Though he moved to Selkirk and later to Winnipeg to manage his business interests, Jonasson remained a strong supporter of the settlement, for which reason he became known as the 'Father of New Iceland'.
He was also instrumental in finally convincing CPR officials to extend the railway to Gimli in 1906, Arborg in 1910, and Riverton in 1914, and is thus responsible for the development of these thriving communities through the following decades.
He was, along with Einar Hjörleifsson Kvaran a key founder of the Icelandic newspaper Lögberg (Tribune), still published in Winnipeg in 2009, Jonasson also acted as the paper's editor from 1895 to 1901.
He first campaigned for the Manitoba Legislature in the 1896 provincial election, and defeated his cousin, Conservative Party candidate Baldwin Baldwinson, by 79 votes in the St. Andrews constituency.
Jonasson helped to establish a co-operative agricultural marketing scheme for Icelandic farmers in 1907, and became the co-owner of a slaughterhouse in Winnipeg.