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.)
ANGELOS TZORTZINIS/AFP/Getty Images
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How the refugee crisis became invisible

Since the failed coup in Turkey, there are on average 200 refugees a day arriving in Greece. But the world's media has gone home.

The image was familiar for the volunteers in Lesvos that still man the beaches where refugees arrive by boat from Turkey. It’s been many months since boats carried 256 people in a single day across the narrow passage of sea. The refugee crisis seems to be giving way to much larger geopolitical issues to the east of the Greek coastline. Those refugees stuck here might soon be joined by the thousands that remain in Turkey as the situation in Syria deteriorates. There is no solution is on the horizon for the bloodshed.

Almost 300 people arrived that Thursday last week, a number not seen since a deal between the EU and Turkey was reached this spring to curtail the flow of refugees heading for Europe. Following the failed coup attempt in Turkey last month, however, something has changed. 3,300 people have arrived on the islands of the eastern Aegean since, according to the official data released by the Greek state, averaging around 200 a day. Reports on the ground suggest that the traffickers operating in the area are expecting a new wave of refugees leaving Turkey soon, a card for Tayip Erdogan to play in his bid for visa-free entry to Europe for Turkish citizens.

Since the deal – and unlike last year, which saw more than a million people passing through Greece and heading up the Balkan corridor towards Germany and the prosperous north – the crisis has taken a new shape, and it’s now largely invisible. Lesvos, the island formerly seen as the frontline of the refugee crisis, is unseen, abandoned by the media and the tourists that used to be its main source of income.

The refugees unlucky enough to be stuck in Greece after the borders to Macedonia closed are distributed in camps across the country. The camps established at the points of arrival, known as “hotspots”, are overcrowded to breaking point, with violence often erupting between refugees, locals and the police. Instances of violence against unaccompanied minors by police were even recorded in the Moria camp in June.

Now, for the close to 60.000 people who in limbo while their asylum applications are processed, it’s a waiting game that looks more like prison than anything else. Meanwhile, deportations back to Τurkey have effectively stopped because of the political insecurity and terrorist attacks there, despite the fact it is still deemed a “safe third country”.

Forty-nine camps have been set up across Greece, but the government has announced that more are on their way. Local business owners in Crete have already protested the news of a camp for 2,000 refugees established on the island. After what happened in Lesvos the tourism industry – arguably the country’s most important, contributing close to 10 per cent of the GDP – is nervous.

Inside the camps, reports of overcrowding, poor hygiene, illness, violence, trafficking and drugs are on the rise. Even in Greece, Yazidis are not safe in the camps, and special arrangements have had to be made for them. The Greek and Albanian mafias have infiltrated camps on the mainland, especially around Thessaloniki, and are pushing hard drugs, which have become a solution for some of the refugees stuck there. Around the downtown area of Victoria in Athens, reports by the BBC and Refugees Deeply have found underage boys prostituting themselves in the nearby parks for 5 euros.

Here is the real problem: while the numbers arriving are nowhere near those of last year, the infrastructure available to take them in is now so strained that every new arrival counts. The margin for the most vulnerable between safety and harm, has narrowed to nothing. The Katsikas camp, near my hometown in north-western Greece, paints a grim picture. Set up hastily on the site of an old military airport, it is almost entirely unsuitable to host the simple military tents the refugees are expected to live in. The ground turns to mud every time it rains, and it rains often. There are scorpions and snakes wandering the camp.

Living conditions are so horrible that according to the camp’s director, Filippas Filios, 200 people recently walked out and abandoned it, preferring to try their luck crossing the Albanian or Macedonian borders on foot. From the 1,020 people that were transported here between March and April, just 520 remain. Another space is being prepared to take those remaining before September – an abandoned orphanage. Unlike most of Greece, the weather here is rainy and cold. If preparations stall and they are caught outside, these people are unlikely to remain in the camp under such conditions. Traffickers who have been active in the area for decades, are banking on just that.

The EU, via Angela Merkel saying that “we must agree on similar deals with other countries, such as in North Africa, in order to get better control over the Mediterranean sea refugee routes”, is hinting at a similar deal to that with Turkey to try and deal with the flow from Libya. With the current arrangement looking shaky, and those living with the consequences being ignored or even blamed for their predicament, we are on perilous ground. There is hardly anything more that Greece can do.

What’s worse is that in the last few months – under pressure from the EU – the Greek government has been dismantling the solidarity networks that alleviated much of the weight of the crisis last year. But they too, where they still hold, are creaking under the weight of the situation. The conditions in some of these informal camps resemble those in the official camps. The more these people are trapped in either situation, the more likely they are to become victims again, be it of trafficking, drugs or violence. For now, the pro-refugee sentiment still holds in Greece, but the illusionary structure of a “dealt with” crisis might come crashing down sooner than most realise.

Yiannis Baboulias is a Greek investigative journalist. His work on politics, economics and Greece, appears in the New Statesman, Vice UK and others.