AFTER THE PRIVATIZATION of Iceland’s banking sector, private bankers borrowed $3,500,000,000 in 2000. This was ten times the size of the tiny nation’s economy! This created an immediate economic “bubble” that had two effects: a few wealthy people became exceedingly wealthy people, and it left Iceland on the verge of bankruptcy.
The rest of the citizens were left with a debt to other nations that they could not pay. They did not take this lying dow, and swift, meaningful changes followed:
1. The citizens replaced the old Iceland government with a new one.
2. The citizens nationalized the main bank of Iceland.
3. The citizens voted to deny payment of the debt created by the bankers.
4. The citizens held a constitutional assembly and rewrote their constitution.
The result was the Organisation for Economic Co-operation and Development expected Iceland’s economy to outgrow the euro and the average for the developed world! 1
Largest banking collapse in history
“The Icelandic financial crisis was a major economic and political event in Iceland that involved the default of all three of the country’s major privately owned commercial banks in late 2008, following their difficulties in refinancing their short-term debt and a run on deposits in the Netherlands and the United Kingdom.
Relative to the size of its economy, Iceland’s systemic banking collapse was the largest experienced by any country in economic history. The crisis led to a severe economic depression in 2008–2010 and significant political unrest.” (Wikipedia)
Today Iceland is thriving
“The prime minister was indicted, over 200 criminal charges were filed against the bankers, and all of the former CEOs of the three biggest banks were arrested. The new government supported citizens by passing a banking remittance that forgave debt exceeding 110% of home values.
As a result, banks have forgiven loans equivalent to 13% of gross domestic product, easing the debt burdens of more than a quarter of the population. Today Iceland is thriving.
This story is much different than what has happened in the US since the banking crisis began in 2008. Large bailouts were granted to the bankers, and none of the responsible parties have faced criminal prosecution. And it appears that we are still at the mercy of the currency cartel and the dollar faces total destruction.” 2
What happened in Iceland
Regarding the title of this piece, “What Happened in Iceland Should Be Happening in America”: the happened part refers to the economic bubbles involving stupid or corrupt bankers that happen regularly in America, just like Iceland.
But what should be happening in America is an uprising of incensed citizens who go after the rotters, change the government, and make sure that wealthy crooks can’t do it again in the future.
But it won’t, because we just don’t have what it takes, unlike the Icelanders . . .
FEATURED IMAGE: The photo at the top of this page captures some of the thousands of protesters in front of the Alþingishús, seat of the Icelandic parliament, in Reykjavik, Iceland, on November 15, 2008.
2 From “Iceland’s Hördur Torfason – How to Beat the Banksters,” by Alex Pietrowski for Waking Times (December 11, 2012).