In our latest in a series of interviews we talk to Birgitta Jónsdóttir, poet, activist, and newly-elected MP and party group chairman for the Civic Movement – the political force that grew out of the protests here in Iceland last fall and winter. It was founded a mere nine weeks before the elections and ran its campaign on a shoestring, yet managed to secure eight percent of the vote and four seats in parliament. Among other things Birgitta has been very frank about her views on the inside workings of Althingi, Iceland’s most venerated institution, which she expresses unabashedly on her blog. Birgitta is a single mom who was unemployed before being elected to Althingi.
IWR: You’re a very outspoken opponent of the International Monetary Fund and its involvement in Icelandic affairs. Why?
BJ: The IMF claims that they don’t interfere in domestic affairs, but they nonetheless create a framework that Icelandic authorities make a decision to follow. In Iceland David Oddsson and Árni Mathiesen [ex-Finance Minister] signed the IMF deal, and apparently did so without much of a struggle – it is virtually unheard of elsewhere that authorities do not try to negotiate around every stipulation to get the best deal. The framework they’ve set for this country, which includes keeping interest rates high, is obviously not helping us. The krona keeps devaluing and our credibility is nil.
I’m very concerned about the vast amount of debt we’re taking on. The European Union refused to support the IMF loan to Iceland unless we as a nation took on all the debts of Icesave and Kaupthing Edge – the debts of private enterprises that we, the citizens of this nation, did nothing to incur. So we were trapped in a hopeless situation. And we can’t pay all those debts. What we need is skilled negotiators who will go to the creditors and say, ‘Look, we really do want to pay those debts, and you can have the money as soon as we recover it from the tax havens where it was stashed.’
In Iceland things are never called by their proper names. For example: what we’ve had here controlling things is nothing less than a mafia. And the banks were one giant swindle. When they were privatized [around 2001-2003] they were sold to select individuals who used them to finance their own undertakings. You can’t tell me, for example, when a convicted criminal who is bankrupt goes off to Russia with nothing and returns to Iceland a billionaire, that some sort of fraudulent activity hasn’t been involved.*
To me, the parallels with Latin America are scary. Argentina, for example. I think we should form an alliance with countries that have been harmed by their dealings with the IMF. These large, national institutions like the IMF and the World Bank are controlled by a small group of people who have their own interests at heart. The IMF lends us money and obviously they’re going to want their money back, but what if we can’t pay it back? Just the interest on the loan is colossal. Iceland is no different from the third world countries that were granted IMF loans to pay back the debts of corrupt dictators that they’ll never be able to pay. If we can’t pay, they can demand control over other things, like our energy sector, or the sailing route that is now being created north of the country as the polar ice melts. That is one area, for example, that is very important for us to maintain control over, as is the Dragon Zone, where an oil search is set to get underway.
IWR: What do you say to the people who dismiss your views about the IMF as mere conspiracy theories?
BJ: Look at it this way: people were warning about the bank collapse and financial crisis for months and even years before it happened, but they were totally ridiculed. Foreign experts who tried to warn us were basically called idiots and told that they needed to go back to school. They were completely discredited. We see the same thing happening now with people who try to sound warning bells about the IMF. Have we not learned our lesson?
IWR: Apart from the IMF, what do you see as the most pressing issue in Icelandic society today?
BJ: Helping households cope. Many of them are in great distress. The process of loan indexation** must be turned around manually. The government has set up measures to help people, but they’re not sufficient. Today people have to have used up all their savings and declared bankruptcy before they get any proper help, which is crazy. The measures are taking much too long to implement – it takes forever to integrate them into the system. We’re dealing with people here, and taking those first steps to get help is always incredibly difficult for people. Then when they finally arrive at the relevant institution they’re told that nothing can be done for them because the measures aren’t integrated into the system yet. People are getting stonewalled when they need support.
IWR: What’s the alternative?
BJ: We need comprehensive measures. For example a 20 percent reduction in the principal on all mortgages, across the board. Instead of doing that the government has introduced interest relief [whereby people can claim back a portion of what they’ve paid in interest], which comes out of common funds. However, if there was a reduction in principal across the board it would involve the credit institutions taking some share of the responsibility, which they absolutely should. Why should the nation bleed for what has happened? This would not have happened if people had been told the truth, if we’d been properly informed. But we were lied to.
IWR: You’ve been very outspoken about your perceptions of your new workplace and what goes on there. Aren’t you afraid of making enemies in parliament?
BJ: I’m not there to make friends or enemies. I’m there to work for the people. And I’m not afraid to call it like I see it.
* Birgitta is referring to Björgólfur Guðmundsson, father of Björgólfur Thór Björgólfsson, who returned to Iceland from Russia and swiftly acquired Landsbanki, Iceland’s most established and reputable banking institution.
** Icelandic loans and mortgages are indexed to the rate of inflation, so the principal increases along with the rise in inflation. This is in addition to high interest rates, which is virtually unheard of anywhere else.