The extensive protests that shook Iceland Tuesday have continued into Wednesday and are beginning to have an effect on one of the two political parties making up Iceland's coalition government.
Late Wednesday night, as thousands of protesters re-lit a large bonfire in front of the Parliament, the Reykjavik chapter of the Progressive Party voted to recommend to the party's national representatives that they withdraw from the ruling coalition, and called for new elections in May 2009. As the night wore on, though, matters descended into violence. Around 1:30 am, police dispersed the crowd with tear gas, the first time tear gas had been used against Icelanders in 60 years. The crowd soon reformed and pelted riot police with stones. One officer was severely injured by a cobblestone, the newspaper Morgunbladid said.

Although the leader of the Social Democratic Alliance, Foreign Minister Ingibjorg Solrun Gisladottir, was out of the country, Prime Minister Geir Haarde, leader of the Independence Party, told reporters that he believed she remained committed to the current ruling coalition. He insisted that the government was "functional" and that holding elections this spring would result in nationwide chaos.
The rank and file members of the Social Democratic Alliance appear to differ, however. Calls for the current representatives within the Party to step aside were widely applauded at tonight's meeting, as were calls for spring elections and a new coalition.

The protests have been sparked by Iceland's catastrophic economic collapse over the past three months, and the failure of the government to call for immediate elections or to investigate the rumored widespread malfeasance by the country's leading bankers, businessmen, and politicians. "It should be clear to everyone that a government that has failed as utterly as the Icelandic government has can neither investigate, nor clear up the past, nor forge a new path into the future," said retired professor Njörður P. Njarðvík.
Wednesday morning began with angry protesters throwing paint at the government building and surrounding Prime Minister Geir Haarde's car. They banged on the vehicle's windows and pelted it with eggs for several minutes before his bodyguards and police pushed them away.
The protesters gathered in front of the Parliament building banged on pots and pans while shouting "Unfit government!" "You're fired!" and more creative insults. Although the racket calmed down to show respect to mourners at a funeral in the neighboring Reykjavik Cathedral, a mourner encouraged them to "produce enough racket to be heard across the country" when it was over.
Iceland has come to expect little change from the members of Althingi, the elected representatives, who have been widely criticized for being little but a rubberstamp for the conservative government agenda, but they claim they are getting the message. "So why aren't the protests getting through to you, why hasn't there been any change?" a state television reporter asked a Social Democratic Alliance representative. "We very clearly noticed the protests, and we get the message that people want change," he said without elaborating. The Conservative Party Representative's reply to the question painfully demonstrated whose interests the Icelandic Althingi represents: "Well, representatives are just representatives," Ms. Ragnheidur Rikhardsdottir, said, "and ministers are ministers, and theirs is the power."
The current political leaders are deeply invested in the status quo and are unlikely to come out of any open and honest investigation with any credibility, so it remains to be seen how far the party's rank and file can go before they meet resistance. The leaders' audacity in the face of the utter failure of their policies would indicate that their powers of introspection and rational thought are on the wane.
After the events of the past two days, however, I feel confident that we will soon be voting for change. The crowds are composed of a wide cross-section of the community, not just a few young hotheads. The protesters' numbers, in proportion to the country's population, are staggering--over 1% of the population. An equivalent meeting of Americans would be over 3 million people.
We are the ones we have been waiting for (where have I heard that before?)
Wish us luck!

Terror as Iceland faces economic collapse - Times Online
Economy of Iceland - Wikipedia, the free encyclopedia
Iceland information on economic freedom | Facts, data, analysis ...
Iceland - Wikipedia, the free encyclopedia
Visit Iceland official travel guide – vacation Iceland hotels
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From CALIFORNIA .....I WISH YOU G'LUCK ICELANDERS ..>FIGHT FOR YOUR CIVIL RIGHT to A GOOD GOVERMENT FOR THE PEOPLE OF THE PEOPLE...I t will get tough but BELIEVE ME WHEN I SAY...YOU WILL SEE THE LIGHT.
geothermal heating for both industry and homes, good seafood production, good health care for all citizens, we need to help these folks.
iceland is a country of hope and beauty. i fervently plead with them to stopthe violence. there is no need for it. what the world needs is your expertise on processing wholesome seafood products. if you again show the world your leadership, the financial crisis for you will end. strive for better relationships with alaska and canada and collectively solve the hunger problems and fishery managment problems ena the world will thank you hang in there
Hi Folks
A voice from Bonnie Scotland here. I also applaud Iris for making me aware of the tragic situation in Iceland. I find it strange I have seen no trace of it in the UK media, maybe I need to look harder!
I would totally endorse the comments condemning the neo liberal dogma that the whole world is paying the price for while a relative handful have made themselves disgustingly rich of the back of lies and greed.
My eleven year old son Sean recorded Obama's inaugural speech on his phone and we've listened to it a couple of times. Good to here him speak up for government that is responsible and effective- it's unfortunately so little of that kind exists in the world. It seems the world has a statesman like politician one again - we need many more and we need to believe that it's not too late to right the wrongs of history and forge a brighter future for all countries of the world.
best wishes to you all lets play our part to the best of our abilities.
Iceland may be the canary in the coal mine. The parallels are remarkable and this could be what is in store for the US if the financial crisis continues.
Put the current government on a sailboat and point it to Greenland - to borrow from historical precedent.
Love reading these posts just for the names! Its becoming a real saga...
Congratulations, Iris. This is what I call real journalism, and I wish that American *journalists* could write as well as you do. I have become very interested in Iceland through reading the novels of Arnaldur Indridason, and if anyone can recommend other writers available in translation, I would be grateful.
Keep up the good work Iris, you are doing a great service for your country!
Thanks for posting this--I think too few people have paid attention to this. Iceland is arguably one of the most stable countries in the world, and the unraveling of things there should perk up our attention to the severity of the results of this economic crisis. Good luck, Iceland.
"It should be clear to everyone that a government that has failed as utterly as the Icelandic government has can neither investigate, nor clear up the past, nor forge a new path into the future,"
Can you say, Barney Frank? Chris Dodd?
Amen!
Sure, but the Democrats came into office in 2006, technically, the beginning of 2007. By that time, all the fraudulent securities trading had been done. By that time, the mortgage crisis was beginning to unfold.
What folks should really be looking at is the Democratic Congressmen who colloborated with Bush on the torture crap.
As for the economic collapse, thats a result of Milton Friedman theories of neo-liberalism adopted by the center Democrats and the entire GOP. Deregulation and privatization have been GOP rallying cries since the 1970s.
BTW, how is Rush Limbaugh doing? Hannity, Beck, Savage? How are all those vitriolic pundits doing with their million dollar jobs for spitting poison. Are they paying your rent when you need loose your job?
Please! Only neo-con ideologists with tunnel vision are going to fall for that nonsense. Everyone knows that this mess falls squarely at the feet of the Republican party leadership and the conservative economic and political ideology, which has apparently caused an equal amount of chaos in Iceland's economy. They are also throwing the bums out to the curb, where they belong.
Agree with you for the most part. The Republicans, Bush administration in particular, have raped the land, but let's not forget that William Jefferson Clinton was the one who signed the repeal of the Glass-Stiegel Act. (My apologies if I'm not spelling that right.)
Fall for that?
Are we talking about the same "let's roll the dice", "let's not fix something that's not broken" Frank, and biggest Fannie & Freddie donation recipient Dodd ($133,900)?
Regular saints those two.
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