It is often said that the political climate in the United States is poisoned. Partisanship is dead on all fronts and woe are we! Well, the truth of the matter is that political bust ups have happened throughout history and happen in just about every county regardless of the type of government or issue at hand. Still, the recent vote in Iceland one the Icesave repayment proposal has proven that people can unite! The years before the Great Recession were great indeed. Housing and banking were purring along and both were using the Internet has a means to spread the good word. In Europe, one group got an interesting idea to make some big money. The group was a bank called Landsbanki based in Iceland. Their idea? To open an online bank called “Icesave” that offered better rates than other banks in and around the EU.
How did the online bank do? It was a huge hit. This was particularly true with British and Dutch depositors. Well, that was until the Great Recession hit. As you may recall, Iceland literally went bankrupt with nearly every bank failing. As this process started, there was a run on the Icesave deposits as well as those held by Landsbanki. The run could not be satisfied and the bank defaulted. British and Dutch depositors lost over six billion pounds.
At this point, the British and Dutch stepped in to cover the losses of their citizens be they individuals or businesses. There was really no choice. The sudden loss of so much money would have sent massive numbers of businesses into bankruptcy and hammered the economies of each country which were already hurting to begin with. Following the mess, the governments demanded repayment by Iceland.
Iceland's government has attempted to negotiate a reduced repayment to the two countries in question. Liberal and conservative. Old and young. The voters of Iceland spoke clear and loud. When asked to ratify an agreement to pay the UK and Dutch 3.9 billion pounds by 2024, the answer was a resounding no. How resounding? A full 93 percent voted against the initiative. You usually only see numbers like that when there is a dictator or king involved!
The fact that the people do not want to repay the debt of a bank is hardly a surprise. The only sad thing about the situation is we in these United States were not given the same opportunity!
Mark P. Warner is with CurrentUSANationalDebt.com - where you can find the current USA national debt figures to the second as well as information on the subject.
