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Wednesday, August 31, 2016

Finland Unleashes Helicopter Money In "Greatest Societal Transformation Of Our Time"

Finland is about to launch an experiment in which a randomly selected group of 2,000–3,000 citizens already on unemployment benefits will begin to receive a monthly basic income of 560 euros (approx. $600). That basic income will replace their existing benefits. The amount is the same as the current guaranteed minimum level of Finnish social security support. The pilot study, running for two years in 2017-2018, aims to assess whether basic income can help reduce poverty, social exclusion, and bureaucracy, while increasing the employment rate.
The Finnish government introduced its legislative bill for the experiment on 25 August. Originally, the scope of the basic income experiment was much more ambitious. Many experts have criticized the government’s experiment for its small sample size and for the setup of the trial, which will be performed within just one experimental condition. This implies that the experiment can provide insights on only one issue, namely whether the removal of the disincentives embedded in social security will encourage those now unemployed to return to the workforce or not.  
Still, the world’s largest national basic income experiment represents a big leap towards experimental governance, a transformation that has been given strong emphasis in the current government program of the Finnish state. Additionally, the Finnish trial sets the agenda for the future of universal basic income at large. Its results will be closely followed by governments worldwide. The basic income experiment may thus well lead to the greatest societal transformation of our time.
There are few important things one should understand when following the headlines on  the Finnish basic income experiment:
1.Basic income is the most comprehensive political reform of our century so far.
There is no other reform in sight that would a) potentially impact the majority of citizens in any given nation and b) be of such great importance in as many countries as basic income is today.Take the global interest in the Finnish experiment as evidence: why such attention for a trial in a country of just 5 million inhabitants? Probably because basic income seems to address challenges faced by all societies across borders. Currently, basic income is being discussed in earnest in Switzerland (where a basic income reform was rejected in a referendum in June 2016), in the US (where Y Combinator, an organization known for its highly successful start-up accelerator, has announced a pilot experiment for basic income to take place in Oakland, California) and in the Netherlands (where a basic incomeexperiment will begin in the city of Utrecht in January 2017).


2. The Finnish basic income experiment is officially referred to as an incremental reform of the welfare model, not as an indicator of a complete paradigm shift.

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