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(4,516 posts)
Fri Jan 12, 2018, 08:08 AM Jan 2018

What if everyone got a monthly check from the government?

In an audacious experiment, Finland is giving some residents a “basic income” of $16,000 for two years, no strings attached. Here’s what two of them did with the money.

One afternoon in the final days of 2016, Steffie Eronen got a phone call from her husband, Juha. The Eronens had spent Christmas with relatives in Savonlinna, Finland, and Juha had just made the two-hour drive home so he could return to his job as an electrician. The couple live with their 5-year-old daughter in a cozy, two-bedroom apartment in Mikkeli, a quiet, midsize city in the southeastern part of the country. Juha was calling to let his wife know he was home safe, and oh, by the way, an important-looking letter had arrived for her from the Social Insurance Institution of Finland—or, as everyone calls it, Kela.

“Open it,” Steffie said.

There was a pause as Juha tore into the envelope. Then he laughed.

“You got it!” he exclaimed.

“Got what?”

“Basic income,” Juha told her. “You’re in the program!”


This is a long piece. I did not read it all but have book marked it for later. I am retired and living on a pension and social security and my wife who is younger is still working. We are doing OK but younger people will run into problems that I never had to.

We are going to need a new model. My question is where does the money come from and what kind of society will we need to make it happen. I hope this is answered in the article. Do the rules of economics I learned in school still apply?

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What if everyone got a monthly check from the government? (Original Post) wasupaloopa Jan 2018 OP
Apparently a 55% tax rate wasn't popular MichMan Jan 2018 #1


(11,502 posts)
1. Apparently a 55% tax rate wasn't popular
Fri Jan 12, 2018, 05:35 PM
Jan 2018

Kela’s researchers originally envisioned the experiment as the first in a series that would help them understand the implications of expanding basic income nationwide. “With basic income, there will be a lot of winners, but there will be a lot of losers also,” Kangas says. “We have to study the losers.” For one thing, he points out, to provide Finns with the level of financial security they enjoy under their current system, basic income payments would have to be at least twice those of the trial. And to pay everyone, the country would have to change its tax structure.

In their proposals for further studies, the researchers estimated that a flat tax of about 55 percent would be required. Kangas says they tried calculations involving progressive taxation but worried that another showdown with the constitutional committee would result. Benefits are taxed in Finland just as income is, and the researchers didn’t think the committee would allow basic income payments to be taxed at different rates when the whole idea was to ensure people received the same amount.

The wealthiest would be relatively unaffected by such a change because their taxes are already high, but a swath of middle- and upper-middle-class Finns would pay more in taxes than they’d get back in basic income. In national polls, when the possibility of a 55 percent flat tax was raised, the percentage of Finns who supported basic income dropped from 70 to about 30. “We would need to implement another study for the whole population to understand it,” says Miska Simanainen, a tax specialist who was part of Kangas’s team. No such studies are planned.

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