The opposition lie while Iceland freezes


2:23 am - November 7th 2008

by John B    


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There is a massive false meme, prevalent both in the UK and in Iceland, that Gordon Brown last month froze Icelandic companies’ assets in the UK as an angry gesture after the collapse of Landsbanki, by labelling Iceland as a ‘terror state’ like Sudan or North Korea.

The existence of this meme is sad, very slightly because it’s caused large numbers of British morons to explode with rage (here’s a good example by ignorant buffoon and Tory MEP Daniel Hannan), partly because it’s hurt Icelanders’ relationship with and perceptions of us – and they’re people who we really ought to get on with, both because of our enormous shared cultural heritage [*] and because they’re great (full disclosure: I’ve just returned from a week in Reykjavik), but worst of all because of the myth’s impact on the already-struggling Icelandic economy.

So what actually happened? The short answer is that the UK government published this order after Landsbanki’s collapse and receivership in Iceland (and after the Icelandic government refused to confirm they’d compensate UK savers in line with EU law – a position they have subsequently reiterated). The order states that UK individuals and companies’ transactions with Landsbanki and related entities must now be approved by the UK Treasury. It was issued under the Anti-terrorism, Crime and Security Act of 2001.

The lie is that the assets of Icelandic companies and the Icelandic government were frozen under anti-terror laws. It’s a lie for three reasons:

* the assets of Icelandic companies were never frozen – the UK assets of one Icelandic company which was already in administration domestically were frozen;

* the assets of the Icelandic government were never frozen – whilst the government was named in the relevant order, this is very clearly and explicitly solely in its role as administrator of Landsbanki (an equivalent would be the Belgian government freezing assets controlled by PricewaterhouseCoopers in its role as administrator of Lehman Brothers, if Lehman owed billions of quid to Belgians – it would not affect PwC’s ability to carry out other business in Belgium);

* the order has absolutely nothing to do with antiterrorism. The relevant clause isif [the Treasury believes] action to the detriment of the United Kingdom’s economy (or part of it) has been or is likely to be taken by a person or persons“, which is not terrorism in any sense of the word.

I’ve tried to trace the source of the bizarre myths suggesting otherwise – clearly, there are four main elements here: 1) the UK media, 2) the Icelandic media, 3) UK opposition parties (Tory and SNP [**]), and 4) the Icelandic government.

My best guess so far is 3/1/2/4, with the Tory and SNP narrative driving media coverage, angering the Icelandic press and hence forcing the Icelandic government to respond to the narrative filtered through two partisan prisms and one nationalist prism (“Mr Prime Minister, the Tories say that Gordon Brown says you’re Osama Bin Laden’s right-hand man – do you think Brown is a tit?”). Any clarification from Icelandic speakers without an axe to grind (sadly in short supply as far as I can find: they are Vikings, after all, so when times get tough axe-grinding is pretty much the way forward) on exactly how the narrative went in Iceland would be welcome (update: I know Geir Haarde made a grumpy comment on October 10, two days after the Order was made – the question is, was that active or reactive?).

But does the fight actually matter, beyond ‘amusing stick for beating Brown and Darling with’?

Well, yes, massively. The effect has been to turn an entirely unremarkable and tedious administrative order over how to wind up the assets of a company that both sides agreed was bust, into a giant media furore over whether the Icelanders are terrorists and whether their assets abroad are forfeit. They aren’t and they aren’t, respectively – and the UK and Icelandic governments agree wholeheartedly on both points.

But just as a giant media furore over whether or not Dave Bloggs is a paedophile, even if Mr Bloggs and the CPS agree that in fact he isn’t, would damage his babysitting career, the ridiculous controversy has led other foreign investors into panic over dealing with Iceland lest Gordon Brown confiscates their fish and aluminum and extradites them to Guantanamo Bay.

This has turned a financial downturn that Iceland should easily be able to ride out (35% of GDP still comes from hard-currency physical exports, the country is energy self-sufficient and has an unbroken 1000-year history of the rule of law – that’s a bloody good start…) into more serious worries about meltdown and inability to trade. It looks like these concerns are starting to diminish, but still it’s not a good situation to be in.

So it certainly matters to the Icelanders. But it ought to matter to all of us as well: the saga shows that the two most credible parties of opposition in the UK are willing to tell lies that harm our national interest, whilst simultaneously both turning friendly foreign countries against us and further damaging their ruined economies. At what point, exactly, does legitimate political debate turn into treason?

[*] potted history: Nordic Vikings sailed to Britain, kidnapped local women and forced them to come to Iceland as their wives; Icelanders’ mitochondrial (maternal) DNA is two-thirds British, whereas the overall mix is about 50/50 British/Nordic. We sent missionaries to teach them how to read and write, and the current Icelandic language is the same as Old English. Then the Danes took over until WWII, at which point the legally-neutral-as-still-technically-Danish Icelanders joined in thoroughly on the Allied side, and many died fighting alongside us.

[**] the SNP’s financial policy until last month was “the fact that the Scottish economy consists of nothing but oil, the dole and RBS doesn’t matter, because we can be financial wizards like the Icelanders”. I’m not saying their attacks on Gordon Brown here were solely driven by embarrassment at the simultaneous failure of everyone north of Watford to run a bank without going bust [***] – just coincidence is all.

[***] blah blah Co-Op blah blah. Manchester doesn’t count as properly Northern, anyway.

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About the author
John Band is a journalist, editor and market analyst, depending on who's asking and how much they're paying. He's also been a content director at a publishing company and a strategy consultant. He is a regular contributor to Liberal Conspiracy and also blogs at Banditry.
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Reader comments


A bit more digging and you would have found this:

http://www.javno.com/en/world/clanak.php?id=190868

His Icelandic counterpart Geir Haarde had earlier expressed anger at Britain’s use of anti-terror laws to freeze Icelandic assets in Britain, and said he had made his views clear to British Finance Minister Alistair Darling in a telephone call.

“That was not very pleasant. I’m afraid that not many governments would have taken that very kindly, to be put in that category and I told the Chancellor that we were not pleased with that…I could not regard us in any way as the people that this act is supposed to apply to — terrorists,” Haarde told a news conference.

I’m afraid the meme came straight out the mouth of Icelandic PM Geir Haarde at a news conference. If the Vikings are wound up there’s no one else to blame except Mr Haarde. I expect he’s fighting hard to save his job.

But Haarde’s comment was on Oct 10, whereas the order was made on Oct 8. The UK media certainly began to create a ‘terror legislation freezing all Icelandic assets’ story over the next two days – the question I’m not clear on is whether the Icelandic media followed suit (ie whether Haarde was confirming or creating the domestic narrative).

Another matter of small detail, Hannan is an MEP, and not especially moronic or buffoonish.

This may well have been exaggerated by others, but surely the real point is that this (unnecessary) freeze was a perfect example of Brown grandstanding. He didn’t give a f*ck about the consequences for Iceland.

I believe the article I quoted above is undated. I found it via this quote aggregator:

http://press.jrc.it/NewsExplorer/entities/en/510130.html

They give the date of the quotation as 9th October. The timeline is:

8th Oct Order made
8th or 9th Haarde and Darling speak by telephone
9th Haarde holds press conference and uses the word “terrorists”
Later on 9th Brown quoted on the BBC saying that Iceland’s failure to guarantee the deposits was “completely unacceptable”. (ie that’s when the diplomatic row started)

The Haarde quote is an emotional appeal. It starts “That was not very pleasant. … I believe he was either in a panic, or he was setting up Britain to be the bogeyman to save his own skin. I’m afraid I don’t know anything about Icelandic domestic politics to offer any judgement. Haarde was aware that the finances of Iceland were about to come under close scrutiny worldwide following the order made by Britian, but ultimately he was the one who chose to bring it to the attention of the press, and is responsible for the language he used.

Contrast Haarde’s emotional language with the objective language Brown is using, where he told the BBC:

“This is fundamentally a problem of an Icelandic registered company (and) Icelandic registered financial services authority — they have failed not only the people of Iceland, they have failed the people of Britain,”

I presume Brown’s use of the phrase “completely unacceptable” is the diplomatic language for illegal. Brown may be prone to “grandstanding”, who knows whether Haarde has a reputation for “grandstanding” in his own country? Cynicism may be a great weapon, but it often best applied to your own motives, not other peoples.

I’ve only been browsing this blog for a few weeks, but going by the number of desperate attempts to justify this Govt.s actions, its already clear that a number of bloggers are either on their payroll, rely on the Govt for work or are Liebour activists.

You seem to forget that this Govt employs an army of people to brief (manipulate) the media. The Govt wanted to appear acting tough and therefore led the hacks to report an interpretation that suited them.

Um, this is all very well, but if you’re looking to point the finger you should start with Blunkett & co., because it was they – seven years ago – who said Part II of the ATCSA was necessary to combat terrorism.

You make a good point ChavScum. I should have made clear that I get paid £5 for supporting the Government and £10 for every mention of Gordon Brown. I found the scheme by Googling “get rich quick will working from home”.

(whoops! there goes another meme)

“Another matter of small detail, Hannan is an MEP, and not especially moronic or buffoonish.”

This I object to, he is VERY buffonish.

http://www.guardian.co.uk/politics/2008/feb/01/conservatives.uk

9. Julek Kedzierski

I quote: “Then the Danes took over until WWII, at which point the legally-neutral-as-still-technically-Danish Icelanders joined in thoroughly on the Allied side, ”

No SO thoroughly. Great Britain actually aggressed Iceland by taking it over before the Germans would. Then ensued the well-known British military exercises in Iceland (with wooden guns and
no overcoats) resulting apparently in some hundreds of deaths from exposure.

Once the “thorough joining-in” on the basis of such models had indeed taken place, apart from denying all Jewish refugees any form of succour throughout the war, the Icelandic support for Britian’s Black Market bloomed mightily indeed!

As we’re talking about correct background….

The Icelandics DID make an unfortunate statement , right at the beginning, that they wouldn’t guarantee deposits in the UK. This was a silly statement to make, and the real story lies in ascertaining whether they made it after sufficient discussion with the British. And congratulations to Mr. Bland for a nice piece of writing.

Well you may object to his choice of analogy.

Or perhaps you object to the idea that the European Parliament should stick to its own rules?

I object solely to the idea that Hannan isn’t a buffon, nothing more 😉

(MP reference corrected to MEP. But as Lee suggests, the implication that Hannan isn’t a buffoon is ridiculous – even Jonathan Ross knows it’s not appropriate to call a German a Nazi…)

Another pretentious “Liberal” debate descends into insults.

Good point again ChavScum. I think I have fairly comprehensively demolished the argument that either the UK opposition parties or the UK media started this meme, but I don’t see any acknowledgement from John that he might even consider this to be true. I think if you want to start a debate like this you should have the courtesy to either defend your line or acknowledge that others might be making a valid contribution. The insult is to hold a debate but not care to finish it.

It hasn’t “descended” into insults…it started with them.

“Morons” and “ignorant buffoon” had been wheeled out by sentence two…

16. douglas clark

If the story was untrue, then why has it taken up until now for a rebuttal? This is the first comment I have seen anywhere that seeks to change the narrative. Seems a bit odd to me that the UK Government did’t make sure these ‘facts’ weren’t in the public domain immediately.

It’s because the ‘facts’ showed Brown getting ‘tough’.

Think again Martin…

“Terror law used for Iceland deposits” – FT, 8th Oct 2008. posted 17:11, last updated 22:54

http://www.ft.com/cms/s/0/abf583de-9546-11dd-aedd-000077b07658.html?nclick_check=1

And as for first reference to terrorists, try this, which was posted at 9:27 on the 9th…

Is Guido the only one uncomfortable with this abuse of the law? Aged hecklers first, now foreign bankers. We are all terrorists…

http://www.order-order.com/2008/10/terror-laws-used-against-icelandic.html

cjcjc has a point – two in fact – the debate did pretty much start with insults, and the government have been remarkably pants at correcting the false narrative.

“The insult is to hold a debate but not care to finish it.”

Sorry. Sometimes I have other things to do.

“I think I have fairly comprehensively demolished the argument that either the UK opposition parties or the UK media started this meme”

The UK media extensively reported on the action on October 8 and October 9; the right-wing press were getting grumpy *at the time* about “using anti-terror laws against an ally”. Hannan’s piece didn’t come until the following week, but it reflected the standard Tory and SNP line on the situation – and that began on October 8.

Is someone bitter that they don’t bank with the co-op?

On being too busy John, I corrected your comment 2 at 4 and you failed to even acknowledge this when you commented again at 12.

Do you agree that it was Haarde who first used the word “terrorist”?
Do you agree that Haarde used terrorist before Brown’s comment about “completely unacceptable”, and hence the before the diplomatic row blew up?

If we are unable to agree on these simple facts, there is little point in discussing this further and I will withdraw.

22. douglas clark

John,

Anyway, it looks as if we’re all chums again:

http://ap.google.com/article/ALeqM5h9Xgi3jMXDX9eF5D_H-RAw5enugQD94A0P6O1

The UK is a partner in the IMF’s bail-out.

It seems my earlier comment got stuck in the moderation queue but, Martin, I think you’ll still find that Guido was the first to use the word ‘terrorist;.

It was Blunkett who first used the word terrorist in relation to the freezing measures in Part II of the ATCSA, seven years ago (took only two weeks to get through Parliament, three days debate in the Commons).

[October 2001] With permission, Mr. Speaker, I wish to make a statement on the legislative steps necessary to counter the threat from international terrorism. … we do need specific and targeted measures, which is why I intend to introduce an emergency anti-terrorism Bill. I am determined to strike a balance between respecting our fundamental civil liberties and ensuring that they are not exploited. … Terrorists use organised crime and trade in human misery to finance their activities. The tough new financial controls in the emergency Bill will help us to staunch the flow of terrorist funding.

The emergency legislation will build on the provisions of the Proceeds of Crime Bill to deal specifically with terrorist finance through monitoring and freezing the accounts of suspected terrorists.

[November 2001] Parts I and II complement the Proceeds of Crime Bill in stopping organised terrorism and crime being perpetrated through money laundering by organised finance—a subject that my right hon. Friend the Chancellor of the Exchequer considered in Ottawa. We are seeking the ability to freeze assets …

The Government contends that the ATCSA contains many provisions and they rightly say they are not all about terrorism (indeed there is no mention of terorrism in Part II of the Act). But that was not what Parliament was led to believe about Part II.

Thanks Unity. Yes the earlier comment did get stuck but it’s slotted itself higher up the chain now. Some facts are sure to enlighten here. I’ll try the timeline again:

8 Oct – FT says Terror Law
9 Oct – Guido says We are all terrorists..
9 Oct – by 4pm at the latest Haarde says Terrorists (he is referring to his earlier conversation with Darling)

By 10 Oct the Icelandic Mission in New York said this:

The use of anti-terrorist legislation by the United Kingdom on 9 October 2008 to seize the assets of Icelandic banks was, in the view of the Icelandic government, disproportionate and extreme. The initial measures taken by the British government have since been partially withdrawn.

This was cached on 30th October but has since disappeared:

http://66.102.9.104/search?q=cache:OUt5Gf2c3vkJ:www.iceland.org/un/nyc/the-embassy/statements-news/nr/5908

Now we have UK Press then Idiot Savant Blogger wind up Icelandic Government! However I still don’t see any evidence of the opposition parties sticking their oar in.

Two points: First, it’s perfectly reasonable to call Hannan a buffoon, although I’d tend to add, cynical, opportunistic and nasty to that. He’s utterly objectionable, while buffoon tends to imply someone who’s cuddly like Boris.

And: Whatever you say it’s the Anti-terrorism, Crime and Security Act of 2001. Note the word terrorism. The British government started this when it tried to puff up/justify yet another piece of authoritarian legislation with a gratuitous reference to terrorism. They used legislation they had described as anti-terrorist against Iceland. That’s a fact.

(Comment moderation meant I had seen UKLiberty’s comment until after I last posted)

I don’t think there’s anything I would disagree with in either UKLiberty or Chris’ comments above. I’ll declare an interest here that I am a lefty. But I will quote Oliver Letwin who spoke in the same debate 15 Oct 2001 immediately after Blunkett:

We share the Government’s view that legislation is required to increase the effectiveness of our counter-terrorist enforcement. However, does the Home Secretary agree that, too often in the past, over-hasty legislation has proved inoperable in practice? Does he agree that the best guard against that danger is detailed scrutiny, which teases out the implications of the legislation to determine both whether it will be effective and whether it poses any undue threat to our fundamental liberties? Can he assure us that those critical measures at this critical time will be debated in detail on the Floor of the House? Is he aware that we will resist using the emergency legislation as a means of addressing problems of law enforcement outside the field of terrorism?

[my emphasis]

I’ll leave it here with my own comment.

The War on Terror: Uzbekistan is your ally – Iceland is your foe.

I don’t think this name calling matters a damn !

The Icelandic Government were not prepared to compensate UK fund holders.

HM Government were prepared to use existing legislation to protect UK interests,
I don’t have a problem with that ! Do you ?

GW

29. douglas clark

GW,

There is civil law and there is criminal law. We should apply the appropriate body of law in the appropriate situation, don’t you think?

Personally, if we have determined that HMG did use Criminal Law then I think they were wrong to do so, especially legislation designed to deal with terrorism. If that is the case, then it is completely crazy.

You’ll note, from my previous post, 22, that this whole matter now appears to be resolved.

So on the same principle is it OK to use “anti-terror” legislation to spy on people whose bins are “too full”?

31. douglas clark

cjcjc @ 30,

Of course it isn’t. One thing that annoys me intensely is ‘legislation creep’, where government pass laws for specific purposes and subsequently their own bureaucracies or the legal profession then use them for reasons that parliament never intended. Often enough, they, the government, turn a blind eye to this creativity, for want of a better word. Parliament ought to oversee it’s own legislation far better than it actually does. It can be somewhat Nelsonian about the chaos it introduces. I also largely agree with Oliver Letwin, quoted @ 27 above.

Of all the articles I have seen on here, I have never seen one so adamant NOT to see the wood through all the trees.

John, by your logic, it would be impossible for legislation to be “anti-terror legislation” unless it was used exclusively against terrorists. It is not enough for you that the government puts anti-terrorism in the title of the bill and that it claims in parliament that the clauses are going to be used against terrorist targets, the moment it uses the legislation against someone else, it becomes just another little executive power to be used at the government’s discretion.

This should underline how ministerial insurances mean jackshit, especially when they are used to justifiy implementing new executive powers (at least ministerial descriptions of ordinary acts can be used by courts to interpret laws when they come before them).

The point is, if you assume that any law means anything other than what it actually says, then you’re unwise.

In real life, whenever any “anti-terrorism” law is passed, it’ll actually be used for whatever the wording of the law says it can be used for (see also “anti-paedophile”). And you need to assume that’ll happen from the start, rather than getting outraged when the government does something which is entirely permitted under the law that you didn’t object to at the time…

“The Icelandic Government were not prepared to compensate UK fund holders.”
First of all, before the Landsbanki assets were frozen, its assets in the UK were more than twice as large as the required compensation sum, money had been poured from Iceland to those assets to make sure of that. Now, however, the worth of those assets is completely unknown and nothing can be done while they *remain* frozen “to protect the British saver”.
Additionally, the British media has very successfully (it seems by the look of a lot of comments I’ve seen) spoon-fed Brits a host of statements and accusations, and it doesn’t really matter if it’s the daily mail or the “prestigious” Guardian or whatever, they never cite their sources, they never offer *our* side of the whole story (which leaves out a lot of information) and they carefully make things look like we’re a bunch of thieves who were trying to steal from the poor British saver and try to escape with it. (Some papers and bloggers even had to drag the bloody Cod Wars kicking and screaming into the whole affair!)

“potted history: Nordic Vikings sailed to Britain, kidnapped local women and forced them to come to Iceland as their wives; Icelanders’ mitochondrial (maternal) DNA is two-thirds British, whereas the overall mix is about 50/50 British/Nordic. We sent missionaries to teach them how to read and write, and the current Icelandic language is the same as Old English.”
and what a complete and utter bullshit that is.

36. Alec Macpherson

I was surprised to see this thread resurrected. The matter of the seized assets has been discussed, I see. Personally, I think it boiled down intemperate remarks by all: Geir Haarde announced that British investors would be subservient to Icelanders; Gordon Brown and Alistair Darling announced that Icelander interests would be subservient to the British. Quite unsurprising.

I recall that the Dutch government then began making similar noises, and they don’t have our Anti-Terror legislation.

Relax, Brynjar. The point of John Band’s piece was that the “terrorist” meme had been permitted to run unchallenged. I can assure you that there plenty of reasonable voices – not limited to those who’d become unhinged by a war which ended five years ago, but strongly represented there – who were not sympathetic to this seizure.

I took the Potted History to be mainly a parody of the “indigenous inhabitants” in certain other countries, or the endless tripe of “the British” devastating every level of societies everywhere, or the grubby nationalism which is growing in at three of our nations. Note, he did stress the efforts Icelanders to fight with the Allies. I will also pay tribute to those who died in the Merchant Navy.

Perhaps he shouldn’t have said British, as this implies a continued cultural link, but I find mention of the genetic patterns unremarkable and inoffensive. Potted histories are, by default, grossly simplistic.

Oh, what am I saying? Three of my grandparents’ familial lines were firmly placed in coastal regions of northern Scotland and the Isles for centuries at least. My mitochondrial DNA likely resided in someone who was present as Agricola sailed through the Moray Firth!

I have never recovered from the pain of events 1,100 years before I was born where Apartheid was instigated with the arrival of the longboats. My great-great-great-[…]-grandmothers were taken as sexual chattels whilst my great-great-great-[…]-grandfathers were expunged from the Y-chromosomal record in acts of genocide, either murder/killing [delete as appropriate] not seen until the Nazi atrocities of the 20th Century (I may be over-stating my case here) or being transported to Rus and then into slavery at Byzantium. For gold and silver!

Alex M wins “comment of the year” in my book. Yes, my ‘potted history’ was a bit tongue-in-cheek, but I’d defy anyone to actually disprove the facts in it. And for fuck’s sake, it was meant as a “we like you guys cos we’re more or less the same” – which was the attitude I got when I was in Iceland the other week. Meh, I suppose if we are the same then grumpy sods on the Internet are a common problem.

(and you actually believe in trolls, whereas we just wish them away…)

38. Alec Macpherson

Aye, John. That said, I actually know Brynjar from elsewhere, and he was most upset by your Icelandophobic comments. He is a kind a gentle individual, and you are a sadist with a heart of stone.

I can hear a cod laughing.


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