Asgeir Jonsson is head of research and chiefeconomist at Kaupthing Bank, the biggest bank inIceland until the nation’s banking collapse. He previouslyserved as assistant professor of bankingand international finance at the University ofIceland. Jonsson is the author of several booksabout the economy and history of Iceland.

WHY ICELAND?

By ÁSGEIR JÓNSSON

The McGraw-Hill Companies, Inc.

Copyright © 2009 The McGraw-Hill Companies, Inc.
All right reserved.
ISBN: 978-0-07-163284-3

Contents

Chapter One

The Enigma of Iceland

An Ultimatum from the King

In the early morning in the third week of June 1000 AD, the general assembly of the Icelandic parliament, Althing, was called into session. Customarily, the session was held out in the open air, in a natural amphitheater in Thingvellir (Parliamentary fields) in the southwestern part of the country, created by the combination of lava flows and fissure formation in the earth, complete with a speaker podium.

There was great tension in the air as the 39 MPs, known as the Godi, stepped forth and greeted Thorgeir, the law speaker, as he prepared to address the crowd from the podium. The Godi represented free farmers from every corner of the country; indeed, a large part of their constituency stood behind them, fully armed. A small minority of the Godi, accompanying a handful of priests in the full regalia of the Holy Roman Church, occupied a corner of the amphitheater at a distance from the others. Thorgeir had been charged with the task of devising some kind of compromise to solve the worst political crisis the young democracy had encountered since its founding in 930.

Ólafur Tryggvason, the great warrior king of Norway, had issued an ultimatum to the young state to either convert to Christianity or face his wrath. The Norwegian king was indeed a formidable enemy. He had the largest fleet of long ships—”war dragons”—in the North Atlantic. The king’s standard carrier Worm-the-Long was the largest warship the Viking world had ever known. Ólafur had used his military might to christen Norway; death and torture awaited those who persisted with their pagan ways. Now, his focus was on Iceland.

The king had sent missionaries to Iceland, German priests accompanied by Icelanders who had served in his army. They had tried peacefully to spread the good word around the country with almost no success. Frustrated, they had resorted to attacking pagan holy sites and temples and killing prominent pagans. The Althing had expelled them from the country and now faced the king’s anger.

Obeying this king’s—or any king’s—command was not to the liking of the newly established nation. The country had been settled by Norse farmers and chieftains fleeing taxes and tyranny as the first unified Norwegian kingdom had been established around 870–900 AD. The Icelanders also knew the king would never risk his precious fleet on the high seas to subdue them. The country was at a safe distance from all Norwegian kings. Nevertheless, King Ólafur wielded sufficient power to enforce near-total isolation on the country, since most shipping routes to Iceland originated in Norway. Indeed, the king had already given a strong indication that pagans were not welcome in his kingdom by ordering attacks on Icelanders visiting Norway. And to further sharpen the thinking at Althing, the king held five Godi’s sons as hostages.

To Christianity as such the Icelanders were ambivalent. Quite a lot of the original settlers had lived in the British Isles prior to coming to the country. Some had become Christians in their new country, although their children would revert back to paganism. Others had chosen to worship Christ along with the pagan gods: in peacetime they would pray to Jesus, but when things got tough, Thor was the God to talk to. The majority probably had accepted a rudimentary baptism as a token act to being allowed to be in communion with Christians in the British Isles. Furthermore, a very significant number of the settlers had married local Christian girls. Of the people gathered at Althing in June 1000, practically everyone had Christian grandmothers or at least great grandmothers. There was little religious fervor to the Icelandic paganism, but nevertheless the pagan gods were interwoven into the cultural fabric and identity of the nation. It suffices to mention that the MPs, the Godi, also served as priests or masters of ceremony in pagan festivals. The name God-i is derived from the Germanic word God.

When the commonwealth was founded in 930 it had been proclaimed that “Iceland is governed by laws not kings.” The new republic prided itself on being able to solve all its affairs through juris prudence and consensus decisions among the Godi. But now the issue of Christianity was threatening to break the commonwealth apart. Iceland might have had a small number of actual Christian converts, but a significant number of people had converted to the idea that Christianity was an absolute necessity to keep the door to the outside world open. Against them stood the conservative diehards that would not abandon the ways of their father and forefathers for “White Christ” as they would call him. They argued for the self-sufficiency of the nation. These two groups had confronted each other at Althing and each had threatened to secede from the commonwealth and establish a new regime with separate laws. Neither side seemed to be willing to give in. As the Althing convened that fateful day in June 1000, everyone knew that if a political solution was not reached, the arms would talk instead of the Godi.

Thorgeir himself was a pagan, but nevertheless all parties trusted him to deliver a verdict on the matter. The Sagas tell that he spent two days and two nights in his tent at the Althing, devising a solution to the crisis while the whole nation waited outside. But it is more likely that his tent served as crisis headquarters, and that Thorgeir used this time to consult with all the Godi and other major players in this political standoff.

There was a complete silence when Thorgeir emerged from under his hide and began to speak and his voice was amplified from the cliffs behind him so the thousands circled around would hear him clearly. He began by highlighting the difference between kingly rule and democracy. Kings could always act on their own whim and force their will against any opposition, but rule of the people would always have to rely on laws and consensus; besides the fact was that in every debate both sides always had something to their case. The survival of the Icelandic Commonwealth depended on the ability of Althing to contain fanatics and aggressive elements in the society. Then Thorgeir paused and then delivered his verdict: “we shall all have one faith and one law.” Thorgeir argued that without the law there could be no peace and life would be unbearable. On the other hand, the one faith for the country had to be Christianity.

The people gasped. Then Thorgeir added a crucial addendum to his verdict: those who wanted to worship the old pagan gods could do so freely, but in private. After some discussion, all Godi agreed. On the way home from Althing, the Godi stopped by the nearest hot spring, and ordered everyone in their group to be baptized with comfort in the warm water. Iceland had converted to Christianity. Thorgeir had delivered a “Gettysburg address” for Iceland; the nation must never let any issue break its unity. The conversion was of course in name only and it would take decades or more for the new faith to win the country over. But the conversion would be peaceful, gradual and the church would be woven into the fabric of the nation in an almost seamless way. There is still no separation of church and state in Iceland.

King Ólafur Tryggvason never knew about this decision, since he died in battle that very summer after being ambushed by the combined fleets of the kings of Denmark and Sweden. Surrounded in his Worm-the-Long, he jumped into the sea and disappeared.

The Icelandic Dream

Iceland was the last country in Europe to be touched by men. It was discovered by chance in the mid-eighth century—the apex of the Viking age—when ships were blown off course by bad weather. There was little there to exploit and no one to conquer; the only mammal living on the island was the arctic fox.

A Norwegian, Floki Vilgerdarson, made the first deliberate attempt at settlement. The Icelandic Sagas tell us that three ravens, which could smell new land, were his guides across the ocean. Some, noting similarities to biblical stories and Old Norse mythology, believe there is more fiction than truth to this story, but whatever happened Floki acquired the nickname Raven-Floki and he did find the country he sought. His settlement was ruined by the harsh arctic winter; frustrated and angry, he returned to Norway and named the island Ice land in a small but lasting act of revenge.

Floki and his ilk were Norse chieftains, otherwise known as Vikings. In ships of their own invention, seacraft that could brave the waves of the North Atlantic, they became the first Europeans to traverse long distances on the open seas as they explored and searched for new land and opportunities. To English speakers familiar with their mythic and cartoonish derivatives the word Viking likely evokes images of bellicose heroes wearing helmets with horns. In the Nordic language, Viking simply means “pirate,” and is applied only to a limited subsection of the Norse seafarers. What is more, the actual Vikings never wore helmets with horns. That regalia first appeared as a stage costume in Wagnerian operas in the nineteenth century, and from there was threaded into popular culture.

The sturdier, faster ships helped transform Scandinavian country boys into citizens of the world. Norse sailors opened new trade routes across the Atlantic and up the Baltic rivers into Russia and the Black Sea. Those who first dared explore and open these routes were risk-seeking, aggressive youths out for plunder—the actual Vikings—who in all likelihood undertook their adventure against the advice of the elders but behind them came traders and then eventually settlers. In many countries the Norse were founders of cities and trading posts; they formed the core of many merchant classes and new urban populations dotting the coastlines of the North Atlantic.

In Floki’s time, Norway was embroiled in a civil war. The country was divided into many small kingdoms and autonomous regions. Around 860 or 870 one of the petty kings in southern Norway assumed the task of uniting the country into a single kingdom by his sword. Legend has that he swore never to cut his hair until his task was accomplished. He would come to be known as Harald the Fair- Haired (850–933). Harald took out the kings and chieftains in successive battles, one by one; or, if the kings managed to organize against him, he subdued them one coalition at a time. The military victories were followed by purges or forced land confiscations that aimed to unseat the old ruling class and secure Harald’s regal position. He also introduced central taxation that got mixed reviews.

Harald’s conquest and pacification unleashed a wave of emigration among Norse chieftains, who harbored a deep-rooted disdain for royal, centralized authority. They spread out over the Atlantic, and while always outnumbered, they visited no small degree of violence and plunder on coastal regions, often winning land for settlement, money, or contracts to guard against other adventurers. In this way they would settle down in parts of England, Ireland, British Isles and France (the word Normandy literally means “Land of the Norsemen”) and, of course, Iceland.

Genealogical evidence shows that Iceland was settled by Norse males and women from all corners of the North Atlantic; specifically, about 90 percent of the country’s male ancestry is Norwegian, while 60 to 70 percent of the female ancestry is Celtic in origin. Some women arrived as slaves, but it is likely that many were married to Vikings who “went native,” and absorbed culture from the British Isles, along with Christianity. Slavery was soon phased out as the country’s diverse population blended together.

The dominant culture in the new country would became distinctively Nordic though the Celtic element in the population would be manifested an in odd tendency toward literacy and storytelling. Icelanders became bards of the Viking world and witnesses to history. Nordic kings, many of whom were illiterate, all kept an Icelandic poet in court as both an entertainer and historian. Of all the great battles of Scandinavian kings there would always be one or two Icelanders that took part in the fighting and were able to get away to tell the tale and have their account written down in their home country. Icelanders also exported books to other Nordic countries, and practically all written histories about the Viking period can be traced to them as the non-religious literary production of the other Scandinavian nations in medieval times was virtually zero. These bookish traditions would come to have a defining influence on the Icelandic national character.

There is a curious parallel between the origins of Iceland and those of the United States. Both countries were founded by independent groups of immigrants, some fleeing tyranny, others simply searching for a better life, no small number brought as slaves. Fifty years into their habitation, the Icelanders founded what today is referred to typically as a commonwealth. Their society had no head of state and no formal executive branch, but it was ruled by a representative legislative authority, the Althing, which was the first European parliamentary body. The names, words, and deeds of the Althing’s founders have survived in the Icelandic sagas, which, like the United States’ Declaration of Independence and Constitution, have defined Iceland’s national character and the political framework to the present day.

The Icelandic republic was simple and effective. The country was divided into 39 constituencies (Godord), each of which elected a single representative (Godi) to the national assembly. This political system, much like Jeffersonian democracy in the United States, was built from a yeoman class of free, independent farmers who could switch their allegiance to a different Godi whenever they chose (women could act as Godis as well as men, provided they had a man who spoke for them in the Althing). The motto of the commonwealth was “With laws we shall build our country,” words that are inscribed on the badges of Icelandic policeman in the present day.

This egalitarian structure faced threats through the years, most notably in the thirteenth century, by which time a handful of families had accumulated wealth and begun to dominate their brethren through warfare and cross alliances. Order needed to be restored, but rather than produce their own Caesar on the battlefield the Icelanders chose, in 1262, to form a union with the Norwegian kingdom. If a king was needed, so much the better if he was far away and unlikely to interfere. Indeed, the Norwegian king never visited or exerted military influence; Iceland ceded its sovereignty in order to restore its parliamentary system to working order.

To Icelanders, the ancient founders of their nation are gone but never forgotten. Most of them are known by name, and all living Icelanders can trace their bloodline to them through genealogical records and a family tree that is rooted in the days of the original settlement. The conditions of that time, over a thousand years past, created one of the great contradictions of the Icelandic society, one that has fueled an ancient, ongoing, perhaps endless debate between isolationists and internationalists.

Iceland was the creation of cosmopolitans, Norse chieftains who roamed through the Atlantic and even into the Mediterranean. They came to the new country with foreign wives, usually acquired during stopovers in the British Isles. These were confident, risk-seeking adventurists that conducted daring raids on hostile territories.

On the other hand, they were also refugees, and deeply suspicious of any foreign authority. In this sense, Iceland was founded as a hideout. It became a conservative farming society sheltered from tumultuous times in Europe; no Viking warlord would ever risk his “war dragons” in the high seas to carry out a raid on this poor island country. Looking from this perspective, Iceland stood to gain from self-reliance and resistance to, as well as removal from, foreign power.

Through the ages, the nation has swung between the extremes of isolation and openness. Years spent in withdrawal from the world have been followed by outbursts of a yearning to aggressively pursue its riches.

These contradictions were especially stark as the Atlantic sea routes would became less traveled and the island more isolated as the Viking age drew to a close. The Icelanders became sedentary farmers, living on an island without ships; over time Europe almost forgot about it. Meanwhile, however, the Icelanders had written voluminous literature, historical and fictional, about the Viking age that would dominate their cultural life. In this way the bookish nation preserved the cosmopolitan atmosphere of the Viking age and their dreams of foreign countries, if only in the life of the mind.

The Icelandic dream is similar in character to the American dream. In the Icelandic version, a high achiever in any trade can export his or her success abroad. A story often repeated in the Saga literature tells of a farmer’s son who travels abroad, distinguishes himself in a larger nation, and returns home with honor to work the land of his father. Still today, even though most Icelanders get wanderlust in their twenties and dwell for extended time in other countries in either work or study they usually return when the time comes to form a family or when their children have reached the age of 6–10. This is something that is difficult to explain since people often leave well jobs and positions abroad to return home. Somehow the Icelandic society creates a sense of security, belonging or self-worth among its people that can also be seen by the fact that Icelanders have consistently ranked highest among other nations of the world in surveys measuring happiness or quality of life.

The Icelandic dream also in turn informs the national character, which is distinguished by a relentless, sometimes crazed assurance today that a nation of 300,000 people can triumph over other nations in any sport competition, no matter how large the opponent looms. Foreigners often do not realize that Icelanders refuse to acknowledge that the small size of their nation could ever be a hindrance to their ambition. For example, Henry Kissinger in his memoirs spoke of Iceland as the most arrogant small nation he had encountered; this assessment was informed by a heckling he received from the minister of fisheries in Reykjavik, during the Cod Wars with Britain in the early seventies.

(Continues…)

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