Alejandro Chafuen and Gissurarson at the APEE conference.

The three main lessons for other nations from the 2008 Icelandic bank collapse are that an economy need not collapse even if the whole of its banking sector falls; that it may be prudent to recognise the priority of depositors’ claims to bank estates; and that if this is done, then government guarantees of deposits may be unnecessary. This was the message delivered by RNH Academic Director Professor Hannes H. Gissurarson in a lecture at a session on money and banking at the annual conference of APEE, Association of Private Enterprise Education, in Las Vegas 1–5 April 2018. Gissurarson added that other three lessons from the bank collapse were that discretionary power would always be abused, as the British Labour government did by imposing an Anti-Terrorism Act upon the Icelanders; that small nations had no friends when push comes to shove; and that in a crisis it was important to have strong leadership such as the Central Bank of Iceland exerted before and during the bank collapse by ‘ring-fencing’ Iceland.

Alan Kors speaks. New APEE President Andrew Young (left) and Edward Stringham listen. Photo: P. Boettke.

Speakers at the APEE conference included Professor Barry Weingast who discussed explanations of the poverty of nations (some of which Adam Smith submitted in the Third Book of the Wealth of Nations), one being that parasitical groups and institutions seized wealth from its creators. Professor Randall Holcombe asked whether Western elites were turning market capitalism into political capitalism. Professor Alan Charles Kors criticised the demand for political correctness in academia, which was threatening the Enlightenment value of free inquiry. Professor Larry White compared three kinds of monetary arrangements, gold, fiat and crypto-currencies, concluding that gold seemed on the whole the soundest. Professor Michael Munger wondered whether market capitalism was sustainable on its own or whether it would develop into crony capitalism, as a result of intensive rent-seeking; it depended, according to him, on whether the productivity of capitalism was larger than the possible gain from rent-seeking.

Buchanan in his office at George Mason University. Knut Wicksell and Frank H. Knight adorn the wall. Photo: H. Gissurarson.

Several sessions were devoted to the political ideas of James M. Buchanan, the father of the public choice school and the 1986 Nobel Laureate in Economics, not least on the occasion of a recent book-length attack on him by leftwing historian Nancy Maclean, Democracy in Chains. In one of these sessions Professor Gissurarson said a few words about Buchanan who visited Iceland in 1982 and whom Gissurarson met several times at Mont Pelerin Society conferences and Liberty Fund colloquia. Buchanan had regarded homo economicus as an analytical tool, Gissurarson pointed out, not as a true description of human nature. Indeed, he had criticised some Chicago economists for seemingly believing that man always sought to maximise his or her income. However, in analysing politics as well as business homo economicus had to be the presumption, or test, just like a shipbuilder would design his product to survive rough seas, however rarely they might occur. Gissurarson recalled that he had learned a lot from Buchanan when they had discussed the management of the Icelandic fisheries. Buchanan had pointed out that it was not sufficient to demonstrate that commons were inefficiently utilised; someone had to have a vested interest in enclosing them. Moreover, such a change had to be Pareto-optimal in the sense that nobody would be worse off as a result. The Icelandic ITQ system fulfilled both these conditions, Gissurarson argued.

At the APEE conference Gissurarson (who resides part of the year in Rio de Janeiro under a research agreement with Brazilian institutions) met with Brazilian participants who are organising the 2020 Mont Pelerin Society general meeting in São Paulo. In Las Vegas, Professor Andrew Young was elected APEE President, replacing Gabriel Calzada, and Dr. Jerry Jordan, former Governor of the Federal Reserve Bank of Cleveland, Vice-President. Professor Edward Stringham (who recently visited Iceland to give a lecture at a regional meeting of the European Students for Liberty) continues as editor of Journal of Private Enterprise and Professor J. R. Clark as APEE Treasurer. Gissurarson’s participation in the APEE conference formed a part of the joint project by RNH and ACRE, Association of Conservatives and Reformists in Europe, on “Europe, Iceland, and the Future of Capitalism”. The 2019 annual APEE conference will be on Paradise Island in the Bahamas 5–8 April.

Platform President Łukasz Kamiński congratules Gauck.

RNH is a member institute of the Platform of European Memory and Conscience which seeks to keep alive the memory of victims of communism and other European totalitarian movements. Monday 26 March 2018 the Platform was the co-sponsor, with the Ján Langoš Foundation in Bratislava in Slovakia, in giving an award to Joachim Gauck, President of Germany 2012–2017 and previously Federal Commissioner for the Records of  Stasi, the secret police in the Soviet-occupied part of Germany (East Germany). Gauck received the award for his courageous fight against totalitarianism both before and after the fall of the Berlin Wall. Ján Langoš, after whom the award is named, was a Slovakian dissident in the communist era, Interior Minister in Czechoslovakia in 1990–1992 and the director of the National Memory Institute in Slovakia from 2003. He died in a car accident in 2006 on his way to a trial where he was to testify against former secret police agents. Other recipients of the award include Dalai Lama, leader of the Tibetan liberation movement, Václav Havel, former President of Czechoslovakia, and Sandra Kalniete, MEP for Latvia.

Dr. Palmer gives his talk.

President Donald Trump is an unpredictable bully who is undermining the institutions and political traditions of the United States, Dr. Tom Palmer, Senior Fellow at Cato Institute and Executive Vice-President of International Programmes at Atlas Network, said at a Freedom Chat in Reykjavik 23 January 2018, organised by the Libertarian Society of Iceland. Palmer found it difficult to explain Trump’s election. Probably this had been a “black swan” event, when several factors suddenly worked in the same way to produce an unexpected outcome. Trump and Hillary Clinton had been unpalatable alternatives. Palmer described Trump as a ruthless power-monger who tried to intimidate both his allies and opponents. The Republicans were afraid of him whereas the Democrats were hostile towards him. If the chance would present itself, Congress would try to impeach him, although Palmer rated the likelihood of that happening less rather than more. He said that one explanation for Trump’s rise was a change in the U.S. political discourse. It was no longer about the pursuit of common rules enabling different individuals mutually to accommodate themselves, but rather about constructing collective identities, hostile to one another. Some white working class voters supported Trump because they resented the mostly negative attitude towards white people in this discourse. Thus, ironically, some left wing intellectuals bore their part of the responsibility for Trump, however loudly they denied it. The office of the U.S. President was very powerful which increased the danger coming from Trump, even if some checks and balances certainly were built into the U.S. Constitution. A lively discussion followed Dr. Palmer’s talk which took place in the Petersen Suite in Gamla Bio and was well attended.

Tuesday 23 January 2018 Dr. Tom Palmer will be discussing the US, Trump and the future of individual freedom at the Petersen Bar in Gamla Bio [The Old Cinema], Ingolfsstraeti 2A. The meeting begins at 20:00 and is held by the Libertarian Association and sponsored by RNH. Palmer’s talk will be followed by questions and answers.

Palmer is one of the best-known and most eloquent spokesmen in the US for individual freedom. He directs international programmes at Atlas Foundation, a Washington-based umbrella organisation for research institutes around the world all of which seek spontaneous rather than coercive solutions to social problems. He is also a Senior Fellow at Cato Institute.

With a doctorate in Politics from Oxford University, Palmer is an old and good friend of Iceland and well-known to many Icelanders. He has published several books on politics and philosophy. The support by RNH for this meeting forms a part of the joint project with ACRE, the Alliance of Conservatives and Reformists in Europe, about “Europe, Iceland, and the Future of Capitalism.”