Iceland’s trust is gone

REYKJAVIK After the eruption of the economic crisis in 2008, many Icelanders blamed the financial sector for what had happened. Though the common banker was no more to blame than the ordinary Icelander, the negative attitude towards the bankers was very much present. People were fed up with the financial sector as much as they were fed up with the politicans in the parliament. The desire for something new resulted in the making of a new party, the Citizens Movement. But the new party has found that making a change might be more difficult than they expected.

By Sajeev Shankar

The negativity towards the government and financial sector peaked in Iceland at the beginning of 2009. Three months later the Citizens Movement was elected into the parliament achieving 7,2% of the votes. This was a party that didn’t even exist a couple of months before the election. A party that was made up by ordinary people who not only wanted but demanded change. A party with completely new and revolutionary ideas on how the country and the financial sector should work. Margrét Tryggvadóttir, one of the four people who were voted into parliament for the Citizens Movement explains why she chose to enter politics.

“I was furious, that is the answer. I felt like everything here was based on a lie. We thought everything was okay beacuse the government, the banks, and the business owners told us constantly that things were great in Iceland, and a lot of us believed that. And then suddenly it all collapsed,” she says.

According to politician Margrét Tryggvadóttir Iceland has become more divided than before the crisis. Photo: Sajeev Shankar

She was not the only one who was furious at both the government and the financial sector. Many people felt the banks had misled them and that they were responsible for the economic difficulties the country had. A few weeks before the election the Citizens Movement was set to get around 2% of the votes, far away from the 5% minimum needed to enter the parliament. Margret Tryggvadóttir is proud that they made it into parliament but she thinks they could have had even more votes.

“It was all new to us, we didn’t know how to run a party. I think if we had had more time, we probably would have got more votes. At that time of the election we didn’t really know what had happened. It was like one of those volcanos, no one had a real oversight (on the consquences of the crisis red.) at the time. But now the polls show that 50 percent are saying that they don’t know which party they are going to vote for in the election next year, there is no faith in politics,” she says.

And Margrét Tryggvadóttir is right. In a survey from february this year only 10% said they have trust in Alþingi, the national parliament. The only place where the trust is lower is when it comes to the financial system. Only 7% have trust in the sector.

At the time of the election in 2009 public attitude towards the financial sector had already become very critical. The union for financial employees on Iceland, SSF, had a big survey on the public’s attitude towards the financial sector at that time.

Little trust in Banks

Back then more than half of the people who were interviewed said they “could not trust the advice given by the banks.” Most of all them agreed that “the bank managers were fully or in the greatest part responsible for the economic downturn.”

And though 28 percent said they had “negative attitudes towards the staff in the banks,” others (more than 60%) said they had “sympathy with the frontline staff because of the harasmments they faced from the customers after the turmoil.”

One of the bankers who could feel the negativity towards her sector was Ingibjørg Jona Gardusdottir, who worked in Arion Bank for 11 years before she and 56 others were fired in september of last year.

“You felt kind of ashamed working in a bank. When I met new people I wouldn’t say that I worked in a bank, I would just say I worked at an office because you didn’t know how they would react. Even last year I didn’t say I worked in a bank,” she tells me.

When the times were most difficult in Iceland it was not a rare sight to see angry people protesting. Protesting against the politicans. Protesting against the bankers. Some of the biggest protests took place in front of the Central Bank of Iceland.

Kjartan Haukson is a risk manager at the Central Bank of Iceland. He didn’t work there at the time, but he remember watching the protesters on television and how he couldn’t believe that this was going on here in Iceland. He thinks the attitude towards the bankers is better today and he is sad about the bad reputation the bankers got during and after the crisis.


Kjartan Haukssoon in front of his work place, the Central Bank of Iceland. Photo: Sajeev Shankar

Society has changed

“In the lead up to the crisis, I was a risk manager on foreign loans (in the bank Landsbanki red.). I had foreign loans myself, and the counseling I gave my clients was the same as the one I gave myself. I did what I thought was best for both me and my clients. If their loan doubled, then mine doubled as well, so I was always in the same position as my clients. The thing that really surprised me when I spoke to some of my former colleagues, was that it was only a very small core in the bank who had a feeling of what was going on. The rest of us knew that we were going through a tough stretch, but none of us imagined that the banks would go bankrupt”, he says.

Indeed not many people had seen it coming. Margrét Tryggvadóttir thinks that’s why it hit so hard. Today she feels the Icelandic society has changed. It has become more closed.

“The worst thing is it doesn’t feel like us. All my life I have been proud to be Icelandic. I liked living here, and there was a good feelling here. It is not like this anymore that is the real problem. I think that the small units, like the family is of more value. But the society as a whole is not, the society is broken. The trust is gone”, she says.

The society is not the only thing that’s broken. Shortly after the election Margréts party, the Citizens Movement broke into smaller units. Today she represents a party called The Movement. And a few weeks ago it was announced that The Movement along with other small parties will unite in a new party, called “Dogün”, which in Icelandic means sunrise, a new day.

“Let’s hope this will be a new beginning for Iceland,” she says.

MP Margret Tryggvadóttir talks about the internal problems her party has faced

MP Margrét Tryggvadóttir talks about the current problems on Iceland

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