Sigrún Davíðsdóttir's Icelog

Iceland seen from Italy

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My annual Italian vacation is coming to an end. I’ve been coming regularly to Italy for twenty years now, speak Italian and in general understand the Italian way of thinking and being – coming here feels like coming home since it’s all very familiar. I know that only a few minutes after I land I’ll hear someone discussing what they had for dinner last night, what they are cooking tonight or remembering some good food they’ve had recently.

There are, however, darker sides to this country than it’s love of food. It isn’t for nothing that the Italian word ‘mafia’ has entered the global vocabulary. But it isn’t something that you necessarily notice when you just fly in and fly out for vacation. Some years ago I spent a few weeks in Naples, in Monte Santo, at the centre, or rather at the heart of the city. I would buy my capuccino at a small bar where I was usually the only guest – this was in August, the traditional Italian holiday month – and I would get my mozzarella and tomatoes from a tiny grocery shop run by two elderly men in the steep maze that is Monte Santo. All so friendly and wonderful.

But when I asked Lidia (not her real name), a middle-aged lady who grew up in Monte Santo, if the inhabitants noticed the mafia she explained that only those who run a business come in contact with the dark forces. ‘And they all pay, no matter what they say!’ As a young woman her dream had been to set up business in Monte Santo. When the opportunity arose she decided against it. ‘I couldn’t bear the idea that part of the money I earned with my own hands would end up undeserved in the hands of the bad lot.’

I’ve often said that I didn’t understand Iceland until I got to know Italy. In Iceland, like in Italy, everything is resolved through personal relations if possible. And in both countries it isn’t easy to be a foreigner because then you are without the personal connections unless you are married into an Italian/Icelandic family. It’s the ample space of personal relations that can easily be a fertile ground for corruption if decisions are made regardless of merit or against the interest of the community but solely in the interest of the few who are more powerful than others.

In summer 1992 the Sicilian investigative judge Giovanni Falcone was brutally assassinated by the mafia together with his wife and bodyguards. Just a few weeks later another prolific colleague of his, Paolo Borsellino, was also assassinated, together with some of his bodyguards as he came for his regular Sunday visit to his mother. Falcone once said that the mafia operates where the state isn’t present. And there is plenty of space in Italy where the state isn’t present. It’s the same in Iceland – plenty of space where things are resolved by personal contacts without official control or transparency.

Until recently, when comparing Iceland and Italy, I would always add that the main difference between Italy and Iceland was that there was no money to speak of in Iceland – and of course there isn’t organised crime in Iceland. Not at all.

But then, around 2004 Iceland was awash with money, mostly borrowed from abroad. We now know, broadly speaking but not in detail, how the banks lent that money: it was mostly lent to a small group of businessmen, closely related to the banks. They used the Enron system: create a myriad of companies where the loans were place, to move assets and debt about which makes it very difficult to keep an overview – and that’s of course the advantage for those who want to evade control and transparency.

But unlike Enron the Icelandic myriad of companies was privately related to these businessmen who are thought to have tunnelled money out of these companies into their own private companies, well hidden from the view of the banks’ resolution committees. The Glitnir charges in New York are one attempt to claw back some of this money. – Interestingly, the big shareholders didn’t go bankrupt though their shareholdings in the banks, thought to be their main assets, evaporated with the collapse of the banks in October 2008.

Just recently, the Italian police imprisoned 300 gangsters connected to the Calabria mafia called ‘Ndrangheta’ – the Italian mafia has several names according to where it operates. In an article in Foreign Policy recently the journalist Alexander Stille recounts these events and their connection to Italian politics. It may come as a surprise to readers unfamiliar with Italian affairs how explicitly Stille discusses the alleged mafia connections of Prime Minister Silvio Berlusconi but that’s how things are talked about in Italy. Ever since Berlusconi entered politics in the early 90s it’s been clear that he is in politics to guard his private interests that are unaligned to the interests of his county – and yes, yet he’s voted into power again and again, one of the paradoxes of this country, another story.

Part of the Italian mafia story is the connection with Italian politics as Stille’s article shows. The Icelandic political parties and individual politicians got handsome donations from the banks and the companies that thrived on handouts from the banks. In order to understand the Icelandic story of recent years it’s important to keep in mind the connections between politics and business.

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Written by Sigrún Davídsdóttir

August 9th, 2010 at 9:11 am

Posted in Iceland