The farce played out by president and prime minister yesterday laid bare Iceland as a nation run by charlatans, whose hypocrisy the whole world can see

The farce currently playing out in Icelandic politics hit new heights yesterday.

Tuesday began well. The leaders of the two coalition parties met for the first time after the notorious broadcast in which the Icelandic people watched their prime minister’s hypocrisy exposed.

Bjarni Benediktsson, the leader of the Independence party – the coalition partner of the ruling Progressive party – had strongly intimated before the meeting that his party would pull out of the coalition agreement, which would lead to new elections. The nation held its collective breath.

Shortly after that meeting ended the prime minister, Sigmundur Davíð Gunnlaugsson, wrote a cryptic status on his Facebook page that appeared to be a veiled threat to his coalition partner. Paraphrased, it went something like this: “If you do not continue to support me in the good works I have performed for this nation I will make the president dissolve the parliament nyah nyah.”

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Cut to Bessastaðir, the president’s official residence. The prime minister dashes in with extraordinary bravado past the assembled media, two minions carrying – as we found out later – a document calling for the dissolution of parliament for President Ólafur Ragnar Grímsson to sign.

After a short meeting between the two, Grímsson holds an impromptu press conference in which he states that it is assuredly not the norm for him to reveal the details of a confidential meeting with the prime minister in which matters of state are discussed. However (and again I paraphrase): “Since the prime minister decided to use me, the president, in a game of political chess, I am going to tell you exactly what he is all about, and also to tell you that I gave him a big fat no. I am not going to dissolve parliament because the prime minister told me to.”

This was getting good, and we the people were already settled in front of our monitors with our proverbial popcorn. We watched as the prime minister’s party cronies sulked on live TV because the prime minister had completely bypassed them in his shrewd attempt to blow up the Icelandic parliament. Another meeting was held, and suddenly the prime minister’s deputy – the fisheries minister, Sigurður Ingi Jóhannesson – appeared on our screens, announcing that the PM had decided to “step aside” and to let him take over as prime minister, though Gunnlaugsson would stay on as the head of the Progressive party.

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And so, as the foreign media reported on the prime minister’s resignation and countless “Iceland Best in the World for Fighting Corruption!” internet memes were being launched around the world, we Icelanders knew that we were basically back to square one. The government was the same as before, albeit with a minor, virtually meaningless, reshuffle. Or as my husband so succinctly put it, we had “the same old soup in the same old bowl”.

The coup de grace in this ludicrous series of events came in the evening, when the foreign media was sent a press release by the prime minister’s office in which it was clearly stated that the prime minister had not, in fact, resigned, but merely “stepped aside”, and had asked his deputy to take over “for an unspecified amount of time”.

We laugh. Because it is farcical. Yet it is really not funny at all. And the truth is that the Icelandic people are angry. Even more angry than we were in 2009 when the government was forced out of office through mass protests that went on day after day. We’re pretty furious, actually. OK: livid.

On Monday evening more than 20,000 people showed up in Reykjavík’s Parliament Square to demand the resignation of the government – in a nation of 330,000. It was probably the largest demonstration in Icelandic history. We were not demanding a cabinet reshuffle. We were demanding a new political culture, a new Iceland – the one we envisaged when the 2008 economic collapse levelled the old nation to the ground.

The Icelandic government must resign. The Icelandic people need more than a blundering disappearing act by a prime minister who will continue to run things behind the scenes. And there are other culprits. Bjarni Benediktsson, who is finance minister, has also been linked to an offshore company, as has the interior minister, Ólöf Nordal. Their involvement is perhaps not as extensive as that of the prime minister, but their credibility is ruined. We no longer trust them. And the fact that they refuse to recognise that demonstrates their level of incompetence to serve in public office better than anything else.

The Icelandic people want a nation that is built on a foundation of transparency, integrity and honesty. Not a nation run by charlatans with companies in tax havens, who betray their voters, who refuse to share economic conditions with the rest of the nation, whose hypocrisy and staggering incompetence is laid bare for the whole world to see.

They must go.