Finland’s landmark experiment with basic income — the idea that the government should give citizens a regular infusion of free cash with no strings attached — is showing promising results.
After the government chose 2,000 unemployed citizens at random and gave them a check of 560 euros ($635) every month for two years ending last December, the recipients reported less stress than the control group. That was true even for recipients who felt they were still struggling to make ends meet, according to new findings released by Kela, a Finnish government agency.
The recipients also reported that they felt more trust toward other people and social institutions — from political parties to the police to the courts — than they did before getting a basic income.
The new findings add to initial results released in February that showed receiving free money made recipients happier without making them any less likely to join the workforce. Although this wasn’t everything the Finnish government was hoping for — its stated goal was to boost employment — it still offered an important counter to critics of basic income, who often claim getting free money will induce people to work less. The evidence does not support that.
It may seem intuitive that getting a guaranteed, regular infusion of cash will make people happier and less stressed (even if that cash isn’t enough to cover all their needs). But that’s kind of the point: This is a pretty obvious way to increase citizens’ well-being, yet most countries aren’t doing it.
Exceptions include Italy, which recently put a version of it into practice. India and Scotland are actively weighing the idea. In the US, the idea of a basic income has been enjoying a surge of popularity over the past few years, but it has yet to be implemented — even though, as my colleague Dylan Matthews has written, “the US could easily afford a basic income program that wipes out poverty entirely.” (This February, Stockton, California, kicked off an 18-month basic income trial; there have been a couple of other trials in the country.)
Finland’s trial wasn’t an experiment in full universal basic income: The government didn’t give free money to everybody, just to 2,000 unemployed people. But the results are suggestive of what could happen if such a program were extended to cover more people.
The finding about trust levels is especially striking, even though the reported gains are modest. Consider this data from Kela:
The respondents reported their trust on a scale of 0 to 10 (0 = do not trust at all, 10 = trust completely). The average score for trust in other people was 6.8 among basic income recipients and 6.3 in the control group. As for trust in politicians and political parties, the average score among basic income recipients was 4.5 compared to 4.0 among members of the control group. The average scores for trust in courts and the police were 7.2 and 6.9 respectively among basic income recipients and the control group members.
Again, this may feel intuitive: If a society gives people enough money to take care of their basic needs, of course people will have more trust in its institutions, because they’ll have reason to believe those institutions actually care about them.
But having quantitative evidence to this effect helps impress upon us that we can have a society where people actually trust the system — if the system earns that trust.
A grim counterexample from Canada
In the Canadian province of Ontario, the government broke people’s trust.
In 2017, the former Liberal government launched a basic income pilot project in three cities. It was supposed to help 4,000 low-income people and last for three years. But then a new Progressive Conservative government came to power, led by Ontario Premier Doug Ford. In 2018, they canceled the project.
Now, a handful of participants in the pilot are filing a class-action lawsuit against the government. As the CBC reported in March:
The lawyer for the proposed lead plaintiffs alleges in a statement of claim filed today that the early termination of basic income payments amounts to a breach of contract.
Lawyer Stephen Moreau writes that the pilot participants relied on the ministry to administer the payments, and the government owed them a duty of care.
Moreau says after the cancellation of the project, people suffered from panic attacks, anxiety and depression.
It’s easy to understand where the plaintiffs are coming from: They were told they’d have enough money to care for their basic needs. They made plans, signed leases, and registered for classes based on that belief. Then they had the rug ripped out from under them.
The Ontario government said it canceled the program after hearing from staff that it disincentivized participants from finding work. But as one person involved in the program pointed out, the pilot had only been active a short time, not long enough to gather the data required to support that claim.
This is the kind of thing that can lessen trust in social institutions — exactly the opposite of the effect we see when a country follows through on its promises.