Iceland's citizens to stiffen government's spine and stand up to bullies

[ryson]

The citizens of Iceland are likely to vote themselves a future tomorrow and in doing so may do the citizens of Ireland and of other countries a major favour.

Hail heroic Iceland!

[Sucker Punch]

Goodness - you mean that you would have gone for an Icesave account because it was backed by the government of Iceland, who said that they would honour any debts. And that you might feel now that you'd been...well...conned, because the Icelandic government isn't going to honour those debts, either with or without the backing of the Icelandic people?

Well, perhaps that woud be applicable in some ways to Ireland's situation, if we had, say, failed to exercise adequate (or even minimal) oversight over our government and banks, and were now annoyed that we might be landed with the debts that they had run up in the absence of such oversight.

Still, never mind, I'm sure that someone will be along to explain how it isn't our fault that we failed to exercise even minimal oversight, and that not only would we be justified in rejecting any responsibility, but that we would be correct to do so. After all, an irresponsible citizenry is the bedrock of democracy, right?

An irresponsible citizenry is the product of an irresponsible democracy, which has fallen between the bleachers of sui generis sovereignty and the virtual senate or lenders and investors that may scuttle a nation on the basis of opportunistic speculation, or premised upon market irrationality.

...but hey... a receding tide capsize all boats right? Best to leave to the next WTO round of negotiations, they'll put it all right having learnt from their mistakes of course.

[joel]

When a bank goes bust is a country responsible? No, not in the capitalist system.

Sometimes guarantees are given up to a certain figure by governments. But not for the WHOLE investment - thats a novel idea.

[Dreaded_Estate]

The fundamental choice facing both Ireland and Iceland is whether the citizens, through the state, should pay off the liabilities of their banks.

Those liabilities could be depositors or bondholders, foreign or domestic but every country should decide whether the citizens will honour the debts of their banks.

You can focus to concentrate on what differences you wish but that is the root of the choice IMO!

[ibis]

Government is paid and resourced handsomely to govern.

Failure of governance may reflect badly on the section of the electorate who had faith in the ability of those they elected, but it remains government's failure.

You may have missed a vital point about democracy - that the government is elected to govern. Failure of governance is always a reflection on the electorate - and it's hardly supportive of the current government to say so.*

*[SIZE="1"]And I'm sure you wouldn't simply be trying to dismiss whatever I might say by such an obvious - and in this case, contradictory - ad hominem.[/SIZE]

[joel]

The fundamental choice facing both Ireland and Iceland is whether the citizens, through the state, should pay off the liabilities of their banks.

Those liabilities could be depositors or bondholders, foreign or domestic but every country should decide whether the citizens will honour the debts of their banks.

No, it is NOT down to the citizens. They are NOT responsible for Limited Liability companies - the shareholders of the companies are. That is company law.

Saving the banking system is the reason given for government action - not any liability of citizens. That is a red herring.

[cyberianpan]

I've no idea why the news media keep hyping this

If Iceland rejects these terms - the previous agreement comes into play

Indeed they probably could never make the current terms so fast anyway... and under the previous agreement they'll pay most of the debt

cYp

[He3]

I've no idea why the news media keep hyping this

If Iceland rejects these terms - the previous agreement comes into play

Indeed they probably could never make the current terms so fast anyway... and under the previous agreement they'll pay most of the debt

cYp

Maybe because this is the first time that a country's citizens have been able to have a direct say on their government's response to fallout from what John Kay described.

We made a mistake in the closing decades of the 20th century. We removed restrictions that had imposed functional separation on financial institutions. This led to businesses riddled with conflicts of interest and culture, controlled by warring groups of their own senior employees. The scale of resources such businesses commanded enabled them to wield influence to create a – for them – virtuous circle of growing economic and political power.

That mistake will not be easily remedied, and that is why I view the new decade with great apprehension. In the name of free markets, we created a monster that threatens to destroy the very free markets we extol.

On a lighter note, have a look at the photo near the end of this piece - Icelanders eye chance for payback

[kerdasi amaq]

More power to the Icelanders. If they deign to accept responsibility for their bankers' debts; then, they have a responsibility to themselves to ensure that the repayment of those debts does not become socially destructive; to their Nation. If, the Shylocks of the City of London don't like it, then, they have to be told where to get off.

I'd insist too that, the interest rate be set to 0% and denominate it in dollars, or maybe mix it up, with some in sterling and the rest in euros and then hope those currencies collapse into hyper-inflation.

[Thranduil]

The Irish electorate has been asleep at the wheel for years. If the government car has gone off the road, there is nobody to blame but ourselves, and we have to accept that we are the negligent party. That means sucking up the debts accumulated while we were asleep. The same goes for the Icelanders - they can, if they like, agree to repudiate their debts to each other, but they cannot repudiate the debts they owe to foreigners who invested in Icelandic banks. If they feel those debts were accumulated without their knowledge, then they too have been negligent.

You would be one of the last people i would expect to see making the case for direct democracy Ibis, i am surprised given your pro-EU tendencies, the people can only be held accountable for what the Govt does to this degree in a direct democracy - where they can petition to have an issue brought up and put to a referendum... without this in a representative democracy the politicians from all sides can simply wall themselves off from the electorate and do what they wish.

In practice in most countries most voting peoples do not have this level of control over the issues for various reasons (and a common argument of those who advocate ceding more power to central authorities of various sorts and repres democracy is the preaching that these issues are very complex and are best left to the 'experts' like the financial regulators and so forth).