Sunday, October 05, 2008

Silent, upon a peak in Darien Iceland

I'm not a great fan of poetry, but love the following:

Then felt I like some watcher of the skies
When a new planet swims into his ken;
Or like stout Cortez when with eagle eyes
He stared at the Pacific – and all his men
Looked at each other with a wild surmise–
Silent, upon a peak in Darien.

Even more dramatically, Darien was one of the causes of the end of Scotland as an independent country.

Back in 1695 Scotland was worried it was falling behind England in the race for overseas trade and colonies. So money was raised to send an expedition to Central America, with the aim of creating a trading base to Asia as well as plantations, forts, towns, and canals.

It all went horribly wrong, and all the investment disappeared into the jungle, along with thousands of brave Scots.

Scotland was broke, owing millions to countries abroad, including the Bank of England. The solution was to merge with England in the 1707 Acts of Union that formed Britain and was to change both countries - in my mind for the better. Together the two countries were the foundation of the British Empire.

Those events, almost exactly 300 years ago, came to my mind reading in the newspaper this weekend about the credit crunch and Iceland.

In the last few weeks a storm has gone through the financial markets, dragging stocks and banks down like trees in a hurricane. And one of the worst effected, though not so well reported, is Iceland.

The three largest banks of Iceland owe the equivalent to 8 times that countries GDP. If they were nationalised the debt repayments would take up roughly all of the countries output.

So what is the solution? Well one would be to follow the example of Scotland those many years ago and merge with a more solvent larger country. Its not total fantasy, as there have already been discussions about Iceland turning tack and joining the EU.

Maybe the UK should have another punt on another Act of Union. After all we reasonably close, with the Shetlands actually closer to Iceland than London. And it would be a good long term investment: lots of geothermal energy, fishing rights, and when things get hot with global warming its climate will seem a bit more tempting. It is even expanding in area due to volcanism.

Not a bad place for the Government to put my taxes. Except.......

... oh dear......

...the articles also say that the "situation is more serious in the UK than in Iceland"!


tillerman said...

I've always fancied owning an island. How much do you think it would cost to buy Iceland right now?

JP said...

At the moment I'd think you could swap Iceland for a tin of that magic WMTHLPHLSSLW.

But you'd have to pay the $$$ billions of bills, and if you couldn't they might send in the bailiffs and grab your beloved laser.