Iceland Walks Away from the International Banking System

Iceland Walks Away from the International Banking System

By Hwaa Irfan

This marks another sign of the times, when celestial messages demand that we differentiate between what is false, and what is true, to extinguish the fire of egos that consume everything that has life, to do away with old patterns that o longer serve a purpose, and to give expression to our true selves, our families, and the communities in which live.

With a touch of Irish blood, Icelanders are a people noted for their pride, for their sense of self determination.

“When you live in a country which moves alarmingly under your feet every five years or so with an earthquake or a volcanic eruption, you face, like the saga heroes of old, a choice of two courses of action, neither of them good: Either to flee the country and all its hazards, or to stay and brave them out. For more than 1100 years the people of Iceland have chosen to stay and brave them out.” – Magnús Magnússon, Reykjavík

With that strong sense of self determination Icelanders voted in an April 09 Referendum to be free of their colonial masters, the international banking system. If passed, that Referendum would have bailed out the U.K. and the Netherlands who lost funds in the Icesave Bank at the dawn of the current global economic crisis in 2008. That loan was a condition of being allowed into the E.U.

The basis for the rebuttal is the nature of the bailout for the global banking system, that taxpayers should not be made responsible for the losses of private institutions.

One might say that is an easy decision for Icelanders to make given Iceland has the smallest population in Europe (320,000 on last count with 3 inhabitants per sq. km), where police do not carry guns, 175 places in prisons, the Prime Minister feels secure enough to live on the outskirts of the main town, with fencing, and without guards, and is even listed in the phonebook!

With one of the most productive economies, and the greenest Iceland is a country to be emulated, by thinking of the needs of its people first unlike the corporate person of the West who will think of power and position first while their family falls apart.

The April 09 Referendum was by no means a reactionary response to be regretted later, but was a confirmation of a 2009 Referendum with a 93.2% against guaranteeing deposits of foreign investors, much larger than the 58.9 of the April 09 2011 Referendum. If the Referendum was approved, Iceland taxpayers would have had to pay £2.35 billion to the UK, and €1.32 billion to the Netherlands by 2046 at a 3 percent interest rate, which means they would be paying investors interest thus swelling their profit margin.

“These were private banks and we didn’t pump money into them in order to keep them going; the state did not shoulder the responsibility of the failed private banks,” Iceland President Olafur Grimsson told Bloomberg Television.

This was no smooth decision making process, because Iceland did not bailout its banks like the rest of Europe which seems to find no end to the dilemma. Icelanders had to ride the tide of threats from Europe, which threatened to isolate them, and Iceland’s credit rating was downgraded, but that is a small price when compared to having a greater control over one’s fate than to be at the mercy of international institutions whose only goal is to sustain and improve their profits at the cost of taxpayers i.e. bailout.

In the words of Bill Wilson, President of Americans for Limited Government:

“It is the conflict that has already defined the beginning of the 21st Century.  The question is whether free peoples will choose to remain free, as Iceland has, or to submit.”


“People and Society.”

Wilson, B. “Iceland Declares Independence from International Banks.”

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