By JOHN F. BURNS
REYKJAVIK, Iceland — It is a tale of light and dark — of a small but rugged country far from anywhere that has suffered as severely as any in the developed world at the hands of buccaneering free-marketeers, but which is now slowly digging itself out from the financial wreckage.
An important milestone was reached on Saturday, when the country’s voters went to the polls to elect a new government, three months after riotous street protests over the country’s banking collapse forced the country’s conservative-led administration from office.
With about a third of the final vote counted late Saturday, it seemed that the country’s leftist caretaking government would be formally voted into power, with the Social Democrats projected to gain 22 seats and their partners, the Left-Greens, appearing to gain 13 seats in the 63-seat Parliament. The conservative Independent Party, ousted after a wave of demonstrations in January, was projected to gain just 14 seats with less than 23 percent of the vote, down considerably from its total in 2007. Final results are to be announced on Sunday.
The conservatives were one of the first governments anywhere to lose office because of the global financial crisis, and it seemed clear Saturday that voters in this country of 320,000 were imposing a further reckoning.
The Independent Party has been blamed for a perceived complicity in the banks’ accumulating unsustainable, multibillion debts, and their partnership with a group of freewheeling Icelandic entrepreneurs known as the “New Vikings.”
Six months after the banks collapsed and three of the largest were nationalized, the grim consequences are only now becoming fully understood after months of forensic work by financial experts.
Many of the debts that drove the banks to the brink of default were incurred as the New Vikings went on a splurge of acquisitions that made them owners of department store chains, soccer clubs and investment houses in Britain and other parts of Europe, as well as mansions, helicopters and Ferraris on their sojourns at home here in Iceland.
If the final results bear out the early tally, the swing in public opinion would elect a leftist government to power for the first time in the modern history of the Althingi — the Parliament, which Icelanders claim to be the world’s oldest continuous legislature — along with the prospect of a four-year term.
It would also confirm a remarkable turnaround in the political fortunes of Johanna Sigurdardottir, the 66-year-old caretaker prime minister, who is the first woman to lead Iceland’s government. Only months ago, before January’s turmoil, she was readying herself for retirement after 30 years in politics and was widely seen as too feisty, and even too left wing, to rise beyond a series of midlevel coalition cabinet appointments.
Ms. Sigurdardottir is notable, too, for being the first openly declared lesbian to lead a government in the modern world, though her sexual orientation was never a significant election issue. What Icelanders say they like about her, as much as anything, is the way in which she embodies everything the New Vikings did not: a quiet, steady personality uncomfortable with the public spotlight, who chose to stay away earlier this month from a NATO summit meeting in Europe, where she would have met President Obama and other Western leaders for the first time.
In Iceland, the storyline of the election has closely followed the growing partnership at the head of the government between Ms. Sigurdardottir, a former flight attendant, and Steingrimur Sigfusson, the 53-year-old former truck driver and geologist who leads the Left-Greens. He, too, is a combative character, though as much at ease with the hurly burly of politics as the shy Ms. Sigurdardottir is not.
Mr. Sigfusson was finance minister in the caretaker government, a position he is expected to keep after the election, and he says he wants to free Iceland from the consequences of embracing the unrestrained free-marketeering that had its origins in the United States.
“What are the people of the United States mad about now?” he said in a recent interview. “It is the same poisonous philosophy that we had here, based on a lack of moral awareness and greed, and people who thought nothing of flying Elton John into Iceland for their 50th birthdays and paying him 70 million Icelandic kronur,” or roughly $600,000.
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http://www.nytimes.com/2009/04/26/world/europe/26iceland.html?em
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