Chris Hedges: Iceland's Leaders!!

One country refused to bail out its derelict banks and slash social spending amid the financial crisis, and guess what? Unlike the euro-zone and the United States, it's making a sturdy comeback. Iceland's stock market plunged 90 percent in 2008. Inflation reached 18 percent, unemployment shot up nine-fold and its biggest banks failed. This was no recession. It was a full blown depression. Since then, the country has steadily improved. By September of this year, it repaid its IMF rescue loans ahead of schedule. Unemployment dropped by half, and its economy will have grown by roughly 2.5 percent by the beginning of 2013. So what's Iceland's secret? According to the editors at Bloomberg News, it's a refusal to do what virtually every other nation that was pummeled by the crisis did: Adopt policies of economic austerity. Iceland's approach was the polar opposite of the US and Europe, which rescued their banks and did little to aid indebted homeowners. Although lessons drawn from Iceland, with just 320,000 people and an economy based on fishing, aluminum production and tourism, might not be readily transferable to bigger countries, its rebound suggests there's more than one way to recover from a financial meltdown. Nothing distinguishes Iceland as much as its aid to consumers. To homeowners with negative equity, the country offered write offs that would wipe out debt above 110 percent of the property value. The government also provides means tested subsidies to reduce mortgage interest expenses: Those with lower earnings, less home equity and children were granted the most generous support. The International Monetary Fund's mission chief to Iceland has sung the nation's praises too. "Iceland has made significant achievements since the crisis," Daria V Zakharova told Bloomberg in August. "We have a very positive outlook on growth, especially for this year, and next year, because it appears to us that the growth is broad based."