Finland to test 'basic income' (free money)

Vinny Lupton

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If all goes as planned, Finland will launch its two-year basic income pilot in January. It’s not a test of universal basic income, where everyone gets a check, rich or poor. Instead, 2,000 unemployed Finns will get the equivalent of $600 a month. Unlike unemployment benefits, they won’t have to prove they’re searching for a job or lose any part of the basic income check if they get a job.

Finland to test a basic income for the unemployed
 

Vinny Lupton

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Finland’s center-right government, headed by Prime Minister Juha Sipilä, wants to see if an unconditional basic income would encourage Finns to take low-paid or part-time jobs that don’t pay off for them under the country’s current welfare rules.

Right now many unemployed Finns are caught in “incentive traps,” where working leaves them worse off than staying on social assistance.






Ollie Kangas, director of government and community relations at KELA, the government agency that handles all sorts of public benefits, He is leading the basic income experiment.

“In the present system they are a little bit afraid of accepting job offers, say, for two months or three months, because they think that, okay, how much would I benefit, in terms of money?” Kangas said. They are also nervous about re-qualifying for unemployment once a temporary job ends. “So they’re afraid of bureaucracy and they’re afraid of losing that income stream,” he said.


“Now, unemployment benefits are conditional on you looking for work,” Kärkkäinen said. “With basic income, you get it even though you don’t look for work, if you stay at home, if you go to work some more. That’s a thing I’m looking forward to most. How making benefits unconditional will affect the choices people make.”





Right now Finland is one of the most generous welfare states in the world, with universal healthcare, free college, four months paid maternity leave and many other benefits. As seen in the chart below, government spending to GDP stood at around 58 percent in 2014. Spending on "social protection" like unemployment and old age pensions was around 25 percent. But the country’s population is aging and growth is sluggish. The government has started to cut back benefits and hopes a basic income could act in lieu of many benefits the poor currently get.



finland_public_expenditure.jpg

In Finland, government spending to GDP has averaged 49.94 percent, one of the highest rates in the world. That spending includes generous benefits for the unemployed. - courtesy Eurostat, Nordea


Liberals in Finland, currently out of power, want to set a basic income at a much higher level than conservatives.
But even they can see advantages to streamlining the vast maze of Finland’s overlapping social benefits, especially for the poor who have to navigate it. Teivo Teivainen, a professor of political science at the University of Helsinki, said theoretically, if an unconditional basic income replaced a handful of other benefits, "Your life would be clearly be less stressful and more free, in that sense.”


Most Finns tell pollsters they support a universal basic income, but at 1,000 Euros a month, not 600, like in the pilot. That’s about $1,055 a month, or $12,660 a year. When informed of the steep tax hikes required, however, they balk. Apparently even the generous Finns have their limits.
 

Scoop

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Most Finns tell pollsters they support a universal basic income, but at 1,000 Euros a month, not 600, like in the pilot. That’s about $1,055 a month, or $12,660 a year. When informed of the steep tax hikes required, however, they balk. Apparently even the generous Finns have their limits.

Everyone wants free stuff, no one wants to pay for it...
 

88m3

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Without having a better idea of the cost of living or other benefits Fins are entitled to this is meaningless.


:manny:
 

Vinny Lupton

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Without having a better idea of the cost of living or other benefits Fins are entitled to this is meaningless.


:manny:


Right now Finland is one of the most generous welfare states in the world, with universal healthcare, free college, four months paid maternity leave and many other benefits.
 

88m3

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Right now Finland is one of the most generous welfare states in the world, with universal healthcare, free college, four months paid maternity leave and many other benefits.

I read that...

"many other benefits" for instance?


generous welfare state is such a ridiculously loaded term btw
 

Red Shield

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Right now Finland is one of the most generous welfare states in the world, with universal healthcare, free college, four months paid maternity leave and many other benefits.

and they would get rid of that and give people a ubi. probably would save money with the ubi :skip:
 

Saiyajin

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the increased spending money will stimulate the economy as well as allow citizens to pursue and attain higher levels of education / skills

dont be surprised if this ends up paying for itself or even leading to a surplus :ufdup:

government debt is nothing like private debt :ufdup:
 
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Maschine_Man

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I think this is a good idea. punishing ppl that want to work is a terrible idea(which is happening now in many places). they should be rewarded.

This could also be a great way to fix the minimum wage problem. Give everyone a basic income, then they can still work their minimum wage job to and live off it.
 

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Mr Jarvinen’s luck turned in January. That is when he was picked at random from Finland’s unemployed (who total 10% of the workforce) to take part in a two-year pilot study to see how getting a basic income, rather than jobless benefits, might affect incentives in the labour market. He gets €560 ($624) a month unconditionally, so he can add to his earning without losing any of it.

If Mr Jarvinen is making progress, it is too soon to draw overall conclusions. Kela, Finland’s national welfare body and the organiser of the pilot, will not contact participants directly before 2019, lest that influences outcomes. Instead it monitors things remotely, using national registers of family incomes, taxes paid, purchases at state-run pharmacies and more. These (anonymised) data will be made available to researchers, who might ask, for example, if consumption of antidepressants changes among grant recipients.
 

Orbital-Fetus

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Deep in your anus...
i thought that they voted against this last year.
perhaps i'm thinking of another country or they are taking another shot at it.

either way i'm curious to see how this works out.
 
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