Iceland at the Crossroads
"... But there is one thing that we can never lose while one man of this race, rich or poor, remains standing; and even in death this thing is never lost to us; that which is described in the old poem, and which we call fame: just so my father and mother are not, though they are dust, called ignoble thieves."
~Halldór Laxness, Iceland's Bell
In light of the collapse of Iceland's banking system it may be that the above quote, spoken by the heroine Snæfriður in defiance of the Danish authorities, describes the underlying dilemma faced today by the people and government of Iceland. It is irrefutable that vast quantities of money have been squandered and/or stolen from the Icelandic treasury, its people and thousands of foreign investors. It is probable that those responsible for this debacle have read the above quote from Laxness. Evidently they didn't take this plea to heart. This is the gist of it: pure greed, fed by lies, theft, and self delusion leading to utter destruction of the institution they had been entrusted to nurture. The only thing a person in political power need remember is that their primary mission is to serve the people they represent. When that covenant is broken there is no government; it is the end of representative democracy (a tradition that goes back over a thousand years in Iceland) and a return to barbarism. Perhaps they were all sick on the day ethics was covered in school?
I'm not here to beat up on the Icelandic politicians but their situation is, because of its limited scope, a good example to a larger world where the same type of malfeasance is occurring on such an enormous scale as to be nearly incomprehensible. It is much harder to hide on an island. I think the global finance crisis may have its roots with a shift in the perception of the roles of Finance and Commerce. Commerce is industry and trade, dealing with services and goods. Finance is a system which provides a framework within which commerce can operate. When Finance mutated into being a form of Commerce in its own right, with its own self-generated rules, any correspondence of worth tied to physical reality was destroyed. Lacking this grounding the system was corrupted, with the inevitable catastrophic results.
I feel compelled to steer readers to Alda's Iceland Weather Report for deeper coverage of the situation. Her coverage is not merely good blog writing, it's just good writing, period. Her latest interview sheds more light on the affair that anything else I've read on the topic. I wish that other media had half the depth of her reportage. The situation in Iceland is reaching a tipping point, within the next few months there will certainly be a sea-change in Iceland's governing structure. Which direction it will take remains to be seen. In most countries fascism is always the devil lurking behind the scenes in any crisis- although the lack of a significant Icelandic military may minimize that possibility. A constructive solution, on the other hand, will not only change the economic system, but even the culture of Iceland itself. Socialism and Capitalism have always been uneasy partners here. Halldór Laxness, in his novels Independent People and The Atom Station, addressed the evils of class and unchecked capitalism; it's nothing new, although the speed and the scale of the current disaster certainly is.
"Why Iceland?" That is the most common cliche heard when meeting tourists. I ask it of myself- why should I care about what happens in such a small and irrelevant country? It isn't just Iceland. How these problems are dealt with may set an example for many countries in the western world which will be facing similar problems in the upcoming months. Iceland is somewhat unique in that it has an intelligent, productive populace, and is used to successfully exporting its culture and strategic and economic opportunities to the entire world. It would be a great, great tragedy if this flowering were to be "nipped in the bud" by a failure to come to grips with self-governance, causing Iceland to slip back into some sort of dismal economic-political serfdom. It isn't "just Iceland", it is the whole world- waking from a frenzied dream.