Today, 6th of December the Republic of Finland celebrates its 92nd Independence day. The year 2009 has also market the 70th anniversary for the beginning of Winter War. Finland held firm against vastly superior numbers of the Soviet forces, causing them massive losses in their illegal attack against Finland.

Finnish Winter War soldier with a machine gun
CC Attribution: Matti Mattila@Flickr
Some of that fighting spirit still remains and has recently seen itself realized in the middle of this economic crunch - perhaps most notably in the increased effort and more positive attitude towards entrepreneurship and grass root sources of economic well-being for Finland.
Over the past months and weeks I have had many good conversations among friends, professionals and with people that care deeply about the state of this nation and its future. Those conversations have sparked a few radical and highly idealistic ideas I'll open up for discussions and debate here.
The problems
Problems are always a decent starting point. After all if there are no painful symptoms the cure is less likely to get developed. Finland today is experiencing at least these symptoms:
Radical ideas
Idea Number 1
Let's get rid of using "the next elections" as an excuse forever. Here's how we can do it:

Finnish Parliament House.
CC Attribution: Miemo@Flickr
Currently Finland has 200 members in the parliament. They are elected every 4 years for an unlimited number of terms. Changing this naturally would require changing the constitution, but let's ignore that hurdle for now.
200 parliament members can stay. They get elected 100 members at a time every 5 years for a term of 10 years. Nobody can ever get elected for a second term. Ever. No exceptions. The first 100 to go would be selected by their parties (or alternatively: at random) after the constitutional change.
This would create a parliament that has a "junior" group and a "senior" group. The seniors will always head out permanently after their unique and one-time-only term of 10 years. There would be some serious circulation in key posts like Speaker of the parliament, chairmen of different committees etc.
Nobody could ever again use "the next elections are coming" as an excuse, because there would not be re-election, not for them anyways. Also in combination with this unique 10 year term each parliament member would be required to state their objectives and goals in getting things done for each year. This would mean answering: what positive things they want to get done for Finland? What kind of end result they desire to achieve that benefits the nation? Do note that "increasing taxes" is an invalid objective; as it doesn't necessarily lead to anything, and increased taxes can result in less tax-revenue (not more). These would be goals, desired outcomes and true end-objectives, not the means, mechanisms or petty ways of getting there. Strategy, not tactics. Vision, not micro-management.
They would have a scorecard and each year they would be evaluated by an independent party (not answerable to the parliament) on how they did. After the term of 10 years is up the permanently ousted politician would receive a permanent final evaluation on how successfully the objectives were completed in reality: and since this is a unique term, the politician would have a one time chance to get things done, and if that doesn't happen then its going to show on a permanent irrevocable record. Ineffective and useless politicians that get nothing done can currently just "weasel out" the backdoor and there's nothing to really hold them accountable in our society. This would force plenty of things to be transparent and the success of each parliament member would be on permanent public record.
Additionally the scorecards would exists for each political party: the successes and accomplishments of their members would be summed up, evaluated as a group, and published as a permanent public record. This would make the performance and ability to get things done transparent between parties; and I'm sure the most successful ones would increase their fan-base, while those who get nothing done year after year would be weeded out like the useless bladders of hot air that they are - and political groups that can actually contribute to the success of this nation would replace them.

Idea Number 2
Taxes should increase the size of "the pie" for us all. Optimize and maximize the whole; maximum prosperity, maximum well-being, maximum wealth, maximum happiness for us all. Taxes should not crunch and limit the size of "the pie", cut growth, increase complex administration at the price of everything else etc.
So why not instate an all-governing tax law that contains a mechanism that ensures successful taxation?
Here's how we could do it:
Removing any tax would require 50% simple majority in the parliament.
Establishing any new tax would require 2/3 majority.
Every expense, account, cost, etc that is spent by the government to administer, oversee, inspect, analyze, etc any tax would be mandatory to get accounted to every tax in our nation. This would include all imaginable costs: including the costs of the parliament creating a tax, down to the cost of maintaining statistical information related to a tax. All costs would have to be accounted and assigned to all taxes: so we would know at all times exactly how much each of our taxes costs to upkeep and how much tax-revenue it produces.
Creating this report of costs vs tax-revenue per tax would be run every quarter, or alternatively every 6 months. If any tax would be on the red (it costs more to maintain than it produces) for two periods it would automatically get cancelled and nullified forever. The costs associated with it would have to be assigned to burden other taxes; or the officials would need to get rid of them all together.
This way our society would never stubbornly upkeep irrational taxes that produce less than it costs to have them in the first place. Also a public high quality statistic on all taxes made in this manner would open up taxation to more political debate and the bad taxes that clearly don't work would get taken down pretty quick. Exposing the upkeep cost of each tax would also incentivize discovering more efficient ways to keep the system running.
Additional means to chop down bad taxation would include giving the president a strike-option-veto on tax laws. This would mean that the president could approve tax laws only partially. He/she would have the power to overstrike any useless text from the new tax law, and approve only what's left there. If the parliament would not like this, they would always be able to easily cancel the law (with 50% attending majority in a simple vote, on an ordinary day).

Idea Number 3
When something gets created as a law the politicians and officials have a clear objective in mind; "what's this law trying to solve?". When the process rolls onward is there a mechanism that would check in retrospect did the law actually yield the intended result? There isn't. No checks and balances, no followup. Just more laws piling up.
Each law should have an inbuilt set of metrics when it gets created. Surely each time our officials and politicians know for certain why they are creating the law in the first place, right? The objectives should be apparent in each case. Laws are typically there to protect society, citizens, to fix a problem, to accelerate or limit, etc.
Creating a set of metrics for laws should not be all that complicated. Following up on how did the law actually impact those metrics - that's very complicated. However gradually changing the entire system towards this kind of accountability should surface more reliable and realistic objective ways to make this kind of assessments. Perhaps we could indeed check if a law is leading to results it was intended to accomplish.
If a law would successfully reach less than 25% of it's metrics it would get automatically cancelled forever. Written into history as a failed law, and added into the public record of all the politicians who created it - linking the accountability for creating bad laws to the people that decided to pass them anyways. LexKarpela and LexNokia anyone? Who's accountable for those piles of manure?
If a law would fulfill more than 25% of it's metrics, but less than 75% it would automatically go for a second iteration round. The law would re-enter the parliament and it would be obligatory to fine-tune it to be better, and fulfill its set of metrics more successfully.
Also there could be a system that would followup the net effectiveness of laws all the time; and when the world changes (as it so often does, with absolute certainty), the laws that would start to loose their effectiveness would get flagged, become visible, and would get iterated with less resistance to change.
Trust me, Finland does not need laws that don't function as they are intended. Laws that don't produce the desired good outcome for us all. Laws that exists only to complicate, cause problems and slow us all down. There needs to be transparent accountability and scientific validation of the theory that creating laws actually matters and changes things towards the better. We have all the science to do this if we want to, its just a matter of willingness to be accountable and transparent.
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Getting rid of short-sighted politics always waiting for "the next elections". Automatically getting rid of taxes that produce negative results and of laws that don't work as intended would be great. It would open up society to highly develop in its ability to adapt, compete, and cope with the inevitable change. Perhaps even a society that cares more about optimizing the whole, reaching very beneficial goals and ideals - and cares less about the petty politics and things of small importance.
For example: it is far less important that a paper factory worker gets to keep his job stubbornly forever, no matter how much the world has changed around him - and far more important that he is allowed every fair change in society, gets to live a healthy fulfilling life with plenty of opportunities to do something else besides just slack around in a paper factory.
..Perhaps ideas are not quite dead yet. What do you think?
Happy Independence day Finland!
This post was mentioned on Twitter by tanelitikka: Wrote a rather huge blog entry about our society. In Finland's independence day spirit: http://ping.fm/axx3O
Hi. My name is Taneli Tikka. This is where I preach what I practice. I'm a
serial entrepreneur and a startup activist of sorts. People usually know me
from my past and present consumer Internet service projects: IRC-Galleria,
Dopplr, Muxlim, StarDoll, RunToShop, Vakuutuskone.com, and a bunch of other stuff. My
"proper" bio is behind this link. Glad to see you here, thanks for browsing
around.
Comments
Let's start with the attitude of the politicians
Sun, 2009-12-06 18:12 — Antti Hannula (not verified)New and fresh ideas. May face some obstacles, however, in real life :-)
There is one concrete thing I would like to have changed right away. I was three weeks ago attending an event which was arranged by a serial entrepreneur Marko Parkkinen and one of the big things was that minister Mauri Pekkarinen was supposed to come there to get feedback from the real entrepreneurs (for the problems of growth entrepreneurs) . For our disappointment he cancelled it "for an acute reason appearing just few hours before the event". He did send an assistant instead. Difficult to say what was the reason but for the entrepreneurs it was partially felt as being not important.
This particular event was just a little thing, but all big things consist of many little things. So let's start by making sure that importance of these issues related to entrepreneurs are prioritized high enough by those who hold the power. Or let's change those who hold the power.
Tax
Sun, 2009-12-06 19:14 — Jon Martin (not verified)In general I like the suggestions. The taxation issue is quite complex though. In deciding whether a tax produces more revenue than it costs you need to factor in the degree to which the tax disincentivises work. That's really hard.
Finland takes about 44% of GDP in tax, which is less than Sweden (50%) but more than the UK (39%) and US (25%). You are correct that at some point the disincentivising effects of taxation reduce revenues but it's not clear where that line is. If you start cancelling taxes on the assumption it will not negatively affect revenues - but you get it wrong - you create a deficit. Finland's deficit at the moment is probably bad enough.
I have no issue with the general logic I'm just saying that it's a genuinely difficult issue with no easy solution. I have my own ideas but they're even more radical than yours.
Incentives
Sun, 2009-12-06 20:41 — mjt (not verified)So next up is to vote in a group of people who would actually make these, or these kinds of, changes, because none of the current, powerful parties would deduce their power willingly.
That's preferrable over a civil-war-type revolution :P
Great ideas, and I'll
Sun, 2009-12-06 21:57 — Anonymous (not verified)Great ideas, and I'll definitely agree with them. Unfortunately the implementation would require less apathetic people than current Finns.
Baby boomers have made sure that any young Finn wanting to succeed, even moderately by today's standards, is unable to do so. Housing costs are ridiculously high, and buying a piece-of-shit family apartment/house for 0.5M euros with insane leverage does not sound appealing. Food and cars aren't exactly free either.
So, either you're born to wealth and prosperity, or you grind like hell - risking your health, marriage/relationship and friendships - in order to gain a piece of the "Finnish dream" (which by definition sucks donkey dick).
The sad truth is that this is not the same nation our grandfathers fought for. That was back in the day, when housing was still affordable to the common man. Maybe you didn't have a SUV with chrome spinners, but you still had a change to raise a family, and maybe by living modestly you could even save something for the rainy day.
A revolution would require guns, and current politicians have probably realized this since they're doing everything possible to ban them.
In the mean time, I'm looking for a way out of here. 6-7 day work weeks in a white collar sweatshop, with living standards at home below 1950's level isn't something I see worth dying for. Kinda ironic, since I should consider myself to be privileged for being able to buy a small apartment with huge leverage and having a stable white collar job.
On a less serious note, we need a president who can get us back on track:
http://www.walken2008.com/
Comments so far
Sun, 2009-12-06 23:00 – taneliThank you for the comments so far. Good stuff.
Antti: certainly agree that the attitude towards entrepreneurship (and all things that hugely benefit society) should change. If it doesn't, what's the alternative then? Are going for broke and simultaneously maximizing the amount of suck in our lives?
Jon: Taxation is a really complex issue as you describe there. There are multiple levels here: if we were to count only the direct tax-revenue and direct costs then that would make a bit easier. If we also count what you suggest: also the accumulative macroeconomical effectiveness of taxes; well up to a degree that can also be done. That's what the whole science of econometrics is for, for example. Some of that could be done, and I'm sure the science would develop if we would place more emphasis on it and we would start creating those metrics that would have to measure it. Today in Finland nobody does statistics that ask private individuals and companies questions like "Anonymously, how much wealth you moved out of the country because of taxation?", or "who much did you company decide to invest in some other country besides Finland, due to too heavy taxes?".. if we would have a reliable way of asking and finding out these kinds of things getting the job done would be easier. France for example has erected an entirely crazy tax on capital itself - the tax states that if you have any capital at all, it gets taxed annually, despite what you do with it. Since then an estimated 1000 billion EUR of wealth has escaped France to other nations...
Mjt: sure. We are approaching a point where that NEEDS to get done, it's not just "nice to have" but starting to be must have.
Anonymous: Thanks for the comment, you are spot on in your rant. Housing is one of the most ridiculously overpriced and inflated issues in our society. Personally I have huge trouble understanding why people are so brainless as to buy roughly 50-40% overpriced homes with massive leverage that costs them no less than the rest of their lives. You have it right there...
let's do some ass kickin'
Sun, 2009-12-06 23:23 — Pekka Front (not verified)The points made were all very true and to me as a cost vs profit kinda guy the ideas sound great.
The only real thing to address is the problem with non profit work, volunteering and bootstrapping that has made this country great in the years after the war. The spirit that this country was built on is something that the parliment and law makers can't affect.
We as individuals, our values and our ethics as finns are the things that should make this country great. And here is where I thing the members of parliment have srewed up the most. The actions of individuals and parties have shown a total corruption of etchics and ideals in the individuals that run and govern our nation.
Our nation should be run like a start-up. With visions of global success, hard work with a results only working enviorment and being ready to eat tuna-noodle meals for months, share offices to cut rent and to share openly to learn more from others.
Boot-strap Finland, I say!
Never knew you were this optimistic... :-)
Mon, 2009-12-07 14:54 — Lasse R (not verified)Good ideas, Tane, but while I agree with your targets unfortunately I have a little more cynical understanding on the applicability of this, mainly based on two facts. 1) Half of any country's population will always be more stupid than the average person. 2) Politics is by definition about taking care of common topics; and it is not mentioned where this should take place.
In 1) i put the statement on purpose in a B/W way, but it just means that there will always be a part (can be > or < than 50%) of the nation, which will not understand what is best for all of us. The result is that even in best case, 50% of the voters who think that the parliament is making decisions sillier than they could make are right. That's just the price of democracy, the other 50% are a part of us as well. In fact, a part of that half is probably not interested in growing the cake at all, since they see that politics is all about distributing wealth that is unfairly collected by capital owners, not about creating some more of it for us all (since they have their whole life been told that the entrepreneurs and bankers do whatever to avoid taxes. Does this sound familiar? I am not taking sides here, just clarifying the thinking of the other side). Thus I cannot trust that they would somehow miraculously start to monitor KPI's instead of the subsidies they get from state. And for sure the parties representing this side of the nation would not approve laws that make it easier to decrease taxes.
Combibe this with 2), which basically means that if you remove the politicians' incentives to optimise based on parliamentary cycles, you just take the problem to somewhere else - the interest groups will still need to try to get their view through. The fight about wealth distribution between political parties would then just happen when setting the KPIs, not in the public discussion on the Arkadianmäki. Most of the (high level) civil servants are also agents of some political party. I feel that the more public way would be better than the less public one.
Additionally: in any party, there is an elite of a handful of people, who control what the party does. In practice it is not needed that these people would be in the parliament themselves (case Cronberb). Hence the fact that there would be a one season limit in the parliament would not change the fact that all decisions are still done by parties. We would just have puppets in TV instead of the real decision makers.
But, like I said, I liked your ideas, please do go on developing them. Definitely our overall tax on entrepreneurship (whether corporate level or small scale - we do not want to create a tax trap there either) is high, as is income tax once you start to earn something. Definitely there could be something in changing only half of the representatives at a time, and for sure the ROI of any law would need to be looked into further (though the wealth produced by a law is a very unclear statement - how do you eg measure the safety brought by traffic police or the benefit of unpolluted waters). Maybe at least in economic area these would be good.
I think the seed to the solutions of some of these questions is already in your text. We should somehow get the system to optimize the whole pie, not to concentrate on sharing it. When I mentioned that 50% will always be below the average, I did not mean that the average and the whole bell curve couldn't be moved. I don't think that can be accomplished through rules about law making - it needs to be built on general understanding of the public that this is how we all get most out of it. It for sure is the most difficult way, but others would limit the democracy and I wouldn't like to go that way. But everyone in Finland should wake up and see that we are currently heading towards a tree and will hit it hard soon if nothing is done.
On tax-KPIs and Bell Curves
Mon, 2009-12-07 17:32 – taneliLasse: Great comment!
Fully agreed that it's certainly not easy to get some real tangible change, due to many things- not least to those that you outline there.
One interesting solution to the "hidden politics" -dilemma would be to utilize the Internet as a tool for transparency: let's make all KPI-setting sessions, negotiations etc public. Video them all, broadcast them all. Make them watchable later on demand. All talks are conducted publicly, and all decisions are reached publicly with all arguments on display. Would be interesting for sure =) - and really not all that far from open parliament sessions nowdays, or the US version of broadcasting just about everything on CSPAN.
Moving the bell curve of "average" and growing the whole pie would be great to get in motion. As you say: Finland is on the brink of seriously losing its global competitiveness, perhaps in such a severe way that we won't be able to recover even to this standard of living ever again - let alone grow above this. There's an ongoing crisis, and the tragic part is that only some of us see it and recognize it for what it is.
Some weeks ago I was attending one closed-doors privileged gathering of CEOs, ministers and high ranking officials. One of our former prime ministers stated there that the crisis is apparent, Finland is on the verge of becoming a globally incompetent nation and losing the race to so many others, especially Asian nations like South Korea etc. He heavily stressed that it is the obligation of the whole group & each individual to raise the awareness and sense of urgency about this crisis in all camps and groups - that way hopefully we can get something done in time, before its all too late.
The message still isn't reaching, and we, as a nation, continue steadily towards a very nasty hangover - one where we have to wake up to the reality of having become a stagnated nation that is no longer competitive nor sustainable with the same old means.
The whole principle of economic growth, interest rates, profit, appreciation of value, etc are based on new economic activity and innovation entering the area, and having a genuine chance to succeed in the marketplace. Now it almost looks like Finland doesn't want to encourage this: as if we had decided that being happy with what's currently there would be enough to sustain us 'till kingdom come.
Doesn't this sound like an old man who has decided that he has lived a full and happy life and now wants to die in peace?
There needs to be change. And the longer we wait, the bigger changes are required (and more radical) to avoid our upcoming massive hangover.
Entrepreneur Ideas
Wed, 2009-12-30 09:22 — Alena (not verified)I recently came across your blog and have been reading along. I thought I would leave my first comment. I don't know what to say except that I have enjoyed reading. Nice blog. I will keep visiting this blog very often.
Alena
http://smallbusinessgrant.info
For Tane
Fri, 2010-01-01 07:47 — WalorinJarkko (not verified)You're doing a good job. Like me, I'm just living a day by day living.. working in a factory. Pretty stubborn guy but that should be normal for everyone who accually do something :). Anyways.. I wanted to tell you guys.. if you ever _know_ taneli.. there is a great opportunity.. :)
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