From left: Prof. Gretar E. Eythorsson, Prof. Gissurarson, Canadian Ambassador Stuart Wheeler, and Dr. Gudni Th. Johannesson.

RNH Academic Director, Professor Hannes H. Gissurarson, gave a lecture 19 March 2016 at a conference at Akureyri University on international affairs. According to him, foreign powers only took interest in Iceland for a brief period of history, while it was true that their fishing vessels had for centuries been operating in the fertile Icelandic waters and had been reluctant to leave when Iceland extended her fisheries limits. Iceland had for a while been strategically important as a consequence of new technology in warfare, submarines, airplanes and weather forecasts, both in the Second World War and in the Cold War. This had changed after the collapse of communism. It had become apparent in the 2008 international financial crisis that the Anglo-Saxon powers had lost interest in Iceland. Nevertheless, Iceland’s place was in the North Atlantic and her natural allies remained Norway, the United Kingdom, Canada and the US.

The many speakers at the conference included Dr. Gudni Th. Johannesson, Associate Professor of History, on relations between Iceland and the US in 1976–91, Professor Eirikur Bergmann on the Icesave Dispute between Iceland and the UK, and Bjorn Bjarnason, former Minister of Justice, on the pursuit of a new balance of powers in Northern Europe. Gissurarson’s participation in the conference formed a part of the joint project of RNH and AECR, the European Alliance of Conservatives and Reformists, on “Europe, Iceland, and the Future of Capitalism”.

Glærur HHG á Akureyri 19. mars 2016

Prof. Gissurarson and fmr. Minister Jonasson.

RNH Academic Director, Professor Hannes H. Gissurarson, gave a talk at a political seminar for Young Left Greens 5 March 2016 on whether Iceland was too small to be sustainable as an independent political unit, as some had claimed after the 2008 bank collapse. Professor Gissurarson described many advantages which small states enjoyed, explaining their proliferation after the Second World War. By means of free trade such states could benefit from the international division of labour and from economies of scale, without developing the lethargic, clumsy and non-transparent bureaucracies of many bigger states. Small states did not need shelters that turned into traps: rather, they needed free trade with the rest of the world, flourishing mutual relations and defence arrangements with bigger states: Iceland should for example pursue such arrangements now with the United Kingdom, the United States, Canada and Norway.

The other speaker at the seminar was former Left Green Minister Ogmundur Jonasson. After their talks a lively discussion followed, not least about justice in income distribution and about increased consumer choice in health. Gissurarson’s participation in the seminar formed a part of the joint project by RNH and AECR, the Alliance of European Conservatives and Reformists, on “Europe, Iceland, and the Future of Capitalism”.

Gissurarson Slides Left Green seminar 5 March 2016

Icelandic Stalinists suffered their biggest blow in the winter of 1956 when news spread to the West about a secret speech that Nikita Khruschev, General Secretary of the Soviet Communist Party, had given in the Kremlin in the night of 25 February. There, he admitted many of Stalin’s misdeeds: The dictator had had innocent people arrested and tortured; he had completely failed during the German invasion of 22 June 1941; he had deported peoples and national minorities from one end of the Soviet Union to the other. The speech was an international sensation, not least in Iceland where a well-organised communist party had been active and influential since 1930, operating under the name Socialist Unity Party from 1938 to 1968. Staunch Stalinists, Brynjolfur Bjarnason, Einar Olgeirsson and Kristinn E. Andresson, dominated the party while writers such as Halldor Kiljan Laxness, Johannes from Katlar and Thorbergur Thordarson eloquently defended Stalin. Laxness and Johannes from Katlar even composed eulogy poems about him. The Socialist Unity Party was always loyal to, and received substantial financial support from, Moscow, as documents discovered in Soviet archives were later to demonstrate.

On 26 February 1956, the Public Book Club, Almenna bokafelagid, republished Khruschev’s Secret Speech about Stalin with a foreword and notes by Professor Hannes H. Gissurarson and an introduction to the original 1957 edition by Aki Jakobsson, who had been a committed Stalinist and government minister for the Socialist Unity Party in 1944–7, but who had later turned his back on communism. The translator, archivist Stefan Pjetursson, had also been a communist, but had, in the early 1930s, dared to question some directives from Moscow. Then he was sent to Moscow to be re-educated, but as he kept being critical, he was about to be sent to a labour camp when, with the assistance of the Danish Embassy, he narrowly escaped from Moscow and became a tireless anti-communist, long as editor of the Social Democratic newspaper. In an addendum Lenin’s famous testament is printed: Icelandic communists had insisted that it was fabricated, but Khruschev had it published in 1956, for the first time in the Soviet Union. There, Lenin warned against Stalin. Franz Gislason made the translation. The book forms a part of a joint project by RNH and AECR, the Alliance of European Conservatives and Reformists, on “Europe of the Victims”. The book is also a part of a series of republished works relevant to the history of the Icelandic communist movement, and was published both on paper and online. The republication of the book caused some stir in Iceland, as is shown in this report by Morgunbladid 25 February:

Prof. Gissurarson speaking at the Peruvian Ministry of Production.

RNH Academic Director, Professor Hannes H. Gissurarson, read a paper at the Peruvian Ministry of Production 26 January 2016 on practical matters concerning the management of fisheries and what other nations could learn from the experience of the Icelanders. According to him, the two key factors in the efficiency of the Icelandic system of ITQs, individual transferable quotas, were that the catch quotas were transferable so that they eventually ended up in the hands of those who were most efficient in utilising them, and that they were permanent, so that owners of fishing firms gained an interest in maximising the long-term revenue of the resource.

Professor Gissurarson discussed the idea of “the property of the nation” often invoked in discussions about natural resources, arguing that the most natural way of interpreting it was to regard it as a stipulation that the long-term revenue from the resource should be maximised. This was definitely not achieved by the state expropriating resources, but rather by allowing individual enterprises to utilise those resources as efficiently as possible. The newly created resource revenue subsequently flowed in natural ways into the economy. The seminar was well-attended.

The University of Iceland Press has recently published a book by Professor Gissurarson in English, The Icelandic Fisheries: Sustainable and Profitable. That book and Gissurarson’s lecture at the Ministry both formed parts in the joint project by RNH and AECR, the Alliance of European Conservatives and Reformists, on “Europe, Iceland, and the Future of Capitalism”.

Prof. Gissurarson giving his talk.

RNH Academic Director, Professor Hannes H. Gissurarson, gave a paper at a meeting organised by the Peruvian Association of Fishing Firm Owners in Lima 21 January 2016 on the problem of initial allocation of quotas. The University of Iceland Press has recently published a book by Professor Gissurarson, The Icelandic Fisheries: Sustainable and profitable. He argued that the quotas should initially be allocated according to catch history, and not auctioned off by the state. In an allocation according to catch history nobody would be made worse off, because fishermen would initially continue to harvest the same proportion of the total catch as they had been doing, and then starting to trade quotas. The only right which people outside the fisheries would be deprived of, would be the right to harvest fish at zero profit, as the economics of fisheries (H. S. Gordon, Antony Scott and others) demonstrated: With open access, effort increased to the level of zero profit where total cost would be equal to total revenue.

Professor Gissurarson pointed out that inital allocation according to catch history fulfilled the Lockean proviso for creating property rights to unowned resources, or enclosing commons: Nobody was made worse off from it. Such allocation was also Pareto-optimal, unlike an allocation in a government auction where some would be made worse off by their inability to pay the required price for the quotas: their investment in fishing vessels, fishing gear and human capital would be wiped out.

The lecture was well-attended. The lawyer Enrico Ghersi introduced the speaker, and after the lecture Elena Contreras, chairman of the Association of Fishing Vessel Owners, said a few words. There is much interest for individual transferable catch quotas in Peru, and one of the attendees was Rafael Rey, who introduced catch quotas in some of Peru’s most important fish stocks, while he was Minister of Production. Professor Gissurarson said that the catch quotas had to be as divisible, transferable and permanent as possible, in order to make the system as efficient and productive as the Icelandic one. The Icelandic system was a good example of how resources could be protected by assigning them to protectors. The lecture formed a part of the joint project of RNH and AECR, Alliance of European Conservatives and Reformists, on “Europe, Iceland, and the Future of Capitalism”. The lecture was taped and can be watched on Youtube dubbed in Spanish:

Gissurarson Slides 22 January 2016

The University of Iceland Press recently published a book by Professor Hannes H. Gissurarson, The Icelandic Fisheries: Sustainable and Profitable, containing four papers which the author has published in English on the most beneficial utilisation of natural resources such as fish stocks. In the introduction Professor Gissurarson recalls the derision with which his suggestion met, at a 1980 conference about the future in Thingvellir, Iceland, that individual and transferable fishing rights should be allocated to fishing firms to solve the problem of overfishing. Still a university student, he published an article in the Journal of Economic Affairs in 1983, arguing further for this idea. The relatively successful Icelandic system of individual transferable quotas in the fisheries had however not been formed in the minds of any scholars: It had developed in a process of trial and error where those with an economic interest in the matter had groped their way towards an efficient solution.

In the introduction, Professor Gissurarson says that three important points are now more clear to him than when he started to think about this problem. First, overfishing is a case of government failure, not market failure. It is caused by the neglect of government to perform its proper task of developing a framework of rules under which individuals would not collide with one another—would not impose harm on one another. In the second place, any major change in the rules applying to an economic sector, such as in this case confining harvesting to holders of fishing permits only, should be Pareto-optimal if possible, which implies that most or all would benefit from the change, while no-one would be made worse-off by it. Initial allocation of fishing permits fulfils this condition, but not an allocation in a government auction. Thirdly, it can be deduced from the analysis of fisheries economists (such as Jens Warming and H. S. Gordon) that the right of which others than the holders of fishing permits under such a system was deprived, was essentially only a right to harvest fish at zero profit, and such a right was, by definition, worthless.

The papers in the book are, 1) Agreeing on the Rules, 2) Non-Exclusive Resources and the Rights of Exclusion, 3) Objections to Individual Transferable Quotas, and 4) The Politics of Property Rights. Professor Gissurarson argues that the disagreements in Iceland about the fisheries can be related to the different views of Locke on the one hand and Marx (and perhaps Henry George) on the other hand on the legitimacy of private property rights, and to the different approaches of Coase on the one hand and Pigou on the other hand to the economic problem of external harm. The publication of the book forms a part of the joint project by RNH and AECR the Alliance of European Conservatives and Reformists, on “Europe, Iceland and the Future of Capitalism”. It is also a fruit of the cooperation betweeen RNH and IDDE, Institute for Direct Democracy in Europe. The book is freely available online as well as on paper.