'Iceland followed the prescriptions of Milton Friedman, and its economy paid a severe price'

[brentspeak]

http://www.alternet.org/workplace/103525/iceland%27s_economic_meltdown_is_a_big_flashing_warning_sign/?comments=view&cID=1038826&pID=1038711#c1038826

Iceland's Economic Meltdown Is a Big Flashing Warning Sign

By Toby Sanger, AlterNet. Posted October 21, 2008.

Iceland is now essentially bankrupt after the government took over its three major banks to prevent them from failing. It owes more than $60 billion overseas, about six times the value of its annual economic output. As a professor at London School of Economics said, "No Western country in peacetime has crashed so quickly and so badly."

What on earth happened to get Iceland and its banking sector into such a state?

It turns out that Iceland, despite its coalition governments and Nordic social values, became a poster child for neoconservative economic policies inspired by Milton Friedman during the past decade. Friedman himself visited Iceland in 1984 and participated in what was described as a http://freedomchannel.blogspot.com/2007/07/milton-friedman-on-icelandic-state.html|"lively television debate"> with leading Socialists. This inspired a generation of young conservatives who came to power through the Independence Party in 1991 and have run its government through different coalitions since then...

...

Under the leadership of Prime Minister David Oddsson and http://www.aei.org/publications/pubID.20743,filter.all/pub_detail.asp|explicitly inspired by Friedman>, Iceland's neoconservative young Turks implemented a radical (but now familiar) program of privatization, tax cuts, reductions in spending and deficits, inflation targeting, central bank independence, free trade and exchange rate flexibility. Corporate taxes were cut from 50 percent down to 18 percent. Privatization and deregulation were http://eng.forsaetisraduneyti.is/ministry/ministry%20|driven directly through the prime minister's office>, and the major banks were privatized...

[Union Thug]

1. Hartmann was speaking to this a week or two ago. The conservative house of cards is coming down...

Good riddance.

[LeftishBrit]

2. Interesting. Milton Friedman has caused a lot of damage everywhere!

[amdezurik]

4. his "ideas" should be as discredited as

the crap in Mien Kampf

[Selatius]

3. Watch the Republicans deny that it had anything to do with deregulation/privatization.

They're going to believe anything except the notion that their dogma was simply wrong.