Finland Will Give 2000 Unemployed People $590 Every Month, No Strings Attached, Even After They Get A Job

from the money-for-nothing dept

Back in 2015, a Techdirt Podcast explored the fascinating idea of a universal basic income guarantee, something that the Swiss considered, but ultimately rejected in a referendum. The idea of giving money to everyone, regardless of what they do, or how much they earn, is intriguing and attractive for many. But what effect would it have on how people live and work? That’s what Finland hopes to find out from an experiment it is conducting in this field, as a story in the Guardian reports:

Finland has become the first country in Europe to pay its unemployed citizens an unconditional monthly sum, in a social experiment that will be watched around the world amid gathering interest in the idea of a universal basic income.

Under the two-year, nationwide pilot scheme, which began on 1 January, 2,000 unemployed Finns aged 25 to 58 will receive a guaranteed sum of €560 (?475).

As that indicates, this isn’t a universal basic wage, since it’s aimed at just a few of those receiving unemployment benefit, and the money will replace existing financial support. On the other hand, it isn’t just some kind of creative accounting, because they will continue to receive the monthly sum even if they find work. There are already plans to roll it out more widely.

As the Guardian notes, other parts of the world, including Canada, Italy, the Netherlands and Scotland, are also looking to try out the idea. At a time when there are fears that automation may well reduce the total number of workers needed in industry, it’s great to see these experiments exploring an approach that could help to alleviate social problems arising from this shift.

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Comments on “Finland Will Give 2000 Unemployed People $590 Every Month, No Strings Attached, Even After They Get A Job”

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Roger Strong (profile) says:

One of the experiments in basic income was in Dauphin, Manitoba, Canada in the 1970s. I only heard about it a year ago, even though I was living in Dauphin at the time. (I was just a kid.)

I asked my mom about it. Apparently our next-door neighbor was in the program. She was raising her children alone after her husband died in a roll-over car accident.

Wendy Cockcroft (user link) says:

Re: Re: Re: Re:

See the report:

It fell on its face when a right-wing government shut it down due to spiralling costs. The “savings on admin” meant no records were kept so no one really knew what was going on.

As an administrator myself I know the value of recording information properly and these guys flat out didn’t. The scheme apparently made some people better off but since it wasn’t self-funding it fell apart.

Any such system needs to self-perpetuate or someone will shut it down. The last thing you want is to get people dependent on government via BI, then take it away for ideological reasons. I’d rather have a minimum income level where people on low wages get them topped up to that level than a one-size-fits-all policy that only suits the most healthy and wealthy.

Roger Strong (profile) says:

Re: Show me the money

Wealthy taxpayers, including corporations. But before you weep for them, consider current job trends:

Back about 1982 my high school electronics teacher insisted that in 10 years there would be a 4-day work week, with 5-day work week being illegal.

There HAD to be. Automation and computers had already led to a dramatic rise in productivity, and the rise was going to continue. Women were continuing to enter the workforce in ever larger numbers. Without a 4-day work week we’d have to accept rising unemployment and ever-lowering wages.

As historian Gwynne Dyer points out:

It was not evil foreigners who “stole” most of those seven million American jobs, and will probably eliminate up to 50 million more in the next 20 years. It’s the ‘intelligent machines’ that did most of the damage, starting with simple assembly-line robots and ATMs. (”Every Automated Teller Machine contains the ghosts of three bank tellers.”)

But the automation keeps moving up the skill sets. The first self-driving cars are now on the road in the United States. That’s another four million jobs down the drain, starting with taxi drivers and long-distance truckers. In recent years eight American manufacturing jobs have been lost to automation for every one lost to “globalisation”, and it will only get worse.

A 2013 study concluded that 47 percent of existing jobs in the United States are vulnerable to automation in the next 20 years, and the numbers are as bad or worse for the other developed countries. This is what is really driving the “populist revolution” that caused two of the world’s oldest democracies to make bizarre, self-harming political choices in the past year. First Brexit, then Trump.

We’re in a long-term redistribution of income to the wealthy. Since 1973 the incomes of the rich have more than quintupled, and the rest of Americans have gotten somewhat poorer. The rich were paying taxes on their income over $400,000 at a 70 percent rate when Reagan entered the White House. Now they pay taxes at no more than 35 percent – before loopholes. After loopholes it’s 18.5%, lower than what the middle class pays. Corporations are paying less too.

So when we talking about "taxing the rich" to offset automation with basic income, we’re only talking about them giving back a bit of what they’ve gained through replacing workers with that automation. Still taxing them at levels lower than even Reagan ever dreamed of.

Anonymous Coward says:

Re: Re: Show me the money

Actually I’m not weeping for any taxpayer.

By definition any money from the government comes from the taxpayer… or the printing press (which is just borrowing from future taxpayers).

I consider myself conservative, but western civilization is entering economic unknown territory.

Ignoring off-shoring, manufacturing productivity is steadily increasing and more and more people are losing their jobs. Traditional welfare and unemployment insurance is ill-suited to deal with this new reality. Large groups of people homeless and starving is unacceptable. Maybe some form of UBI is an answer.

I’ll be following the results of Finland’s experiment with interest.

Anonymous Coward says:

Re: Re: Re: Show me the money

“Ignoring off-shoring, “

Do this at your own peril, congress was told.
Off shoring concerns are a liberal myth congress said.
Homelessness is illegal local municipalities said.
The masses revolt .. congress runs and hides .. shit hits the fan.
Is this what we have to look forward to?

Anonymous Coward says:

Re: Re: Re:2 Show me the money

I mean “ignoring off-shoring” as a cause of job loss as opposed to job loss due to increased manufacturing productivity due to automation and robotics.

That is, even if Trump “brings manufacturing jobs back to the United States” (unlikely), we’ll still see job loss due to automation and robotics.

Anonymous Coward says:

Re: Re: Re:3 Show me the money

Likely. But manufacturing still employs a lot of people. Yes manufacturing is getting increasingly efficient. But the total amount of stuff getting manufactured in the world is also increasing which results in needing more jobs. Look at automobiles for an example. We have lost 350,000 automobile jobs in the US since NAFTA. But Mexico has gained ~430,000. Even with all the efficiencies gained we still have an overall increase in the number of jobs in the automobile industry.

Anonymous Coward says:

Re: Re: Re:4 Show me the money

With the world economy still recovering from the 2008 debacle, who is going to purchase all these brand new trinkets? Net disposable income in the largest consumer sectors has not recovered from the huge attack upon the middle class which has been going on for decades. Your supply side economics has not worked in the past 3 + decades, what makes you think it will work now?

Derek Kerton (profile) says:

Re: Re: Re:9 Show me the money

Roger’s argument seems entirely serious and credible.
It’s not good, but it is entirely plausible, and is the direction we are heading.

“Not serious” would be ignoring this trend, and not trying to mitigate it – as most politicians do. It’s more popular to say, “We’re great, and we’ll all be wealthy.” than to be more realistic.

Anonymous Coward says:

Re: Re: Show me the money

Automated jobs should eventually go to the government. Then again the government can be inefficient.

The traditional thinking is that things that are new, poorly understood, and not standardized should be done by the private sector. The government isn’t here to take risks. But once something is very well understood and standardized the government can begin to provide such services. That’s not to say the government should preclude the private sector from also providing it but the government can also provide it.

So as automation becomes more standardized the government can begin providing us with goods and services that are the product of automation.

and while this may make a whole lot less sense with manual labor, because government employees are well known for doing nothing while getting paid (think of the typical Caltrans stereotype where you have one person actually working and five people standing around and watching) this doesn’t really apply to robots. A robot working for the government works about just as hard as the same robot working for a private person. So if robots are the ones doing the work why can’t the government begin to employ robots to provide us with some of our standard goods and services.

If robots started building our streets that’s less taxpayer money we have to spend on building streets. That’s more money we have in the economy to do other things and we still have streets. The whole point is not to have jobs but to have goods and services such as roads.

Anonymous Coward says:

Re: Re: Re: Show me the money

Government = Salvation? No, the government is almost completely inept. They cannot be fired, they have no incentive to do a good job. They are corrupt. They have no accountability. So throwing more money and power at them will only increase all of these problems.

Also, innovation does not stop. The auto has been well understood for decades and if the government was left to create them we would still be driving model T’s.

Socrates says:

Re: Re: Show me the money

I believe you are more right than Gwynne Dyer, though the issues are linked.

Unemployment caused by automation is a social problem and a economic one, and it gives a pressure towards lower wages for the populace (as they cannot be picky). And the economic injustice drain most of the population, and this again alters the exchange rate between the privileged and most people, the same way 3’rd world nations have been drained of resources and stay poor. USA is making itself a 3’rd world nation.

But the core of the problem, in my opinion, is the draining of disposable income. With insignificant disposable income payed services by one citizen to another becomes difficult, and lives get poorer, at both ends. Solidarity have delayed the collapse of western civilization so far, but if it comes I guess it comes suddenly. And harm greedy bastards and commoners alike.

With rapidly rising cost of education, with Britain being a particular grim example, effort to study to better ones prospects is rapidly becoming a joke. Even from young age, as university equals lifelong debt.

But we should not forget that it is a willed policy. From Southern European nations forced to accept the dept of the gamblers as a public dept, and payed by loosing infrastructure; to unions in Sweden being fooled into believing reduced wages would improve employment enough to give rise to total income. Our democracy is failing, how could we let it go this far?

Shilling says:

But as usual there is a problem with these so called tests. If you give people the bare minimum so they can just survive there is nothing left that can be used to invest in themselves. In Finland education as far as I know it is free and meals are included. In many other countries this is not the case so there are more barriers that have to be lifted then to just give people a minimal amount of money unconditionally and see a successful outcome.

In this system there will still be serious issues that have to be tackled for it to work for everyone. But hey at least they are trying something I guess.

Anonymous Coward says:

Re: The Culture

“The aim is no work.”

How silly.

No, the aim is to steal as much from others as possible (while supplies last), all the while wagging fingers at the less fortunate telling them it is all their fault for being so lazy and stupid. They have to do this in order to bolster their own self esteem, poor babies. When these folk finally wake up, it will be too late and they will be crying for their mommies. Civilization may take multiple centuries to rebuild and repeat the same shit over again because humans are greedy little shits.

andrzej (profile) says:

Goverment leaders should not give away people cash for free.On the market there are mamy financial instruments that work actively at lost people. The Finnish solution does not support in any social activity. It rather creates the demotivate system. Iam sure that Finnish experiment can only increase the number of the unemoployed and the homelles. It is a kind of utopia, which remember me communist utopia. In the long run Finnish experiment can lead to the destruction of the state. That is why I am convinced that it should be treated as an academic reaserch experiment and not as a social programme!

Anonymous Coward says:

Re: Re:

What you’re saying might apply to country X but it doesn’t apply to Finland’s current system. Finland is a socialistic country that has a social welfare for people who have lost their jobs. This system creates a “financial trap” where a person cannot accept a job offer because either the job doesn’t pay enough or it’s a part time job. If they would accept this job offer they would lose money compared to the welfare and possibly lose their homes.

With “basic income” you can accept any job, even a low paying part time job to actually better your self. Sure, it doesn’t fit the american dream but it might improve Finlands current system. Then again, try to tell a Finn or any nord “screw the poor, go murica” and see how well that goes outside the rich.

But hey, the experiment might fail and you might be right.

Wendy Cockcroft (user link) says:

Re: Re: Re:2 Re:

Not so, Roger. First of all, the BI amount isn’t much. It’s not enough to live on by itself.

If you really want to stop that redistribution try capping CEO pay at 20x the lowest paid worker’s wage, breaking up monopolies and cartels, and increasing access to higher education for people on lower incomes. We NEED a middle income earners group and this needs to be as big as we can make it as it’s folks like us who pay all the taxes. The rich are adept at avoiding it.

John Lambert (profile) says:

Who pays for a universal income?

I have a practical doubt about a universal income: Who pays for it?
A sales tax? The people receiving the UI are who pay the sales tax.
A business tax? It gets added to the retail price of goods & services and the people receiving the UI are who pay the business tax.
I don’t think of any source of revenue to fund these UI payments that does not ultimately come from the people receiving the UI, with an administrative overhead for moving it from one pocket to the other.

Derek Kerton (profile) says:

Re: Re: Re: Who pays for a universal income?

Not so complicated guys.

IF – automation is transferring income from Labor (L) to Capital (K), as robots take the jobs of L

THEN – The income is already in the process being redistributed from the workers to the wealthy. Finland is merely seeking to stop the redistribution.

SO – Taxing K income at a reasonable rate is where the money comes from, and then distributing it as basic income.

Many on the right like to act like any income received without having to work for the income will result in lazy people just slacking around. They act like our American system would crumble if people got paid but didn’t work. I dunno. Maybe. Let’s watch Finland.

Yet those same on the right don’t seem to have a problem with wealthy people with capital earning money on their investments without working for it. They have no problem with inheritances so some families never have to work, but just reap dividends from their K.

We’ve already got people who make money without doing work for it. Why no anger at this group? Why is it only the worker who is scorned when they get a work-free income?

Anonymous Coward says:

Universal income is a bandaid, needed because of globalization. The rates of unemployment, homelessness and poverty for the citizens of (whatever country) have skyrocketed since the start of off shoring and H1B like programs.

Countries across the planet struggle in dealing with the perturbations resulting from power struggles within the globalization syndicate.

Sorta like when the beach masters fight for mating rights and the newborns get trampled. I don’t have any answers, I doubt there is an easy fix and therefore nothing will be done because our fearless leaders are lazy assholes.

Anonymous Coward says:

I really think there are better ways of looking at this. One of the reasons why we have to work is to maintain our property due to things like property taxes. Or to pay rent to a landlord that must pay property taxes.

The government should do more to encourage people to own their own homes and not to own homes that they rent out (and they do some things to help first time home buyers). For instance you can have a system where the government allows you to pay a much lower property tax on only one of the properties you own while forcing you to pay a much higher property tax on any other properties you own. This will reduce the value of a home to people that want to own it and rent it out while increasing its value to someone that wants to own their own home. Doing so will naturally shift the economy towards people owning their own homes where it’s cheaper for everyone because it becomes more expensive to buy a home and rent it out but it becomes cheaper to own your own home and live in it.

It also doesn’t make sense for the government to give you extra money only to take it from you in the form of property taxes. Perhaps the focus should be on the government taking less. Everything the government gives you was taken from somewhere, instead of focusing on how money is given the government should restructure how money is taken in a way that creates a similar effect.

I’m also kinda against the government giving money to people that keep having children. We need to do something about population growth. Perhaps we should do something like China. Or perhaps a cap and trade on childbirth. I posted this random idea elsewhere and will re-post it here.

Why don’t they have a cap and trade system on births. Every person is allowed to have a single child, a couple is allowed to have two children. If you want to have another child past two you must buy the right from someone that has it (and markets determine price) and they lose that right. When you reach a certain age (a reasonable age, old enough to make such a decision, let the government decide how old that is) then you may sell your given right if you haven’t already exercised it.

If two people have a child they both lose half of their right each. Then if they want to have a second child they lose the other half.

Alternatively if they divorce after having one child each person is left with one half of a child that they may have. If one of them wants another child he/she must pair up with someone else that at least has a right to have half of a child to make one full child.

Or if that person pairs up with someone that has no rights to have any more children but they want another child they can buy half of someone else’s right on the open market to make one full right.

If the government later decides that the population is shrinking too fast and they want to grow it or prevent it from shrinking so fast they can then sell additional child rights on the open market.

Alternatively when the population is growing too fast the government can then control the population by reducing the number of rights each person is endowed with. For instance they can decide that each person is only entitled to have 3/4 of a child and rights can be sold in 1/4 increments. Each couple can have 1 & 1/2 children (ie: only one child) but if they want to have a second child they can buy half a right from someone else willing to sell to make two whole rights. When the population begins to shrink the government can adjust the number of endowed rights each person is allowed to have (ie: with a stimulus plan giving people more rights) or they can sell rights on the open market.

Originally posted here

China’s ‘Missing Girls’ Theory Likely Far Overblown, Study Shows

Anonymous Coward says:

Re: Re: Re: Re:

Some people do not like contributing to the building and maintenance of infrastructure, perhaps these people should therefore disconnect themselves from same. No more public utilities, gas, electric, water, sewer, phone – all these things will be your responsibility. In addition, you will not use any public roads, public lands, or easements. Flying will be out also.

Just pay your taxes cheapskates.

Anonymous Coward says:

Re: Re: Re: Re:

I pay a Water Bill every month which includes sewage. Roads and police and fire, OK, but that really is a small fraction of what your property taxes pay for. A HUGE percentage of it goes to Schools!!! How this I have a problem with. Why are my Property Taxes the SAME as the person across the street when I have zero kids and they may have 4 or more kids??? Not only that, but for each of those kids, they get their taxes reduced every year for the next 18 years!!!! Tell me, how is that fair?

Derek Kerton (profile) says:

Re: Re: Re:2 Re:

I know this requires seeing things as a community, not as a selfish actor, but consider:

We in a town, state, our country, make up a community of people. We ALL mutually and EACH individually benefit from a stable, productive, healthy, and educated community. Separating out education, it benefits ALL of us because:

– educated people make better employees for people who want to grow a business
– educated people make better co-workers
– education wildly increases productivity of the individual
– educated people tend to have fewer children
– educated people vote better in a democracy
– educated people commit fewer violent crimes

So, education is offered by government, NOT to educate MY kids with MY taxes, quid pro quo, but rather because it is a smart investment for the community to educate ALL its children.

It’s very fair. Stop whining and pay.

PS: I also pay taxes for lots of services I will never use. That’s the nature of working as a community, not an individual. I never drove on Hamilton Ave. in my town, should I go to my Mayor and as for that portion of my taxes back?

Richard (profile) says:

Re: Re:

I’m also kinda against the government giving money to people that keep having children. We need to do something about population growth. Perhaps we should do something like China.

Overpopulation isn’t the problem we thought it was.China’s experiment hasn’t worked out as expected and is now being reversed. It was never really necessary and was quite inhumane.

The most humane method to reduce overpopulation is to educate women. Most western countries are operating below replacement rates largely as a result of providing education for women.

Derek Kerton (profile) says:

Re: Re: Re: Re:

No. It’s the education. There is negligible resource scarcity in the USA, and in fact, your argument is provably false because the Americans with the fewest resources procreate more than average.

In fact,

– Educated women have income, options, other things to do. They don’t see endless child-rearing as their entire life’s calling.

– Educated women also don’t worry about starving in retirement, so don’t need many children to assure they have support. Instead, they can earn money and invest it!

– Uneducated women/men are often in poor countries with high mortality rates. The only way to assure a couple of children in her old age is to bear 6+ children. This is a strong motivator. Educated women buy healthcare, and expect their 1.9 kids to outlive them.

– Uneducated women/nen are encouraged to have more children by tribal leaders, in order to increase the strength of the tribe. This does not really apply to educated women.

It seems unlikely, but you appear to have not interacted with many educated women. You should also visit some countries where women’s progress is withheld, and listen to women there.

Bill Openthalt (profile) says:

Re: Re: Re:2 Re:

Sufficiently scarce. As you point out, “real” resources aren’t scarce in the USA, so even poor people have enough to eat, are housed and clothed, and can send their kids to school. So they procreate — which is a subconscious affair, not a matter of consciously deciding to assure your old-age survival.
Having an education, a job, a house, and all the paraphernalia of modern living are subconsciously attributed resource status, hence not having them is perceived as scarcity, and women (and men) feel less interested in having babies. Because children require so many resources (and so much time) to educate, by the time parents have two of them, the (subconscious) motivation to have more disappears — until they change partners.
Education is a veneer that doesn’t change human nature, and rational thought does not provide motivation — it merely modulates behaviour.

shanen (profile) says:

No mention of Jeremy Rifkin, eh?

Lots of things you could read on this topic, but the kernel of the problem is that productivity is becoming so high that there is no economic requirement for many people to work. If you want those “unneeded” people to continue participating in the economy, then the money has to be provided via transfers that are NOT economic.

However, I prefer to approach the problem from a solution perspective that I tag “ekronomics”. The base is a division of human time into essential work time, investment time, and recreational time.

Essential time is for such things as food, clothing, housing, and directly related stuff (like the legal system that keeps people from robbing you of your essentials). In a highly advanced society the average hours for this stuff are quite low, and most people are not even involved. In extremely poor places everyone spends ALL their time scrabbling for survival.

The investment time is for stuff like research and education that increases the productivity going forward. Another type is new infrastructure (in contrast to the essential maintenance of old infrastructure).

Recreational time is different for many reasons, but it would take to long to describe them here. Therefore I’ll just focus on the short summary that the balance between investment and recreational time largely determines the FUTURE competitiveness of the country.

Not surprising to me that Finland is leading the way in dealing with this deep economic transition. If Trump “succeeds”, maybe America will wind up as a hunter gatherer society?

Anonymous Coward says:

We already have this system in the US

You can stay on social programs for as long as you like in the US. The Dems use this to their advantage. They people just enough to keep them in their place but not enough to truly be comfortable. They use promises of small increases to keep their voting base. The system does not work now and will never work. The people being kept down will never be given enough to be happy. Watching people vacation in nice places, have new cars that don’t break down, roofs that don’t leak tends to produce envy, hopelessness and despair. All of these social experiments fail because they do not take into account the human factor.

Ninja (profile) says:

Re: We already have this system in the US

While the purpose of those social programs is the same the methods are largely different. When you give everybody a basic income you largely forfeit any other direct distribution program. What’s left is housing, health care and education. With no strings attached, everybody will take that income for granted and will know that at the very least they will be able to fulfill their most basic needs without having to prove at every corner they are poor. It also solves the problem of retirement income so many countries are facing.

The ‘problem’ is they will have to actually tax the rich. So it won’t happen in most of the world till we meet a complete economic and social collapse.

dan (profile) says:

It just raises the 0 point

A true test would give everyone in a designated area this minimum income. Giving this to every fifth person in the area is not an accurate test of the possible results of creating a guaranteed minimum income (GMI)for all.

Although some items humans use money to purchase have a very elastic supply (anything digital) some items are not. The most significant is of course housing. The demand for good housing in areas people want to live will be market based. If two people want a particular property the person with GMI plus will be able to pay more then the person with just GMI. With that in mind, if everyone has a base X salary than this will essentially be 0 when considering these non-elastic supply items. To say it another way, the 0 score for the SAT is 500 (or whatever it is now) no matter what you make the minimum score it is still 0 for comparative purposes.

Or to put it more crudely: The vast majority of humanity is trying to put themselves in the best position to sleep with the hottest woman(or man) possible. Money is nothing more than one of the factors that helps with being more attractive (yeah yeah love is free blah blah). With all other attractive features being equal the person with GMI plus will not sleep alone.

If you do not want to live in a highly desired areas and consume generic items and digital products then a GMI will work. Otherwise the person with more money (no matter the number) will get what they want first.

Wendy Cockcroft (user link) says:

Re: Basic income is a con

All of my objections are here:

and I have yet to see even one of them refuted.

People who argue with me tend to rely on appeal to emotion or to authority to back up their assertions. Give me facts.

That money is not enough to live on by itself, Glyn, particularly where people with complex needs are concerned. These schemes tend to fizzle out after a while because they’re not self-funding and I expect to see this one go the same way as Portugal’s.

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