But during the crisis, the country did many things different from its European counterparts. It let its three largest banks fail, instead of bailing them out. It ensured that domestic depositors got their money back and gave debt relief to struggling homeowners and to businesses facing bankruptcy.
The article notes Iceland did have some advantages many larger countries don’t enjoy, namely its relatively few government debts, but the article also notes that Iceland’s a strong social safety net was also an advantage for the country.
While I’m obviously not an economist, providing real relief to homeowners who are struggling with underwater mortgages or a lack of ability to pay their mortgages due to unforeseen circumstances (job loss, etc.) seems like a common-sense solution for helping jump start our economy.