Women, Citizenship, and the End of Poverty by Hilkka Pietila

This remark annoyed me immensely. Intuitively I felt that it was not true, but I did not have a good answer. So I began to study the history of emerging wealth in Finland and the other Nordic countries. These countries are located far to the North in a harsh climate where nature does not permit more than one harvest a year. Furthermore, the Nordic countries never had colonies, from which most of the world's other rich countries have extracted wealth for centuries. Yet, according to the United Nations, the Nordics are among the world's wealthiest and most equal and democratic countries.

photo by Kerttu Barnett

The common belief is that a country must first become rich, and then it can provide welfare for its people. The history of the Nordic societies tells a different story; here, wealth has been built by building welfare for people.

This success was built on a notion of welfare entirely different from welfare as understood in the United States. In the US “being on welfare” is humiliating, and welfare benefits often depend on the recipient's relationship to something or someone else. What is radically different about the Finnish system is that here welfare benefits and services are rights that everyone living permanently in the country is individually entitled to. Finnish people have economic, social, and political citizenship.

For women, it has proved particularly important that social benefits and services belong to everyone without distinction as to sex, marital status, employment, race, or nationality. Thus Finnish women are entitled to enjoy their social entitlements whether or not they are married or employed.

This social welfare system is based on a long heritage of democracy, social justice, and equality, and a sense of collective responsibility for the well-being of the people. The workers' movement has been strong in the Nordic countries since the beginning of the 20th century. But ever since 1906, when Finland became the first country in the world to grant women the vote and full political rights, the most important force in building the welfare system has been Finnish women.

In 1899, when the majority of Finns were living in poverty, a group of women established the Martha Organization to advance the country's economic and cultural life. The strategy was to mobilize educated women—often teachers and home economists—who volunteered to visit women in their rural homes and teach them about childcare, cooking, housekeeping, handicrafts, raising animals, growing vegetables and fruits, using berries, mushrooms, and wildlife from the forests, and fish from the thousands of lakes.

The movement helped women earn their own income; otherwise, the husband often held the family finances totally in his hands. As the skills, knowledge, and income of rural women grew, their status, self-confidence, and respect rose.

This “Martha method” improved the health and well-being of children and families, and helped to build the early foundations for the welfare society. The results showed, for instance, in rapidly declining birth rates and infant mortality and rapidly rising life expectancy.

But the change wasn't only social and economic. Before and after the constitutional reform in 1906, the Martha movement played a vital role in training women to use their political rights. The result was that in Finland's first modern parliamentary elections in 1907, 19 women were elected to the 200-member parliament. Many of these women supported efforts to improve women's social conditions.

The movement persists today. Membership peaked in the 1960s with almost 100,000 women as active members, falling to 55,000 in 1997. In recent decades the Marthas have also shared their skills and experiences with their sisters in Kenya, Zambia, Zimbabwe, and most recently in Burkina Faso.

The social progress in Finland in the early 1900s proves that empowering women and strengthening their competence to help themselves is the way to eradicate poverty. It is social policy from below, building self-reliant and sustainable well-being for the whole nation.

This progress paved the way for the creation of the welfare system after World War II. Finland was not a wealthy country in the 1940s and 1950s. We had just survived two devastating wars from 1939–1944, first fighting against the Soviet Union and then fighting to drive the Germans from our country. We lost about 15 percent of our territory, and the whole of northern Finland was burned down by the Germans.

Almost half a million people moved from the lost territory and were resettled in the rest of the country (about 13 percent of the 3.6 million population). Enormous reconstruction of the country was necessary, and we were obliged to pay heavy war indemnities to the Soviet Union. But because Finland wished to stay out of the Cold War, we refused offers of aid under the Marshall Plan.

Despite its poverty, Finland began to create one of the world's most generous social welfare systems. The aim was to build the economy while eradicating poverty. The aims supported each other: the growing well-being of people provided a healthy and well-trained labor force, and the economic growth was redistributed to people as social benefits.

As Finland's economy grew, the welfare system grew, so that today, everyone is entitled to a minimum salary or unemployment benefit, child-support allowances for all children, paid parental leave for 44 weeks, pensions, free education up to university level, free school meals to all pupils in public comprehensive schools, highly subsidized public health services, day care services for all children under school age, and subsidized care for the aged.

The government also provides good public transport, free universities in 10 cities around the country, high-quality public primary and secondary schools and vocational training, a comprehensive adult education system, excellent public libraries all over the country, and highly subsidised theatre, music, and arts in all cities.The welfare system here is a lifelong social insurance, a guarantee that whatever may happen, children will not lose access to education, people will not be left at the mercy of relatives or charity organizations, no one will be abandoned in case of illnesses, accidents, unemployment, or bankruptcy, and everyone will have old-age income and care no matter what. Open poverty and misery are almost nonexistent.

The public welfare services create a huge public sector that employs hundreds of thousands of people in caring for, educating, serving, and transporting other people. People who work in the social sector have meaningful jobs and spend their incomes on housing, clothing, food, services, and so on. This money keeps rotating, creating other jobs, demand, and consumption, and thus supports the economy.

These benefits go to all, yet in practice they—along with easy access to reproductive health services—are most important for women, who are able to enjoy their social, economic, and political rights equally in all walks of life. The welfare system has the effect of “making visible the female world,” says researcher Anneli Anttonen.

Finland has financed its welfare system mainly through highly progressive taxation on salaries and wages. Taxes can be as high as 50–60 percent of salaries and wages for those who earn the most. In addition, Finland put in place a strong financial regulatory system. The government has regulated transactions to adjust the terms of international trade and provide legal protection to Finnish industry and agriculture.

As the result of decades of systematic policies and work for welfare and equality, Finland is one of the wealthiest countries in the world—and, at the same time, has a highly equal distribution of wealth. Income disparities have in the last 25 years declined not only between people but also between regions. Finland is the most equal society in the world, with regard to both class and gender, according to UN statistics.

I am a product of Finnish welfare society. I was born in an ordinary country village, and without the free school system and other social services I wouldn't have been able to attend university far away from home. I received a low-interest loan for living expenses during my student years and also to buy my first apartment. Using good public transportation services all my life, I have avoided the need to own a car. And now that I am aging, I enjoy the benefits of public health services. The welfare society has allowed me to choose my work and way of life freely.

Encountering globalization
Despite its successes, this welfare and service society is now under threat. At the beginning of 1995, Finland became a member of the European Union. In order to qualify for membership, the government introduced austerity measures. In the late 1980s capital transactions were liberalized. Private companies gained new leverage, and Finland increasingly had to open its economy to international competition. The recession and the requirements of the European Economic and Monetary Union have served as excuses for further austerity measures and gradual dismantling of the welfare state.

Power has been internationally centralized within the EU and increasingly is transferred to undemocratic commercial structures. The power balance between corporate employers and trade unions has also shifted. The corporations derive strength from their international capital base and expansion of their operations, which make workers more vulnerable to threats that their jobs will leave the country. Trade unions can retain only defensive positions. The earlier arrangements are eroding.

Women especially have seen this shift as a backlash against equality and democratization. The cuts have hit women especially hard, both because women and children especially use the social services and because many of the public service jobs are held by women. Austerity measures continue, even though the economy has until lately been growing at record rates. It would seem that Finland has become so rich that it can no longer afford the welfare society, even though we could afford to build it when we were poor.

However, the welfare system is deeply rooted in Finnish society, and the people strongly defend it. Strong support for retaining and even improving the welfare society shows up regularly in public opinion polls, election campaigns, and protests against austerity measures.

When plans were announced to close branches of the public library in some Helsinki suburbs, for example, a strong local uprising succeeded in keeping the libraries open. In many places, people have been fighting for years to retain their schools, when the government has wanted to close the small schools and collect all children into massive centralized institutions.

After decades of developing a well-functioning welfare society, there is a deeply rooted sense in Finland that communities can create well-being for their members. And since we know this is possible, we believe that people have a right to it. It may be that this insight will help us fight off the neoliberal agenda and push the welfare society to a more mature stage instead of dismantling it.

Hilkka Pietilä is a scholar associated with the University of Helsinki. She has published widely on development issues, peace, and international cooperation. She is the author, with Jeanne Vickers, of Making Women Matter: The Role of the United Nations, Zed Books, 1996.