Wow. This is crazy! Iceland’s former Prime Minister Geir Haarde (who served as Finance Minister from 1998 to 2005 and then as Prime Minister from 2006 to 2009) has been indicted for economic mismanagement that led up to the economic collapse of that country in 2008.
Iceland’s Haarde Is First Leader Indicted Over Crisis – BusinessWeek.
Update: BusinessWeek dropped the article a couple of years later so I found a similar article over at Bloomberg: Iceland’s Haardd Indicted by lawmakers over role in crisis.
This is fascinating! As the article points out, political leaders have been indicted for war crimes in the past but they’ve never been indicted for economic mismanagement… until now. The assertion by the lawmakers is that Haarde had been negligent in allowing the finances of the country’s banks to get out of hand and thus broke the law of ministerial responsibility.
Here are my thoughts: Haarde is being held up as a scapegoat for (what I believe is) a populist agenda. Current leaders are conveniently placing blame on the shoulders of former leaders. Yes, politicians should be held accountable for their conduct and misconduct. Yes, politicians need to work with the country’s best interests in mind. Yes, the laws of the land prevail even over politicians.
But, Haarde as the country’s former figurehead and as the former finance minister should not be the only one held to this degree of accountability. This indictment seems singularly focused on Haarde alone. However, he did not work alone to create this situation. Not only is the economic situation the result of a myriad of factors, it also didn’t just take place while he was in office. The economic structure that led up to this collapse was developed well before 1998 (when Haarde started as Finance Minister). So was the desire for banks to accept debt and take an increasing amount of risk. So was the need for people to pay with debt instead of cash. So was the willingness of businesses to accept more debt-based payment options.
Icelandic lawmakers might feel better by pointing an accusing finger at one person and saying that he was responsible for the entire economic collapse of the country but it doesn’t place blame appropriately. If they are truly looking for someone to blame, they need to blame banks, lenders, currency traders, politicians, businesses, consumers, and other countries.
The global economic situation (of which Iceland was an unfortunate, participating victim) is part of the natural ebb and flow of economics. It can be controlled slightly but it is never going to be completely avoidable and indicting one person for a country’s financial woes is unreasonable.