Finland ends trial Universal Basic Income experiment - Politics Forum.org | PoFo

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#14987062
Am I the only person that feels the headlines around this story are trying to make it sound like the UBI experiment was a failure?

The group that was given a UBI was better off than the group that wasn't in terms of well-being. Even if they didn't find work, perhaps there are other positive benefits that make it worth it to society. All the article around this, didn't seem to get into that question at all.

I would have loved to see if there could be an affect on crime rates too. Let's say you give people in the ghetto UBI, would crime rates fall? If it did, I would say that's worth the UBI. However, doesn't look like this sort of thing was studied here.

UBI is a concept I find very interesting.

https://www.nytimes.com/2019/02/09/world/europe/finland-basic-income.html

HELSINKI, Finland — A basic income made recipients happier than they were on unemployment benefits, a two-year government experiment in Finland has found. But it did not, as proponents had hoped, make them more likely to work.

Finland — the world’s happiest country last year, according to the United Nations — is exploring alternatives to its social security model. About 2,000 Finns, chosen randomly from among the unemployed, became the first Europeans to be paid a regular monthly income by the state that was not reduced if they found work.

The government announced initial findings on Friday, a month after the trial ended.

The trial was being watched closely by other governments who see a basic income as a way of encouraging the unemployed to take up often low-paid or temporary work without fear of losing their benefits. That could help reduce dependence on the state and cut welfare costs, especially as new forms of automation eliminate some jobs.

Finland’s minister of health and social affairs, Pirkko Mattila, said the impact on employment of the monthly pay check of 560 euros ($635) “seems to have been minor on the grounds of the first trial year.”

But participants in the trial were happier and healthier than the control group.

“The basic income recipients of the test group reported better well-being in every way (than) the comparison group,” the chief researcher, Olli Kangas, said.

The chief economist for the trial, Ohto Kanniainen, said the low impact on employment was not a surprise, given that many jobless people had few skills or struggled with difficult life situations or health concerns.

“Economists have known for a long time that with unemployed people financial incentives don’t work quite the way some people would expect them to,” he added.

Sini Marttinen, 36, a former I.T. consultant, had been unemployed for nearly a year before “winning the lottery,” as she described the trial.

Her basic income gave her enough confidence to open a restaurant with two friends. “I think the effect was a lot psychological,” she said.

“You kind of got this idea you have two years, you have the security of €560 per month,” she said, adding: “It gave me the security to start my own business.”

Her income only rose by €50 a month compared with the jobless benefit she had been receiving, “but in an instant you lose the bureaucracy, the reporting,” Ms. Marttinen said.

Mira Jaskari, 36, who briefly found a job during the trial but lost it because of poor health, said losing the basic income had left her feeling more insecure about money.

The center-right government’s original plan was to expand the basic income scheme after two years as it tries to combat unemployment, which has been persistently high for years but reached a 10-year low of 6.6 percent in December.

That followed the imposition of benefits sanctions on unemployed people who refused work.

The basic income has been controversial, however, with leaders of the main Finnish political parties keen to streamline the benefits system but wary of offering “money for nothing,” especially ahead of parliamentary elections due in April.

Prime Minister Juha Sipila’s Center Party has proposed limiting the basic income to poor people, with sanctions if they reject a job offer, while the Conservative finance minister, Petteri Orpo, says he favors a scheme like Britain’s Universal Credit.

The higher taxes that the Organization for Economic Cooperation and Development says would be needed to pay for basic income schemes might also be off-putting for voters.

In a review of the Finnish scheme last year, the organization warned that implementing it nationally and cost-neutrally for the state would imply significant income redistribution, especially toward couples from single people, and increase poverty.

The researchers have acknowledged that the Finnish pilot was less than realistic because it did not include any tax clawback once participants found work and reached a certain income level.

Swiss voters rejected a similar scheme in 2016. Italy is planning to introduce a “citizens’ wage” in April in a major overhaul of the welfare state, which will offer income support to the unemployed and poor.

Trial participants were generally positive, however, with Tuomas Muraja, a 45-year-old journalist and author, saying the basic income had allowed him to concentrate on writing instead of form-filling or attending jobseekers’ courses.

He said the end of the two-year trial, during which he published two books, had made it difficult again for him to accept commissions, because he could earn only €300 a month without losing any benefits.

“If people are paid money freely that makes them creative, productive and welfare brings welfare,” Mr. Muraja told Reuters about his experience of the pilot.

“If you feel free, you feel safer and then you can do whatever you want. That is my assessment.”
#14987067
A basic income or something equivalent to that will be needed as more occupations and roles are automated by robots and technologies in society. If everything is automated by robots in the future, then what will people do? If the economy is still capitalist at that time, then a basic income will be needed.

If people take advantage of UBI via starting an underground economy selling dangerous drugs, getting into prostitution, and not coordinating wealth correctly, then those fuckers are traitors to the survival of humanity, and they are advocates of social decay, NOT the road to progress.
#14987088
SSDR wrote:A basic income or something equivalent to that will be needed as more occupations and roles are automated by robots and technologies in society. If everything is automated by robots in the future, then what will people do? If the economy is still capitalist at that time, then a basic income will be needed.

If people take advantage of UBI via starting an underground economy selling dangerous drugs, getting into prostitution, and not coordinating wealth correctly, then those fuckers are traitors to the survival of humanity, and they are advocates of social decay, NOT the road to progress.


This is why I find UBI interesting. I currently support the idea of UBI. I just think it will be needed to maintain order within society. The social/economic upheaval that we face in the future is going to be greater than ever. Especially given the fact that even well paying skilled jobs are getting affected by automation. It's not just low skill menial labor jobs that are automated away.
#14987100
Rancid wrote:Am I the only person that feels the headlines around this story are trying to make it sound like the UBI experiment was a failure?

The group that was given a UBI was better off than the group that wasn't in terms of well-being. Even if they didn't find work, perhaps there are other positive benefits that make it worth it to society. All the article around this, didn't seem to get into that question at all.

I would have loved to see if there could be an affect on crime rates too. Let's say you give people in the ghetto UBI, would crime rates fall? If it did, I would say that's worth the UBI. However, doesn't look like this sort of thing was studied here.

UBI is a concept I find very interesting.

https://www.nytimes.com/2019/02/09/world/europe/finland-basic-income.html


UBI is probably inevitable. Automation is a serious benefit and problem. Actually automation might make communism viable, well, may be some form of technocratic communism when most labour work is automated and mainly research/control work is left to the humanity with assistance of AI. I doubt we will give AI full control.
#14987920
Given that headline results of "UBI increases happiness, but not efforts to find a job."

Could this screw up potential future experiments of UBI? Unfortunately, I think yes. Given this "negative" result, other people will be unwilling to try and test other factors. For example, the one I'm most curious is, if crime rates dropped if you give UBI in poor areas.

The more I think about it, this one small experiment kind of makes it harder for more research/experiments to happen basically. It's shame, because I think UBI will be needed as automation gets more sophisticated.
#14988044
It's ridiculous to abandon an idea because you didn't get the result you wanted on your first attempt. The USA trialed UBI in the 80s and decided it was a failure because the divorce rate increased when it was trialed. Later analysis showed that the increase in divorce was unrelated to the UBI.

Post hoc ergo proctor hoc.

Also one of the arguments for UBI is that there aren't enough jobs to go around and the lack of jobs will be exacerbated as automation advances. UBI frees people to pursue socially and culturally valuable goals that capitalism is unwilling to pay for.
Last edited by AFAIK on 14 Feb 2019 08:15, edited 1 time in total.
#14988048
The Finnish government wanted to find out if unconditional payment would make it more likely for people to find work. From the report:
The section titled “Wellbeing and health” in the Government programme lists customer-oriented services as a key strategic goal. To achieve this goal, the Government decided to launch a basic income experiment during its term of office. Through the basic income experiment, the Government wishes to investigate whether a social security model based on a basic income could promote more active participation and provide a stronger incentive to work than the present system.

Hard to call this anything else but a failure.

I'm sure people like it more if they don't have to jump through bureaucratic hoops, so I'm not too surprised by the wellbeing results. Not sure how much weight should be given to this.
#14988063
It may not have made it more likely to get work but it didn’t make it less likely either. I think that is just as interesting.

Big money needs to be careful attacking ideas like this. I mean it’s better in their interests to pay a bit more tax so that the poor get free money to buy the capitalists products, as opposed to crime or revolution .... I think eventually all parties will come towards some version of this.
#14988094
layman wrote:It may not have made it more likely to get work but it didn’t make it less likely either. I think that is just as interesting.

If the 50% tax on first earnings had been implemented then this would have been a brilliant vindication of UBI. If you can get the exact same results in getting people into work without coercion why on earth would you want an expensive, bureaucratic, error prone, coercion system. The key to UBI is that tax / benefit withdrawal is applied at something like 50% from the first pound earned. What you certainly don't want is people taking UBI and then working in the Black economy or even worse engaging in criminal activities.

The key insight behind UBI is that a very small percentage of the population are actually content to live on UBI. Only a small percentage of the population are hippies, spiritual types, committed but permanently economically unsuccessful artists, pathologically lazy and value the freedom from gainful work over the negative of the poverty of living on UBI only. It is therefore stupid to design a tax benefit system around a tiny, economically marginal, sliver of the population. It is however necessary to have strong sanctions and strong policing against those that seek to defraud a UBI system.
#14988098
Rancid wrote:"UBI increases happiness, but not efforts to find a job."


How is that surprising? :lol:

If they gave me a UBI right now $18K a year, I would quit my job to get my farm going and build my house.

You think i'm the only one?

Rancid wrote: Let's say you give people in the ghetto UBI, would crime rates fall? If it did, I would say that's worth the UBI.


That is a tough one, this question assumes the cause of crime is lack of money, is it though?

The inner city crime rate can be tracked alongside Johnson's welfare program and its effect on the family, but people in the inner city often do get lots of welfare already; additional welfare is not likely to decrease crime rates in my opinion because the problem of "idle hands" and "broken families" doesn't change, if anything it could very well worsen.
#14988100
Victoribus Spolia wrote:That is a tough one, this question assumes the cause of crime is lack of money, is it though?


At a minimum it would suggest lack of money is a factor in causing crime. We don't know the answer to that question, hence why I was interested in the experiment of giving UBI specifically to families in the ghetto to see what would happen.
#14988111
Clearly there is a correlation between poverty and crime but how does that relationship work? Poor Native American communities have a lot of domestic violence crime but not many gangs.

Most street Crime seems to be localised in poor areas for sure. Idleness, hopelessness or community/peer acceptance seem to be big factors that may or may not relate to poverty.

Post war Britons were dirt poor on rations but didn’t turn to mass crime. Tax avoidance crime is socially acceptable in many countries, as is drink driving.

One key point about ubi is that it won’t change inequality much if done in its purist form. Not unless you introduce more progressive taxes to pay for it of course.
#14988114
layman wrote:Not unless you introduce more progressive taxes to pay for it of course.


They would have to, as the lowest taxable bracket would likely drop out of the workforce completely and the middle-class wouldn't be able to shoulder the burden, it would have to be placed on the wealthiest bracket. Of course, such a tax would likely disincentivize the growth of that class and cause many in the lower tiers to drop out of it completely to avoid the massive hikes.

Rancid wrote:I'm curious if UBI would change the story in anyway.


I doubt it, most of the crime in the ghetto is not caused because minorities can't get food so they steal bread to survive. :lol:

This demographic suffers from chronic obesity which is bankrolled by unsupervised food-stamp allotments. Likewise, most the crimes in inner cities are drug or gang related.

How more welfare would solve any of this needs to be analyzed prior to rolling out a massive social experiment that directly affects the lives of people.

Now, do I think UBI would be a better alternative as a replacement to our current welfare system? In some ways, but generally I think it would decimate the working class; they would almost cease to exist and a massive progressive tax would have to be rolled out that would cause the wealthiest at the top to jump ship. I can't see this ending well.

Fact is, if you give a livable income to people for simply existing; many will be perfectly content to simply exist and those who are working for that same amount or near it; would invariably stop working altogether and they would be making the most rational choice given their circumstances.
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