Iceland. The country, not the shop.

[HeadlessLamAAARRRGHHHH]

After their banks went tits up a couple of years ago, they have now become what I think is more democratic. A constitution by the people, for the people. Plus the obvious point of why the fuck should Ordinary Joe pay for the criminal misdeeds of the banks/bankers. Good on them, hope we do it here.

Fascinating article. We definitely need a new approach. So far all we have had is self defeating austerity that strangles growth and same old bail outs for bankers getting off scot-free.

yes, very odd these bank bailouts. Usually those who cant pay their excessive debts go bankrupt, not bonuses

Great article, very interesting.

They have very nice horses.

That's all I've got to add. Although there was a big article about feminism in Iceland in the Guardian recently.

at Dazzle and "nice horses"!

Why is it that Iceland prosecutes the bosses for fraud whilst we only go after the foot soldier? Surely those that were actually in charge are far more worthy of horsewhipping having their day in court?

"Why is it that Iceland prosecutes the bosses for fraud"

Before the crash Iceland was running itself at a profit, the Government earned more money than it spent. So it wasn't that dependant on the banks and even though it's now having to borrow money to get by (which means the banks are making profits from the Icelandic people when they never used to, have they really lost out here?) they're not that deeply dependant. So they can go after the banks.

"whilst we only go after the foot soldier?"

On the other hand we were running at a huge and ever increasing loss before the crash. We became dependent on the banks for about 25% of our spending. So if we really annoy the banks and then they stop lending money to us then we'd be facing either 25% cuts which would make the current cuts look like a walk in the park or an average of 33% tax rises.

And there in lies our problem.

We've become totally dependent on the banks and on credit to pay our normal daily bills. So therefore we can't allow a situation where the banks either can't or won't lend to us.

What do you mean, we're dependent on the banks? That doesn't make any sense. Why do we keep lending billions to bail out the banks, then? How can we owe money to institutions that only exist because we lent them money in the first place?

I don't think it's banks we owe money to.

"I don't think it's banks we owe money to."

It is. In 2009 to 2010 we added nearly another $150 billion to the massive pile of debt, 24% of the money the Government spent. And that money has to come from somewhere, which is banks. Most of those banks are foreign banks, but as you're seeing with the Greek problem all banks are linked. If the British banks collapsed they would collapse owing other banks money, and that chain of owed money would eventually bite us as banks become no longer able to lend us money or push the price of borrowing that money upwards.

Look again at Greece where there is a massive problem making sure that they can borrow the money they need to keep their economy running.

So we are very dependent on the banks. If we couldn't borrow money we would, as said above, be facing 25% cuts in spending or 33% tax rises.

And as if 60 years of Government over spending isn't bad enough this country also engineered an economy that was based heavily upon the financial sector. So if that does collapse not only would our ability to borrow be hit but Government revenues would fall. So we'd need to borrow even more money.

So this country cannot allow the global banking system to fail because it needs that banking system to fund it's public spending and it needs our portion of the global banking system to provide a large chunk of it's income.

If we'd lived within our means and kept a diverse economy then we could afford to give the banks a good kicking. We didn't and therefore we can't.

Iceland is currently being sued by both the British and the Dutch Governments over the way they handled their banking crisis.