Felix Stalder on Fri, 8 Jan 2010 12:16:03 +0100 (CET)

[Date Prev] [Date Next] [Thread Prev] [Thread Next] [Date Index] [Thread Index]

<nettime> Iceland on the brink

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=20
even more interesting.=20

A couple of days ago, the president, =C3=93lafur Ragnar Gr=C3=ADmsson, refu=
sed to=20
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=20
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.=20

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=20
democratic and civil society institutions is being forced to accept=20
treatment usually reserved for developing countries. Whether or not this is=
possible, we will see, on February 20th.



[2] =20

Some background from the FT.com

Q&A: Reasons for resentment
Why has this crisis erupted now?
The Icelandic government agreed in June to reimburse =C2=A32.35bn ($3.8bn,=
=E2=82=AC2.6bn) to the UK and =E2=82=AC1.3bn ($1.9bn, =C2=A31.2bn) to the N=
etherlands but has=20
struggled to secure domestic backing. Parliament approved the repayments in=
August but added conditions. Britain and the Netherlands rejected some of=20
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.=20

Why is Icesave important?
=46or the British and Dutch governments, this is all about getting their=20
money back after paying out compensation to thousands of citizens who lost=
deposits in Icesave online accounts when the Icelandic banking sector=20
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=20
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=20
the mistakes of bankers and regulators. They say the repayments, which=20
amount to about =C2=A340,000 per household, will choke off economic recover=
Iceland is bound by European rules on bank deposit guarantees but critics=20
say these are unclear and that Britain and the Netherlands are trying to=20
reclaim more than Iceland is legally required to cover.=20

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=20
on the result.

=2D-- 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=20
*|Open Cultures and the Nature of Networks. Ed. Futura/Revolver, 2005=20

#  distributed via <nettime>: no commercial use without permission
#  <nettime>  is a moderated mailing list for net criticism,
#  collaborative text filtering and cultural politics of the nets
#  more info: http://mail.kein.org/mailman/listinfo/nettime-l
#  archive: http://www.nettime.org contact: nettime@kein.org