Iceland is chiseled from some of the most volatile land on earth 
"The Bible tells that God created Earth in six days then he rested," said Dr. Olafur Ragnar Grimsson, president of Iceland. "That's not true because he forgot Iceland. The creation of the Earth has continued in Iceland to this very day. You can see it in the volcanoes, geysers, in the glaciers, in the earthquakes."
There's a simple reason for the island's fickle and fiery moods: location, location, location.
The country sits atop the Mid-Atlantic ridge, where the plates of the African and American continent are separating by about an inch a year. In effect, the island is being torn in half and lava explodes from the Earth's center to fill the gap.
"There are two such mountain plumes on Earth which are so heavily active," said volcanologist Gudmundur Sigvaldason. "One here in the North Atlantic, the other in the Pacific, creating the Hawaiian Islands."
Iceland's temperamental beauty has always put its inhabitants to the test. The first settler, Ingolfur Arnarson, fled Norway 1,100 years ago to escape a domineering king. He sailed to Iceland around 874 and built his home in what is now the capital, Reykjavik.
"He actually named the city Reykjavik which means 'smoky bay,'" said mayor Injibjorg Solrun Gisladottir. "That was because we have hot springs here in Reykjavik and he saw the smoke from the hot springs and gave the city or his house the name."
Epic tales and a new form of government
It was a bleak if ambitious beginning. Isolation and meager farm lands coupled with famines and plagues meant desperate lives for those who followed.
These early struggles are preserved in the Icelandic sagas, epic medieval tales handed down through generations.
"This was not really Vikings," explained Svarrir Tomasson, a professor of medieval literature. "They were mostly farmers. When you look at literature like the sagas, you can say in one sentence what it's all about: farmers at feud."
Those feuding farmers ended up giving the world its first parliament. In 930 -- in an effort to end brawling over issues like land and religion -- they convened an assembly on the grassy plains of Thingvellier in southwest Iceland.
It was a loud, messy affair. The plains were overrun by farmer-warriors, blacksmiths, crooks and people hawking food. And somehow they fashioned a working government amid the chaos.
"They stayed here for two weeks every year and decided all the laws, rules," said Stefan Tourrson, an assistant hotel manager and historian. "They put up the judge and juries and all the problems were solved, not only the governing of the country, but also the legal aspects, the sentencing of the criminals."
A day at the park in the Icelandic capital Utopia of fire and ice
The Althing, the actual seat of government, was moved from Thingvellier to Reykjavik in the mid-19th century. Iceland won independence from Denmark about 100 years later, in 1944.
At the time, World War II was blistering Europe. Allied nations, including the United States, poured money into neutral Iceland to turn it into a staging ground. Icelanders' national income skyrocketed 60 percent, helping create a generous welfare state whose people today enjoy a near-utopian living standard.
There's virtually zero unemployment, crime or pollution. The literacy rate is the world's highest, 99 percent. And the average life expectancies -- 80 years for women, 75 for men -- are surpassed only by Japan.
"I myself consider it a privilege to be Icelander," said Reykjavik's mayor. "I think people here are friendly ... and people like to travel. A lot of students travel abroad so they come home with all kinds of impressions. Although we are geographically isolated, we are not culturally isolated."
Today half of Iceland's 250,000 people live in the capital and, increasingly, they earn their living by catering to out-of-town guests. About 160,000 people visit Iceland annually, making tourism the second biggest money-maker -- after fishing.
"We have decided in Iceland to welcome all these people from different parts of the world who want to come not only to see our country, but also to learn here in Iceland to respect the globe," said President Grimsson.
Despite its far-flung location, getting to the island isn't that difficult. Icelandair offers direct flights from the United States and Europe. Traveling time is three hours from London, or six from New York.
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