Björk Explains It All To You

Björk Explains It All To You

Icelandic singer Björk Guðmundsdóttir (oldsters know her from the Sugarcubes) wrote an Op-Ed in Tuesday’s Times of London linking Iceland’s financial crisis with an incipient ecological danger. If you haven’t been paying attention, Iceland is the worst-case scenario for financial deregulation; its financial services companies borrowed ten or twelve times the value the country’s entire money supply. The notes are due, the banks are closed, the currency is worthless, and the island nation cannot import goods.

The choice of the Timesis important. British depositors had savings in Icelandic on-line banks, and cannot access their funds. Icelandic companies bought British firms, and the U.K. government has seized these assets under an anti-terrorism law.

Björk describes the situation from a local point of view:

Young families are threatened with losing their houses and elderly people their pensions. This is catastrophic. There is also a lot of anger. The six biggest venture capitalists in Iceland are being booed in public places and on TV and radio shows; furious voices insist that they sell all their belongings and give the proceeds to the nation. Gigantic loans, it has been revealed, were taken out abroad by a few individuals and without the full knowledge of the Icelandic people. Now the nation seems to be responsible for having to pay them back.

What makes people furious is that those responsible for putting Icelanders in this situation are now the ones trying to get us out of it. Many here want those in charge to resign and allow others to tidy up after them. Most criticism is aimed at Davíð Oddsson, who made himself chairman of the central bank after 19 years as Mayor of Reykjavík and then 13 years as Prime Minister. A crowd is gathering in downtown Reykjavik once a week to demand his resignation.

If that crowd is gathering on Friday evening,  Davíð Oddsson better watch out. That’s the night when many Icelanders get profoundly drunk, and anything can happen.

 Björk draws attention to another lurking danger: Three huge aluminum smelters have been built by Alcoa Rio Tinto, and there are plans to construct two more, all powered by the island’s geothermal energy, which is abundant but nonrenewable. There is concern about the ecological impact of these behemoths, and Björk has recorded some songs about the issue. She among those who would prefer development of Iceland’s biotech, high-tech, and health sectors, which are easier on the land and take advantage of country’s highly-educated and imaginative population.

We hope Iceland has more imagination than the U.S. and EU when it comes to solving the world’s financial crisis. So far, governments and central banks cannot seem to imagine a way out of it.

Hat tip: Joe Weisenthal of Clusterstock.

Image by Mike Licht. Download a copy here. Creative Commons license; credit Mike Licht, NotionsCapital.com.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s


%d bloggers like this: