Slaves of Iceland: Libertarians have your way out

January 7th, 2010

January 5, 2010 is a historical day for Icelanders. The Icelandic President Olafur Ragnar Grimsson had a tough decision to make, and difficult choices to make. To listen to the 23% of the nation that signed a petition calling on him to put the state guarantee for 5.4 billion dollars to be paid to the British and Dutch governments to a national referendum. Or to ignore the nation and sign the bill for the government, after the bill had been passed through the parliament with a narrow vote on December 30, 2009 after months of acrimonious debate, tainted with secrecy and dishonesty on the part of the government. Every day throughout the debate, new information would emerge and documents would leak to local media or wikileaks. Yesterday, the people of Iceland finally had a chance to have something to say about their fate, because if the state guarantee is accepted it will mean that Iceland will become like a third world country, spending its GDP largely on paying interest on foreign debt. Last summer, a bill for a state guarantee was passed that had a significant meaning not only for Iceland, but also for other nations around the world facing the same problems of private debt being forced on taxpayers. The bill included a reasonable and fair way of handling the interest and the debt: Icelanders would pay, but only a certain percentage of their GDP, and if there were to be another financial black hole, they would not pay during that time. Thus it comes as no surprise that the Dutch and British governments reacted so swiftly with a condemnation of Iceland’s citizens for having the audacity to think they have the right to exercise their democratic rights in deciding for themselves what is in the best economic interests of their nation.

Let’s also put this debt into perspective: 320.000 people live in Iceland, each and every person on the island, including children and the elderly, the disabled and the poor, would have to pay around $30,000 under the bill. The danger if Icelanders will accept this enormous burden is that the entire welfare system would simply collapse with no money to run it. On January 5th the Icelandic president had the courage, backed up by his nation, to place the interest of the people before that of the banks.
Of course there has been an incredible spin by the government controlled media, attacking the nation and the president for this simple and fair demand. The UK and Dutch media were also full of misleading news, saying the nation had demanded not to pay, and that we would become isolated and there were even suggestions that the British navy should flex its muscles against this nation which has no military. As if the terrorist act they imposed on us was not enough during the darkest hour of our crises to bring us further down!

The spin is failing because people around the world are finally starting to hear our side of the story, and other suppressed nations have perhaps seen this as a sign that they can also rise up against the corpocracy in our world where those with the money have as a rule always won. Let’s hope the nation will not been coaxed into fear of isolation and let’s hope the people of the world will join in this experiment of letting the interest of the peoples rise above the interests of banks, corporations, and international bullies such as the IMF. We need your support. I will soon issue a comprehensive report on the entire Icesave saga.
Love and rage from Iceland.

Birgitta Jónsdóttir
Party group chairman for The Movement in the Icelandic Parliament
Documentation: I append links to the files about Icesave that were leaked to wikileaks, and which show how the EU member states blackmailed Iceland into the same corner the government helped push into by accepting the Icesave bill. This file also contains letters between the main financial adviser to the Iceland Finance Minister and Mark Flanagan of the IMF:

The people of Iceland need to face up to the facts of this matter.

As individuals, they are no more personally responsible for the failure of a bank in their country than the people of Tazmania are. No person can be made liable for a debt incurred by a third party without the written consent of that person, so unless every person has signed a contract that makes them legally bound to repay the debts of Landisbanki, Icesave or ANY bank they are not liable for that debt, PERIOD, no matter what anyone says. It is entirely immoral for the government of Iceland to socialise the debt of these banks and tax the Icelandic people to raise the money. This is unambiguous and criminal theft.

Watch this:

at 14:35. For a very clear explanation of the background.

The answer for Iceland is Libertarianism and Austrian Economics.

First of all, they need to close down their central government PERMANENTLY and not replace it with anything. Then they need to start trading with each other for and with real money, which means gold, or fish or whatever it is they have to hand or that they determine money should be.

Birgitta Jónsdóttir said:

The danger if Icelanders will accept this enormous burden is that the entire welfare system would simply collapse with no money to run it.

The welfare system of Iceland needs to switch to an entirely voluntary basis; Icelanders cannot afford (either financially or morally) a socialist style system of welfare based on theft. It is precisely this sort system that got them into this trouble in the first place.

Murray Rothbard says:

English laissez-faire liberalism, even though it generally accepted [p. 148] "Poor Law" governmental welfare, insisted that there be a strong disincentive effect: not only strict eligibility rules for assistance, but also making the workhouse conditions unpleasant enough to insure that workhouse relief would be a strong deterrent rather than an attractive opportunity. For the "undeserving poor," those responsible for their own fate, abuse of the relief system could only be curbed by "making it as distasteful as possible to the applicants; that is, by insisting (as a general rule) on a labour test or residence in a workhouse."6

While a strict deterrent is far better than an open welcome and a preachment about the recipients' "rights," the libertarian position calls for the complete abolition of governmental welfare and reliance on private charitable aid, based as it necessarily will be on helping the "deserving poor" on the road to independence as rapidly as possible. There was, after all, little or no governmental welfare in the United States until the Depression of the 1930s, and yet — in an era of a far lower general standard of living — there was no mass starvation in the streets. A highly successful private welfare program in the present-day is the one conducted by the three-millon-member Mormon Church. This remarkable people, hounded by poverty and persecution, emigrated to Utah and nearby states in the nineteenth century, and by thrift and hard work raised themselves to a general level of prosperity and affluence. Very few Mormons are on welfare; Mormons are taught to be independent, self-reliant, and to shun the public dole. Mormons are devout believers and have therefore successfully internalized these admirable values. Furthermore, the Mormon Church operates an extensive private welfare plan for its members — based, again, on the principle of helping their members toward independence as rapidly as possible.

Note, for example, the following principles from the "Welfare Plan" of the Mormon Church. "Ever since its organization in 1830, the Church has encouraged its members to establish and maintain their economic independence; it has encouraged thrift and fostered the establishment of employment-creating industries; it has stood ready at all times to help needy faithful members." In 1936, the Mormon Church developed a "Church Welfare Plan, . . . a system under which the curse of idleness would be done away with, the evils of a dole abolished, and independence, industry, thrift and self-respect be once more established amongst our people. The aim of the Church is to help the people to help themselves. Work is to be enthroned as the ruling principle of the lives of [p. 149] our Church membership."7 Mormon social workers in the program are instructed to act accordingly: "Faithful to this principle, welfare workers will earnestly teach and urge Church members to be self-sustaining to the full extent of their powers. No true Latter-Day Saint will, while physically able, voluntarily shift from himself the burden of his own support.


For A New Liberty The Libertarian Manifesto

320,000 people live in Iceland. They have a 21st century infrastructure, a tourism trade, fishing and many other things, including the magical Björk who on some level understands that Icelanders need to "start their own currency".

They do not need a central government to enslave them, to feed them, to 'keep them safe' to organise them, to regulate them, to print and control their money, to regulate their banks or do anything else of any kind. These people are in a very good position to adopt the principles of a pure Libertarian society powered by Austrian Economics; that means no coercive central government and absolutely no central bank – voluntary interaction and exchange in all areas of life at all times. All they have to do is shutter their government, promise not to bother each other and launch their new money.

We know how a purely voluntary society operate, but what would the new Icelandic money really look like? Well, that is up to the market. Money is a commodity, just like wood, oranges, geothermal heat, tea or anything else that one person has that he wants less than something someone else has. People whose business it is to make money know how to craft it so that it is acceptable to the greatest number of people; it is something that they have in abundance that they have little real need for, which they can use to make more money. This is a great business opportunity for entrepreneurs to step in and create a good set of monetary units for Iceland.

A clever person with alot of money could mint (for example) small gold coins, say the size of a us Dime.

The weight of a US Dime is 2.268g
The price of gold at the date of this post is $36.38/g
That means that each of these new Icelandic gold coins would be worth 2.268*36.38 = $82.51 : enough for a weeks shopping at the grocery store.

Smaller amounts of money would be minted in silver coins:

2.268*18.23 = $41.35

for a dime sized coin made of pure silver. Price of twenty pints of bitter. Or a canister of natural gas.

These are two examples of the shape of money that could come out of a market driven currency. The money makers business is then to inject this new money into the economy, taking a small profit whenever the money is exchanged. Read about how it works:

This is the true and remarkable story of private coinage and banking in Britain in the early years of the Industrial Revolution (1775-1850). Making money was a business in demand. The needs of business for small denominations were changing. Merchants needed small denomination coins in copper and silver.

The Royal Mint couldn't be bothered. It made coins to serve the elites, not the new and burgeoning working class. Free enterprise stepped in with a new industry that truly saved the day—before the Crown cruelly stamped it out and ended one of the most beautiful experiences with private money in world history.

It is very likely you have never heard of this episode. You can read dozens of histories of the early years of capitalism and know nothing of this spectacular industry – to say nothing of its lessons for today.

What is going on here? George Selgin, professor at the University of Georgia, has discovered the monetary equivalent of the lost city of Atlantis. He has written a full-scale historical narrative—one that is deeply interesting and engaging—that has been largely unknown, even to scholars of the Industrial Revolution.

It is not only the first full-scale history of this episode ever written. It is likely to maintain a place as the definitive work for many decades. It is 400 pages, but always and everywhere very interesting. It includes 20 pages of color photos. The prose is elegant, and the method of analysis is thoroughly Rothbardian: this is flesh-and-blood history of real human beings.

These coins would be desirable not only in Iceland, but all over the world; they are gold, and gold is money.

Thanks to the small number of Icelanders, a single billionaire could jumpstart this new currency. Many millionaires could do it. It has been done before, for purely commercial reasons; this time it would not only be commercial pressures that propel the adoption of this currency but also the thirst for freedom, that would propel it.

However the Icelanders decide to solve their problem, one thing is for sure; they need to understand what their problem is before they can solve it.

Their problem is the parasitic, resource sucking corrupt and evil Government of Iceland, and all of its institutions, pure and simple. If they do not face this fact, they will wind up being further enslaved and pauperised.

As the guest in Max Keiser's report said, the educated (and productive) will flee Iceland to set up life somewhere else rather than be destroyed by this slavery, and who could blame them? Of course, the answer to that would be for the Government of Iceland to bring in exit visas for all Icelanders so that no one can escape, and don't think for an instant that they would not do it. They are already willing to sell the entire population into slavery at the behest of foreigners, so locking them all into a giant geysered gulag is just the next logical step.

Finally, they can demand all they like with petitions and other old fashioned and impotent strategies. Governments like those things; it shows how bereft of imagination and common sense the best of the population is. It makes them feel secure and powerful: "If this is the best that they have, 'demanding' their freedom and signing petitions on a website that WE set up, well HAW HAW HAW, we can take them any time we like!". These Icelanders, with a very small population, have fewer people to connect with, convince and organise. Their population is more homogenous than many developed countries, they are all in the same boat at the same time; it could not be better for them.

Its going to take a nation wide, 320,000 strong Old Holborn style refusal to cooperate to get them clear of their blood sucking government. That is the first step. Once that government is no more, and there is no replacement, the incredible force of the market will begin to solve their problems in very short order. They have the balls to do it; what they need to do is do it with a clear plan and understanding of their problems and the way out.

If they do it, Iceland might just become THE place to be in the early part of the 21st century!

Icelander's Emergency Reading List:

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