Where Next for Finland’s Welfare State?

Li Andersson

Li Andersson, the leader of Finland’s Left Alliance, on the country’s diminishing welfare state, rising populist right, and possible socialist future.

Li Andersson speaks at a Left Alliance event in 2015.

Interview by
Ronan Burtenshaw

It’s been a turbulent decade in Finnish politics. The erosion of its much-vaunted welfare state and collapse of communications giant Nokia provided the backdrop for the emergence of populist right-wing party the True Finns.

Meanwhile, its largest socialist party, the Left Alliance, joined a national unity government in 2011 prompted by the Finns’ rise, only to resign in 2014 in protest at budget cuts. In the time since the True Finns entered government following the 2015 election and, recently, split, leaving a more hard-line anti-immigrant party in opposition.

The Left Alliance, which has its roots in the Communist-led People’s Democratic League, a force that commanded as much as a quarter of the vote in the mid-twentieth century, now sits just shy of 10 percent in the polls. In 2016 it elected Li Andersson, an activist-politician and woman not then thirty years of age, as its leader.

In her time as chairperson Li Andersson has established herself as one of Finland’s most popular political leaders, gaining the highest vote total of any candidate outside Helsinki in this year’s municipal elections.

Here she talks to Jacobin’s Europe editor Ronan Burtenshaw about the welfare state and neoliberalism in Finland, the rise and stumble of the country’s far-right, and her vision of the path to socialism in the twenty-first century.

Finland and the Welfare State


There is a cliche version of Finland presented internationally: the utopian society with a strong welfare state, low levels of income inequality, and high educational attainment. The liberal press often holds it up as a triumph of sensible policy-making and a communitarian ethos. But that seems to miss both the battles won to attain these achievements and their erosion in recent decades. What would be a more accurate way of describing contemporary Finland?


Finland is a good example of how nothing is stable. Partly it’s a question of perspective. If you look at Finland compared to other countries, we are doing well in education and gender equality. But if you look from a Finnish perspective, comparing the situation to what it was previously, it’s worrying. The whole idea of the welfare state is under attack politically from the Right and the government is undertaking a decisive plan to dismantle some of its crucial elements. This is not a development specific to Finland; you see it in other Nordic countries as well. Within these countries we are having significant debates about the future of the welfare state.

One good example is the drive to reform the social and health care system. In recent decades Sweden’s right-wing has managed to build a more market-driven system for health care, eldercare, and medication. This has succeeded to the extent that Sweden has one of the most privatized medication systems in the word. Now the Finnish government is aiming to follow this lesson. Their reforms would change our system from one where public institutions are the primary suppliers of health care to one where private and public actors compete for funds in a market. Of course, this would create the possibility for businesses to build a commercial model based entirely on making profits from public funds. Proposals like these have provoked a lot of discussion in recent times.


Is it difficult for left-wing parties in the Nordic countries to talk about socialism without engaging in nostalgia? Clearly, the Nordic states have gotten farther along the line than anyone else in the West in terms of living conditions and empowerment for workers. But they remain welfare states within capitalism and, as you say, are increasingly in retreat. How do you talk about socialism with reference to the future rather than the past?


That’s something with which we’re struggling. The welfare state is a good concept and still retains widespread support among Finns. We represent a certain continuity in terms of these structures but understand that change is needed because they are under attack. One thing that separates Finland from Sweden is that we had a lot of influential autonomist-leftist debates in the mid-2000s which impacted policy and thinking in the Left Alliance. I come from that scene — as do many others — in the squatters’ movement and the politics of urban space.

One of the proposals which came from there and has become popular is the basic income, which the party has supported for a long time. The most innovative aspect of the basic income is its potential to free you from the state. The social democrats are completely against it because they are attached to a more traditional relationship between the state and the citizen. This is an example of the contrast between old and new welfare-state thinking. Our aim would be to use the basic income to enable people to decline jobs with poor conditions. It can also help people retain income in sectors which are seeing huge declines in wages.


In Finland the basic income has been introduced to replace people’s existing social benefits. In fact, in most contexts it seems to amount to a basket of existing supports rather than a new revenue stream. Isn’t there a danger that this will be used to cut entitlements rather than liberate people?


No concept is free of ideology. It’s the same thing when you talk about wages. A wage isn’t meaningful; it’s the level of the wage that is political. It’s the same thing with basic income. Our basic income concept is completely different from that of the Right. It’s important to talk about basic income in terms of what we want to achieve.

We propose to put it at a level where people feel empowered to refuse bad jobs. The social democrats believe they can end all precarious work by introducing new laws. We’re saying no, entrepreneurship and self-employment are here to say. People want to do it and it’s also something that brings with it a freedom to be your own boss. What worker does not want to be their own boss? Instead of saying that we need to reverse all these changes we’ve seen in the labor market through new laws, we need a welfare structure that isn’t based on two categories: employed and unemployed. Basic income concerns the whole employment system.


In 1903 Finland’s social democrats adopted the Forssa Program, a radical document which foresaw the development of the welfare state as a stepping stone to socialism. The years afterward have shown us that this does not necessarily happen. How does that transition look today, more than a century later?


We have a tendency to think about progress as continuation of a certain process to its logical end. That’s not how society or politics works. It’s a struggle back and forth, with some steps back and some forward. The welfare state was a big step forward but now we need to think about what others might look like.

When you look at the future, the redistribution of power and resources will be important. I recently visited a university where they showed me tools to make fuel and food from air and sunlight. If this was expanded to a mass scale, you could see the biggest redistribution in a long time. You could provide anyone that has access to air and sun with resources.

Another example is the so-called sharing economy, which is really more like a renting economy. It’s possible to imagine how these platforms could be run collectively in a way that resembles the traditional socialist concept of co-ownership of the means of productions. We should also look at data. If instead of it being hoarded by large corporations all the data we produce in society were open assets, it would provide a base for innovation which would be radically different compared to an economy with a few private actors owning patents. If data was owned collectively, it would be a great equalizer. Then there is the rapidly occurring automatization of industrial labor. We could respond to that by taxing the robots, creating a universal basic income and moving to a six-hour work day. This is an optimist view of the future — but we need to start thinking that way if we want to avoid the worst outcome.

I think the Left always wants to have a blueprint for everything. We tend to think you have to have a plan for exactly how the future society would work; otherwise, you don’t have a credible alternative to capitalism. In reality, few societies have had such a plan. They have had a vision and short-term demands. This is certainly the history of the working-class movement in Finland — utopian vision and concrete demands. I don’t know if I will be able to get Finns on the barricades for open data, but I can get them on the streets for their student allowance and start the conversation.


Finland has an unusual combination of deindustrialization and what might be called de-post-industrialization, by which I mean first, the decline of traditional Finnish industry and then of communications giant Nokia. How have those two economic processes shaped the Finnish economy?


The decline of Nokia significantly impacted productivity, leaving Finland with far fewer high-productivity workplaces. Usually when something like that happens with an export industry, you try to increase competitiveness by devaluing your currency. But Finland is a member of the European Monetary Union (EMU) and uses the euro, so we lack those instruments. Instead Finland, like many other European countries, has been forced to go through an internal devaluation. Although it has been on a lesser scale than some of those at the frontline of the recent crisis in southern Europe, it has still been very damaging. The government forced the unions and employers into a labor market agreement which cut wages. The result is that Finnish labor costs have been declining by several percent while Germany, Sweden, and other northern European countries see increases. We have been opposing this deal and the idea behind it, which is to force Finland into international wage competition. The government has tried the same austerity measures you see throughout Europe with wage and public spending cuts and this hasn’t worked. We propose a policy of investment instead, particularly into research that might help develop productivity in our export sectors.

The problem for these kinds of policies in Finland is membership in the EMU. Until recently the Left in Europe was relatively united about its demands for reforms of the EMU. We talked about the role and mandate of the European Central Bank, the possibility of acting as lenders of last resort, and so on. But after what the Eurogroup did to Syriza in Greece, the momentum for any change in this direction is gone.

There has been a lot of discussion about what to do next but no consensus. The European Union is a political project with some important symbolism. But if we compare the Left in terms of policy to the Right, it’s clear that they have focused much more on economics. Maybe it is time to look at the EMU simply from an economic point of view. We can’t have one that’s halfway. The decisions being made and the proposals at the European level for common financial policy are all going in a disastrous direction. They are determined to reform the labor market above all else and this means more gains for capital. It is difficult to imagine any progress for the Left across Europe unless this direction is reversed.

The Populist Right and Finnish Politics


At one stage, the True Finns were seen as the standard bearer of populist right-wing parties in Europe. Then they got into government and their momentum stalled. Recently they split, with the moderate elements remaining in government and the more radical ones in opposition. How do you reflect on the True Finns’ experience?


It should be remembered that the party differs from other populist-right forces in its origins. Unlike, say, the Swedish Democrats and the Front National, it began as an agrarian party with migration playing a relatively minor role. Its rhetoric was much more traditional populism — the ordinary man against the elites, particularly against the EU. In the mid-2000s anti-immigrant, right-wing groups in Finland were looking to come together and saw the potential of the True Finns as a vehicle. The party that rose to prominence was founded on this mix of xenophobic, migration-focused politicians and an agrarian populist base. 2011 was their big breakthrough and research suggests a broad range of sentiments about change propelled them. They said they were outside of politics, with the regular people, rhetoric you can even find in more centrist figures like Macron in France. So it wasn’t some kind of pure anti-immigrant vote.

The leader of the True Finns at that time, Timo Soini, knew that this combination was working for them. He never really interfered with issues concerning xenophobia. He was quiet and allowed the more radical elements to define the immigration agenda of the party. This was a successful strategy and took them into government. But in power they supported measures which really impacted low-income earners. They also found, even though they managed to change Finland’s migration and asylum policies, that they didn’t appease their hardline anti-immigrant supporters. So they lost half their support in the polls during the first year of government.

Some people ask me, “Doesn’t this show that the way to defeat the populist right is to allow them into government?” But, unfortunately, they have caused a lot of damage. They have succeeded in polarizing Finnish society. Their anti-immigrant rhetoric has managed to turn widespread insecurity about the economy against immigrants. Then their policies in government have hurt a lot of people, particularly the marginalized. And in the end their split was caused by Jussi Halla-aho, a more radical right-wing figure, being elected as party leader. Now we have a party in government called Blue Reform that carries many of their policies and a hard-line True Finns in opposition, growing in the polls, pushing even more extreme ideas. Their story isn’t over yet.

But it is important that they showed their true colors when it comes to economic and social policy. In this respect, the True Finns is an example. From now on we can point to the True Finns and say we know what the populist right are really interested in. They don’t care about low-income earners; they have no problem cutting back social security; they have no problem cutting back social services or forcing unions to accept deals that cut wages. Finland provides evidence for all of this. But the split causes further issues. The party in government, Blue Reform, has no future. They have shown they are only interested in power. But the True Finns in opposition, without its more moderate elements, will show us what the true support level in Finland is for an overtly racist party. I think the other parties will reject cooperation with them now, but whether this works remains to be seen.


How has the Left Alliance responded to the populist right and its influence on Finnish politics?


It’s clear some of their vote came from areas where we were once strong, particularly from older workers outside the big cities. This was helped by a media narrative that said we were a party for urban elites. But, importantly, in this year’s municipal elections our best results were outside the big urban areas. The reason for our success was the much closer relationships we’ve built with the unions. The government’s labor-market reforms split the Social Democrats and leftists in the unions, really for the first time since I’ve been active in politics. At the same time it brought together left-wing activists and voters across party lines.

But there have also been difficulties. Our base is divided between more conservative left-wingers in the industrial towns and the countryside, and liberal left-wingers in the big cities. The True Finns have played on this divide. They developed identity politics as a substitute for their lack of policies, building a narrative where they represent the regular people. This cultural battle sets up a contest which benefits the True Finns and also the Greens by pitting older rural voters against young liberals in the cities. Meanwhile, the economic policies don’t change.

The more they manage to trap us in this identity-politics frame, the worse it will be for us. The more we manage to frame political struggles through big, unifying issues on the traditional themes of the Left — housing, social security, wages, poverty, public services, education — the more we can overcome the True Finns. We need to politicize material issues.

We also need to build credibility as a force for change. Successful political campaigns in recent years have been able to communicate their outsider status, placing them on the side of the people against the elite. On the Left we often struggle to communicate effectively this way; we position ourselves like it but we end up being perceived similarly to mainstream parties. Unless we can be seen as the ones most likely to bring change to improve people’s lives, it will be difficult for us to build beyond the margins.


One barrier to an outsider status for the Left Alliance is its recent participation in the “six-pack” government with various mainstream parties. How do you reflect on this experience?


Leftist government participation is important to make the Left a viable political alternative. Since we want to overcome the entirety of capitalist society, we need to prove to people that we have the capability to take power and push reforms that move us in the right direction. Our problem is that the last two times the Left Alliance was in government, we have been governing with the Right. This is an absurd situation, quite particular to Finland. It is not beneficial for the Left because the Right determines how far policy can go; we can only make small changes. It also creates a dynamic where we are only in government in times of recession, to be the social conscience of the government when they are cutting back services and so on. This isn’t a way for us to progress.

We did do one thing right in government, which is we had a clear framework. We communicated to people that our key issue was to oppose cuts to social security and that we would leave if this happened. We also said that all budgetary measures had to be measured against income inequality. So any time they did a tax reform, they had to calculate its effect on income inequality. The result was a decrease in inequality during that period. Then, when they attempted to cut social security in a budget, we resigned from the government. If the Left is to govern it is essential to communicate your priorities and red lines to your voters.

But in other ways we didn’t communicate effectively. We got our message wrong about the economy in general. The six-pack government had an austerity policy to cut public spending and taxation by six billion euros. We endorsed this by participating in the government. Then, when we left, we said we were in favor of an expansive fiscal policy when we participated in the next parliamentary election. That’s a contradictory message. In fact, it allowed the Right to win the debate on macroeconomics, making the discussion about debt. In the end, we were labelled irresponsible, the party that wanted to explode the debt. It was a really superficial debate but they won it. Meanwhile there was no discussion about services; no discussion about income inequality; no discussion about taxing the rich and serving the poor. Nothing about specific issues in the lives of everyday people we were supposed to represent.


The prominent left-wing leaders in Europe in recent times — Corbyn, Mélenchon, Iglesias — have mostly been men. What is it like to lead a left-wing party as a woman, particularly in a country where the right-wing is waging a culture war against feminism?


It isn’t easy. I try to talk as little as possible about myself because that’s what they want. They want me to talk about being a young woman. I try to talk about the policy issues. Otherwise, they have you in the frame where you are talking about being young and female all the time when you want to talk about the policy of your party and what you can do for people. I’m not very good at being a populist leader. I’m not sure that style works for a young woman. I already get a lot of “why don’t you smile” messages from people. Why should I smile when I’m criticizing a male leader? To be frank, you will always have a credibility problem. They will say you are not a credible representative of your voters or the people at large. So you have to show them you are by knowing your facts.