The incoming administration of Prime Minister Kristrún Frostadóttir, which takes over on Sunday, also said it will set up a panel of experts to look into the advantages and disadvantages of retaining the Icelandic crown over adopting the Euro.
Hope they don’t adopt the Euro. Maintaining currency sovereignty is vital to being able to actually run an effective government. Without the ability to print money they’re forced to “balance the budget” and that always means austerity.
The thing with printing money in Iceland is that a) they proved that they think it grows on trees and b) there’s no trees in Iceland.
Ask Greece how great it is being unable to print money. Or Kosovo. Or Montenegro. Or Spain.
Literally the only benefit to being part of the Eurozone is that tourists don’t need to exchange their currency. That’s it. Otherwise it’s just giving up sovereignty to France and Germany. During financial crisis it’s even worse, it basically makes the government unable to respond to rapid shifts in the market and forces them to slash public spending to pay for bailouts.
Iceland wouldn’t jail bankers if it was in the Eurozone. Guaranteed.
Awful take.
Instead of printing money, they should be raising taxes on their wealthiest.
Printing money does raise taxes on the wealthy. Inflation is a tax on every person with currency. If you print money and give it to the poor to make up for the real value they’re losing to inflation, the tax falls on the wealthy.
Err… the thing about printing money and giving it to the poor is that the wealthy people who own the companies will raise prices to overcompensate for the increase in currency available.
I keep saying: inflation is how the ruling class recoups any gains the working class has made, with interest.
Prices are set by the market. They can only charge as much as people will pay.
Obviously currency sovereignty isn’t the only tool to redistribute wealth, but it’s one of them! Do you not understand how much austerity is caused directly by governments not being able to print money to fund the government?
If a country using the Euro wants to build public housing, it has to raise taxes or cut spending. If a country with currency sovereignty wants to build public housing, they just print money.
