Herring and Class Struggle

Capitalism came late to Iceland. At the end of the 19th century this large, wind-swept, thinly populated island was made up of small towns, farms and seasonal fishing stations. Then European capitalists saw another Klondike in the herring-rich waters of the north Atlantic..

Monday, 11 February 2013

The Myth of Iceland's Recovery: allotments and health workers

One of the demands of the Icelandic communists in the 1930’s depression, was that the Reykjavik town council provide plots of land for people to grow there own food. 

This month Reykjavik city council has announced that 800 new allotments will be available from May this year. Of these 200 will be in Skammadal near Mosfellbær just north of Reykjavik. They will be about 100m² each. Then 600 ‘family plots’ of 20m² will be available in the Reykjavik suburbs of Breiðholt, Árbær, Vesturbær, Fossvogur, Laugardalur and Grafarvogur. The big plots cost 5,600 ISK a year and the smaller ones 4,200 ISK, that’s about £28/£21. The price includes the ground being already ploughed and a water supply. 

It’s unlikely that 800 plots will be anything like enough to meet demand because working class Icelander’s are struggling with stagnant wages and underemployment. Since 2007 food and fuel prices have gone up dramatically.  The image below shows price increases for basic foods and fuel from 2007 to 2012 in Bonus, Iceland’s cheapest supermarket chain.

Bonus supermarket prices 2007/2012

Some examples:

Rugbrauð, ryebread, a staple food has gone up 104 %

Sliced bread  - 95%

Bensín, petrol has gone up 101%

Epli rauð, red apples -  287%

Cucumber -  135%

Skimmed milk -  66%

Súrmjólk, buttermilk - another traditional staple - 61%

Baked beans -  144%

Flour -  204%

Bonus was—before the crash—part of the Baugar empire owned, with his dad, by Jón Ásgeir Jóhannesson who was convicted last week of £1.5 million tax evasion.

The allotments probably won’t come close to meeting demand. People are saddled with debt and housing costs keep rising. Yet the persistent nonsense spouted about Iceland’s response to the 2008 financial crash was that ordinary people and welfare were protected and banks were made to pay for their own crisis. How this miracle happened under capitalism isn’t explained. The foreign papers only get away with this rubbish because there is so little visible protest, strikes or demos. 

But 260 nurses at the National hospital have threatened to resign from 1 March if their wages don’t increase. They will be followed a month later by 20 more. The health minister promptly announced an average wage rise of £123 a month, but in a ballot 91% rejected the deal. Nurses pointed out this will work out at 65 krona extra per hour or 32 pence and management had said that anyone not accepting by 10 February would get no increase. The nurses have now been joined by 40 x-ray technicians who threatened to resign from 1 May. 

Allotments are good for people’s mental health, if the crops don’t fail, but this is no solution to below inflation wage rises. The European free trade association court has now ruled that Iceland does not have to reimburse the British and Dutch governments’ money they repaid to savers. So the Icelandic finance minister Katrín Júlíusdóttir, and the markets want to remove Iceland’s capital controls which were imposed in the crash to stop its creditors stripping the country. So the Financial Times today quoted Lars Christensen, an economist at Danske bank who said, “the ruling should also help speed up the process of reliberalising the Icelandic financial markets.” 

These financial genius’s turned Iceland into a giant hedge fund and they wouldn’t mind doing it again if they can just get the working class to pay the price. It would be progress if Iceland’s health workers had other ideas.