November 14,
2008: The president of Iceland has offered Russia the use of an abandoned NATO
airbase. The Russians declined, partly because the president of Iceland does
not have the authority to make such a deal. What is happening here is that, at
the moment, Iceland is unhappy with their NATO allies. Partly this is the
result of the global recession hitting
Iceland particularly hard. That's because Iceland's economic boom was fueled
largely by Icelandic banks making heavy use of risky derivatives. This was fine
when the global economy was growing, but leverage works both ways, and GDP is
expected to contract by at least 15 percent in the next year. The Icelandic
currency has lost over half its value (against major foreign currencies.)
Icelanders suddenly feel poor, although unemployment is still under four
percent, that is high by local standards. But the real sting has come from the
unwillingness of European nations to help bail out the Icelandic banks. This
has caused bad feelings towards the NATO countries, which have provided for
Icelandic defense for over half a century.
The U.S. has
had troops stationed in Iceland since World War II. That's because Iceland has
no armed forces of its own, and occupies a strategic position in the north
Atlantic. During the Cold War, U.S. warplanes regularly intercepted Russian
maritime patrol aircraft that strayed into Icelandic airspace. But two years
ago, the U.S. Air Force withdrew its fighters. Right about then, Russian
long-range patrol aircraft, which had been absent since the Cold War ended in
1991, returned. Since then, Russian aircraft have wandered into Icelandic air
space over a dozen times. So the Icelandic Defense Minister (actually the
Minister of Justice, who also takes care of military matters), asked NATO for
some help.
NATO
countries agreed to provide interceptors
(usually four at a time) on a rotating basis. But what Iceland would really
like is some economic assistance. Some Icelanders believe that leasing the old
air base to the Russians would generate some needed income. A few million
dollars goes a long way in Iceland, because the island nation only has a
population of 320,000.
