Professor Gissurarson lecturing in Porto Alegre.

The internet is a veritable fountain of intellectual resources, data and information, supporting individual freedom. This is what Professor Hannes H. Gissurarson argued in a lecture at a conference in Porto Alegre 25 May 2014, organised by the Brazilian Students for Liberty, or Estudantes pela liberdade, on “Liberty in the Information Age”. The conference was co-sponsored by the American institute Language of Liberty and the German Friedrich Naumann Stiftung. Professor Gissurarson mentioned the websites of research institutes such as Cato Institute and Heritage Foundation, and of international associations such as the World Bank, the International Monetary Fund and many UN organisations, and also internet data banks such as the Index of Economic Freedom. Many stimulating ideas and arguments were also to be found, he said, in internet commentaries and blogs by liberal writers, for example by best-selling science writer Matt Ridley and historian Niall Ferguson. In the lecture, Professor Gissurarson showed many graphs which he had constructed from data available on the internet. One example was a graph with statistics from FAO, the UN Food and Agriculture Organisation, which demonstrated that the productivity of cultivated land had increased at a faster rate than the area of land cultivated, a development sometimes called the “Green Revolution”. Professor Gissurarson pointed out that the Malthusian scenario of an impending demographic disaster where population was growing at a faster rate than food production—spelling the eventual doom of capitalism—had not turned out to be true, even if Malthus’ prophecies were echoed in relatively recent works like the 1972 Limits to Growth (translated into Icelandic in 1974). Professor Gissurarson added that the rate of growth of world population had indeed slowed down in the last twenty years.

Here is Gissurarson’s lecture on Youtube:

Professor Gissurarson’s lecture formed a part of the joint research project of RNH and AECR, the Alliance of European Conservatives and Reformists, on “Europe, Iceland and the Future of Capitalism”. Here is his graph on the Green Revolution:

From left: Hauksson, Juliusson and Bartoszek.

RNH has received the Kjartan Gunnarsson Freedom Prize for 2014, awarded by the Board of the Young Independents, SUS. The Prize is given annually to one institution and to one individual for their services to individual freedom. RNH received the institutional Prize for its contribution to research on the benefits of economic freedom. The Centre has, as the SUS Board recognises in its declaration, explored the causes of, and hindrances to, innovation and economic freedom. In its research, a special emphasis is put on the way in which individuals can by spontaneous cooperation, mutually beneficial trade instead of commands from above, fulfil their needs and improve their living standards.

“RNH has organised several conferences and meetings and has invited to Iceland many foreign scholars and activists to participate in the Icelandic discussion and debate on freedom. RNH also does research on income distribution and taxation, resource management, environment protection, innovation and entrepreneurship. Moreover, RNH has made a powerful contribution to keeping alive the memory of those who lost their lives to 20th Century totalitarianism,” the SUS Board declares.

The individual recipient of the Freedom Prize this year is Pawel Bartoszek, a frequent commentator on current affairs, the son of Polish immigrants to Iceland and a mathematician by training. Two members of RNH’s academic board, Professors Ragnar Arnason and Hannes H. Gissurarson, are among previous recipients of the individual Prize. On behalf of RNH, Gisli Hauksson, Chairman of the Board, received the institutional Prize from Magnus Juliusson, Chairman of the Young Independents, at a ceremony in Valholl, headquarters of the Independence Party, Friday 23 May 2014. The Prize is named after Kjartan Gunnarsson, an investor and former Executive Director of the Independence Party, who was and is well-known for his firm support of freedom.

Dan Grossman

Dan Grossman, chairman of the board of Atlas Network and member of the board of Students for Liberty, briefly visited Iceland on 11–12 May 2014. He had a luncheon meeting with Gisli Hauksson, chairman of RNH’s board, and a few other people involved in RNH’s activities. Hauksson gave Grossman a brief account of what RNH has been doing in the last two years, including the publication of three Ayn Rand novels, many international conferences on fisheries management and on the financial crisis—two topics of particular relevance to Icelanders—and several lectures by foreign and Icelandic scholars. Hauksson also told Grossman about a few RNH projects in the next few months, including meetings on taxation and income distribution, the index of economic freedom, and Herbert Spencer, the publication of online editions of many out-of-print anti-totalitarian books in Icelandic, including the Icelandic translation of the landmark Black Book on Communism, and the publication in Icelandic of a book by best-selling science writer Matt Ridley on the reasons to be optimistic. RNH is a part of the Atlas Network, whose founder, Sir Anthony Fisher, once came to Iceland and inspired many members of the Icelandic business community reminding them of how important it was to defend economic freedom and to facilitate the work of those few and embattled intellectuals supporting it.

Las Vegas: Wynn Hotel where the APEE meeting took place is left of centre.

Some left-wing commentators assert that the 2008 Icelandic bank collapse was caused by a failed attempt in the preceding years to implement “neoliberalism” in Iceland. Professor Hannes H. Gissurarson rejected that explanation in a lecture at the annual meeting of APEE, Association of Private Enterprise Association, in Las Vegas 14 April 2014. That explanation, according to Gissurarson, was incompatible with two undisputed facts. First, the Icelandic financial market was subject to the same legal and regulatory framework as its counterparts in other member-states of the EEA, European Economic Area, comprised of all the EU countries, Norway, Iceland and Liechtenstein. In the second place, the credit expansion of the Icelandic banks, ultimately leading to their downfall, had only seriously begun in 2004, when in Iceland crony capitalism had replaced market capitalism (or “neoliberalism”). Gissurarson added that ironically, however, there was a grain of truth in the assertion that “neoliberalism” had caused the bank collapse. Iceland had indeed gained a good reputation as a result of the sound economic policies of the 1991–2004 period, when public subsidies to loss-making private enterprises were cancelled, taxes greatly reduced, public companies privatised, pension funds strengthened and the public debt brought down, while inflation fell to the same level as in neighbouring countries. Because of this hard-earned good reputation, in the mid-2000s Icelandic banks and other private enterprises enjoyed high credit ratings, giving them an almost unlimited access to cheap credit from abroad which they used to grow at an astonishing rate, far beyond what the Icelandic state was able to support in a case of crisis. “No good deed goes unpunished,” Professor Gissurarson observed.

In Iceland, two systemic risks were therefore found in addition to the general risk under which banks normally operate in international financial markets. Because of the 2004–8 crony capitalism, many Icelandic companies were debt-ridden and excessively dependent on one another, with extensive cross-ownership. Moreover, the banks’ field of operations, the whole of EEA, was vastly bigger than what turned out to be their field of institutional support, Iceland alone. When the international financial crisis reached its peak in the autumn of 2008, no one came to the assistance of Iceland. The US Federal Reserve System refused to make dollar swap deals with the Icelandic central bank similar to those which it made with the central banks of Norway, Sweden, Denmark and Switzerland. The British government refused to include the Icelandic-owned British banks in its extensive rescue programme. To add insult to injury, it also invoked an anti-terrorism law against one of the banks, as well as, briefly, against the Icelandic Central Bank and the Icelandic Financial Supervisory Authority. On the British Treasury website, the Icelandic bank was placed on the same list as the Al-Qaida, the Talibans and the governments of Iran and Sudan. Thus, in October 2008 Iceland was totally isolated and all hopes of rescuing any part of the banking sector evaporated.

APEE President Professor Joshua Hall.

A lively discussion followed Professor Gissurarson’s lecture, with the audience clearly not being well aware of the treatment of Iceland in the financial crisis. Over 500 people, many of them graduate students, attended the APEE meeting, making it the largest in APEE’s history. In another seminar at the meeting, Professor Carrie B. Kerekes from Florida Gulf Coast University discussed the institutions of the Icelandic Commonwealth lasting from 930 to 1262. Kerekes pointed out that the Icelanders were able to live under the law, but without government, for more than three hundred years. Law in the Icelandic Commonwealth had been privately enforced. Professor John E. Mueller from Ohio State University gave a keynote lecture at the APEE meeting. According to him, US authorities vastly exaggerated the danger from foreign terrorists, spending enormous sums of taxpayers’ money on anti-terrorism measures, without any clear goal or evidence. Niels Veldhuis from the Fraser Institute in Vancouver gave a luncheon talk at the meeting, describing the successful liberalisation of the Canadian economy since the mid-1990s: public expenditure had been cut, and taxes reduced, creating conditions for the subsequent economic growth.

In Las Vegas, Professor Gissurarson used the opportunity to meet with old acquaintances attached to the Institute of Humane Studies, IHS, where he attended seminars and summer schools in the 1980s, including Professor Roger Garrison of Auburn University, Professor Larry White of George Mason University, Dr. Gerald P. O’Driscoll of the Cato Institute, Dr. Nigel Ashford of the IHS, Professor Peter Boettke of George Mason University, and Professor Sanford Ikeda of Purchase College at the State University of New York. Attendees at the meeting also included recent RNH visitors to Iceland, such as Professor Douglas Rasmussen, Dr. Eamonn Butler and Dr. Yaron Brook. Professor Joshua Hall is the next President of APEE, and the next annual meeting will take place in Cancún, Mexico, 2015.