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<nettime> Iceland on the brink, reformatted
Felix Stalder on Fri, 8 Jan 2010 12:33:55 +0100 (CET)


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<nettime> Iceland on the brink, reformatted


[sorry for the formatting misshaps. in my own message, at least. Felix]

 
May you live in interesting times, as the curse goes. Icelanders are forced 
to live in interesting times for the last 18 months, and they might get 
even more interesting. 

A couple of days ago, the president, Ãlafur Ragnar GrÃmsson, refused to 
sign to law an agreement [1] that would obligate Iceland to replay massive 
amounts of money to the British and Dutch governments (who bailed out their 
own depositors after the Icelandic banks went bankrupt in Sept. 2008) or 
risk risk serious retaliation from the Brits (Gordon Brown already declared 
'diplomatic war' on Iceland over this [2], after invoking anti-terror laws 
at the time), the Netherlands, the IMF etc. 

Now, the law will be voted upon by the citizens of Iceland. As far as I can 
tell, it's the first time that a developed country with functioning 
democratic and civil society institutions is being forced to accept 
treatment usually reserved for developing countries. Whether or not this is 
possible, we will see, on February 20th.

Felix

[1]
http://www.icelandreview.com/icelandreview/daily_news/?cat_id=16567&amp;ew_0_a_id=356059

[2]  
http://www.icelandreview.com/icelandreview/daily_news/?cat_id=16568&amp;ew_0_a_id=356244


Some background from the FT.com
http://tinyurl.com/ybbc8ye

Q&A: Reasons for resentment
Why has this crisis erupted now?
The Icelandic government agreed in June to reimburse Â2.35bn ($3.8bn, 
â2.6bn) to the UK and â1.3bn ($1.9bn, Â1.2bn) to the Netherlands but has 
struggled to secure domestic backing. Parliament approved the repayments in 
August but added conditions. Britain and the Netherlands rejected some of 
these, forcing Iceland to seek parliamentary approval for a compromise deal 
agreed in October. Parliament passed the revised bill last week but Olafur 
Ragnar Grimsson, president, refused to sign it. 

Why is Icesave important?
For the British and Dutch governments, this is all about getting their 
money back after paying out compensation to thousands of citizens who lost 
deposits in Icesave online accounts when the Icelandic banking sector 
collapsed in 2008. For Iceland, resolving the dispute is crucial to its bid 
to join the European Union and to securing further support from the 
International Monetary Fund and other lenders.

Why are Icelanders so angry about the deal?
Many Icelanders resent the fact they are being asked to foot the bill for 
the mistakes of bankers and regulators. They say the repayments, which 
amount to about Â40,000 per household, will choke off economic recovery. 
Iceland is bound by European rules on bank deposit guarantees but critics 
say these are unclear and that Britain and the Netherlands are trying to 
reclaim more than Iceland is legally required to cover. 

What happens now?
Under the Icelandic constitution, when the president rejects legislation it 
is put to the people in a referendum, likely on February 20. The future of 
Johanna Sigurardottir, prime minister, which backed the deal, could hinge 
on the result.







--- http://felix.openflows.com ----------------------------- out now:
*|Mediale Kunst/Media Arts Zurich.13 Positions.Scheidegger&Spiess2008
*|Manuel Castells and the Theory of the Network Society. Polity, 2006 
*|Open Cultures and the Nature of Networks. Ed. Futura/Revolver, 2005 






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