The decision of Icelandic president Ólafur Ragnar Grímsson to veto an updated resolution of the Alþingi to reimburse IceSave depositors has sparked a bit of a controversy here on Iceland. Strangely enough the majority of Icelanders I talked to would have preferred if the president had approved the updated resolution, although the new version of the bill removes the limits existent in the original version. Polls, however, suggest that the public vote is against the reimbursement under the new conditions.
What’s more interesting, though, is that the veto causes a plebiscite to take place on the topic of the reimbursement and its conditions. Since the polls indicate that the majority of Icelanders opposes the new version of the bill, the reactions from the UK and the Netherlands have been stern (see the article of the Wall Street Journal linked above).
The fascinating side of the issue is, that this literally could mean a standoff of the Icelandic public vote against other so-called “Western democracies”. Which begs the question how the British and Dutch are going to treat the Icelandic public vote once it’s final. After all plebiscite is an instrument of direct democracy that many EU-citizens have been deprived of by the political elite in their respective countries. Think about the introduction of the Euro or the Treaty of Lisbon – consider especially the treatment of the Irish public vote after the first referendum in which the Irish rejected the treaty.