PRESIDENT OF THE REPUBLIC OF FINLAND

AT THE OULU YMCA CENTENARY CELEBRATIONS;

March 24, 1996

THE SOCIETY OF CITIZENS AS AN OPPORTUNITY

As I was drafting this speech, the proofs of a history written to mark the centenary of the "Y" were made available to me. The document is an excellent illustration of the background and importance of this "Christian youngsters' association".

Recent years have brought a constantly growing recognition that as the State's role in the provision of welfare services dwindles and structural change in the economy proceeds, the importance of initiative and voluntary effort by people, by the entire society of citizens, is increasing commensurately.

I shall examine somewhat more closely the possibilities that initiative on the part of citizens offers with respect to developing welfare services and even to some degree overcoming the unemployment that afflicts our country. This "Y" function is an ideal place to present such an assessment.

The YMCA gained a foothold in Finland at a time when new cooperation was needed as our country moved towards a period of major transition. To use present-day language, the YMCA became one important factor of a budding society of citizens.

The YMCA movement's arrival in Finland as the last century was drawing to a close coincided with one of the great transformations of our society. Alongside the political parties and trade unions that were taking shape, apolitical, but nonetheless very influential associations and organisations were also being created by people acting on their own initiative. One such organisation was the YMCA, proclaiming its general Christian identity.

"That they might all be one." This text from chapter 17 of the Gospel according to John heads the introduction to the Oulu YMCA 100th anniversary history. For me it is a permanent ethical guideline: strengthening a sense of collective responsibility and increasing cooperation throughout the world.

To begin with, a few words about development phenomena that are causing me great concern. A considerable number of the developed democracies, of the OECD countries, are today undergoing a historical upheaval comparable to that initiated by the industrial and social revolution a couple of hundred years ago.

In these countries, the severe unemployment and economic differentiation experienced in recent times are symptoms of that development. Many observers are rightly warning these countries that an era of social instability threatens unless measures to correct the development succeed.

A citizen finds it difficult to understand when a company's chief executive is given a golden handshake as part of a rationalisation or merger agreement, whereas the workers get the cold shoulder and end up on the dole. One of Finland's strengths has been the ability of the parties in the labour market to reach agreement with each other. There will continue to be a solid foundation for agreement, provided all benefit from it. That is the direction in which to proceed.

Voices, fortunately not many, calling for income differences to be increased so as to enable us to overcome unemployment have begun to be heard also in Finland. Our position in the internationaleconomy is based in all essential respects on our know-how and capacity for renewal. The success of the University of Oulu is a good example of this. The level of our school system and universities must be further raised. We need economic incentives, so we must accept the principle that education and skill should bring better rewards. Nonetheless, that must not feed perceptions that widening wage differences would in itself be a sensible goal of social policy.

I recently studied a report on young people in Helsinki suburbs. It revealed, among many other things, that the greatest cause of anxiety among young people is the fear of unemployment. That fear is certainly warranted. And, to a growing degree, the fear of losing one's job also oppresses those with regular work.

There is a danger that social cleavage will further deepen. The weak economic situation in EU member countries could be of longer duration. Assessing problems is a tough challenge for all Europeans. What is involved in tackling unemployment is a challenge to the future of all of the developed OECD countries. Either they will be able to solve this problem in the next few years or we shall have to brace ourselves for major instability.

It must be admitted that we currently lack effective means of managing the integrated global economy and to some extent the great social transformation resulting from its operation. A transition to an information economy based on new technology is the fundamental feature of this transformation.

We are transferring jobs to robots, computers and countries where labour is cheaper. It is estimated that there are more than a billion people in the world prepared to work for two dollars, less than ten markkas, a day.

I am concerned about a certain atmosphere of helplessness that hangs over our country. Yet we have survived wars and great upheavals. This challenge must also be coped with.

Answers and constructive solutions must be sought open-mindedly. I shall now turn to a closer examination of the society of citizens from the perspective of employment and safeguarding prosperity.

I have been calling for a spirit of voluntary effort, a dynamisation of civic action and for people to cooperate to improve the conditions of their lives: all of that means a self-renewing society of citizens. I have consciously wanted to avoid a one-sided debate on the welfare state, its becoming bloated or dismantling it. In my view, framing the question in that way will not ultimately prove fruitful.

The society of citizens is associated with traditional civic virtues: voluntary and active participation on a basis of equality in the work of many organisations like the "Y", exercising one's right to vote in elections, customarily reading newspapers, and so on.

Community capital is the phrase adopted in recent times to describe the yield and significance of civic activities of this kind. What is largely involved is the not-for-profit economic, cultural and social activities of associations, foundations, organisations and civic movements.

Respected studies indicate that a falling off in the rate at which this community capital is formed has negative ripple effects also on the formation of the real financial capital that generates profits. We cannot afford that in Finland now. Especially in conditions of high unemployment, there is the danger that attention will be focused exclusively on the performance capability of the profit-oriented market economy, and not on the possibilities that community-centred civic activity offers.

If the development of the community capital described here is forgotten, the innovations that ultimately create new content and jobs throughout society will also fail to emerge in sufficient numbers.

An economically bifurcated social system inevitably neglects the society of citizens. I am convinced that a properly-functioning society of citizens provides a basis that facilitates the focusing of policy on matters that really require public inputs.

The underlying assumption here is that the State, for a variety of reasons, is no longer capable of looking after all of citizens affairs to the same degree as earlier. Thus more and more responsibility is being transferred to citizens, and to the associations, companies and organisations that they have established.

It is noteworthy that the states which have enjoyed the greatest economic success, such as Germany, Switzerland, Japan and the United States, are all countries with a developed society of citizens. Economic development in those countries has likewise depended largely on team work. The fact that different people have been able to engage in cooperation without prejudice has played an important role in that development.

Attention has now turned to the economic opportunities associated with the development of the society of citizens. It has been calculated that in the United States today as many as 11 per cent of jobs are in the not-for-profit sector, i.e. in the society of citizens. It has also been forecast that a considerable number of new jobs will be created in this sector over the next few years.

Why could it not be the same way in Finland? If robots are freeing people from production, could not a society of increasing free time become a new kind of society of reciprocity and service? We have filled free time with unemployment. There are other alternatives.

There are many civic organisations in Finland with lively programmes of local activities. Those organisations can take a wholly new kind of responsibility for citizens' well-being and their immediate environment.

Stimulating, goal-focused action effectively prevents marginalisation and activates our fellow-citizens to work, in a balanced manner and on a basis of equality, to develop our society. Unemployed people in various parts of our country have demonstrated initiative by starting projects that can best be described as a new coming of the cooperative movement. I wish them success in those endeavours.

An employment project launched by several sports organisations here in Oulu is an excellent example of the kinds of schemes within which those new challenges have been responded to.

Sports and other leisure pursuits engaged in by young people need leaders, coaches and other persons to run things. Among the unemployed are many capable and well-trained people, who could be given employment in these tasks. Society's investment in sports facilities and other amenities intended for public use would also be employed more gainfully. Relative to the costs of unemployment, the expenditure that a project of this kind would require is very low. I am sure that the final outcome, examined from the broader social perspective, would be very positive.

I have presented one good example. There is no doubt in my mind that this is the road to something very encouraging and a very major opportunity for development.

What I am actually asking is whether what we are discussing is a new and underrated solution model for our employment problem. According to very tentative estimates made by the Statistical Centre, not-for-profit bodies account for between 2 and 2,5 per cent of our gross domestic product. They employ more than 62,000 people, i.e. slightly in excess of 3 per cent of the working population. I should like to emphasise that these figures tend more to be over-cautious than exaggerated.

Voluntary work of various kinds is being done on a growing scale in Finland. The most recent time-use survey - which was conducted in the late 1980s and before the onset of the recession - showed that well over 400,000 people were contributing their time, in varying amounts, to this work. Could not the development of this work become an employment alternative to be taken seriously in Finland? What I have in mind here is above all new kinds of employment relationships, which could be applied more flexibly in these projects of the society of citizens.

Part-time jobs could provide opportunities for work and income also within a broader framework, thereby supplementing the incomes of persons who would otherwise be unemployed and reducing the costs that unemployment causes society. There is a need to create the legislative framework that this requires.

When the society of citizens is stimulated and invigorates itself, it becomes an opportunity with the potential to tackle the structural slump on a national level.

Continuing unemployment is a threat. There are two approaches to getting on top of it. One leads to a risk-prone concentration solely and one-sidedly on economic incentives. The other, that of dynamising the society of citizens, may be more awkward, but it is also more effective in safeguarding the equal opportunity of citizens to enjoy their own country's prosperity and prevent division in society. The choice is in the Finns' own hands.