Shaken by meltdown, Iceland seeks new start
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Reuters
Oluşturulma Tarihi: Ocak 29, 2009 00:00
REYKJAVIK - Iceland faces one of the worst political crisis in its history with a severe economic recession compounded by a government collapse. But the grim situation, surprisingly, signals a new beginning for the island nation’s political scene.
Their economy is in ruins and their government has collapsed, but Icelanders see a rare opportunity in all the misfortune: a chance to overhaul how business is done on the volcanic island.
For decades the North Atlantic nation of just 320,000 people has been run by a tight-knit group of political and economic power-brokers. But the ruling elite has been tainted by their role in a financial meltdown that stands out, even by world standards, for its speed and scale. "I just hope that we can build a new government with a new constitution and no 'I'll scratch your back, you scratch mine' kind of game-playing involved," said Elva Benediktsdottir, a business lawyer.
Questioning arrangement
As the economy boomed, making Iceland one of the richest countries per capita in 2007, few questioned a system, which appeared to bring so much prosperity. But after a debt crisis that led to the collapse of Iceland's main commercial banks and is expected to plunge the country into a deep recession this year, many now question the cozy arrangement.
"I think the present crisis gives us the best shot we've ever had of doing something about this, because it is not a very healthy characteristic of Iceland and Icelandic politics, these close ties," said Gunnar Helgi Kristinsson, a professor of political science at the University of Iceland. The intertwined nature of Iceland was also evident in the complex web of cross-ownership which characterized much of the island's economy, often making decision-making opaque.
With the economy in tatters due to the crisis, Iceland was forced to seek an IMF-led bailout totaling $10 billion in loans and aid. Protests have become a regular fixture in the once-tranquil streets of Reykjavik. Former Prime Minister Geir Haarde's Independence Party, for decades Iceland's biggest and most influential party, is the target of much of the popular ire.
"I think the Independence Party must be held responsible for what has happened," said Sigridur Thorsteinsdottir, a parking attendant. "I would just like some new blood and want to see new people govern the country."
A recent poll in Icelandic daily Frettabladid showed support for the Independence Party at 22 percent, down from 37 in the last election. Support for its previous coalition partner, the Social Democratic Alliance, has also plunged.
Instead, the opposition Left-Green Party, which has never been part of government, looks set to take the driver's seat after early elections, the exact timing of which for now is uncertain. Polls suggest they will become the biggest party. But there are also indications Icelanders may be turning away from their established parties, all seen as part of a leadership that failed to stave off the crisis.
"It is a big misunderstanding within the opposition parties that we would want them to take over," said Bjorgvin Mar Kristinsson, a teacher. "We don't want them at all either. New people and a new democracy is our demand." Grassroots movements have organized many of the protests and might fill the power vacuum left by the diminished support for the island's traditional political parties, Kristinsson said.
For decades the North Atlantic nation of just 320,000 people has been run by a tight-knit group of political and economic power-brokers. But the ruling elite has been tainted by their role in a financial meltdown that stands out, even by world standards, for its speed and scale. "I just hope that we can build a new government with a new constitution and no 'I'll scratch your back, you scratch mine' kind of game-playing involved," said Elva Benediktsdottir, a business lawyer.
Questioning arrangement
As the economy boomed, making Iceland one of the richest countries per capita in 2007, few questioned a system, which appeared to bring so much prosperity. But after a debt crisis that led to the collapse of Iceland's main commercial banks and is expected to plunge the country into a deep recession this year, many now question the cozy arrangement.
"I think the present crisis gives us the best shot we've ever had of doing something about this, because it is not a very healthy characteristic of Iceland and Icelandic politics, these close ties," said Gunnar Helgi Kristinsson, a professor of political science at the University of Iceland. The intertwined nature of Iceland was also evident in the complex web of cross-ownership which characterized much of the island's economy, often making decision-making opaque.
With the economy in tatters due to the crisis, Iceland was forced to seek an IMF-led bailout totaling $10 billion in loans and aid. Protests have become a regular fixture in the once-tranquil streets of Reykjavik. Former Prime Minister Geir Haarde's Independence Party, for decades Iceland's biggest and most influential party, is the target of much of the popular ire.
"I think the Independence Party must be held responsible for what has happened," said Sigridur Thorsteinsdottir, a parking attendant. "I would just like some new blood and want to see new people govern the country."
A recent poll in Icelandic daily Frettabladid showed support for the Independence Party at 22 percent, down from 37 in the last election. Support for its previous coalition partner, the Social Democratic Alliance, has also plunged.
Instead, the opposition Left-Green Party, which has never been part of government, looks set to take the driver's seat after early elections, the exact timing of which for now is uncertain. Polls suggest they will become the biggest party. But there are also indications Icelanders may be turning away from their established parties, all seen as part of a leadership that failed to stave off the crisis.
"It is a big misunderstanding within the opposition parties that we would want them to take over," said Bjorgvin Mar Kristinsson, a teacher. "We don't want them at all either. New people and a new democracy is our demand." Grassroots movements have organized many of the protests and might fill the power vacuum left by the diminished support for the island's traditional political parties, Kristinsson said.