Iceland’s government is in disarray. A month after its most recent election it is struggling to do basic things like decide which members of parliament will hold the various minister positions, including that of Prime Minister. It is just the latest in a series of missteps, scandals, and political maneuverings by a political elite that seems deeply disconnected from its voters.
To understand this situation you must go back to the leaking of the Panama Papers, which revealed the finances of many notable people around the world, people who have preferred that information remained hidden. In Iceland this worldwide event manifested itself initially and primarily in the person of Sigmundur Davíð Gunnlaugsson, who had became Prime Minister in 2013 after his party, the Progressive party, ran on a platform of reforming the banking and financial sectors of the Icelandic economy. The Panama Papers, however, revealed that he had significant undeclared financial interests in one of Iceland’s banks. This undisclosed conflict of interests sparked anti-government protests and calls for Gunnlaugsson to resign, which he did in April 2016 despite initially refusing to. In the aftermath of the resignation and the scandal Gunnlaugsson’s party held an election in October 2016. Out of this a new Icelandic government was formed, with a man named Bjarni Benediktsson of the Independence party becoming the new Prime Minister.
However, shortly after Benediktsson took office another scandal happened. In some ways this was destined to happened the moment he came to office and really one has to wonder what on earth the members of Iceland’s government were thinking. Firstly, the new Prime Minister already had a spotty record, having been revealed to be a registered member of Ashley Madison, the dating website that caters to married people, in 2015. Furthermore, despite the fact that the public outrage over Gunnlaugsson was over his financial dishonesty revealed by the Panama Papers, Benediktsson was also among the list of public officials ousted by the documents. Considering this there is little surprise as to why Benediktsson was already on thin ice the moment he came to office. That ice cracked very quickly.
In Icelandic law there is a mechanism by which a convicted criminal can have their “honor restored”. They can present written recommendations from law abiding Icelandic citizens and get a full pardon from the government, allowing them to overturn any conviction that is at least 5 years old. In September of 2017 it was revealed that Benediktsson’s father, himself a prominent businessman and one of the wealthiest people in Iceland, had written a letter for Hjalti Sigurjón Hauksson, a notorious pedophile rapist who had been shockingly pardoned that summer. Benediktsson had chosen not to reveal this even though the identity of the letter’s writer is not supposed to be confidential. Only after the media acquired that information did it become public. When it did it sparked outrage, both within the Icelandic parliament and among the general population. The Bright Future party, which had been a part of Benediktsson’s governing coalition, cut ties with him and his Independence party, leaving them without the seats necessary to form a majority. In response, Benediktsson called a snap election in October 2017.
The election has only thrown the government into further chaos. Benediktsson’s Independence, having already been several seats short of a majority prior, lost 5 more in the election while some of the smallest parties in Iceland made significant gains. Benediktsson is now trying to forge together some kind of governing coalition out of his party and two more and it’s not even clear if he will remain Prime Minister. The parties in question aren’t natural allies either, running the gambit of the political spectrum from left to right and sharing very little common ground on which to form a policy agenda. Regardless of what the new government in Iceland is going to look like it appears that it will be a deeply divided one which I doubt will be prepared for whatever is coming next, constantly looking over its shoulder for the next conspiracy.
What does this mean? Well, it will continue to feed a growing distrust of the government dating back to the 2008 financial crisis, especially a government led by a political elite that seems to be tone deaf at best. Take Gunnlaugsson and Benediktsson as examples. The former is a young, 40-something man from a wealthy family that has a history in Iceland’s parliament and had financial secrets revealed in the Panama Papers. The latter is a young, 40-something man from a wealthy family that has a history in Iceland’s parliament and had financial secrets revealed in the Panama Papers. While the name may have changed it is clear that the political elite in Iceland didn’t understand the voter’s demands in the slightest and it is no surprise that another scandal was able to tilt the balance in parliament so much. Until there a major change in the people at the top of the Icelandic government I don’t see the situation stabilizing.