Reality Check

Today the President of Iceland (and my personal hero) Ólafur Ragnar Grímssson, refused, for the second time, to sign the ICESAVE agreement into law. Too bad he didn’t go further and dissolve the Althing at the same time, but there is always Monday. Before everyone rushes to judgment with what this all means to the British, Dutch and Icelanders, there are two important points that need to be seriously reflected on:

 

First, for the British and the Dutch- The problem with this ICESAVE deal, as it is with all the other deals, is that the total debt is unknown. Nobody likes unknowns. It is why horror movies are successful and ICESAVE agreements aren’t. Most people in their right mind would be terrified to sign under a contract without knowing the total debt up front. So this outcome should come as no surprise. The Icelanders are right not to take on a burden that they might not be able to pay. But before you throw your arms up in the air and walk away empty handed, consider this: Most Icelanders would agree to use the assets of Landsbanki to pay the ICESAVE debt. These assets could cover up to 95% of the debt. Also, no Icelander really shuddered at the idea of paying an extra 50 billion kronur (about 270 million pounds). One reason is that the Icelanders just spent 27 billion on their monstrous opera house so 50 billion doesn’t sound like that much. More importantly though, 50 billion is a set figure; the unknown factor would be removed. So a deal still could be reached, that would be acceptable, involving the assets and some reasonable fixed amount. As debt collectors say everywhere, “Something is always better than nothing”.

 

Now something for the Icelanders- To all that don’t want to burden their children and grandchildren with an unbearable debt I congratulate your efforts. To those that simply don’t want to pay anything, think about this: If it were a British or Dutch bank that collapsed in Iceland and left your government to cover your deposits (which the Icelandic government probably couldn’t do) and then paid British and Dutch depositors in full, you would be screaming for British and Dutch blood demanding quite firmly that the Britsh and Dutch pay. (corrected 21.02 for those who can't understand idioms) There would be no consideration for who caused the collapse, you would simply want your money, and rightfully so.  The British and Dutch saved their depositors (the life savings of real people with homes and families) of an Icelandic bank when the Icelandic government that you elected (and many want to put in power again!) failed them while saving its own Icelandic depositors. To put this all more succinctly, you owe them, plain and simple. You are correct not to want to take on an unforeseen and unsustainable debt, but the country must pay something, possibly with the Landsbanki assets and an additional fixed amount, to the British and Dutch. Sorry to say, but not wanting to indebt future generations is one thing, not offering any compensation is just shameful and embarrassing for the entire nation, and unfortunately, there will be consequences. That is a fact.

 

So this is where the ICESAVE matter is, today February 20, 2011. It most likely is not over, and won’t be until BOTH sides have faced reality.

 

GTB

Forsetinn staðfestir ekki

No Signers?

A website, "Icesave, Ja Takk",  has been started to gather signatures in support of the lastest Icesave deal and to counter the website http://www.kjosum.is/ started earlier by InDefence http://www.indefence.is/ that gathered around 56.000 signatures last year against the old Icesave deal. Those 56.000 signatures were the main reason the President of Iceland, Ólafur Ragnar Grímsson, refused to sign the original Icesave deal, forcing a national referendum where the Icesave deal was soundly defeated 93,2% to 1,8%.

(http://gregg.blog.is/blog/gregg/entry/1027536)

As of the time of this blog, either no one has signed under "Icesave, Ja Takk" or the people who created the site forgot ( on purpose?) to place a counter on it so we could see how many (or few) people supported "Icesave, Ja Takk", which by the way, roughly translates to " Screw me in the butt? Yes, thanks!" 

 

GTB

Icesave Já Takk opnar síðu