“No other option”: an insight into the political crisis
The crisis came after 6 months in office for Benediktsson and 11 years in office for the Sjálfstæðisflokkurinn (Independence Party), a centre-right political party. The Prime minister stated he had “no other option” regarding the political situation than to resign.
Since April 9th 2024 the government had been led by Bjarni Benediktsson and made up of his own party, the Independence Party, as well as the Progressive Party (Framsóknarflokkurinn) and the Left-Green Movement (Vinstrihreyfingin – grænt framboð). This quirky coalition made up of conservative, liberal, pro-business, agrarian, ecological and left-wing forces had moderate success starting from the 2017 elections and the formation of the Katrín Jakobsdóttir cabinet. The coalition was reconducted by the 2021 election results maintaining with Jakobsdóttir staying in office. The former Prime minister, and leader of the Left-Green Movement, gave her place to Benediktsson after she decided to run for the 2024 Icelandic presidential election, which she eventually lost, coming in second place.
A lot has changed in the world since 2021: the war in Ukraine, an economic crisis, and high inflation… and also an Icelandic particularism : the multiple Grindavik eruptions which have triggered regional evacuations and contributed to a surge in inflation, already high by that point. This tense situation led the government to propose new solutions, or more specifically led the parties to propose new solutions. But whereas some points of agreement between member parties of the coalition could be found, this was no longer the case in 2024. Mistrust between the governmental coalition partners arose. These faults were the starting point for the coming political eruption.
Bjarni Benediktsson, who resigned as Prime Minister in October 13th.
During the first weeks of October 2024, amid the next year’s budget discussions, partners of the government couldn’t find any common ground to fix the impending political and economic issues. Taking this into account, Bjarni Benediktsson triggered an eruption; he decided to clarify the situation by announcing the resignation of his government and snap elections planned in November, just before the end of the budget discussion.
Run for general elections: the Red lava flow
Now, the question is: will the political eruption lead to a blue pyroclastic flow or a red lava flow? To a victory of the conservative block, or a victory of the opposition parties?
Taking the latest polls into account, it seems former governmental coalition parties, like the Independence Party, the Progressive Party, and the Left-Green Movement are losing popularity day after day since 2022 and the start of the inflation crisis. They have lost 8.9%, 9.3%, and 8.6 % respectively since the last general elections in 2021. The fall of these parties is undoubtedly linked to their participation in the government and the political, social, and economic issues they faced during the time they were in office.
Meanwhile, coalition partners are falling in the polls, opposition political forces are taking a new breath. Indeed, the downfall of the Independence Party, the Progressive Party and the Left-Green Movement has essentially given a golden path to the centre-left Samfylkingin - jafnaðarflokkur Íslands (Social Democratic Alliance), the centrist Viðreisn ( Reform Party), and the misnamed Miðflokkurinn (Center Party) which is actually a centre-right party. Indeed, these three are the main opposition parties, and as opposition, they can easily propose a more coherent political program and more unified solutions to voters. Regarding the latest opinion polls, the SD Alliance would get 26% of the vote (this would be 16.1 % more than the previous election), the Reform Party would get 10.4%, and the Center Party would have its best result since 2020 with 15.7%.
Could this opposition unite into a governmental coalition? It is difficult to say for now, but it will of course depend on the results of the November snap elections, as well as on the will of those parties. One decisive topic in the election will surely be the Icelandic struggle with inflation and the resulting economic crisis, with a particular focus on the cost of living and rent. If this topic eventually boosts the political campaign of the opposition parties, surely it will also bring division. All parties, with their own ideological prism, will defend their own solutions. With a more social-democrat approach from the SD Alliance, and a more liberal one for the Center Party and the Reform Party. However, at the time, it was a surprise for the Left-Green Movement to join a coalition with the Independence Party and the Progressive Party, and so it could be to have a government made up of the SD Alliance, the favourite of these snap elections, and at least one of the two liberal opposition parties.
The European blast: a coalition for a European referendum?
Will the parties’ position on the EU matter? Hard to say for now as well. This question matters because the last time the Social Democrats were in charge in Iceland the country submitted its application to the European Union (in 2009), and was only a few steps away from being a full EU member state. This was frozen and stopped by the Independence Party, who led the government in 2013. Since then, the Social Democratic Alliance has consistently defended Iceland’s candidacy for the EU by proposing a referendum on the country’s accession to the Block. This position is shared by the Reform Party, which wants Iceland to apply to both the EU and the Eurozone, having already joined the Schengen area.
However, apart from these two parties, the Pirate Party (5th place with 8.2%), and the desolated Left-Green Movement, not a lot of “big” parties are defending the idea of an EU membership referendum. Some are not excluding it even while they defend the “no” in this case, such as the Independence Party, but some fundamentally reject it, like the Center Party and the Progressive Party.
The opinion polls give a majority of Icelanders asking for the question to be solved by a referendum (about 55%), in which case a small majority would vote for accession (with 42.4%) and 35% would vote against. The pressure of public opinion could lead some parties, such as the Independence Party or the Progressive Party to change their view on the topic. It could also persuade some parties to agree on an EU referendum in exchange for a compromise on another point of the programme in coalition negotiations. Even if the EU may not be an essential point in the upcoming snap elections, it could certainly be one of the surprise consequences of it.
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