In late April 2013, a slight majority of Icelanders who
voted in the parliamentary election went for a return to the center-right
Independence and Progressive parties even though they had been responsible for
the banking crisis that bankrupted Iceland. The two parties promised to forgive
or renegotiate the Icelanders’ personal debt and end the four years of
austerity by lowering taxes, ending capital controls and stimulating foreign
investment, according to the New York Times. The center-left governing parties,
including the Social Democrats, had cut spending and raised taxes, making the
carrots being offered by the center-right parties all that more alluring.
Although not the main issue of the election, the prospects for Iceland becoming
a state in the European Union lessened significantly with the ousting of the
center-left government. Unlike that government, the center-right parties voiced
skepticism and advocated a referendum before any the government would take any
further steps. In the wake of the election, it might be helpful to reflect on
whether Iceland should become a state. After going over some economic and
political factors, I want to highlight subtler factors whose influence is
typically understated in newspaper headlines.
The
complete essay is at Essays on Two Federal Empires.
