The citizens of Iceland voted in a referendum, on Saturday (20th), with about 70% of the voters. The basic text of its new constitution, drafted by 25 delegates, almost all ordinary men, chosen by direct vote of the people, included the nationalization of its natural resources. Iceland is one of those enigmas of history. Situated in an area warmed by the Gulf Stream, which winds in the North Atlantic, the island of 103,000 km2, is inhabited only along its coast.
The interior of high hills, with 200 active volcanoes, is entirely hostile - but this is one of the oldest democracies in the world, with its parliament (Althingi) running for over a thousand years. Even under the sovereignty of Norway and Denmark, until the late 19th century, Icelanders have always kept comfortable autonomy in their internal affairs.
In 2003, under pressure from neoliberals, Iceland privatized its banking system, up to that time state-owned. As they pleased major U.S. and British banks, already operating in the derivative market, in the spiral of subprimes, Reykjavik turned into a great international financial center and one of the biggest victims of neoliberalism. With only 320.000 inhabitants, the island became a comfortable fiscal paradise for the great banks.
Institutions like Lehman Brothers used the country's international credit in order to attract European investments, particularly British. That money was applied to the financial casino, commanded by U.S. banks. The bankruptcy of Lehman Brothers exposed that Iceland therefore has taken debt exceeding ten times its gross domestic product. The government was forced to re-nationalize its three banks, whose executives were prosecuted and sentenced to prison.
In order to tackle the huge debt, the government decided that each of the Icelanders - of all ages - would pay 130 euros monthly for 15 years. The people demanded a referendum and, with 93% of the vote, decided not to pay that debt as it was the responsibility of the international financial system from Wall Street and the City of London.