Relationship with the United States
According to Countryaah, the agreement with the US meant the end of Iceland’s neutrality policy. The United States had become aware of Iceland as a suitable military base. In the fall of 1945, the United States made a wish for permanent military bases in the country. This was rejected. However, in 1946, the United States was granted the right to use the airfield at Keflavik in connection with its forces in Germany. The Communists/Socialists walked out of government in protest and the agreement also met from other teams opposition.
Iceland later joined several of the West’s organizations. First in the Marshall Plan where the country received relatively more aid than other countries. In 1949, Iceland joined NATO on the condition that in peace time the country did not need to make room for military bases. However, the Keflavik base was restored as early as 1951 following an agreement with the United States. Well, not to sign an agreement with NATO.
The base agreement has been a constant controversy in Iceland’s policy, with the largest party – the Independence Party – traditionally a safe defender of the presence of North Americans and the socialists/communists as equally opposed. The other parties responsible for the return of North Americans have at times been faltering. In 1956 and 1971, the government – in both cases a leftist government – declared its intention to have the base liquidated, but nothing came of it. The base was of great economic importance to Iceland in the years before 1956. It employed up to 4% of the country’s workforce, and 15% of foreign exchange income came from companies affiliated with the base. In 1956 there was a great change in the meaning of the base. The figures for labor and foreign exchange income fell to 1-1½% and 4-5% respectively.
It has been difficult to estimate the country’s total economic dependence on the United States. The sale of Icelandic products in the United States has taken place without the assistance of Washington. For a long time, Iceland benefited from US export programs for developing countries. Many foreigners have a notion that Iceland is highly economically dependent on the US favor. This has probably motivated some to accept North American interests in the country.
The base question has aroused strong national sentiments since 1940. During a long but peaceful struggle for independence, Icelanders had developed a strong national feeling – which the country’s largest party reflects in its name. During the war, the British and since the North Americans employed many Icelanders at facilities and in services. The narrow conditions of the pre-war years were replaced by a material wealth for most people. New tools such as saved work appealed to the settler spirit of Icelanders. This reinforced a friendly attitude towards the United States in advance.
Some politicians were prepared to satisfy all the wishes of North Americans. Leading people in business and commerce who had the difficult marketing conditions before the war in fresh memory set high expectations for the United States.
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North American influences on people’s lives and culture, on language and attitudes, have caused concern for many. Since the re-emergence of North Americans, they have had their own radio station which broadcasts 24 hours a day in the style of Radio Luxembourg. Around 1960, North Americans began broadcasting television, which – quite unnecessarily – was directed at Reykjavik. North American TV became a matter of contention between the many who appreciated the programs and who felt this was a private matter and those who wanted the country and the people to be allowed to be at peace for this intrusion. These were also many. In the fall of 1974, the government ensured that television broadcasts were restricted to the base.
During the 1980’s, no decisive questions were asked about Iceland’s relationship with NATO, but the Keflavík base with its 3100 North American soldiers continued to cause controversy. In September 88, the Icelandic government formally declared that no new military projects would be implemented in the country. This happened on the basis of a tense relationship between Reykjavik and Washington. The US criticized Iceland’s decision to catch 80 adults and 40 young whales, and declared it a violation of the agreements of the International Whaling Commission. Iceland replied with a statement that the catch was for scientific purposes and refused to reverse it. The US threatened to introduce a boycott of Icelandic fish products, and activists from environmental organizations lowered two whaling vessels in Reykjavik Bay.