Germans, Belgians, Italians, Dutchmen etc. We are sorry about your republics coming to an end with the Lisbon treaty.

Our 90 year old Icelandic tradition of sovereignty and our 65 year old republic is now the subject of envy from you, our neighbours in the east. While you succumb to uniformism and dependence on each other, we proudly accept the responsibility of being the torch bearers of freedom and independence in the western world.

We are a self sustainable country which does not tolerate your contaminated food, uniform human rights or sharing of resources. We have a proud democratic, economic and political tradition and our resources are plenty and our pillars of society are strong.

Not for us, the abhorrent currency known as the Euro, not for us the President of Europe, not for us the Schengen agreement.

Brussels, Haag and Maastricht are not recognized word in Icelandic.

The long night of bureaucratic darkness and lost national sovereignty might be ascending on Europe. But let it be known that there is still a proud country in the north which holds true to the values of days gone and time passed. Our independence, sovereignty and access to European markets through the benefits of the EEA agreement will be an example for other nations to aspire to.

Our resolve is strong, our need is none. Rest in peace Kingdom of Sweden, goodbye Britannia, farewell France.

Long live the independent, alone and free state of Iceland.

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3. Sense of Sovereignty: How national sentiments have influenced Iceland‘s European policy

Although it is not yet heavily involved in international banking, Greenland’s progression toward independent statehood is strikingly reminiscent of Iceland’s experience (especially its desire to maintain its own culture and protect its natural resources at the cost of isolation from the rest of the world and its wish to limit its economic relationship with Europe).

This raises questions – does the recent experience of Iceland suggest that a country can be too small to be a nation state, and what are the costs and benefits of being isolated from the rest of the world?

Anne Sibert at Vox

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The SFO’s team has intensified its inquiries following the leak of Kaupthing’s loan book on to an internet site, Wikileaks.org, over the weekend, according to sources,

A team is understood to be examining the document connected to the failed Icelandic bank, which had a large UK client base. It has also received information relating to the UK operations of the Icelandic banks, apparently from a number of whistleblowers ranging from employees to investors and depositors.

From The Telegraph

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One of the suggestions Joly makes is the interest of Russians in Iceland. She states that if the UK and Dutch governments, the EU and the IMF don´t actively seek solutions for Iceland then there will be an exodus and those left behind will be at the mercy of those who will still want something to do with the country.

This is no imaginary scenario. Since last year, prominent Russian businessmen and investors have been frequent visitors to Iceland, assisted by some of the wealthiest Icelanders who not only see possibilities in selling their assets, mainly land and buildings, and gaining some powerful friends.

So don´t wonder when Russian oligarchs will step ashore with big pockets and great ambition. They are already here.

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Despite the fear-mongers and special-interest groups within the Progressive Party, Left Greens and the Independence Party rejecting the proposal. But then again, they know who is paying for their seat and it isn’t the people of Iceland.

The Citizens’ Movement seems to be having difficulties in deciding who they are supposed to represent.

Meanwhile, I unfortunately cannot comment too regularly for a few days because of a hectic work schedule.

I will check back soon with a reaction.

Related posts:

1. Iceland Takes Two Steps To The Left
2. Situation in Iceland – The Fourfold Dilemma
3. Its All Gone Fucking Fuck In Iceland