Dollars and Delusion: Global Finance, Cultural Trauma and Ethno-economic Subjectivity in Post-boom Iceland

Abstract

Paradoxically, recent financial crises reveal both the ultimate collapse of ‘national capitalism’ and the increased prominence of economic nationalism. This article examines the Icelandic case in order to analyse socio-cultural dynamics of economic downfall and to offer an approach to investigate (post-)neoliberal impressions of the nation as economic entity. It employs Piotr Sztompka's work to assess Iceland's economic meltdown in 2008 as traumatizing change that triggered a project of (national) self-transformation. This project, dissected as mnemonic phenomenon, entails reframing the success of bankers as deceit, a call for the purge of politics and business, and various adaptive efforts initiated to realize a sustainable existence in tune with Iceland's ‘real’ history and geography. We stress that such dissection reveals the influence of macro-economic tendencies on principles and practices of collectivity, and illustrates the relevance of a focus on ethno-economic subjectivity to study the lived experience of those confronted with contemporary politics of finance.

Keywords::

• Iceland
• subjectivity
• neoliberalism
• crisis
• cultural trauma

Notes

¹ Analyses of household debt seem to back this statement. Ólafsson and Vignisdóttir (2012) for instance state that ‘Icelandic households were among the most indebted household sectors in the run-up to the crisis and were the only households with widespread borrowing in foreign currency’ (see, also, Ólafsson and Pétursson 2010).

² In an analysis of Icelandic national images that pre-dates the crisis, ĺsleifsson (2009) mentions the speech of President Grímsson. According to him, Grímsson's words reflect earlier depictions of the national self—ĺsleifsson refers to Finnbogason's work—and thus indicates the existence of ‘a kind of national character or essence’ (2009, 155).

³ Daniel Chartier (2011) refers to these individuals as ‘new Vikings’. According to him, ‘The new Vikings, booed and blamed for all the problems during and after the crisis, were seen as heroes in Iceland … during their period of glory’ (124).

⁴ See also Ann Brydon's work on the politics of nature (e.g. Brydon 2006).

⁵ The Icelandic government applied for EU membership on 16 July 2009. Formal negotiations began on 17 June 2010. On 12 September 2013, the Icelandic parliament was informed by the foreign minister that the (new) government had dissolved its EU accession team.

⁶ Jónsson and Hannibalsson (2012) use the term ‘real economy’ to label ‘the part of the economy that is concerned with actually producing good and services’ in an analysis of recent economic development in Iceland.