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Cold Reality

10/28/2017

Iceland is a fascinating little island-nation with a population of a mere 335 thousand, much less than the city of Virginia Beach for example.  Often called the “land of fire and ice,” it is indeed a land of contrasts from glacier-covered active volcanoes to magnificent art galleries.  Despite a jaw-breaking language, the population is remarkably well-educated and well-read.

While I believe that people are just people everywhere and that “the Russians love their children too,” I did find a special, laconic disposition of Icelandic people.  Their speech is melodic and hypnotizing.  Except for their politicians, I’ve never seen an angry Icelandic person.

Speaking of politics, Iceland neatly separates its economic and social issues.  It is progressive on issues such as same-sex marriage and abortion but conservative on business regulation.  (It is oddly conservative on alcohol consumption!)

Karl Marx famously said that capitalistic systems may be efficient, but they are also cruel.  Iceland could have been a case-study for him.  It’s economy was traditionally built on fishing and farming.  In the halcyon days of minimal worldwide financial regulation before 2008, Iceland added a potent third new industry – banking – and proceeded to make loans worldwide and, more importantly, buying derivatives, such as credit default swaps.   This country consequently became the first country to collapse during the global financial crisis, and its people suffered greatly.  One important economic tool is the currency exchange rate.  Iceland devalued its krona over 50%, which means all imports suddenly cost 50% more.  GDP promptly shrank and unemployment tripled.  They saw the cruelty of capitalism up-close and personally.

Slowly, the capitalistic Icelandic economy fought back and recovered.  Today, it has the fastest growing GDP (7.2%) among developed nations and a mere 2.6% employment.  Their economy is booming.  Banking has been replaced by tourism.  Over two million tourists visit this tiny country annually.  Construction cranes dot the horizon in their capital city of Reykjavik.

But, like people are the same everywhere, politicians are the same everywhere.  Icelanders are voting today to replace their year-old government, because the leader’s father wrote a letter asking for a pardon or “honor restitution” for a pedophile.  Understandably, snap elections were called immediately, and we will know soon enough who the new leader will be, but it doesn’t really matter, because Iceland will continue to be socially progressive and economically conservative.

Iceland is a must-see country!  Go, see it now . . . 

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