Why Finland is thinking about paying every citizen $850 a month (tax free)

There certainly has been some frustration in recent months over reports claiming that Finland simply does everything better. "Stop the Scandimania: Nordic nations aren't the utopias they're made out to be," British journalist Michael Booth, for instance, wrote earlier this year in The Washington Post.

But some Finnish initiatives are worth noting anyway: For instance, Finland is considering a plan to give every citizen about $850 per month -- no matter whether the money goes to someone who is unemployed, retired or has a job. The benefit would not be taxed and would replace all benefits currently paid by the country's social security system.

At first glimpse, the idea appears to be the easiest way to raise unemployment. But the Finnish government wants to achieve the opposite and thinks it has the right idea. Unemployment already is at a record high in the country -- partly because those affected faced a harsh trade-off in the past: Unemployed people who accept a temporary job often receive less money, compared to their previous unemployment benefits. Considering an average wage of $3,600 per month, a basic income of $850 does not amount to a lot.

It's a problem Americans are unlikely to encounter in the foreseeable future. But in Finland, about 70 percent of the population favors the idea, which would come close to establishing a national basic income. At this stage, it remains uncertain whether the proposal -- expected to be submitted next year -- will ever become reality. However, leading politicians have embraced the concept. "For me, a basic income means simplifying the social security system," Finnish Prime Minister Juha Sipilä was quoted as saying.

Indeed, Finland has missed out on more economic growth due to rising inequalities than any other developed country in recent years. In a report by the Organization for Economic Co-operation and Development (OECD) examining 21 wealthy countries, Finland was one of the surprising losers.

Although there have been similar demands for a national basic income in Switzerland, most other European countries remain opposed to the idea. Germany, for instance, has taken the opposite approach, which is often credited for the current economic boom in the country.

In his Agenda 2010, former German Chancellor Gerhard Schröder made it harder for unemployed people who were unwilling to accept job offers to receive benefits. After a certain deadline, payments are stopped. In Finland, it seems, politicians facing a similar problem think a different approach could be more successful.

Rick Noack writes about foreign affairs and is based in Europe.