The program featured an interview with the prime minister in which he is surprised by questions about his connection to offshore accounts. He accused the journalists of talking nonsense and walked out of the interview.
The following day saw some of the largest protests in Icelandic history take place in and around Austurvöllur, in front of the parliament building, as MPs inside discussed what was to happen next. Some hurled skyr (a local delicacy and source of pride) and bananas at the building. The not-so-subtle subtext was that Iceland had become a banana republic.
Bjarni Benediktsson, the aforementioned finance minister and head of the coalition partner the Independence Party, was in Florida when all this was happening but was due back in Iceland on tuesday morning, as was the president of Iceland Ólafur Ragnar Grímsson.
All parliamentary business was postsponed indefinitely. The president has traditionally played a largely ceremonial role but his pro forma consent and signature is needed for actions like passing laws and dissolving parliament. The president planned to meet with heads of both coalition parties on tuesday to discuss the situation and see how they wished to proceed.
Prime minister Gunnlaugsson appears to have pushed up his meeting with the president by nearly two hours. President Grimsson claims the prime minister arrived with aides that carried with them all the necessary paperwork to be signed, that would essentially hand the power to dissolve parliament to the prime minister alone.
The president says he refused this request because it was not appropriate to give Gunnlaugsson the authority to dissolve parliament before notifying his coalition partners. The president actually said the prime minister intended to use this power as a weapon to cow the Independence party into submission and allow him to continue in office. Indeed it later transpired he had not even notified his own MPs that he would seek the power to dissolve parliament.
The prime minister then took the unprecedented move of disputing the president's version of events. Gunnlaugsson claims he never asked the president to dissolve parliament in the first place. He emerged from a meeting with his party MPs without speaking to the media but soon after his deputy in the party, Sigurður Ingi Jóhannsson, stepped forward to speak to the media.
He announced that the prime minister wanted him to take over the reins of government and become the new prime minister so he could continue the good work of the government and maintain the coalition. After initial hesitation, and after meeting with president Grimsson, Bjarni Benediktsson tacitly agreed to this arrangement by scheduling a meeting with Jóhannsson for the following day. Protests have also been scheduled.
But the day was not over. In the evening it emerged that prime minister Gunnlaugsson's office had sent out a press release to the foreign media claiming he had not in fact resigned at all and was still in power and would remain as head of his party and as an MP. The office of the prime minister, it said, would only be temporarily handed over to party deputy Jóhannsson. This sparked great confusion and speculation that has yet to abate as of this writing, on Wednesday morning.
The strange press release not withstanding, it has now been made clear that Sigmundur Davíð Gunnlaugsson will step down as PM. Apparently the press release was written by an aide. The two coalition parties are now in talks about how to form a new government with a new prime minister.