Why has Iceland returned to the politicians who caused their crisis?

The centre-right's victory masks growing disaffection with politics.

As Iceland re-elects the parties that led it into the financial crisis and Italy forms its broadest coalition since 1946 to the sound of gunfire, something strange is afoot in European politics. As the economic crisis rumbles on past the five-year mark, traditional party systems across the continent are under strain and contorting themselves into ever-more unusual arrangements to meet the challenge posed by the plunging living standards of their electorates.

In retrospect Britain, which elected its first coalition since World War II in 2010, now looks like a trend-setter. Everywhere one looks across the continent, the financial crisis has upended the old patterns of politics. The "grand coalition" of left and right in Italy is only the latest example of political parties closing ranks against threats to their traditional position – in this case, economic woe and a surge by the anti-establishment Five Star Movement, which may be led by a comedian but proved it was no joke by garnering over 25 per cent of the vote in February’s election.

Meanwhile in Iceland, voters have just returned the centre right to power in the form of the Progressive Party and the Independence Party. These are the parties many blame for getting them into a financial mess in the first place. It was Independence Party Prime Minister David Oddsson who gave Iceland its version of the City’s "big bang" and was central bank governor when the financial crisis struck. That voters would turn back to these old hands – much less in the biggest electoral swing in Iceland’s independent history – is, to put it mildly, a sign of some desperation.

The head of Iceland's Pirate Party – another anti-establishment force which just won its first seats in a national legislature, becoming the first Pirate Party to do so – was rueful about the return of the centre right. "It is the problem of the leftwing," said Birgitta Jonsdottir, a Pirate Party MP. "They clean up the vomit after the cocaine party of the neocons, who go into rehab and then come back to reap the benefits." But the very success of her own movement is a sign of something else – outsiders are increasingly crashing the party.

Europe's national governments all share a basic impotence in the face of the economic crisis and the austerity consensus imposed from Brussels, Berlin and the bond markets. Even Iceland, which has its own currency, is not fully ruler in its own house – and the outgoing government had received many plaudits from outsiders like the IMF. The exact party configurations ruling in each capital are, to an extent, besides the point in the face of this external pressure. Witness how France’s first Socialist government in twenty years is now planning to slash capital gains tax to attract businesses.

This impotence is leading to a general decline of established party systems across Europe. Voters are realising that none of the traditional parties can fundamentally challenge the austerity consensus, and are turning to outsiders who might. Italy's Five Star Movement is one example. Greece's Coalition of the Radical Left (Syriza), which is now the second-biggest party in the country’s legislature, is another. Even UKIP is capitalising on the mess on the continent and economic fears here at home to shake up the British political scene.

As austerity passes into its second half-decade – and as forecasts for when it will come to an end are pushed further into the future – the strain on Europe’s traditional parties will increasingly show.  If Italy’s broadest coalition since World War II and Iceland’s establishment parties cannot deliver economic security to their voters – and there seems little reason to think they can – then what happens next will be unpredictable.  Voters are running out of options near the traditional centres of their politics.

All of this poses the greatest long-term threat to the austerity consensus across Europe, as perhaps leading figures in Brussels and Berlin are starting to realise as they rhetorically distance themselves from austerity and start to talk about how, as Jose Manuel Barroso said recently, the policy has reached the limits of its popular support. But the pull of the consensus – tied up as it is with continued euro membership and the European project as a whole – remains strong.

If European governments of the traditional left and right don’t find a way to keep public confidence in both themselves and the European project alive, then we will see outsiders keep rising and rising until one day they rise all the way into power. Even more worrying is what happens when despair at the political centre becomes despair over the political system as a whole, and starts to find expression in movements like Greece's Golden Dawn or in senseless acts of violence like the shooting of two police officers in Rome. They too are warning signs on the road to an austere future.

Birgitta Jonsdottir, leader of Iceland's anti-establishment Pirate Party. (Photo: Getty.)
Getty
Show Hide image

Bernie Sanders is America’s most popular politician – and he’s coming after Donald Trump

Sanders, unlike Clinton, had a clear and coherent vision. As of now, he is the best hope the Democrats have of retaking the White House in 2020.

“I like Bernie Sanders,” my four-year-old niece in Texas said to me last month. “Why isn’t he president?” More than six months on from the defeat of Hillary Clinton, it’s a question that countless frustrated progressives across the United States continue to ask aloud.

Remember that the election of Donald Trump was not the only political earthquake to shake the US establishment last year. A 74-year-old, self-declared socialist and independent senator from the tiny state of Vermont, in a crumpled suit and with a shock of Einsteinian white hair, came close to vanquishing the Clinton machine and winning the Democratic presidential nomination. Sanders began the campaign as the rank outsider, mocked by the former Obama strategist David Axelrod as the candidate with whom Democratic voters might “flirt” and have a “fling” before settling down with Clinton. By the end of the campaign he had won 13 million votes and 23 states, and raised more than $200m.

In this dystopian age of Trump, it is remarkable that Sanders is now by far the most popular politician in the US – and this in a country where “socialist” has long been a dirty word. Increasing numbers of Americans seem nevertheless to “feel the Bern”. As such, Sanders supporters cannot help but ask the big counterfactual question of our time: would Trump be the president today if he had faced Bernie rather than Hillary in the election? Throughout the campaign, polls showed him crushing Trump in a head-to-head match-up. In a poll on the eve of the election, Sanders trumped Trump by 12 percentage points.

Democratic voters were told repeatedly that Clinton was more “electable” – but had they opted for Sanders as their candidate, there would have been none of the backlash over her emails, Benghazi, Bill, her Iraq War vote, or her Goldman Sachs speeches. So did the Democrats, in effect, gift the presidency to the Republican Party by picking the divisive and establishment-friendly Clinton over Sanders the economic populist?

I can’t prove it but I suspect that Sanders would have beaten Trump – although, to be fair to the much-maligned Clinton, she, too, beat Trump by nearly three million votes. Also, one-on-one polls showing Sanders ahead of Trump in a hypothetical match-up fail to tell us how the independent senator’s support would have held up against a barrage of vicious Republican attack ads during a general election campaign.

Then there is the matter of race. Clinton, despite deep support in African-American and Latino communities, was unable to mobilise Barack Obama’s multiracial coalition. Sanders would have done even worse than she did among minority voters. Trump voters, meanwhile, were motivated less by economic anxiety (as plenty on the left, including Sanders, wrongly claim) than – according to most academic studies, opinion polls and the latest data from the American National Election Studies – by racial resentment and an anti-immigrant, anti-Muslim animus. Sanders, who at a recent rally in Boston defended Trump voters from accusations of bigotry and racism, would probably have struggled as much as Clinton did to respond to this “whitelash”.

Nevertheless, Sanders, unlike Clinton, had a clear and coherent vision and I would argue that, as of now, he is the best hope the Democrats have of retaking the White House in 2020. His support for greater Wall Street regulation, debt-free college tuition, universal health care and a higher minimum wage is not only morally correct and economically sound but also hugely popular with voters across the political spectrum.

The Democrats have a mountain to climb. They have to find a way to enthuse their diverse, demoralised base while winning back white voters who are concerned much more by issues of race and identity than by jobs or wages. A recent poll found that the party had lower approval ratings than both Trump and the Republicans as a whole.

Yet press reports suggest that at least 22 Democrats are thinking about running for president in 2020. This is madness. Few are serious contenders – thanks to the dominance of the Clinton machine in recent years, the party doesn’t have a deep bench. There is no new generation of rising stars.

The only two people who could plausibly prevent Sanders from winning the nomination next time round are the former vice-president Joe Biden and the Massachusetts senator Elizabeth Warren. The good news is that all three of these Democratic contenders are, to varying degrees, economic populists, willing to stand up passionately for “the little guy”. The bad news is that the Democratic base may fantasise about a young, dynamic Justin Trudeau or Emman­uel Macron of their own but, come the 2020 election, Sanders will be 79, Biden 77 and Warren 71. (Then again, they’ll be up against a sitting Republican president who will be 74, behaves as if he has dementia and refuses to release his medical records.)

Bizarrely, that election campaign has already begun. On 1 May, Trump released his first official campaign ad for re-election, 1,282 days before the next presidential vote. Biden visited New Hampshire last month to give a speech, while Warren is on a national tour to promote her new bestselling book, This Fight Is Our Fight.

Sanders, however – riding high in the polls, and with his vast database of contacts from the 2016 race as well as a clear, popular and long-standing critique of a US political and economic system “rigged” in favour of “the billionaire class” – is the man to beat. And rightly so. Sanders understands that the Democrats have to change, and change fast. “There are some people in the Democratic Party who want to maintain the status quo,” he said in March. “They would rather go down with the Titanic so long as they have first-class seats.”

Mehdi Hasan is a contributing writer for the New Statesman and the co-author of Ed: The Milibands and the Making of a Labour Leader. He was the New Statesman's senior editor (politics) from 2009-12.

This article first appeared in the 18 May 2017 issue of the New Statesman, Age of Lies

0800 7318496