Free Money for Everyone Sounds Great, But Finland Proves Basic Income is a Bust
Finland’s universal basic income experiment shows that plans that seek to hand out free money won’t work. | Source: Shutterstock
Universal basic income experiments and other plans that seek to distribute free money seem wonderful considering so many people struggle to make ends meet because of their limited incomes.
In the U.S., many legislators have called for federal and or/state governments to trial these economic policies. One recent proposal actually calls for people to receive money from the government even if they are unwilling to work!
As lawmakers and supporters champion such ideas, it would behoove them to look beyond the U.S. border to countries who have already taken a stab at basic income.
Finland took up the effort, and the results have many Finns acknowledging that the idea wasn’t a good one.
No Strings Attached Free Money
Finland implemented a universal basic income program on a trial basis to help its low-income citizens. Simply put, they received money from the government, whether or not they had a job or even wanted to work.
Adopted in 2017, early results released this week indicate that the downsides outweigh any economic benefits.
Participants received monthly payments equal to $634 from January 2017 through December 2018. Officials wanted to see if the payments could be a safety net for those looking for work. For those who needed work to tide them over until they found higher-paying jobs, these payments were thought to be of help.
Finland’s foray into providing free money cost the government about $22.7 million. The expected positive effect on the country’s employment rate didn’t materialize.