Stephan: It is a measure of how disconnected corporate media has become from what is really going on that the cautionary tale comparing Iceland and Greece is barely mentioned. With the exception of the Charlie Rose show I don't think I have seen a single serious discussion of the issue on any American outlet cable or network. This is a joint French and English assessment.
We can see a lesser variant of those two countries in the US. It is Wisconsin compared to Minnesota, or Kansas and California only writ mythically large. Everywhere Austerity Economics is practiced the results are inferior. It is an economic philosophy that should be abandoned but never forgotten. What has happened in both countries as a result of the economic crisis should be a text book study.
This very begrudging report — the only one I could find, on this story — is the latest from Iceland. Read it in the light of the Greek referendum today. Iceland has charted its own course. And they are succeeding, as the report barely mentions, where Greece is failing and in revolt. Iceland is now seriously considering stopping commercial banks from creating money. Research has shown it inevitably results in financial crises arising from greed and speculation. The data is there. Rightwing economics are not life-affirming. They do not create wellness.
Icelandic currency. Note the woman on the 5000 krona note. $1 = 132 krona Credit: Iceland.org
Iceland’s government is considering a revolutionary monetary proposal – removing the power of commercial banks to create money and handing it to the central bank.
The proposal, which would be a turnaround in the history of modern finance, was part of a report written by a lawmaker from the ruling centrist Progress Party, Frosti Sigurjonsson, entitled “A better monetary system for Iceland”.
“The findings will be an important contribution to the upcoming discussion, here and elsewhere, on money creation and monetary policy,” Prime Minister Sigmundur David Gunnlaugsson said.
The report, commissioned by the premier, is aimed at putting an end to a monetary system in place through a slew of financial crises, including the latest one in 2008.
According to a study by four central bankers, the country has had “over 20 instances of financial crises of different types” since 1875, with “six serious multiple financial crisis episodes occurring every 15 years on average”.
Mr Sigurjonsson said the problem each time arose from ballooning credit during a strong economic cycle.
Frosti Sigurjonsson’s […]
