economy

Icelandic history teaches: democracy is a revolution that starts from below Yet fifteen years of economic growth have made Iceland one of the richest countries in the world. A wealth based on the model of pure neo-liberalism that had allowed a rapid and ephemeral growth. It all began in 2001 with the beginning of the privatization of the banks. In 2003 all the banks in the country were completely privatized and obsessively used themselves to attract foreign investments in the country. Banks, as bait, adopted online accounting techniques, which drastically reduced management costs, and allowed higher interest rates. The program was called IceSave. In a short time many foreigners arrived, mostly English and Dutch, who deposited their savings. The mechanism on the one hand increased the investments, but on the other increased the external debt of the same banks. In 2003 Iceland had a debt equal to 200% of its GDP. Four years later it was 900%. But it does not end here. The coup de grace arrived with subprime mortgages in 2008. The three major banks Landbanki, Kapthing and Glitnir, exposed for about 10 billion euros, failed drastically and were again nationalized. Thus the crown collapsed, compared to the euro, by 85%, tenfold the outstanding debt and at the end of that year Iceland was declared bankrupt. This was the dramatic awakening of the Icelanders. The conservative Prime Minister at the helm of the country immediately asked for help from the International Monetary Fund, which promptly granted a loan of two billion and one hundred million euros, while some Nordic countries intervened with another two and a half billion. In the meantime, the population was shaking and protesting a destiny that no one could escape from. In January, after 14 weeks, the garrison of citizens who have been guarding parliament for days, has resigned from the conservative government of Geir Haarde and gets early elections. Meanwhile, the international financial powers pushed Iceland towards drastic measures, the IMF and Europe asked the country to take on the debt, or rather on the shoulders of the population. According to the Monetary Fund, that was the only way to pay off the debt and save Iceland.In the game of the parties, Holland and England, they had guaranteed their compatriots the reimbursement of what was lost, so it became imperative that the Icelandic State re-enter with debt as soon as possible. However, with the early elections, the new government comes, this time left, which after criticizing neo-liberalism, yields to the strong demands of world finance. At the time an exorbitant proposal was made to the nation. An extreme economic maneuver would have returned 3 and a half billion euros of the debt. The figure would be divided among all Icelandic families for 15 years with an interest equal to 5.5%. In practice, the proposed tax was nothing more than a sum of 100 euros per month for each citizen, for 15 years, with a load of 18 thousand euros each for Icelandic in order to settle a debt contracted by a private individual to another person. But President Grimsson, hearing popular protests, refused to ratify the super-tax rule and called a referendum on the tax itself. In short, the citizens decided. The politician’s move inflamed financial power, even raged against Iceland. England and the Netherlands threatened an “embargo”, while the IMF was holding the blockade of aid. England, meanwhile, announces anti-terrorism measures and freezing Icelandic bank accounts. Grimsson summarizes these days: “They told us that if we had not accepted the conditions of the international community, we would have become the Cuba of the North. But if we had accepted them we would have become Northern Haiti. “The referendum was a no-no to the maneuver.93% of the citizens rejected the debt which is declared” detestable. “For the citizens of Iceland it is not payable.The International Monetary Fund he immediately froze the money.The Icelandic government opened a civil and criminal investigation against the bankers and managers responsible for the financial crisis.The interpol issued an international arrest warrant for the former president of the bank Kaupthing. great escape of the Icelandic bankers, many of whom ended up in handcuffs, under a popular push, it was decided to rewrite, ex novo, a Constitution capable of preventing the excessive international banking and virtual money.The current Constitution dates back to the independence of Iceland from Denmark, in fact it was a copy as such that differed only for some words “King / President”. In this way the innovative method of a real participatory democracy begins, relying on the memory of past mistakes. For the first time a government entrusts the radical change of the Constitution to its citizens. A Constituent Commission of 25 citizens elected from a base of 522 candidates was elected. The requirements to apply were: seniority, the support of at least 30 people, and not be a member of any political party. This is how the first ‘crowdsourcing’ constitution was born, a text created by users on the net through e-mail and social networks. Every citizen could view the reports on the web, attend meetings via streaming and contribute, from home, to the proposals, expressing their opinions freely. A revolution from below. From that moment, Iceland has dissolved that malignant spell based on the belief that debt is a sovereign identity for which an entire nation can be sacrificed. Not only. The will and commitment of Iceland has destroyed the idea that the laws should be written in great secrecy and by a select few. The Magna Carta, so defined, fruit of the Constitutional Commission, has been screened, discussed and modified thanks to the citizens. A young participant in the experience said: “I understood for the first time what the word democracy really means. Having helped to write the Charter, besides filling me with pride, makes me feel very responsible towards my country and the freedom of my people “. Today, against all expectations of the IMF, rating agencies, and European, international investors have returned to believe in Iceland and important fact is that Iceland itself has not lost any monetary sovereignty. The island of the extreme north spreads a massage of clear hope: “the citizens are not responsible for the debts contracted by the strong powers, so the nations are not expendable”.

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