Do liberal ties pacify? A study of the Cod Wars

Introduction

The so-called Cod Wars occurred between states – Iceland and the UK – whose relations are purportedly pacified by the Kantian tripod for peace. The states in question were democracies with considerable economic interests that would have been compromised had a militarized dispute occurred. Iceland and the UK were also members of NATO, OEEC, GATT and the World Bank and, during the last two Cod Wars, maintained considerable ties through European institutions. While militarized disputes between Western democracies over maritime rights are not uncommon (Hensel et al., 2008; Mitchell and Prins, 1999), it is rare for the disputes to last as long, be as intense and revolve around such high stake-issues as was the case with each of the Cod Wars. Therefore, it is not surprising that these disputes are deemed a major exception to the tendency of North Atlantic and Western European states to solve their problems through peaceful means (Cohen, 1994: 216; Kacowicz, 1995: 270).

Liberal thinkers argue that democracy, commercial ties and institutions have a pacifying influence on states and contribute to the peaceful resolution of disputes. These factors facilitate peace by shaping pacifist norms, providing common interests between states, constraining leaders legislatively, raising the costs of mobilization for war, and making it easier to signal resolve. The Cod Wars earn a mention in many studies of the liberal peace, because scholars try to make sense of why they occurred and what the implications are of the disputes (Gelpi and Griesdorf, 2001: 636–637; Gleditsch and Hegre, 1997: 289; Hart, 1976; Hellmann and Herborth, 2008; Lebow, 2010: 198; Muller and Wolff, 2006: 57; Russett, 1993: 21–22). However, most of these mentions are superficial and brief.

While the Cod Wars were not actual wars – only one individual died during the three conflicts – the disputes did involve the use of force and could have potentially led to more casualties. While it is central to the liberal peace that disputes between states are solved through non-violent means, this was not the case with the Cod Wars. Furthermore, scholars frequently fail to account for how costly and risky the disputes were, which makes the occurrence of the conflicts even more noteworthy. Each Cod War increased considerably the risk that Iceland would shut down the US base on Icelandic soil and withdraw its NATO membership. Due to Iceland’s strategic importance to the US and NATO, this meant that the disputes had the potential to affect adversely the balance of power in the North Atlantic. ¹ That two allies with such extensive liberal ties and boasting all of the purportedly pacifying characteristics of the liberal peace should enter into militarized disputes on three separate occasions is puzzling. Not only did the liberal peace fail on three separate occasions, but also different British and Icelandic governments were involved in the use of force. The disputes were therefore not flukes.

With one exception, there are no comprehensive studies in the literature on the role of liberal factors in the Cod Wars. ² The article by Hellmann and Herborth (2008) is the most comprehensive study to date, but its examination of the Cod Wars is still fairly brief, each Cod War is not studied separately, and the authors did not use key primary and secondary sources. Given the puzzling nature of the Cod Wars and the interest in them among scholars dealing with the liberal peace, it is worthwhile to study each of the Cod Wars separately and examine the ways in which the supposedly pacifying factors pacified, aggravated or had no impact on the outbreak, conduct and resolution of the Cod Wars.

I find that liberal explanations for the disputes are only correct in so far as actual war was highly unlikely between the states due to their democratic characteristics, economic ties, and common membership of institutions. However, democratic processes and economic interests were crucial factors in escalating the disputes as far as they went and in limiting the ability of statesmen to resolve them. Common membership of institutions had a mixed record. Iceland tended to use its strategic importance to NATO as a bargaining chip, threatening to withdraw from the alliance or close the US base on Icelandic soil unless the British would meet Icelandic demands. NATO membership therefore hardened Icelandic resolve and eagerness to act unilaterally. Icelandic elites were, however, wary of escalating the disputes further due to the significant negative impact it would have had on Iceland’s US-reliant security arrangements and US-reliant economy. ³ In addition, the UK surrendered to Iceland when the disputes looked set to escalate to an unacceptably high level. While NATO’s mediation capabilities were left wanting, NATO did engage in informal or formal mediation during the disputes, and this helped both sides find an agreement. In short, while the liberal characteristics of the states played a role in escalating the disputes, they effectively acted as a threshold on how far the conflicts could escalate.

The liberal peace

Liberal IR theory unites a diverse set of thinkers who tend to hold a more optimistic view of international politics than realists. In relation to realists, liberals see conflict as a more avoidable and less necessary component of international politics. For liberals, it is the lack of regulating mechanisms that explains why competition and conflict is so prevalent in international politics. Democracy, commercial ties and institutions feature prominently in liberal writings as factors that can pacify state relations and provide a foundation for lasting cooperation (Doyle, 1986; Hegre, 2014; Moravcsik, 1997; Oneal and Russett, 1999; Russett, 1993).

Democratic states are supposed to be more peaceful towards other states (other democracies in particular) due to normative constraints, legislative constraints, mobilization constraints, and credible commitments. Just as disputes within democracies are resolved with compromises and nonviolence, democratic leaders are expected to ‘externalize’ those norms when in dispute with other states. Given that democratic leaders have to govern with the consent of the governed, they will also have to mobilize public opinion in favor of any conflict and overcome potential legislative constraints. This largely precludes conflicts that do not reflect the interests of citizens and influential groups. This makes it more time-consuming and difficult for democratic leaders to mobilize for conflict, decreasing the likelihood that they would do so without a demonstrably favorable ratio of costs and benefits (Doyle, 1986; Hegre, 2014; Russett, 1993). Democratic leaders are also more credible in interstate disputes due to audience costs and greater transparency which make bargaining problems concerning resolution less severe, thus reducing the unnecessary escalation of disputes (Fearon, 1994; Gelpi and Griesdorf, 2001: 645; Schultz, 2001). In the Cod Wars, we should therefore expect elites to be constrained by liberal norms in how they resolve the contest over fishing rights in the North Atlantic: they should opt for non-violent means and avoid the use of force in favor of compromises and legal dispute settlement mechanisms. Elites should be constrained by the public and political competition from taking actions which are costly and risky to society at large.

Trade between states is also meant to have a pacifying influence on interstate relations. After all, economic ties create greater common interests between sub-state groups in both states, making it more difficult for leaders to mobilize support for conflict. Conflict is costly in terms of physical destruction, the severance of trade ties, and flight of capital; but hostile rhetoric and the mere risk of conflict can often be costly enough, because it drives away investment. The greater costs and lower benefits of conflict between two trading states (Gartzke, 2007: 172; Moravcsik, 1997: 530) make it more difficult for leaders to issue the empty threats that could lead to conflict. Leaders of economically interdependent states should also be able to signal resolve more efficiently, because economic ties raise the costs of the signals and therefore their credibility (Gartzke et al., 2001: 400–401). In the Cod Wars, we should therefore expect the loss of trade ties and other economic harm to constrain leaders from taking risky actions. The Icelanders should be more wary of economic harm and more prone to compromise, given their significant dependence on UK trade. We should therefore expect to observe the loss of trade as yet another barrier with regard to Icelandic elites seeking to take Iceland into costly and risky disputes with the UK.

International organizations are also supposed to pacify. States have incentives to increase their information about other states’ actions, in order to make cheating less likely and bargains more likely, and increase their own credibility, to make other states more willing to cooperate (Keohane, 1984; Keohane and Martin, 1995). This leads states to create and maintain institutions, because they ‘provide information, reduce transaction costs, make commitments more credible, establish focal points for coordination, and in general facilitate the operation of reciprocity’ (Keohane and Martin, 1995: 42). International organizations allow states to cooperate in ways that would otherwise be very difficult or impossible (Abbott and Snidal, 1998; Ikenberry, 2001: 52–64). In the Cod Wars, we should therefore observe that the utility of Iceland and the UK’s common membership of institutions raises the costs of conflict between members. ⁴ Leaders and the public should show an awareness of the value of these institutions, and wariness to risk their states’ membership of them and respect with them. Iceland and the UK should feel compelled to settle their differences legally in the hopes of reciprocity. Members within the institutions should pressure their fellow disputing members to resolve their differences peacefully. The disputes should be resolved through legal means that reflect broadly shared norms, not through violent means that reflect short-term interests and divert from broadly accepted principles.

First Cod War (1958–1961)

This dispute lasted from September 1958 to February 1961. It began with Iceland’s unilateral extension of its fishery limits from 4 to 12 miles, and the failure of the British to comply with the Icelandic regulations. The UK refused to withdraw its fishing fleet and deployed the Royal Navy to defend British trawlers. During the dispute, there were confrontations at sea between Icelandic patrol ships and British trawlers and warships. Icelandic officials threatened to withdraw Iceland’s membership of NATO and expel US forces from Iceland unless a satisfactory conclusion could be reached. In 1961, an agreement was reached between Iceland and the UK wherein Iceland obtained 12-mile fishery limits and the UK gained temporary fishing rights within those 12 miles. As part of the agreement, any future disagreement over fishery limits was to be settled through the International Court of Justice (ICJ).

The pacifying role of democratic norms was highly limited. Both sides claimed that international law was favorable to their cause, but neither side was fully prepared to pursue the dispute in the ICJ, due to time constraints and fears that the ICJ would rule against them. The unwillingness of the British to use the ICJ puts some doubt on the norm externalization argument of the democratic peace, because the British were reluctant to refer the case to the ICJ for fear of losing (Jóhannesson, 2004: 558). Both sides wanted to reach a conclusion at the Law of the Sea conferences. Once at these conferences, however, they pushed for proposals that were too extreme to pass. With no conclusion in sight, Iceland was unwilling to wait for additional Law of the Sea conferences to settle the issue, and chose to extend the fishery limits unilaterally instead. Nonetheless, had a conclusion been reached by any subsequent Law of the Sea conference, there is evidence to suggest that both states would have felt obliged to comply with the conclusion (Jóhannesson, 2007: 248).

There is some evidence that democratic norms constrained the actions which the British government could take. The British knew the costs that naval protection would entail (Jóhannesson, 2007: 186). In addition to the costs of diverting the naval fleet to Icelandic waters and disobeying its NATO partners, they risked getting into confrontations with Icelandic patrol boats. These confrontations, which could lead to deaths, would stimulate Icelandic public opinion against NATO and the US, and could therefore jeopardize Iceland’s membership in NATO, as well as US bases in Iceland, and the balance of power in the North Atlantic. British statesmen therefore instructed the Navy never to open fire on Icelandic patrol ships unless being fired upon first, and then only with the intention of destroying the weapons on the patrol boats (Jóhannesson, 2007: 187). Thus, while the British were willing to employ the Royal Navy, they also wanted to avoid clashes, which would reflect poorly on the UK. In this situation, norms put a limit on the manner in which force would be used, even if those norms did not stop the employment of force.

There is little evidence which supports the notion of public constraints on British policy-makers. There are no signs that the British public opposed the actions of the British government or applied pressure to resolve the dispute. There are however clear signs of the opposite. The trawling industry and local communities that depended on distant water fishing put pressure on the British government to offer naval protection for the trawler fleet, coerce Iceland economically, avoid compromise, and push for restricted fishery limits during Law of the Sea conferences. The only British economic sector with interests affected by the occurrence of a conflict was therefore the sector that had a stake in stopping Icelandic extensions at almost any cost. The Ministry of Agriculture and Fisheries, the government department most beholden to the interests of the trawling industry, was the hard-liner within the British bureaucracy during the dispute (Jóhannesson, 2007: 262–264). Neither the British public nor democratic institutions hindered mobilization in relation to the dispute, thus steering the government on course for the Cod War.

Iceland’s domestic politics had an incendiary impact on the dispute. Despite the intentions of several pro-Western statesmen to deal with the fisheries question cautiously, domestic circumstance made it untenable not to extend the fishery limits unilaterally and hold out for British surrender. The Icelandic economy was highly dependent on fishing, so much so that a temporary loss of trade and other economic harm seemed inconsequential, given the major gains that could be won through extending the limits. Public pressure made it difficult for political parties in Iceland not to push for extended fishery limits. Icelandic politicians on both sides of the aisle were determined to extend the fishery limits again after the resolution of the Proto-Cod War (1952–1956) but differed on the timing and size of the next extension (Ingimundarson, 1996: 377; Jóhannesson, 2007: 159–160). As time passed, Iceland became less willing to compromise with the UK. As the chief negotiator for Iceland noted, the 12 miles had assumed an ‘almost religious importance’ for Icelanders (Jóhannesson, 2007: 236). It was not domestically feasible for Icelandic politicians to delay further or enter into a compromise with the UK. The pacifist intentions and conciliatory tendencies of elites were therefore undercut by public opinion and hard-liner elements. The aggregate preferences of the Icelandic public were to start the costly and risky dispute, not to avert it.

Icelandic coalition politics played a key role in the dispute. The involvement of diverse parties in government did not temper the most extreme elements of Icelandic politics but, rather, emboldened them and weakened moderates. In 1956, a three-party leftwing government was formed. The parties in the government clashed over how to pursue extended fishery limits. The Socialist Party were the hard-liners in the government, whereas the Progressive Party and the Social Democratic Party were internally divided but led by elites who preferred to pursue extensions cautiously. The Socialist Party pushed the government to adopt a more uncompromising negotiating stance and extend the fishery limits earlier (Guðmundsson, 2006: 99–100). The soft-liners in the government managed to delay unilateral extension and make demands of the British that fell short of what the Socialist Party wanted. However, to keep the Socialist Party in government and avoid a collapse of the coalition government, the other two parties had to agree to a date at which Iceland would put an end to negotiations and unilaterally extend. The coalition government agreed internally not only to extend until the UN Law of the Sea conference had reached a conclusion (as per the wishes of the soft-liners) but also that, in the absence of a conclusion, the fishery limits would be extended (as per the wishes of the hard-liners) (Ingimundarson, 1996: 377; Jóhannesson, 2007: 160).

Prior to the extension, some Icelandic statesmen showed themselves willing to accept 12-mile limits with 3–4 year fishing rights for the British in the outer six miles (Jóhannesson, 2007: 188). However, the coalition government was divided, with Jósepsson, the socialist leader and Minister of Fisheries, threatening to extend the limits on his own. The Social Democrats and Progressive Party secretly reached out to NATO for 12 miles and temporary fishing rights in the outer six miles, even though such a compromise would lead to the collapse of the fragile coalition government and pit both political parties against public opinion (Jóhannesson, 2007: 188). This illustrates a willingness by these elites to jeopardize their own political standing to make a last-ditch effort to prevent the outbreak of a conflict. When the UK rejected the offer, the Progressive Party did not want to pursue negotiations further. According to Jóhannesson (2007: 189) and Thór (1995: 175–176), the coalition government was on the verge of collapse because the Social Democratic Party was unsure about going ahead with a unilateral extension. In the end, the Social Democrats ‘most reluctantly gave in’ to the hard-liners (Jóhannesson, 2007: 189).

Even after the collapse of the leftwing government ⁵ and formation of a new rightwing government in the fall of 1959, coalition politics again made it difficult for the new Icelandic government to compromise. This was due to the small majority that the government had in the legislature, which meant that hard-liner MPs in the government parties essentially acted as veto players (Guðmundsson, 1999: 68). Even if the rightwing government had been able to compel its members to support any compromise, it was likely that any agreement with the UK would have complicated the economic reforms that the Icelandic government was pursuing as its main priority (Guðmundsson, 2006: 101). The domestic political situation in Iceland did not favor a conclusion to the First Cod War short of full victory.

Iceland, short of appreciating the value of its NATO membership and its allies, exploited its own value to the alliance as a bargaining chip in the dispute. Despite resisting these tactics, Icelandic elites were pushed by the public to tie Iceland’s alliances to the outcome of the Cod War. The Icelandic public became agitated after the unilateral extension and subsequent entry of the Royal Navy into disputed waters. A month after the extension (October 1958), the Icelandic Prime Minister warned the US that public pressure might lead the government to break off diplomatic relations with the UK and withdraw from NATO (Jóhannesson, 2007: 214–215). In May 1959, an Icelandic representative at a NATO meeting indicated that the Icelandic government would be under significant pressure to withdraw from NATO unless the dispute with the UK was resolved favorably (Jóhannesson, 2007: 217).

Domestic politics prevented the Icelandic government from compromising with the UK, even when the UK had moved significantly closer to the Icelandic demands and delayed the re-entry of British trawlers into Icelandic waters after the 1960 Conference. During negotiations in July 1960, Guðmundsson (2006: 101–102) for instance noted that Icelandic officials had difficulties in convincing the Icelandic public of the utility of negotiations with the British. Icelandic statesmen therefore enquired about the possibility of secret negotiations between the prime ministers of the two countries (Guðmundsson, 1999: 91).

Even as the British became more desperate to reach an agreement, public pressure prevented Iceland from meeting the British halfway. The British government managed to convince the trawling industry to delay re-entry into the 12-mile zone for two months, in an attempt to restart negotiations (Jóhannesson, 2007: 265). Just before the deadline for re-entry, a crisis was averted when the Icelandic government asked that it could begin negotiations in a month’s time (it did not consider it feasible to start negotiations immediately because of domestic pressure). Once negotiations re-started, the Progressive Party and Socialist Party condemned the rightwing government (Jóhannesson, 2007: 267).

At this time, the government parties were unsure that they even had a majority to pass any agreement with the British through the Althing, because of possible defections by MPs from the governing parties (Guðmundsson, 1999: 75–76; Jóhannesson, 2007: 268–269). Twelve days prior to the new deadline for re-entry, negotiations began in earnest. During these negotiations, thousands of Icelanders protested against deviation from the 12-mile limit (Jóhannesson, 2006: 271). Furthermore, members of the government expressed doubts about offering concessions (Jóhannesson, 2007: 271). These negotiations did not result in an agreement, because the Icelanders demanded baseline changes and fishing rights outside of the 12 miles. The British government consequently pleaded with the trawling industry for a further delay on re-entry into the 12-mile zone, which it complied with (Jóhannesson, 2007: 273).

The two sides managed to reach a provisional agreement, but the Icelandic government had to convince individual hard-liner MPs in the coalition government to support the agreement (Jóhannesson, 2007: 279). The passage of the provisional agreement was delayed by tense labor negotiations in the Icelandic fishing industry, which led to strikes in January 1961 (Guðmundsson, 1999: 106). During this time, in which Icelandic government was stalling on the agreement, British trawlers had to stay outside of the 12-mile zone on an indefinite basis, and this placed substantial domestic pressure on the British government; and. it led the British government to pressure the Icelandic government into announcing the agreement. It took until 28 February 1961, several weeks after the agreement was made, for the Icelandic government to publicly announce the agreement and put it to a vote in the Althing (Guðmundsson, 1999: 107). The agreement was strongly criticized by opposition parties; and prolonged debates occurred in the Althing; but ultimately the Icelandic government managed to get the support that it needed.

The role of institutional ties was highly limited in averting and resolving the dispute. As has been pointed out, neither the ICJ nor the Law of the Sea conferences were used as avenues for resolving the dispute. Icelandic statesmen rejected a Danish suggestion of a conference prior to the extension to settle the question of fishery limits in the North Atlantic. The reason was that this might delay and interfere with the planned extension (Ingimundarson, 1996: 381). The disapproval of all NATO members of Iceland’s unilateral extension (Ingimundarson, 1996: 377) was not enough to deter Iceland. As was mentioned above, Icelandic statesmen eventually used NATO as a bargaining chip. Pressure from NATO members on the UK to settle grew over time, but it was not powerful enough to push the UK towards compromise until 1961.

This international organization, to which both states belonged, thus attempted to mediate the dispute. Paul-Henri Spaak, the Secretary-General of NATO, undertook mediation and attempted to help the two sides to reach an agreement both prior to and after implementation of the unilateral extension (Jóhannesson, 2007). However, as Hellmann and Herborth (2008: 482) pointed out, this mediation was non-existent during crucial stages of the dispute. Nonetheless, the mediation, once offered, was helpful in forcing Iceland to the negotiation table when there were domestic pressures on Icelandic statesmen not to negotiate. NATO mediation also resulted in the UK making the concessions needed to keep Iceland at the bargaining table and entice Iceland into accepting a provisional agreement.

The liberal peace is for the most part rejected in the case of this dispute. Public opinion, the legislature and coalition politics had adverse effects on the ability and willingness of statesmen to compromise. Icelandic statesmen’s fears that these actors would prevent the passage of the provisional agreement with the UK, or use it to disrupt economic reforms, led them to delay the announcement of the provisional agreement and delay the resolution of the dispute. British leaders had to overcome the pressure put on them by the trawling industry to reach an agreement with Iceland. The role of institutional ties was more mixed. NATO membership was used as a bargaining chip by Iceland, hardening the resolve of the Icelanders. The institutional ties between the two states did not appear to deter British leaders or Icelandic leaders. NATO mediation came late; but, once offered, contributed to the resolution of the disputes.

Second Cod War (1972–1973)

The Second Cod War lasted from September 1972 to November 1973. It began with Iceland’s unilateral extension of its fishery limits from 12 to 50 miles, and the failure of the British to comply with these new Icelandic regulations. During the dispute, Icelandic patrol ships employed wire cutters for the first time, severing the trawling cables of British trawlers, sabotaging their fishing and endangering their crews. British trawlers were consequently reluctant to enter Icelandic waters without warship escort. Once again, this led the Royal Navy to reluctantly enter Iceland’s newly declared limits in May 1973. After Iceland’s unilateral extension, the ICJ ruled in favor of the UK, but Iceland refused to comply with the verdict. The Second Cod War also prevented Iceland from signing an agreement that it had negotiated with the European Economic Community to halve trade barriers on marine products. During the dispute, Iceland once again threatened to expel US forces from Iceland and withdraw from NATO. The Second Cod War came to an end in November 1973 with an agreement providing a 50-mile fishery limit for Iceland and temporary fishing rights for British trawlers.

Some aspects of Icelandic behavior between the First and Second Cod Wars are consistent with the liberal peace. The rightwing government of 1959–1971 was, for instance, constrained by liberal norms. This was the same government that concluded the First Cod War (1958–1961). As part of the agreement ending the First Cod war, Iceland agreed not to extend its fishery limits again without the approval of the ICJ. This government consequently refused to make another unilateral extension, arguing that reneging on the previous agreement would ruin Iceland’s credibility and impose reputational costs on Iceland. Furthermore, if the British were to refer the dispute to the ICJ, the sitting government worried that the ICJ would rule against Iceland (Ingimundarson, 2002: 122). The government was therefore constrained by liberal norms in its dealings with the UK, despite the pressure from Icelandic opposition parties and public opinion to renege on the previous agreement (Guðmundsson, 1999: 111–112, 2000: 102–103; Ingimundarson, 2002: 119).

A leftwing government was formed in 1971 and elected on a promise to extend the fishery limits. This government did not show much concern for the legitimacy and legality of its actions. It was unconstrained by liberal norms; and the provision regarding ICJ referral was ignored. The government was even unwilling to make its case before the ICJ when the British referred the dispute to the Court (Thór, 1995: 203). The Icelandic government was also unwilling to hold off on the extension and wait for the conclusion of the 1973 Law of the Sea conference. The government cited the failure of previous conferences to produce conclusive rules as justification to proceed unilaterally (Hart, 1976: 7). The government went ahead with the extension despite the opposition of its NATO allies (Ingimundarson, 2002: 146). The Icelandic government’s rhetoric and behavior during the dispute were belligerent. For example, Frederick Irving, the US ambassador, claimed years after the dispute that Ólafur Jóhannesson, the Icelandic Prime Minister, had demanded that US jets bomb the British warships after they entered the contested waters (Jóhannesson, 2006: 90). The Icelandic government also accused a UK embassy staff member of espionage and threatened him with arrest (Jóhannesson, 2006: 94). Thus, liberal norms fell by the wayside, resulting in legal dispute settlement mechanisms being willfully side-stepped, condemnation by allies ignored, and previous commitments reneged.

Even though the parties that formed the rightwing government of 1959–1971 (the Independence Party and the Social Democratic Party) had been constrained by norms in extending the fishery limits, these same parties put no constraints on the new leftwing government’s belligerent and norm-breeching actions. Due to the popularity of the leftwing government’s proposed extension, the Independence Party and the Social Democratic Party rubber-stamped the unilateral extension, even though they recognized how costly and risky it was (Ingimundarson, 2002: 147–148). The opposition parties were therefore too heavily constrained by public opinion to challenge the government. This meant that the government had unanimous parliamentary support for its resolution to extend the fishery limits (Thór, 1995: 201). Public opinion and opposition parties therefore did not constrain the government in the lead-up to the Second Cod War.

Commercial interests drove the dispute. There was no pressure to extend fishery limits during the 1960s, in part due to the relative importance of herring fisheries (Thór, 1995: 195). Because herring could be caught in shallow waters, an extension of fishery limits would not have a significant commercial impact. This changed by 1967–1968, when herring fishing failed, which led to a renewed emphasis on trawling (Ingimundarson, 2002: 120). By 1971, Icelanders had become more dismayed by their narrow fishery limits because cod stocks were on the decline, foreign fishing vessels were present in record numbers beyond the 12-mile zone, and the Icelandic economy was declining (Ingimundarson, 2002: 121). The fact that the unilateral extension, to 50 miles, would have an adverse impact on Iceland’s prospective trade agreements did not deter Iceland from going through with the extension. A trade agreement with the EEC that halved tariffs on Icelandic fish products would have come into effect (Hart, 1976: 20). There is no evidence that this led to any Icelandic commercial interests affected by the prospective trade agreement to lobby against the unilateral extension.

Pressure from the British trawling industry pushed the British to send the Royal Navy into disputed waters. There is evidence that the British government resisted deploying the Navy in order to avoid raising the stakes and entangling NATO in the dispute, in addition to concerns relating to logistics and the costs of maintaining the fleet in the disputed waters (Ingimundarson, 2011: 104). When the British trawling industry gave the British government an ultimatum, the government bowed to the industry’s demands and offered the trawler fleet naval protection in the disputed waters. Despite some hesitation, the government was not sufficiently deterred by world and domestic public opinion not to send the Royal Navy into disputed waters, even if it led to some hesitation. As in the First Cod War, the one economic sector in the UK with a consequential stake in the dispute pushed for belligerent actions, not compromise.

Icelandic decisions on whether to use multilateral venues were dependent on whether those venues could predictably serve Icelandic interests. Iceland wanted to pursue the dispute in the UN Security Council, to shame the UK and appeal to world opinion. Iceland chose not to do this when it was realized that such action would most likely be counterproductive. They were dissuaded by representatives at the Nordic Council who felt that this would be likely to result in the US and France taking the UK’s side (Guðmundsson, 2000: 70, 2006: 104). After the Althing passed a resolution in February 1972 to extend the fishery limits on 1 September 1972, the British referred the dispute to the ICJ. The Icelandic government did not even send representatives to the ICJ (Ingimundarson, 2002: 148). In August 1972, the ICJ issued a preliminary ruling against Iceland’s proposed 50-mile extension (Ingimundarson, 2002: 153). Iceland refused to abide by this ruling.

Institutions did not have any meaningful pacifying influence on the dispute until a crisis emerged. NATO was reluctant to get actively involved in mediating the dispute due to fears that the Icelanders would be more encouraged to use its NATO membership as blackmail (Ingimundarson, 2002: 224–225). By mid/late May 1973, the issue was only addressed in an unofficial manner. NATO began to take initiative to resolve the dispute only once Iceland began to threaten to withdraw from NATO and break off diplomatic relations with the UK (Guðmundsson, 2006: 107). NATO mediation was helpful in getting the British to make the concessions needed to keep Iceland at the negotiating table and then give in to most of Iceland’s demands (Hart, 1976: 45).

The liberal peace is for the most part inconsistent with this dispute. Neither side was brought to the bargaining table due to pressures from citizens or legislators (it was rather the reverse), or adherence to democratic norms. In the case of Iceland, a government was elected on a mandate to renege on the commitments of the preceding government and to sidestep the liberal norms that the preceding government abided by. Once the Second Cod War started, fear of public opinion made it difficult for the Icelandic government to compromise with the British. Public pressure also neutralized opposition political parties. In the case of the UK, commercial interests pushed the UK into making tougher demands prior to the onset of the dispute and then played a key role in the UK’s decision to send in the Royal Navy, which escalated the dispute significantly. Pressure and mediation from NATO had a pacifying impact only after Iceland escalated the dispute by threatening to withdraw from NATO and expel US forces. At that point, NATO mediation helped keep the two states at the bargaining table, pressured the UK into making concessions, and helped the two states in locating a zone of possible agreement.

Third Cod War (1975–1976)

The Third Cod War lasted from November 1975 to June 1976. It began with Iceland’s unilateral extension of its fishery limits to 200 miles when the temporary agreement concluding the Second Cod War expired, and the failure of the British to comply with the Icelandic regulations. The dispute was, however, mainly about the fishing grounds within the 50 miles, which had not been permanently resolved in the Second Cod War. During the dispute, there were many clashes at sea between Icelandic patrol ships and British warships and trawlers. Iceland broke off diplomatic relations with the UK, which was a first between NATO members (New York Times, 1976). During this dispute, Icelandic officials hinted that NATO membership was at stake, but they did not go as far as to threaten the expulsion of US troops (Ingimundarson, 2003: 92, 2011: 136; see also Jónsson, 1981: 45). The Third Cod War concluded with a highly favorable agreement for the Icelanders, giving them a 200-mile exclusive economic zone with very limited temporary fishing rights for the British.

Democracy, commercial interests and institutional ties led Iceland to extend the limits unilaterally, make strong demands, and use NATO as a bargaining chip. They also constrained the ability of Icelandic leaders to compromise, and made it difficult for Icelandic leaders to finalize the highly favorable deal that ended the dispute. The underlying reasons for the extension were primarily economic. A report published by the Icelandic Marine Research Institute in 1975 had painted a dark picture of the state of fish stocks in the waters off Iceland. Extensions were important to safeguard the long-term sustainability of fish stocks by keeping foreign fleets out, but without having to limit Icelandic fishing. This report unsurprisingly led to significant domestic pressure on the Icelandic government not to compromise with the UK (Jónsson, 1981: 19). In the lead-up to the extension, Icelandic leaders therefore had less room to compromise.

There is some evidence to suggest that Iceland was enticed to compromise by the prospects of being able to finally sign an agreement with the EEC on the reduction of fish tariffs. British diplomats tried to use this enticement to convince Icelandic leaders to compromise (Jónsson, 1981: 13). Geir Hallgrímsson, the Icelandic prime minister, partly justified his decision to seek an amicable compromise with the UK and other interested states by pointing to the reduction in tariffs that would inevitable follow (Jónsson, 1981: 15–16). These commercial incentives to settle proved insufficient, however.

Pressure from the public and opposition parties did not help. The Socialist Party and their prime news outlet criticized the rightwing government for sacrificing Iceland’s core national interest in order to maintain unity in NATO (Jónsson, 1981: 15). This pressure magnified after the UK sent the Royal Navy into the disputed waters once more (Jónsson, 1981: 34–35). Even MPs of the pro-Western Social Democratic Party criticized the Icelandic government for being too conciliatory (Jónsson, 1981: 80–81). When the Third Cod War heated up, there were individual MPs from all parties who pushed for escalatory measures (Jónsson, 1981: 82). It became domestically unfeasible for Icelandic statesmen to engineer any agreement, short of full victory.

The Third Cod War was difficult to resolve due to struggles within the Icelandic coalition government. Pro-Western politicians in the Independence Party were reluctant to jeopardize Iceland’s security interests, whereas the Progressive Party was not (Ingimundarson, 2011: 135). The Icelandic Prime Minister tried to get his coalition partners in the Progressive Party to accept 65,000-ton catch quotas for the British for a period of two years, but they would not accept the proposal (Guðmundsson, 2006: 109). The Progressive Party became noticeably more combative in its rhetoric after the Royal Navy entered the disputed waters, and was not as hesitant to threaten Iceland’s NATO membership as it had been in earlier stages of the dispute (Jónsson, 1981: 52).

The entry of the Royal Navy into the 200 miles led to demonstrations in Iceland. The Icelandic government responded to the fervor by banning British military aircraft from using the US base in Keflavík and denying British vessels access to Icelandic ports (Ingimundarson, 2011: 135). Public pressure led the government to use Iceland’s NATO membership as a bargaining chip, but the government resisted trying to connect the US base to the dispute (Ingimundarson, 2011: 135–136). Public pressure also made it impossible for Iceland to negotiate unless the British would agree to the pre-condition of withdrawing its Navy (Ingimundarson, 2011: 135–136). Icelandic statesmen also threatened to break off diplomatic relations with the UK unless British warships would stop ramming Icelandic patrols (Ingimundarson, 2011: 136). The failure to withdraw the Navy led the Icelandic government to go through with its threat of breaking off diplomatic relations with the UK (New York Times, 1976).

Even when the two sides reached a provisional agreement, one highly favorable to Iceland, the ‘sensitive domestic political situation’ in Iceland made it difficult for Icelandic leaders to accept the deal (Ingimundarson, 2011: 137). All opposition parties in Iceland opposed the provisional agreement (Jónsson, 1981: 98). According to Ingimundarson (2011: 137), ‘there were protests in Iceland against the agreement on the grounds that the British should not be allowed to fish anything’. Nonetheless, the Icelandic government signed the agreement.

The results were mixed with regard to British behavior, though. The British were emboldened by commercial interests to escalate: the trawling industry was in dire straits and needed better terms for fishing in the disputed waters than Iceland was willing to concede. As in the other disputes, there were no economic sectors harmed by the outbreak of this conflict. The losses caused by an Icelandic extension would have been significant for the British trawling industry, however. With the loss of the fishing grounds around Iceland, the trawling fleet from the Icelandic waters would either have to be shelved or diverted to British waters (Jónsson, 1981: 12). The latter option was not attractive since the British fishing grounds were already over-exploited (Jónsson, 1981: 12).

The British decision to send the Royal Navy into Icelandic waters was, as in the previous Cod War, driven by an ultimatum by the British trawling industry. The British trawler fleet in the disputed waters threatened to abandon the waters and give Iceland de facto recognition of its newly-claimed limits unless the British government would send in the Navy to protect British trawlers from the harassment of Icelandic patrol ships (Ingimundarson, 2011: 135–136; Jónsson, 1981: 22–23). Once in the disputed waters, the British government imposed restraints on the Navy, even if those restraints made the naval protection less effective. Ingimundarson (2011: 137), for instance, documented how the Royal Navy asked for permission to use gunfire and cut the trawling cables of Icelandic trawlers, but the British government understandably rejected these proposals. The UK also withdrew the Navy temporarily from the disputed waters in order to facilitate negotiations, but sent it back into the disputed waters when negotiations failed. In addition to being able to withstand some of the pressure from the trawling industry, there is some evidence of public pressure on the British government to resolve the dispute. The central committee of the Labour Party criticized its own government, and the British press complained about the costs of the dispute (Guðmundsson, 2006: 109). Nonetheless, Jónsson (1981: 33) argued that the British public tended towards supporting the decision to deploy the Royal Navy to disputed waters.

Institutions failed to avert the outbreak of the dispute. Iceland’s strategic importance to NATO also emboldened the Icelanders to escalate and make threats. Nonetheless, NATO did contribute to peaceful resolution. Pressure from NATO on the UK mounted after the Royal Navy entered into the disputed waters for the second time in the dispute, which led Iceland to break off diplomatic relations (Guðmundsson, 2000: 75). NATO mediation helped bring a resolution to the dispute. The Norwegians, in their efforts to bring the two parties to the negotiation table, even proposed to its other NATO members that they offer to pay the British trawlermen to leave the disputed waters, so as to bring Iceland to the negotiation table (Jóhannesson, 2006: 129). Even the United States, which had attempted to stay out of this dispute, became involved. In the weeks prior to the conclusion of the dispute, ‘the United States government finally took some initiative in solving the dispute and put pressure on the British to give in’ (Guðmundsson, 2006: 110). It was ultimately through mediation by Joseph Luns, NATO Secretary General, that the British agreed to withdraw its warships (without Icelandic counter-concessions), in order for negotiations to begin (Ingimundarson, 2011: 136). After an agreement was reached between Iceland and the UK, the British foreign minister identified pressure from other NATO states as being an influence on British calculations (Jónsson, 1981: 99). Peer pressure and NATO’s value to the UK did therefore pacify the British.

There is mixed evidence for the liberal peace. Democracy, commercial interests and institutions had an escalatory impact on Icelandic statesmen. Public opinion, coalition politics, political parties, media and commercial interests acted as constraints on the ability of Icelandic statesmen to compromise with the UK. Several times, as a result of domestic pressure, the Icelandic government therefore chose not to accept British offers, even though individuals in the government considered the offers favorable to Iceland (Guðmundsson, 2006: 109). Iceland used institutions as bargaining chips rather than avenues for compromise and dispute resolution. The story is more mixed for the UK. The trawling industry had an escalatory influence on the British government, but the British government still exhibited some autonomy from the trawling industry. Pressure from NATO members contributed to the British offering concessions to Iceland.

Conclusion

Whilst the Cod Wars are often framed as a major challenge to the liberal peace, this has not been sufficiently analyzed. I demonstrate that democracy was crucial in escalating the disputes, while also limiting the ability of statesmen to resolve the disputes. Even though some Icelandic statesmen showed signs that they were constrained by liberal norms in their efforts to resolve the contest over fishing rights in the North Atlantic, they were unable to avoid the use of force and extra-legal means. Pressure from the public and opposition parties obliged statesmen to make more extreme demands, hurried the implementation of the extensions to Icelandic fishing zones, and made it extremely difficult to fashion agreements acceptable to both Iceland and the UK. On numerous occasions, Icelandic statesmen were hindered by their coalition partners, public opinion or the legislature from accepting agreements that they considered highly favorable and which would have either avoided or quickly resolved the disputes. Statesmen were therefore emboldened, not constrained, by the public and democratic institutions in taking actions which were costly and risky to society at large.

In terms of economic ties, the Cod Wars demonstrate how reliance on one commodity can be bad. A diverse economy would be hurt by the outbreak of a conflict, thus reducing the risk of its occurrence. Icelandic dependence on British trade and the possibility of tariff reductions on marine products did not pacify the Icelanders. This was in part due to the lack of diversity of the Icelandic economy and the fact that the dominant economic sector stood to benefit greatly from an extension of fishery limits, even if that same sector depended on trade with the UK. There were no other important economic sectors that were negatively affected enough by the disputes to pressure the Icelandic government into making compromises and thus avoid the outbreak of conflict. This suggests, then, that the liberal peace is predicated on a large diverse economy where the benefits of belligerence for one economic sector will be offset by the harm caused to numerous other economic sectors. The UK was certainly a diverse economy, but because the economy was not dependent on trade with Iceland to any significant degree the outbreak of the Cod Wars did not encourage non-fishing sectors to press the government to seek a resolution to the disputes. British elites did feel constrained by liberal norms, showing signs that they were wary of sending the Royal Navy into disputed waters. It was primarily the trawling industry, and the ministry beholden to the interests of the trawling industry, that put pressur on the government to take the naval and other extreme actions.

Common membership in institutions had a mixed record. Iceland’s NATO membership and strategic importance was used as a bargaining chip, offering Iceland the means by which to blackmail the UK. NATO membership therefore hardened Icelandic resolve and eagerness to act unilaterally. The findings of this study are therefore consistent with both Krebs (1999), who contended that alliances may embolden smaller allies to pursue conflicts under certain circumstances, and Olson and Zeckhauser (1966), who found that small allies have greater action space than large allies. Several scholars have also cited the Cod Wars as an example of how the larger of two democracies can be more severely constrained by the liberal peace than the smaller one (Gelpi and Griesdorf, 2001: 636–637; Jóhannesson, 2007: 293–294, 297–298; Keohane and Nye, 2011: 87–89; Muller and Wolff, 2006: 57). Mediation by NATO did, however, contribute to the resolution of all three Cod Wars. Both states side-stepped the ICJ, except when it was certain that the ICJ rulings would be favorable to a state’s cause. Iceland put a lot of effort into influencing the UN conferences on the Law of the Sea, but was impatient and chose unilateralism when those conferences did not produce satisfying results.

To the extent that the Cod Wars escalated was in many way due to the aforementioned liberal factors. However, the common interests of the two states, namely that they were both democracies, members of trading communities and allies in the Cold War, also set a threshold on how far the Cod Wars could escalate. Leaders on both sides were largely unwilling to cause casualties, and Icelandic statesmen were very reluctant to actually go through with the threats to leave NATO or expel US forces from Iceland. The British, at least, surrendered whenever the disputes seemed to threaten the unity of NATO. Actual war was, in other words, inconceivable.