Icelanders Reject Massive Bank Bailout Debt

Icelanders Reject Massive Bank Bailout Debt
Icelanders voting in a referendum in Reykjavik, Iceland, Saturday, March 6, 2010. The nationwide referendum is to approve the use of taxpayers' money to repay international debts.   (AP)

Icelanders have expressed their outrage at being asked, because of the collapse of their financial system, to take on debts adding up to 45% of last year’s economic output. A whopping 93% of voters rejected IMF loans that would have saddled each of Iceland's 320,000 citizens with $16,400 of debt to pay off losses in the UK and the Netherlands caused by defaults of Iceland's three biggest banks. The hugely unpopular "Icesave Bill" passed 30-33 by Parliament approved $5.3 billion in loans, but President Olafur Grimsson blocked it and the referendum followed.

Icelanders, the world’s fifth-richest people per capita as recently as 2007, ended 2009 18% poorer and will see their disposable incomes decline a further 10% this year, the central bank estimates. (Read more Iceland stories.)

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