Iceland failed financially in the latest financial crisis. The IMF has a post-mortem. I don't know what else you can call it than failure when the central bank, which is a government creation, supports a housing and banking bubble that collapses the economy and requires an IMF bailout, capital controls, years of recovery, and the transfer of debt to the government. If the state was supposed to have regulated the monetary system and the economy so as to prevent such dire results, it utterly failed to do so. It achieved the opposite.
The U.S. is not so very different. This is not just the failure of Keynesian economics. It is the failure of an entire system of government, education, and control by elites. It is the failure of the state as an organization and the failure of societies that organize larger and larger portions of their economies via states. It is the failure of the idea that the power of state used to control economic activity is a good thing. This idea has already been demonstrated to be false big time in fascist Italy, national socialist Germany, communist USSR, and communist China (and wherever else one cares to examine the facts carefully).
The people who create the Failed States Index come up with Iceland having a very high SUCCESS rating as a state. It's their choice of factors, weightings, and measurements that do this. Iceland is inexplicably given good ratings on economic decline, on rise of elites (aren't central bankers an elite?), and on intervention of external actors (doesn't the IMF count?). If I devised such an index, all states would be failures.