A year ago, the financial wags asked this question and the punch line was:
"One letter and 6 months......"
The Icelandic economy collapsed in the shambles of the world wide banking crisis and we were told it was only a matter of time before the same thing happened to Ireland.
Now, Ireland is bailing out the bankers and putting the burden of the crisis on the population by cutting social programs and raising taxes.
But look at the way Iceland reacted. The banks were allowed to collapse and the executives were prosecuted on criminal charges. The financial world at the time shuddered and predicted utter doom.
Today, 2 years later, Iceland is becoming a very smart place for investments. Their economy got better much faster because of their approach of identifying the real problem and harshly dealing with it.
Now, the citizens of Iceland, who said no to bailing out the bankers are being allowed to participate in writing the country's new constitution. Isn't this what America is supposed to be about?
REYKJAVIK, Iceland -- Iceland's getting a new constitution - and it's really going to be the voice of the people.
The sparsely-populated volcanic island is holding an unusual election Saturday to select ordinary citizens to cobble together a new charter, an exercise in direct democracy born out of the outrage and soul-searching that followed the nation's economic meltdown.
Hundreds of people are vying for the chance to be among up to 31 people who will form the Constitutional Assembly slated to convene early next year - a source of huge pride for Icelanders who have seen their egos take a beating in recent years.
"This is the first time in the history of the world that a nation's constitution is reviewed in such a way, by direct democratic process," says Berghildur Erla Bergthorsdottir, spokeswoman for the committee entrusted with organizing the Constitutional Assembly.
Iceland has never written its own constitution. After gaining independence from Denmark in 1944, it took the Danish constitution, amended a few clauses to state that it was now an independent republic, and substituted the word 'president' for 'king.' A comprehensive review of the constitution has been on the agenda ever since.
Pressure mounted for action after the nation's economic collapse in 2008, an event punctuated by ordinary citizens gathering outside the Althingi, the parliament, banging pots, pans and barrels - a loud, clanging expression of fury. The meltdown was seen not only as a failure of the economy but of the system of government and regulatory agencies. Many came to believe a tighter constitutional framework - including a clearer division of powers - might have been able to minimize that damage, or even prevent it.
"It is very important for ordinary citizens, who have no direct interest in maintaining the status quo, to take part in a constitutional review," said Prime Minister Johanna Sigurdardottir. "We are hoping this new constitution will be a new social covenant leading to reconstruction and reconciliation, and for that to happen, the entire nation needs to be involved."