What They Stole

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I grew up in Gimli, Manitoba. Gimli is regarded as the heart of New Iceland. It is, in many ways, the focal point for the individuals of Icelandic extraction in North America and for the various Icelandic North American communities.

When I was growing up in the 1940s, 50s, 60s, Gimli still retained much of its Icelandic character. Relatives and friends still spoke Icelandic over coffee and in the stores. The Lutheran ministers were often from Iceland. A lot of the food was Icelandic, particularly the desserts. We ate skyr and rullapylsa and kleiner and ponnokokur. Iselendingadagurinn was a local celebration for locals and their extended families. People came from near and far to renew acquaintances.

People were tremendously proud of their Icelandic heritage.

Until around 1971 there wasn’t much travel between Iceland and North America, at least not from New Iceland. With increased ease of air travel and lower costs, visiting back and forth began

One of the outcomes of the separation between the people in Iceland and the immigrants and their descendants for decades was that a romantic notion of Iceland developed. That’s quite normal with all immigrant cultures.

Cherished by the immigrant community was the belief that Icelanders were exceptionally honest. All through my childhood and adolescence, I heard people talking about how honest Icelanders were. There were no police because there was no need for them.  Even though a prison had been built by the Danes there was never anyone in it.

The exceptional honesty of Icelanders sprang from fertile soil. Early explorers commented on this honesty and generosity of spirit in the face of poverty and hardship. Travel writers always read what had been previously written about Iceland and seldom questioned it. They’d come to visit for a few weeks in the summer when the weather permitted. They’d travel about the countryside, staying in farms, study birds, look at saga landscapes, investigate the mineralogy, then return to England or Scotland or America before the weather trapped them in Iceland for the winter. Attitudes in a previous book got incorporated in the next book by the next author.

In New Iceland there was a culture of dignity and honesty. That didn’t mean that everyone of Icelandic descent was honest or dignified but there was an attitude about appropriate behaviour and it was an attitude that transcended poverty. I remember once, as an adolescent, doing something foolish and my mother saying to me, “Why would you do that? You’re a Valgardson.” Within the community there was a certain standard of behaviour expected. Although that standard was broken at times, everyone was aware that it had been broken.

Romantic visions are important. Some would dismiss them for cold, hard facts. That is a mistake. Romantic visions often help hold us together, give us unity in the face of difficulty.

Cold hard logic would have instructed the first settlers to look after themselves first, to follow the saying “What’s in it for me?” Instead, in the face of tremendous hardships, they shared their homes, their food, their resources with friends, neighbours, countrymen. They had a romantic vision of who they were and what their ethnic background required of them in terms of compassion and justice.

When the idea that greed is good, that there was no social responsibility to ones relatives, friends, neighbours, countrymen spread through Iceland and making money in vast amounts seemed to be possible, people in the Icelandic community in North America were initially impressed. It was a bit like the PeeWee hockey team winning the NHL. The cry of look at our people, powerful, strong, like the Vikings, although the people saying it seldom knew anything about the Vikings outside of Hollywood movies or comic books. They had it wrong, of course. They should not have said look at those Vikings.  They should have been saying look at those Turkish pirates who have come to steal and do harm to us.

When the kreppa came and Iceland’s economy crashed and the behaviour of those who created the crash was revealed, we discovered that a lot of Icelanders got hurt by other Icelanders. The people who created the crash cared nothing for their relatives, friends, fellow Icelanders. Community ceased to exist. There was a large cost to the people of Iceland so that a small handful of Icelanders could benefit. This financial disaster wasn’t done to the Icelandic people by foreigners. This was like the Turkish raids. Except this was Icelanders pillaging their own people.

The Turkish raiders sold Icelandic men, women and children into slavery. The reckless, irresponsible behaviour of the bankers who caused the kreppa, if the penalties demanded by England and Holland had been enforced, would have been turned into economic slaves for decades to come.

However, the cost wasn’t just internal. The cost also occurred in the diaspora, not just because some Icelandic North Americans got conned into investing money in this banker’s folly of greed. Few had the kind of money that attracted these pirates who came to North America on their raiding. I was told when Landsbanki had representatives in Gimli that they weren’t interested in anyone unless he had a million dollars to invest. Our unimpressive wealth saved many of us from folly.

No, the cost to Iceland is not the hostility of a few individuals who lost money in the banker’s schemes. The loss was of our belief in the honesty of Icelanders. It was a cherished belief. It was a belief of which the community was proud. It was part of our identity and our heritage.

The community could say, yes, we come from a tiny country. Three hundred and twenty thousand people. That’s the population of a small Canadian city. It has no large role to play in world politics. However, the characteristics of its people are unique and one of those characteristics is an exceptional honesty.

No one I meet says that anymore. The bankers took people’s money, their savings, their investments, their pensions, everything they could. That the Turks would raid Iceland, stealing, enslaving, killing was cruel but understandable. They were foreigners from a different culture. That Icelanders could beggar other Icelanders, deprive them of their incomes, their homes, their savings, was not understandable. Hopefully, the money can be replaced.

Unfortunately, there are things that once lost cannot be replaced. One of those things is people’s belief in the honesty of the people from which they are descended. This cost is far bigger than the money lost. These Turkish raiders should live in shame, should be shunned, disowned, cast out. Yes, they’re our relatives. That makes their crimes much worse. Iceland would be better off without them. Banishment  was used in the sagas. Perhaps it is time to implement it again.

The Viking Banksters

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Photo by P. Baer

Thorgerdur Einarsdóttir, professor of Gender Studies, University of Iceland, gave a Richard and Margaret Beck Lecture today, Feb 8, on “Finance Vikings, Masculinities, and the Economic Collapse in Iceland“. It proved to be a popular title for the audience kept arriving and arriving and arriving. People made Viking forays to nearby rooms for chairs, sat on the steps, stood against the walls. As John Tucker said, pleased as punch but bemused, “You just never know how many people will turn up.“

As I´m sure everyone knows, there was a special Investigation Commission in Iceland to investigate the banksters. However, readers may not know that there was a gender review of the SIC done by Einarsdottir & Pétursdottir.

The banks grew 20 times in size in seven years. The economic policy from 2004 contributed to the imbalance in the economy. Deregulation and financial liberalization meant a  lack of control over the bankers. The employment policy, the lowering of taxes and the financing of  houses plus the political ideology mindset contributed to the crash.

How does gender matter? The events leading up to the crash was controlled and directed by men. National ideas of masculinity fueled the ideology behind the events. Rah, rah, we‘re Vikings, lets go raiding. One gets the feeling that some of the bankers had read too many sagas when they adolescents.

Transnational business is largely male and within that context, Icelandic men saw themselves not just as bankers but as the Financial Vikings. Their financial exploits were a way of showing everyone how powerful they were.

There was nothing to stop all the testosterone fueled risk taking. The business tycoons were praised by the media, by politicians, by the bankers, the president himself. Wow, look at our Vikings! From 1997 to 2008, magazines chose the financial Vikings as Man of the Year. As I listened to the lecture, I got the image of the banksters arriving on the shores of Iceland in Viking long boats while worshiping crowds sang their praises.

The Viking heritage was seen as strength, daring and sound knowledge of business that created success quickly in investing abroad. Björgvin G. Sigurðsson, the Minister of Business Affairs praised the Viking qualities of the businessmen who were taking huge financial risks.

Ölafur Ragnar Grímsson repeatedly praised the so-called Viking qualities of Icelandic business. He said “Icelanders focus on the result rather than the decision-making process…go straight to the task and do the job in the shortest possible time“.

He also said, “Elements in our culture and history have played a part …qualities we have inherited from our ancestors give us an advantage in the international arena“.

When the bankers were borrowing and buying there was complacency and arrogance: the Icelandic Chamber of Commerce said Iceland should “stop comparing itself to the other Nordic countries since Iceland already is way ahead of them anyway“.

Thorgerdur showed a video called Mindset made by Kaupthink bank. (www.youtube.com/watch?v=Rkz-hipch38)that drew a lot of laughs. The laughter was because the claims are so vain, so unrealistic, so absurd that one could do nothing but laugh. I have been told all my life that the worst sin an Icelander can commit is to brag but self-importance and vanity drip from the film.

After the collapse, the former chair of the Financial Supervisory Authority, Lárus Finnbogason, said that maybe the supervisory authority over the banks should actually have been in direct contact with the top managers. The statement seems utterly bizarre. What he was saying was that the people trusted to supervise the banking system had no direct contact with the people who were borrowing vast sums of money and creating schemes like IceSave. They were too impressed  by them.

A Norwegian bank specialist said after the collapse that “Icelandic bankers…seemed to hold the view that they had invented something new, that they had superior competence and a better understanding of risks and profit possibilities as compared to more traditional and conservative bankers, and that, in their view, the sky was the only limit.“ This was the view of one of those other Scandinavian bankers that the Icelandic chamber of commerce thought were so far behind.

The view of the Icelandic banks was not as flattering as the banker‘s view of themselves. The Trade Council´s report said Icelandic companies “were young companies with young management“ and there was “Something infantile and nouveau-rich about the expansion.“

What allowed the disaster to happen was that there was an old boy´s network made up of friendship and family ties and the gender review showed that it was very definitely a boy´s network. No girls allowed.

When the banks were privatized, people were told that there was clear understanding that the state getting out of the financial markets and allowing private business to run the banks was highly important. However, in actual fact, the two state banks were divided between the ruling parties. This was cronyism at its worst. When I heard this I thought this was every bit as bad or worse than the cronyism of the Southern American states at the beginning of the 20th Century. So much for all the times I had been told while I was growing up in Gimli, Manitoba, that Icelanders were so  honest that they only had one jail and had no need for policemen.

How much the system was dominated by a few members of Iceland´s elite upper class could be seen by a statement by Sigurjón Þ. Árnason, CEO of Landsbanki. “Generally speaking, David didn´t call  me. This is the way the system worked: David spoke to Halldór, Sturla spoke to Jón Thorsteinn or to me. Me and Stulli are friends, we sat side by side in college, that´s the way it is in Iceland, therefore, we know each other pretty well, even if we are not friends today but we know each other, historically speaking, and we can therefore talk to each other, independent of work. Therefore, we sometimes talk to each other, but generally speaking Jón Thorsteinn communicated with him.“

If you lost money in the crash, your savings, your investments, your house, anything, this statement by Sigurjón Þ. tells you exactly how it was done with backroom deals among the power elite who think no rules apply to them and that they are entitled to take anything they wish. When Thorgerdur showed us this statement, I thought about my research into the 1800s in Iceland and thought also of Laxness´s novel, Independent People, and thought Icelanders may have more cell phones than anyone, they may have a computer in every home, but nothing much has changed. The elite still believes that it has the right to take whatever it wants. The ordinary people are still Bjartur of Summerhouses. The rich give themselves money and the ordinary people are dispossessed.

Prime Minister Geri Haarde said “Sigurjón Þ. Árnason CEO of Landsbanki is my neighbour… and I got him to walk over to my place three times in the month of March…to discuss the Icesave accounts“.

After the crash, The Observer said “Iceland´s spectacular meltdown was caused by a banking and business culture that was buccaneering, reckless — and overwhelmingly male.“

One of the most interesting slides that Thorgerdur showed was a diagram of the relationships of the various men involved in creating the crash. It was shocking. It made clear that a small group of privileged men created the boom, benefited from it and caused the crash is made absolutely clear.

Thorgerdur ended with a set of recommendations to include women in decision-making roles in government and business so that the testosterone fueled disaster won´t happen again.

After the lecture, I was fortunate to have lunch with  Thorgerdur and some members of the audience. She is charming and intelligent. She has done a good job as both an investigator and a reporter of the follies of the testosterone driven crash. However, I came away from this lecture saddened. It is obvious from this lecture and from others I have attended that the Icelandic elite believed it had the right to take and keep whatever it wanted during the 19th C, that it believed it in the 20st C. and that it still believes it.

Unfortunately, it looks like many ordinary Icelanders still believe that this select few do have the right to take what they want and will vote them back into power. In this, they are not unique. It is often the working class, the underprivileged, the exploited, who support the Republican party and the right of the one percent in the United States to have and to hold their wealth and privileges no matter how they got them. Why should it be any different in Iceland?