{"id":129816,"date":"2016-03-02T09:11:08","date_gmt":"2016-03-02T09:11:08","guid":{"rendered":"http:\/\/www.thetruthseeker.co.uk\/?p=129816"},"modified":"2016-03-07T07:33:05","modified_gmt":"2016-03-07T07:33:05","slug":"icelands-stabilized-economy-is-a-surprising-success-story","status":"publish","type":"post","link":"https:\/\/www.thetruthseeker.co.uk\/?p=129816","title":{"rendered":"Iceland’s Stabilized Economy Is A Surprising Success Story"},"content":{"rendered":"

Tracy Greenstein –FORBES Feb 20, 2016<\/h1>\n
\"Icelandic<\/a>

Icelanders protest during the 2008 economic crisis.<\/p><\/div>\n

You may have heard about Iceland\u2019s toppling economy back in 2008.\u00a0 As one of the hardest-hit countries at the time, Iceland\u2019s heavily criticized method to escape veritable economic demise actually did the trick.<\/span><\/p>\n

Faced with the possibility of financial failure, Iceland had to think on its feet.\u00a0 Instead of bailing out banks USA-style, the country forgave mortgage debt<\/a><\/strong><\/span> for the population \u2013 and completely started over from square one.<\/span><\/p>\n

A country with a small population of roughly 320,000 citizens, Iceland<\/a><\/strong><\/span>\u2018s entire banking structure \u201csystemically failed\u201d in the early days of the 2008 recession.\u00a0 Despite the fact that Iceland is still on the road to recovery, the country ranks high as a politically and economically stable nation.\u00a0 Their success over the last few years has been largely under-reported, and the story behind it is quite fascinating.<\/span><\/p>\n

A Little Bit of Morality Goes A Long Way<\/strong><\/h2>\n

Let\u2019s face it: Icelanders<\/a> are tough.\u00a0 They are entirely isolated, living in frozen tundra, perpetually enduring less-than-optimal weather patterns.\u00a0 While they are surrounded by epic natural beauty, these people aren\u2019t spoiled; they\u2019re tenacious.<\/span><\/p>\n

Instead of allowing the criminals responsible for bank fraud<\/a><\/strong><\/span> to run free as the years passed by, Iceland thought it might be wise to actually indict bankers who committed serious financial crimes that contributed to the collapse.\u00a0 By paying off loans for consumers, forgiving homeowner debt (up to 110% of the property value), and throwing the offenders in prison, Iceland was able to bounce back.\u00a0 Now, its economy is \u201crecovered\u201d and is growing faster than both the US and European economies.<\/span><\/p>\n

When Iceland\u2019s President Olafur Ragnar Grimmson <\/a><\/strong><\/span>was asked whether or not other countries \u2013 Europe in particular \u2013 would succeed with Iceland\u2019s \u201clet the banks fail\u201d policy, he stated the following:<\/span><\/p>\n

\u201cWhy are the banks considered to be the holy churches of the modern economy? Why are private banks not like airlines and telecommunication companies and allowed to go bankrupt if they have been run in an irresponsible way? The theory that you have to bail out banks is a theory that you allow bankers enjoy for their own profit, their success, and then let ordinary people bear their failure through taxes and austerity. \u2028People in enlightened democracies are not going to accept that in the long run.\u201d<\/span><\/p><\/blockquote>\n

Grimmson\u2019s \u201cfamous\u201d reply to the controversial question, \u201cWhat is the reason for Iceland\u2019s recovery?\u201d is most remarkable.<\/span><\/p>\n

\u201cWe were wise enough not to follow the traditional prevailing orthodoxies of the Western financial world in the last 30 years. We introduced currency controls, we let the banks fail, we provided support for the poor, and we didn\u2019t introduce austerity measures like you\u2019re seeing in Europe.\u201d<\/span><\/p><\/blockquote>\n

Picking Up the Pieces On the Road to Recovery<\/strong><\/h2>\n

Of course, though, everything isn\u2019t all rosy.\u00a0 Many Icelanders have two or three jobs to sustain themselves and their families post-2008, and a sudden spike in taxes \u2013 an inevitable result of letting the banks fail \u2013 made the burden even harder to bear.<\/span><\/p>\n

Though unemployment is down (it\u2019s less than 5% of the population), you could say that \u201cIceland<\/a> is a victim of its own success.\u201d\u00a0 Very high standards of living and 60-70 hour work weeks create a bit of a pinch in the pockets.\u00a0 Difficult challenges lie ahead, but whichever way you look at it, Iceland did avert a seemingly incurable catastrophe.\u00a0 The point is that Iceland was criticized for allowing the banks to fail \u2013 and we now know that the disparaging remarks from scathing critics were too quick to judge.<\/span><\/p>\n

Since 2008, Iceland has added jobs to its tourism and green energy sectors.\u00a0 In fact, according to the Icelandic Tourism Board<\/a><\/strong><\/span>, foreign visitors increased last year by 15.9% \u2013 and travel now accounts for 5.9% of GDP.<\/span><\/p>\n

However unorthodox in its method, Iceland\u2019s \u201clet it fail\u201d policy resulted in jubilation.\u00a0 We can\u2019t seek perfection in the years after a global financial collapse, but we can acknowledge nations who persevered with integrity.<\/span><\/p>\n

Source<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Probably because instead of bailing out the bankers they jailed them, Iceland’s recovery has received little media attention.<\/p>\n","protected":false},"author":39262,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","footnotes":""},"categories":[66,48],"tags":[],"class_list":["post-129816","post","type-post","status-publish","format-standard","hentry","category-Economics","category-Unreported_News"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.thetruthseeker.co.uk\/index.php?rest_route=\/wp\/v2\/posts\/129816","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.thetruthseeker.co.uk\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.thetruthseeker.co.uk\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.thetruthseeker.co.uk\/index.php?rest_route=\/wp\/v2\/users\/39262"}],"replies":[{"embeddable":true,"href":"https:\/\/www.thetruthseeker.co.uk\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=129816"}],"version-history":[{"count":5,"href":"https:\/\/www.thetruthseeker.co.uk\/index.php?rest_route=\/wp\/v2\/posts\/129816\/revisions"}],"predecessor-version":[{"id":129836,"href":"https:\/\/www.thetruthseeker.co.uk\/index.php?rest_route=\/wp\/v2\/posts\/129816\/revisions\/129836"}],"wp:attachment":[{"href":"https:\/\/www.thetruthseeker.co.uk\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=129816"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.thetruthseeker.co.uk\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=129816"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.thetruthseeker.co.uk\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=129816"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}