Finland Testing Basic Income

With centralized social welfare systems breaking down, the world will be watching Finland’s experiment

Finland is testing the idea of a Basic Income – paying €560 to a select group of citizens regardless of whether they work or not.

The experiment will be watched closely, as the rise in automation and precarious work is revealing the severe flaws in the current social welfare system.

I am a big fan of the Basic Income, though I have recently given more thought to the problem of making sure people are incentivized to find work. This matters, because it’s tough to imagine that people would be willing to pay taxes into a system that let a massive amount of citizens get free money without seeking employment.

But even with that concern in mind, the current welfare system is big failure. It discourages work, and often creates more wealth for government bureaucrats than it does for struggling citizens. Plus, it puts way too much power in the hands of politicians due to its over-centralization.

A basic income could lead to a huge reduction in government bureaucracy and spending, leading to a more efficient system, a smaller government, and more empowered citizens. It would also decentralize power – shifting it from government to individuals and families.

Finland’s experiment will allow those ideas to be tested in real time. As reported by the AP, “Those chosen will receive 560 euros every month, with no reporting requirements on how they spend it. The amount will be deducted from any benefits they already receive. The average private sector income in Finland is 3,500 euros per month, according to official data.

Olli Kangas of the Finnish government has said the idea is to end the “disincentive problem” for unemployed individuals.

It is clear that our old government systems are failing and breaking down. New solutions and new ideas are needed.

Time will tell whether Finland’s Basic Income experiment is the solution to the problem of fixing social welfare systems. It will be watched with great interest, because if it works it could inspire big changes around the world.

Spencer Fernando

Photo – Twitter