The Cheating Politicians of Iceland

Protesters gathered in front of the Parliament building in Reykjavik, Iceland, on Wednesday. Spencer Platt/Getty Images
Protesters gathered in front of the Parliament building in Reykjavik, Iceland, on Wednesday. Spencer Platt/Getty Images

Iceland, population around 330,000, is the most peaceful country in the world. This is a country where violent crime is rare and blackmailers give receipts. We are not used to seeing ourselves grouped with the most corrupt governments in the world. Yet here we are, in the foreground of every article about the Panama Papers.

This week our prime minister resigned, then appeared to un-resign only to resign again, after it came to light that his wife owned a shell company incorporated in a tax haven. He probably hoped the scandal would blow over like the one last year, when a leak revealed that another minister had an account on Ashley Madison, the website for people seeking affairs, with the username Icehot1. But the prime minister was not so lucky. Icelanders might forgive sexual experimentation, but ever since the devastating bank collapse in 2008, we have zero tolerance for shady financial dealings.

For days now, thousands of protesters have filled the square outside the Parliament, calling for resignations and elections, hurling eggs at the building and, for a bit of Icelandic flair, the occasional salmon fillet.

There’s no evidence that the prime minister’s family’s offshore investment (like those held by our finance minister, internal affairs minister and others) included stolen funds, or anything illegal like that. That’s not why people are angry. They’re angry because we thought we had put news like this behind us. It has been only eight years since the economy collapsed and the country was nearly bankrupted. We were then forced to face uncomfortable truths about officials’ involvement in the failed banking sector, as well as about inattentive government watchdogs. Iceland may have been considered a nanny state, but the nanny was dipping into the sherry bottle hidden in the pantry.

Trust in government has been rebuilt, slowly and painstakingly, in the years since. And now we find out that our new leaders have been sneakily shipping their money from our small island to another small island, halfway around the world, most likely to save a little on their taxes. For an ordinary citizen that might look like bad form; for a politician it looks like corruption. It ridicules the fundamental Icelandic expectation that all people are equal.

It is usually easier to solve problems in small nations like ours than in large and complex societies. That is not the case, however, when facing the corruption of an entitled elite. In the United States, you talk about six degrees of separation between people. Here in Iceland, with our minuscule population, it’s more like one degree. Within a few minutes of meeting someone you will find a common relative, friend, colleague, enemy or former flame. That makes it hard to escape nepotism and crony capitalism.

This is one of the reasons the financial crisis got so bad: Many executives of financial institutions had political, social or family ties to government officials and others who were responsible for keeping them in check. To make matters worse, some of those people monitoring the banks had been hired based on connections instead of competence. Many politicians had accepted huge campaign contributions from the banks. And so on. Of course, the main blame lies with the bank managers, but an investigation into the collapse showed an inclination in all levels of government to overlook the negligence or deceptive accounting that was rampant.

We thought we were done with this, rid of the old politics. But the same old networks are still in place. The same old people are sharing the same shady tax lawyers and investing advice. Those who set the rules still aren’t able to follow them.

Icelanders yearn for the change we were promised. We want to move on. References to the 2008 crash are no longer heard daily, only weekly. People have stopped discussing the fallen banks and have begun to share again their opinions on the European Union. (Which, incidentally, we applied to join soon after the crash, then changed our mind and sent a letter saying we no longer wanted in, to which the union replied that it did not care, it intended to continue the negotiations, with or without us. We have not heard how that is working out.)

Since the Panama Papers scandal, a new party called the Pirate Party, focused on democratic reforms, has been surging in the polls. The party leaders are called, not chairmen or chairwomen or secretaries, but captains. The co-founder of the party, whom some see as a candidate to replace our disgraced prime minister, describes herself as a “poetician” and used to have blue hair.

I don’t know what’s going to happen next. We are all suffering from a news overload. One widely read article said that Richard Branson had gotten a phone call from the prime minister’s wife asking to be taken into space. We found this rather odd but it turned out that it was actually the wife of our president who wanted to go into space. Which no one found odd.

At present we have an interim prime minister, who appeared a bit lost and underdressed for the occasion when he was introduced to the public on Wednesday. He does not seem to own a tie. But neither does he hold an offshore account. Nor an Ashley Madison account. That’s something, I guess.

Yrsa Sigurdardottir is the author of the Thora Gudmundsdottir crime series and the novel I Remember You.

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