From Iceland — "Meet the new boss, same as the old boss..."

“Meet the new boss, same as the old boss…”

Published September 30, 2010

This summer’s special income/tax issue of the Icelandic business magazine Frjáls Verzlun is at once a bottomless source of nauseating news and a testament to the pervasive incompetence and disgraceful cowardice of Iceland’s political class. The magazine reveals that the con artists who bankrupted the nation were in 2009—the year following the collapse brought about by their spectacular ineptitude, greed, and grandiosity—pulling in salaries like 2007 had never ended. The former CEO of Glitnir bank, Lárus Welding, received in 2009 over $3.000 per day—per day (which is a considerably higher amount than many public employees make per month after decades of work) for… for what? The magazine lists him as “Glitnir‘s CEO.” Welding is in familiar company; most all of his bank buddies co-populate the obscene-salary list with him.

After they’ve squandered the nation’s wealth, devastated its institutions, and ruined its reputation for generations, it is truly revolting to see these prosperity butchers still making millions, and that after Icelandic taxpayers having had to deliver first aid to their bruised and bloody handiwork.
Why these incompetents are still receiving obscene payments from the state-rescued banks is absolutely mind-boggling. They’re hardly being rewarded for primo performance on the job. Is it so much more difficult for the politicians to tell their buddies at the banks—as they have the labour movement—that contracts cannot be kept because there is “no money”? How about simply telling them that, considering their rotten job performance, their employment contracts are null and void ipso facto? How about demanding that they return the “bonuses” they paid themselves for their fine feats? How about slapping them with a few executive penalties, for countless violations of Icelandic law? The counting house lords at least have cash—which is more than can be said about their victims—to pay them.

According to FV, eight employees of the banks’ marketing departments receive monthly salaries of over one million ISK, which is remarkable generosity for an industry that is considered overtly bloated in addition to having bankrupted a whole country. Equally astounding is the fact that most of these people have worked at the banks for years! I wonder if these employees are the same ones responsible for the “rapacious marketing” discussed in the Black Report: “Countless examples exist of how people were manipulated into doing business… In some cases these are seniors who seem to have been deceived and defrauded and feel they have been humiliated in their twilight years.” And regarding the marketing of the money market accounts: “The Report seriously criticizes many of their [the accounts’] aspects… marketing to the public.” It was difficult for “…individuals to realize the increased investment risk since the information from the banks was at best deceptive […] When then the banks are all promoting the same deceptions, it is even more difficult for people to get correct/reliable information.”

How wonderful to know that the people behind these kinds of “marketing efforts” are still sitting firmly in the banks that Icelandic taxpayers rescued with their blood money. I wonder if Steingrímur [Sigfússon, Minister of Finance] knows about this. Last February he said he believed that salaries of the banks’ resolution committee members were “completely at odds with the current reality, what workers in general have to live with […] I believe it is right and [the administration’s] obligation to look at this and consider if the government can somehow, via the FME and the ministries of finance and business, or the state in its position as a creditor, ensure that society’s salary decisions in general are in line with today’s reality, not the past.”

I’m still waiting for the administration to take action. But I’m not holding my breath. This administration was elected to clean up after and in the banks. For the former task they’ve made the public pay, and at the latter, they’ve utterly failed. When it comes to taking on Iceland’s failed financial sector and its criminal class, this administration is no different from its right wing colleagues. However, while Icelandic voters can be forgiven for being frustrated over that fact, it is truly depressing to see that over a third of them believe that the only solution to the country’s nightmarish mess is to replace the politicians currently in charge with the ones who created it.

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