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In Iceland things are never called by their proper names

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.

birgittaI’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.



Comments on this entry are closed.

  • iris May 28, 2009, 3:26 pm

    Way to go Birgitta!

  • Bromley86 May 28, 2009, 4:27 pm

    That’s a little scary. One of us has the wrong idea of what the Icelandic state was forced to cover regarding the Icesave and KE branches. It should be common knowledge what Iceland is potentially and what it is probably liable for. If it isn’t, then that’s another massive failure of both the government and the media to do their jobs.

    Also, I hope everyone’s not holding their breath for the money to be recovered from the tax havens. Eva Joly knows more about this sort of thing than most, and the first thing she said on Silfur Egils was that there was next to a zero chance of recovering any of it.

    Has there been a rough breakdown of what the $5.1bn is earmarked for?

  • Dorothy Gale May 28, 2009, 4:36 pm

    Jaysus, she makes so much sense it’s scary. Would common sense really work?

  • Nancy May 28, 2009, 5:23 pm

    Love her! Can we clone her and send the clone to kick some you-know-what in the US Congress? We could use someone like her. Great interview.

  • Physchim62 May 28, 2009, 7:03 pm

    I must agree with Bromley86 here. Birgitta has made the transition from unemployed single mum to consummate Icelandic politician remarkably rapidly.
    The major part of the debt of the three major commercial banks is held by ordinary Icelanders. The banks borrowed money abroad to lend in Iceland, taking an indecent chunk out of the cake in between (through index-linked mortgages, among a myriad of other mechanisms). The question remains as to exactly who ended up with the cash in their pockets. I’m confident that the memory of Icelanders will be long enough to ensure that they will be suitably punished, one day or another: but that day doesn’t seem close.
    Just to take one example, the Icelandic fishing industry (40% of Iceland’s exports, at least according to official figures) is indebted to nearly three times its annual income (yes, income, not profits). Who was this money paid to, and why? Those are the questions which new parliamentarians should be asking as loudly as possible.

  • Ljósmynd DE May 28, 2009, 8:14 pm

    It is good to have people in parliament, who at least try to look for alternative ways out of all this.

    And I can’t see anything wrong in the reminder of the fact that it were private debts, which caused the disaster.

    It’s definitely wise to have the path outlined, how to get off the needle, before becoming increasingly addicted to infusions by IMF loans. Argentina is a good example, that friends are needed to succeed.

    But I wouldn’t count too much on the treasures, stashed away in some Carribbean tax havens. I think, not only the IMF deal was poorly negotiated. Those infamous viking raiders on their quest to become really big boys collected much overpriced junk on their raids. So, a lot of this money has most likely evaporated into thin air.

  • Lee, UK May 28, 2009, 9:44 pm

    Andy Grove (Intel’s ex-Chairman and CEO) had a famous motto “only the paranoid survive”. David and Arni should have asked him to negotiate the IMF deal…

  • Marc May 28, 2009, 9:53 pm

    One of the best interviews you have hosted yet. One of the most importante issues Birgitta touches on is the need to form alliances. Please do. If you want to protect your country that is. If not, just wait and see everything fall apart until ordinary people are prepared to pay whatever to get out of this mess.


  • idunn May 29, 2009, 2:17 am

    Birgitta Jónsdóttir is precisely right.

  • Svein May 29, 2009, 7:36 am

    The good thing about crises and chaos is that they unleash creativity to overcome them. The sad thing is that they also create space for conspiration bent populists who propose measures which, if implemented, would make Iceland’s macroeconomic situation completely untenable and beggar you all.
    Paying the IMF back will be hard but less hard if you can get the economy in shape again. And there is hadly an alternative if you still want to live in this world.
    Of course you also need to hold the “bad bankers” to account.
    (If not for any other reason then for their outrageous taste in boots.)

  • Bromley86 May 29, 2009, 8:03 am

    A very intersting interview with the Special Prosecutor over on the Huffington Post:

    Let’s just say that the idea I had — that the general public had — of banking in this country was completely different from the reality. What we think banking is, this picture was incorrect, it had no basis in reality.
    There are no instant solutions or quick fixes here. Business relationships are founded upon trust that people build up over a long period of time. So there is nothing we can do today that will result in everybody wanting to all of a sudden do business with us. I will say this; we [Icelanders] should just realize — with complete candor — that in business we are graded lower than Nigeria. Nigeria at least can buy stockfish and salt cod here in Iceland using a letter of credit; Icelanders cannot get a letter of credit from foreign banks. So we are not in a good position. But the rashness of Icelanders is such that we think we can do something for just one week, and then everything will be fine again.

  • Bromley86 May 29, 2009, 8:04 am
  • Wilfred Hildonen May 29, 2009, 10:42 am

    Well spoken, Birgitta! If Iceland should go ad undas, welcome to Norway! We could need a politician like you here:) I hope Iceland will be OK, however, but for people who want to know more of the wheeling and dealing of the IMF, I recommend Naomi Klien´s book “The Shock Doctrine”… Read it!

  • Kate May 29, 2009, 8:22 pm

    Kudos to Birgitta! and Alda, too 🙂

  • Birgitta Jónsdóttir May 30, 2009, 11:51 am

    Alda is a great journalist and writer – many thanx for asking the questions Alda and presenting them in such a pro and kind way:)

    Thank you all who have commented – Iceland is in a mess and we need all the help we can possible get from friends of Iceland around the world…

  • alda May 30, 2009, 12:21 pm

    Takk, mín kæra! 🙂

    Thanks, everyone. Birgitta had a lot more great things to say and in fact we probably could have talked all evening … I unfortunately had to rush out due to time constraints just when the conversation was at its height!

    Unfortunately I couldn’t fit more in a regular blog post … but may try to slip them into other posts in coming days.

  • Don in Seattle May 30, 2009, 8:10 pm


    All I can say is excellent, excellent, excellent post.

    This is the kind of information unavailable in English anywhere else.

    Don in Seattle (actually in Milwaukee right now)

  • The Chosan One July 14, 2009, 2:53 pm

    I agree with Physchim62 here above.
    According to my sources Birgitta was registered in VG (Left Green Party) before the elections, and has always been a firece anti-EU person.

    I hope, for her sake that she does not become a symbol of how not to do things. Perhaps her political skills in lying and deception are not as fine tuned as the professional politicians skills, yet. So it looks very clumsy for her at the moment.

    And by the way… how can one be against something one does not know anything about, and in Birgitta’s case, does not understand.

  • Marilynne L. Mellander October 27, 2009, 8:01 pm

    I heard about this courageous woman on the Webster Tarpley show
    “World Affairs Brief”…he speaks highly of her and her stance
    against the takeover of Iceland by the jackals and hyenas of the
    IMF…hooray for her…where can I find an English translation of her

  • Haakon January 7, 2010, 11:14 am

    A once proud, strong and free people are being reduced to slaves of the international mafia. Break free of your shackles and recapture your great heritage! Walk tall into the halls of your ancestors!

  • Roger January 7, 2010, 5:58 pm

    Yes agreed this was seen coming even to many lay persons years before! The Zionist bankers have us all screwed! Its not the British or the Dutch people its these criminal extreme communist/socialist NWO criminals who hold power over everything banls the media and politics, and they have been trying for years to put Iceland into debt so they can own it.These criminals or the hidden hand want us all locked up in our own prison planet so they can destroy the northern European peoples,the only people who will fight back.That’s why they are so intent on multi-cults! How to do it is easy, put them US all in debt forever!

    All Northern Europeans must wake up to what is happening!

  • Michael Kristiansen January 14, 2010, 6:02 pm

    It’s been building up inside us, since the crisis unravelled in its full scale around the World, – YOU said it out loudly; the banks fell under their own GREEDINESS, and now the PEOPLE are supposed to just..PAY THE BILL’s !?? THANK YOU Birgitta !!
    Keep it up, big hug from Michael, DENMARK

  • Johnny Go March 23, 2010, 8:11 am

    She is a superstar — WE LOVE YOU BRIGITTA !!!!!!!!