Everywhere we look, people are now refusing to stomach austerity because of bankers' greed and mistakes.
First we have the big news that Icelandic voters have firmly rejected the idea that they should be forced to pick up the tab for their bankers' mistakes. In a referendum on Saturday, they rejected a deal that would see them repay Britain and the Netherlands about €4 billion ($5.78 billion) lost during the global financial crisis. The case is likely to end up in the courts with Britain and the Netherlands planning to sue Iceland.
Iceland's problems can be sheeted home to investor greed. British and Dutch savers deposited their savings in an Icelandic internet bank called Icesave, which offered high rates of interest. But Icesave's parent, Landsbanki, collapsed in October 2008 when it, along with Iceland's other major banks, could no longer raise money in global capital markets. As a result, the UK and Dutch governments were forced to cover the losses. They struck a deal that would see Reykjavik paying compensation. Iceland voters have said no.
So what implications does that have elsewhere? We are seeing similar developments in Europe where workers in Europe are protesting against austerity programs cutting pay and pensions. Like Icleand voters, they are refusing to make sacrifices to placate politicians and bankers.
The political fallout from the bankers' greed continues around the world.
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