World and Canadian News

In the World

Finland's basic income trial falls flat

By Laurence Peter/BBC News/April 23, 2018

The Finnish government has decided not to expand a limited trial in paying people a basic income, which has drawn much international interest.

Currently 2,000 unemployed Finns are receiving a flat monthly payment of €560 (£490; $685) as basic income.

"The eagerness of the government is evaporating. They rejected extra funding [for it]," said Olli Kangas, one of the experiment's designers.

Some see basic income as a way to get unemployed people into temporary jobs.

The argument is that, if paid universally, basic income would provide a guaranteed safety net. That would help to address insecurities associated with the "gig" economy, where workers do not have staff contracts.

Supporters say basic income would boost mobility in the labour market as people would still have an income between jobs.

Finland's two-year pilot scheme started in January 2017, making it the first European country to test an unconditional basic income. The 2,000 participants - all unemployed - were chosen randomly.

But it will not be extended after this year, as the government is now examining other schemes for reforming the Finnish social security system.

"I'm a little disappointed that the government decided not to expand it," said Prof Kangas, a researcher at the Social Insurance Institution (Kela), a Finnish government agency.

Speaking to the BBC from Turku, he said the government had turned down Kela's request for €40-70m extra to fund basic income for a group of employed Finns, instead of limiting the experiment to 2,000 unemployed people.

Another Kela researcher, Miska Simanainen, said "reforming the social security system is on the political agenda, but the politicians are also discussing many other models of social security, rather than just basic income".

When Finland launched the experiment its unemployment rate was 9.2% - higher than among its Nordic neighbours.

That, and the complexity of the Finnish social benefits system, fuelled the calls for ambitious social security reforms, including the basic income pilot.

The pilot's full results will not be released until late 2019.

OECD finds drawbacks

In February this year the influential OECD think tank said a universal credit system, like that being introduced in the UK, would work better than a basic income in Finland. Universal credit replaces several benefit payments with a single monthly sum.

The study by the Organisation for Economic Co-operation and Development said income tax would have to increase by nearly 30% to fund a basic income. It also argued that basic income would increase income inequality and raise Finland's poverty rate from 11.4% to 14.1%.

In contrast, the OECD said, universal credit would cut the poverty rate to 9.7%, as well as reduce complexity in the benefits system.

Another reform option being considered by Finnish politicians is a negative income tax, Prof Kangas said.

Under that scheme, people whose income fell below a certain threshold would be exempt from income tax and would actually receive payments from the tax office.

The challenge is to find a cost-effective system that incentivises people to work, but that does not add to income inequality, Tuulia Hakola-Uusitalo of the Finnish Finance Ministry told the BBC.

What do others say about basic income?

Some powerful billionaire entrepreneurs are keen on the idea of universal basic income, recognizing that job insecurity is inescapable in an age of increasing automation.

Among them are Tesla and Space X CEO Elon Musk, Facebook's Mark Zuckerberg and Virgin Group boss Richard Branson.

US venture capitalist Sam Altman, who runs start-up funder Y Combinator, is organising a basic income experiment.

Y Combinator will select 3,000 individuals in two US states and randomly assign 1,000 of them to receive $1,000 per month for three to five years. Their use of the unconditional payments will be closely monitored, and their spending compared with those who do not get the basic income.

In 2016, Swiss voters overwhelmingly rejected a proposal to introduce a guaranteed basic income for all.

Supporters of the proposal had suggested a monthly income of 2,500 Swiss francs (£1,834; $2,558) for adults and also 625 Swiss francs for each child.

And in Canada

Yes, anti-pipeline Vancouver really is North America’s largest exporter of coal
A city dead set against expanding petroleum exports is decidedly less irked about another type of fossil fuel

By Tristin Hopper/National Post/Apr. 12, 2018

Lately, it’s one of the few things that oil boosters and environmental activists can agree upon: Calling Vancouver a hypocrite for opposing carbon emissions while also being the continent’s largest coal port.

And both camps are correct. According to the data, Canada’s mecca of anti-pipeline sentiment does indeed rank as the largest single exporter of coal in North America.

Vancouver’s various coal facilities exported 36.8 million tonnes of coal in 2017, according to the Vancouver Fraser Port Authority.

This places the B.C. city well above Norfolk, Virginia, the busiest coal port in the United States. Despite a massive spike in U.S. coal exports for 2017, only 31.5 million tonnes of coal moved out of Norfolk last year.

Vancouver’s coal exports also dwarf the total coal production for the entire country of Mexico. According to data gathered by the U.S. Congressional Research Service, Mexican mines have produced no more than 16 million tonnes of coal per year since 2006.

Much of Vancouver’s coal is handled by a single facility that ranks as the largest of its kind on the continent.

Westshore Terminals loaded 29 million tonnes of coal in 2017, nearly triple the combined coal exports of the entire U.S. West Coast.

It’s also right next to the Tsawwassen ferry terminal, making it a familiar sight to any passenger aboard a ferry arriving from Vancouver Island. Currently, Westshore Terminals is in the midst of a $275 million upgrade to “replace aging equipment and modernize our office and shop complex,” according to the company.

B.C. mines provide much of the coal flowing through Metro Vancouver. Even as coal production enters a prolonged decline around much of the world, it has been positively thriving west of the Rocky Mountains.

“Coal production is a mainstay of the province’s economy, generating billions of dollars in annual revenue and supporting thousands of well-paid jobs,” reads the website for B.C.’s Ministry of Energy, Mines and Petroleum Resources.

Coal is the province’s number one export commodity, with $3.32 billion of coal mined in 2016. Much of this is metallurgical coal, which is exported to Asia for the making of steel.

In recent years, however, Vancouver’s coal ports have also accommodated a massive increase in exports of thermal coal, which is used for the production of electricity.

In 2008, only 4.4 million tonnes of Vancouver’s coal exports could be called non-metallurgical. By 2017, this had more than doubled to 11.3 million tonnes.

Controversially, almost all of this thermal coal is coming from the United States. As lawmakers in Washington and Oregon have begun shutting down their own coal ports due to environmental concerns, thermal coal producers in Wyoming and Montana have simply diverted their product through Canada.

In August, then-premier Christy Clark called for a ban on Vancouver exports of U.S. thermal coal in retaliation for U.S. tariffs on Canadian softwood lumber.

“They are no longer good trading partners with Canada. So that means we’re free to ban filthy thermal coal from B.C. ports, and I hope the federal government will support us in doing that,” she said at the time.

In the main, however, Metro Vancouver has benefited handsomely from the presence of the coal industry, according to numbers compiled by the B.C.-based Coal Alliance. Between 2012 to 2017, coal-related companies spent $2.29 billion in Metro Vancouver, including $470 million in the City of Vancouver proper.

One the most visible contributions of the coal sector has been as a key sponsor of the Vancouver Aquarium. In 2012 Teck Resources donated $12.5 million to the attraction, the aquarium’s largest-ever single donation.

It’s difficult to precisely calculate the lifecycle carbon footprint of Vancouver’s coal exports, given that the city’s ports handle a variety of coal types, each with their own specific emissions profile.

But according to emissions formulas used by the Sierra Club, Vancouver’s 2017 coal exports will produce 99.8 million tonnes of CO2 over their lifetime.

For context, this is significantly higher than B.C.’s entire carbon footprint. In 2014, B.C. estimated that it produced 64.5 million tonnes of CO2 equivalent.

It also means that B.C.’s existing coal exports are roughly as bad for the climate as anything scheduled to come out of the Trans Mountain expansion.

The completed Trans Mountain expansion would move 215 million extra barrels of diluted bitumen per year. Depending on the kind of Alberta bitumen the pipeline will be moving at any one time, this means that total product shipped through the expansion will emit between 129 million and 158 million tonnes of carbon dioxide over its lifecycle.