Martin Paasi: Some restless host of the Rahapodi podcast went, back then
in the era of negative interest rates, shouting all the way on YLE that we should
take out 100 billion in loans. Negative interest rate — so really, invest it in something
productive, that is. And that's how I think about it:
let's make Finland a superpower of entrepreneurship, let's make everything possible.
Then again, under the Marin government it would have
just raised the discretionary 20 billion of spending to 80
billion. All right, welcome to the year 2026. With us is Member of Parliament Martin
Paasi. Howdy. Howdy. Well, this took off quickly.
You're not the "Tsädäm" guy anymore. Have you given up on that era?
Sure I am — didn't you just say it yourself? No, no, just on my own show. Of course it's,
you know, a registered trademark — there's something fine about that. It was my third time
on Paasipodi in parliament. There's something fine about going — well, this time
we came in through the tunnels of the Little Parliament annex, so —
don't go telling that now. Oh right, the Russians are listening. The Russians
are listening, or, or maybe Tuomo Pietiläinen is taking
notes on the real influencers, um, to put into Helsingin Sanomat's GDPR register,
filing criminal complaints about us. Yeah, let's actually start right there. So,
um, I've been following this with interest — how our leading paper, Helsingin
Sanomat, did an investigative-journalism, um, exposé, where they concluded that 600
thousand Finns were investigated — that is, among the signatories of citizens' initiatives that had made it
through, an awful lot of right-wing ideas were found.
In my view the research method was questionable — essentially digging up
people's political opinions with the consent of the digital surveillance agency's
um, henchmen — but the finding itself is, to me, a fine thing.
Well, it does, it does in a way give a little hope that, that, um, this country isn't
completely fire-red through and through, but, but,
um — but then again it was, all the same, also
just as much a bit of a, like, hit job
of sorts. I was honestly a bit disappointed in Salla. In Salla Vuorikoski. I've
considered her a really, like, critical
journalist, and, like, someone striving for objectivity and all that, and
and, um, and of course, it being her job, she then defended her own work,
when she — her team, which had, um, been looking into
what various well-known people had voted for when it comes to citizens' initiatives —
like "Elokapina, Extinction Rebellion Finland, must be banned", this, um, "political strikes must be
banned" and other such, like, emotionally charged, like,
legislative initiatives. So, well, they did this kind of
study and then skewered individual people who are, like,
somehow in decision-making positions in society and, and who after all quite
as citizens taking part in citizens' initiatives. Not
not, say, as the CEO of some big company, or in any capacity
other than as a citizen — and that's really the whole
tone of the piece: 'well, who else did wrong,' and, and, and
Salla then defended the piece on social media for a couple of days, and, um, I was left
feeling a bit — I don't really want to get into that debate now — I was left
feeling a bit down about it, honestly. Yeah, and then there were
people calling in saying, 'aren't you ashamed, acting like some corporate CEO,
wanting to shrink YLE.' I mean, what a radical opinion is that? I
genuinely do want to cut the, um, 590 million euro
budget of a market-distorting operator handing out free media content — cut it substantially. In my view
that's basically a no-brainer. But then, the way people tried to
fish out some kind of great sin — one figure apparently made a very
priest-like public apology, but, like, hardly anyone else actually caved,
and honestly I'm proud of that — good, good, good on those people, that
good Finns, just like that. And in my view, this
actually revealed that maybe the idea in that left-wing bubble had
been that this would get people condemned, and then people who hold the wrong
opinions would learn to keep quiet, like, at every political level, so that,
you know, if you vote
the wrong way, or, um, back the wrong causes, we'll expose you.
So, quite the decent, 'cultural-
revolution'-style leftist attack, um.
Well, at least nobody's been carted off to Inari yet.
No, not yet, no. But, um, let's go through a bit of your first full year
in parliament. So, on this — my third episode of Paasipodi — you
apparently had Anna Kontula on, so I guess the contrast is a bit different. What's it
like — A, interviewing people like that, not on Rahapodi, and B,
then being colleagues with them over there in parliament?
Well, I'm, I'm, I'm a bit of an odd person in that sense, because I like
um, different opinions — and especially when they're put forward or
defended by people who, as a matter of genuine conviction, disagree.
So, politics aside, and party politics aside — all
these kind of, like, surface-level opinions, those aren't really that
interesting. But then, on the other hand, the kind where people
genuinely, strongly believe something — that, to me, and maybe
even more so if they strongly disagree — that's
— I have a curious nature, and I respect anyone who has
a well-considered opinion at all, whatever that opinion
looks like or however it's shaped. And, and, and
Anna — I know her as the chair of the Committee for the Future,
where I'm also a member myself, and she runs that job very
exemplarily, and firmly, and wisely, and smartly. And, um, I got to
comment on things for her new book too, which
— by the way, it was really done in a very journalistically open way, in that
yeah, and she keeps repeating that it's not — that it's the journalist's
book, that she hasn't, in that sense,
set any boundaries, or encouraged, or steered it in any way whatsoever,
but, um, anyway — it was a good conversation, I'd recommend
giving it a listen. We, we sadly got cut off in the middle again. We
were just getting to the juicier part, like this communist-versus-
market-liberalism divide in the conversation.
Hopefully we'll get back to it, but overall, um,
um, for people who like people, parliament is actually a pretty good
place. Most of the people there are, um, pretty sharp.
Then there are some others — you find people who are, you know, kind of
fanatics, and with them you basically can't
discuss anything at all, because they've already decided you're wrong, and you're, you're
basically the devil's own spawn, and so on. So yeah, you do find maybe about
a couple handfuls of those, and then roughly the same number of people
whose, like, soul in political life has already
burned to ash a long time ago. In other words, who no longer have any kind of their own
vision, or sense of what's better, or how — like, trying to get good things for Finland,
good outcomes for Finns — no, you're just, like, a completely political
opportunist at every turn, in every sentence, and, and if
you can grab one more crumb of political capital,
you don't care one bit if you destroy somebody else's life. So, so, I mean, they're
basically, like, broken inside. Yeah, you do find people like that. It's not really
about that, though. But most of the people are just exactly as I said — decent.
It took me about a year, in a way, to understand — to find in myself — that,
okay, that a lot of people here actually do want to genuinely discuss
things, and there's nothing to be ashamed of about it, that you [unclear]
come to understand other points of view. Yeah, in this book there was also discussion
among other things, about her relationship with Kimmo Kiljunen, who in turn was
chair of the Defence Committee, of all things, I believe — which is, in a way, funny because
personally I always feel like these Kiljunen- and Kontula-type figures — that Finland
is completely missing that 'lustration' process — the vetting used to screen out old-regime sympathizers — that could have gotten people like that
to shift their outlook a bit and pick up a little
cognitive dissonance, because, like, basically everywhere else
people like this were, at best, removed from office and publicly shamed,
I'm not saying I want some kind of pillory, but somehow we missed out on
that period when all the normal Western countries went through a kind of
burst of self-reflection. But then, as such, when it comes to Anna Kontula,
she does, she does reflect on herself pretty — pretty, in my opinion —
objectively, extremely honestly,
about what she is.
So that lustration thing doesn't necessarily apply, in my opinion, or
the need for it doesn't necessarily apply to her. But, but, I mean,
well, it would at least apply to Kimmo Kiljunen. But, but I agree that
overall in Finland it would be good to just
realize and actually do the work of figuring out that
Paavo Lipponen got 3 million euros
in pipeline-consulting fees — and, um, has that actually been talked about much? And
yeah, and then, but I mean, even more so, it's not really
even about, like, Russian influence operations — I've
had, for example, Esko Aho as a guest, who sat on Sberbank's board and
who's basically now switched over to building relationships with China instead —
smart guy. But, um, somehow, like, it just was never grasped, the
sheer, senseless stupidity of Soviet communism, and, in a way,
its bleak inhumanity, and, in every way, its complete lack of
functionality compared with the market economy and capitalism
— somehow that whole thing just never, ever got experienced in Finland. So
we still have people today in the media, on the left, who
genuinely believe in, say, a planned economy.
So it kind of feels like that refreshing cold-water dousing
that happened everywhere else through lustration — that has
completely passed us by, right up to this day. So, well, I mean, if
you think about it — if you follow the public media in Finland, then, then, well, roughly,
on the surface an outsider could be left with the impression
that, that, for Finns it isn't
self-evident that the market economy — the market, the economy — is the very thing that
has improved humanity's well-being the most significantly, and, and
improved it overall, full stop, and all the other systems are some kind of
something else entirely, and especially planned economies and communism and
all the rest — those have left trails of destruction
— and, and it's maybe a bit surprising: you end up having to — and this impression of mine
comes from the fact that I feel like I somehow end up, in a way,
even in my own role, having to defend something that is self-
evident, that's, like, common knowledge basically everywhere else in the world, pretty much
universally known — and I have to say that
that's, like, very worrying. And the problem in my case is that, since
I wasn't interested in politics before this, I don't have that kind of
visibility, like, perspective on what this whole business used to be like before.
So now I've, like, basically stuck my head straight into a wasp's nest, and
it's a bit hard to say whether this — the number of stings coming my way —
is actually normal, since I haven't done this before. But, but, um, yeah, yeah, I would be
um, extremely worried
in Finland about the fact that, that, um,
everyone can have opinions, but not everyone —
not even necessarily half the population — finds it self-
evident what actually creates prosperity and well-being. And
with all its imperfections, it's nonetheless the market economy that does — and
— um — this is, in my opinion, a really strange,
strange trait. This is an image that's just formed. It's not
based on any research or anything. In my opinion, you can
clearly see it — um, we have — well, I had this guy, Markus Holm,
over from Switzerland, and he, by the way, was praising direct democracy. They had
just been voting there on implementing this
inheritance tax, and were against it — and there the threshold would have been 50 million francs,
only above that would it even have started applying. Whereas here in Finland,
the inheritance-tax threshold was just raised from 20 grand to 30 grand.
Even that was too much communism for them, apparently. But then he'd calculated that
our public sector is 159 billion euros, almost 60% of GDP, and private-sector
employees, meanwhile, number just under 2 million — so that works out to 84
thousand euros basically loaded onto the backs, in a sense, of that planned economy of ours, for us,
for private-sector employees, in a way.
And if you compare that to, say, the total wage bill, it's roughly
the same size as all of Finland's earned income, um, including pensions. So,
we have — and somehow the idea that this is totally fine, that there should be
even more of it — whether that's the public sector's wage bill, or
pensions, or social security, or, like, free-of-charge services,
subsidized services, national defense — nobody
even tries, in any way, to put that into perspective — that
in Switzerland that same backpack is half the size of ours. So
now that we have this right-wing government, and you came in via roughly the same
route as, say, the Defence Minister — an old colleague of mine from RPS days, by the way — Elina
Valtonen — and then Ville, well, Foreign Minister, and, um, so, so, 'Minister
of War,' as it were, Trump-style — and then Ville Valkonen also came in
partway through the term. Didn't you come in after Pekka Toveri?
I came in after Toveri — literally following in 'Comrade' Toveri's footsteps there. So you
came in a bit late to the party, so to speak — so you probably missed the opening celebrations,
where the government program was being drafted. So does that affect your — have you
have you caught up with my crowd here yet?
Well, um, it's, like, a bad thing in terms of impact
to come in mid-term, exactly because, um, for many reasons. One is that,
at the start you have very intensive discussions, negotiations,
in practice — and in that process you learn,
you learn what's a difficult issue for each governing party, and
what the arguments are. So you, you basically get a kind of fast-forward
— okay, this is the crowd you're forming a government with, and, um, and here
are the sore spots, and these aren't sore spots, and these are the things they want, and these
work for us, and so on. That's one thing. Then the second
layer is what's actually been decided overall, because since you
were there taking part in making those decisions, and, and creating that
government program, then, then, then you don't necessarily need to read
the government program cover to cover, because — since you were there in those
negotiations, you know what the deal is. Then the third thing is that,
when the government program is being negotiated, and so on, then, in there,
everyone's kind of arranging some positions for themselves, um,
like, from within their own group and so on — committee seats, that sort of
thing. Well, I'm not on a single, like, Finance Committee,
any committee dealing with the economy, as a member — instead I sit on all sorts of
other committees, which are perfectly good committees too, but it's
clear that when I got to sit in as a substitute on the Finance Committee,
it was kind of like, well, okay, now I — now I, like, now I'm
among my own people, or rather in my own subject area. Now there's a lot
I can contribute. But, but since I wasn't there at the start, I didn't get those
seats, and nobody wants to give them up, because they're, like, important,
and a vantage point, and so on. So, um, that's just kind of how it stays, and, and
all this leads to you having to come up with your own ways
of influencing things. So maybe, actually, let's take this one thing about committees —
um, I thought it was a completely absurd event, this so-called 'leaning' — 'Nojailugate.'
So, um, tell us what happened here with the leaning incident involving Krista Kiuru and your committee.
I, I remember — it was, I just, like, woke up one day to, um,
this story, and I just had to go write, like, this ridiculous
crap myself, that, um, you're not exactly, like, the furthest thing from someone who
harasses women, or leans over them as a tall guy, or however
they tried to, like, spin it — I thought it was totally, uh—
it wasn't — Krista made it clear in that piece that, um,
actually, Krista backed me up through this whole mess
I have to give her credit for that. So, what this was actually about was,
we'd been sitting there for 17 hours straight. I mean, 17 hours.
Mm. Time burned again.
Well, that was Krista's fault, wasn't it? Well, that burned up a day and a half of
the night. If, like, on top of that,
you drag things out endlessly — that's what's called
filibustering. In other words, it's basically deliberate obstruction in practice —
something the opposition can engage in. And, um, I had other committee business and
stuff like that, and all this work just got put on hold, and all
these things — since I was brand new, I was already pretty stressed
to begin with, but, in that sense, I tried, from the substitute's bench there
in the committee, to get things done while I was sitting there on standby,
stopping the opposition from marching, so to speak, out
in front of the cameras to say 'we can't continue this discussion, blah blah blah,' because
if we have full ranks, we can keep the meeting going, and, and
then get things done — because if the opposition walks out, we can just make,
like, endless decisions in a short amount of time. So it's this kind of
committee maneuvering, this whole thing that was going on at STV — the Social Affairs and Health Committee — and I was an extra there,
as a substitute member,
keeping the governing party's ranks full. And then, um,
um, then, well, it was one of those days again where we'd been sitting for 17
hours, and, um, then I thought, well, this is a whole new sport for me, but if I
were on a board — some company's board — I would give
a pretty strongly opinionated,
honest, openly candid speech. Like, 'this is total crap, that'
what does it matter, like, what does it matter whether we discuss this now or
the opposition discusses this matter, because the governing-party members have already
said, like, no, this isn't going to fly. So we're just burning
time, basically. And that was really on the same level as any
board work, whether that's a company's board, or the Finnish Economists' association's
board, or wherever. So there wasn't, in my own opinion,
anything all that strange about it, but, um,
in politics, this kind of theater gets performed. So then certain, um,
opposition-party representatives acted all outraged, and 'never,'
and, and used this kind of superlative language, and, um, and so on, but
it was really just totally normal, like, 'hey, come on, let's actually
stop this rambling and get decisions on the table' — I mean,
we all know what this game is. It was that kind of
thing. And then, um, after a while, I moved back to the substitute's bench.
The actual member came in to STV, and, um, then, then this one
politician there — um, when they were having some discussion about things, she again
got, um, outraged, and she said, 'I can't'
accept this,' and blah, blah, blah. And then I said — I remarked
from the substitute's bench, 'well, but you're in the opposition,' like — and that was all
I said, but, like, in parentheses, meaning, of course, if there are good points,
we'll take them on board — but since the governing parties have said these
aren't going to fly right now. Mm.
So what does it matter what your opinion is, and what happens to you, or, like, what
does or doesn't suit you, because you're in the opposition.
And it was obvious that it was filibustering. In my opinion it should
be obvious to everyone that the context was filibustering. Well, exactly
that. And, I mean, the same goes the other way too — if I'm in the opposition next
term, if I even get re-elected at all, and so on, then I too
would understand this. So, that, um, that — it's, like — I'd
suggest, 'hey, could we think of it this way' — and then the governing parties say no, fine.
Then it's pointless for me to keep dragging it out. But anyway,
this particular person then got outraged — like, really went
into orbit right there. A former minister, and, um, and I, I, I
was, like, taken aback by it — like, 'did you maybe misunderstand something, what
did I' — I just said that, since you're in the opposition, that's
all — everyone gets that you're in the opposition and this is filibustering —
how can you be that upset about it? And then when there was a break, I didn't
notice that all the governing-party members had left the room.
Mm. I was left in that room with only the opposition-party members. I
hadn't even thought to be wary of a situation like that.
Mm. And then, there, I went up to
the end of the table, where Krista Kiuru was sitting — this one person, and another, and, and,
um, and, and I'm standing on the other side of the committee table, which is 2
meters wide, and then there are chairs on top of that, so it's really about three meters
away. And I was coming over there, like, hey, um,
'is everything okay, because now, now you probably misunderstood something, since you
got so worked up like that.' That's what I was about to say,
but I didn't get a single word out before this person said,
'I'm not talking to you.' And then I was just, like, 'what the
[bleep] is going on?' Like that. And then the other person picked it up and
started narrating the situation, like, 'you come over here acting in a threatening manner.'
And I was just, like, 'seriously, what—
what's happening here?' That's when I, that's when I started to realize that
some kind of narrative was being written here. Yeah, that's when the, like, warning lights
came on. I thought, 'some narrative is being written here that isn't going to be [unclear] —'
friendly to some left-wing journalist's column.
Anyway, so I said to the other person, who was claiming that I'd
acted threateningly, I said, 'hey, don't, don't blow this thing up,
this situation.' That's not quite proper Finnish, but that's just what I happened to say. I
say that word exactly, and, um, and I left that situation
and I said, I think, as I was starting to get a bit heated at that point, that
'damn, what a clown.' Those were all the things I said
in that situation. And then, when the meeting continued,
the one who'd been so shocked then went and shared that shock
with the whole, whole committee. And, um, and at that point I then
got to say something, like, 'hey, seriously, I was actually about to come over
and apologize, since you got so upset about the fact that I'd said that,
well, since you're in the opposition' — that's the sentence I said that got
her so worked up. And, um, and at that point Krista Kiuru
gave her own remarks, in her capacity as chair, saying, yeah,
of course she understands people can experience situations differently, and so on,
'but I, sitting right here between the two of you,
from where I was sitting, it certainly looked like Paasi was coming over
to apologize to the whole committee — and this'
'is common knowledge.' Okay, fast forward. So then,
at some point, about a week — a week later — there was
Independence Day right in between and something like that, and then,
on Independence Day, so, um, so,
Paula Risikko called me — um, the deputy speaker of parliament,
the deputy speaker — and, um, said that right now
the media's cooking up some kind of soup. And, um, then, on Monday, the next day,
well, then the media was, like, all over me, since we were doing this STV
business again. And, um, there was this Helsingin Sanomat reporter, who'd
been trying to reach me, and I said, well, it took a little while before
we ended up in the same place, and, and she then did the interview, and she
asked me things like, roughly, 'what's your shoe size, are you this or that,' and blah,
blah, like, some completely pointless stuff. And, um, and then I went and
sat back down in committee again, and then within, like, 5 to 10 minutes
she had already published the piece, in which, um,
it was claimed that I had threatened a female individual,
and she hadn't actually asked me about that at all
when she interviewed me five minutes earlier — instead, she, she had
already written the piece in full, clearly, because it came out just like
snap — bang, and there were just some pointless comments of mine in it, like, blah-blah-blah,
and, and that was the only thing in this whole mess that, um, back then, and
even now, um, it goes beyond my sense of justice, that — that it was really, yeah,
really embarrassing on YLE, on that live TV, how it went, in
my own opinion. For some reason my throat just completely seized up. I couldn't
get a word out. I don't even know who was interviewing me. It was a really confusing
situation. It was really embarrassing. Of course I was mortified.
Um, and, um — could I have lived without that storm? Well, maybe. On the other hand,
it was really instructive, so I, like—
to be honest about it, I wouldn't trade away a single day of it. But in there
was this, this kind of fabricated claim — a smear campaign — which Helsingin
Sanomat took part in, and which never got corrected at any point, even though I did
everything I could to get it corrected. That article has been corrected
eight times, but, um, not on that particular point.
So that was the story. And maybe, coming back to why
this was, all the same, such a good experience — it's that I
um — I was a five-month-old politician at that point, four maybe,
and I really learned a lot from that whole batch of events. First of all, that
the National Coalition Party's modus operandi is to throw you under the bus. In other words, they want —
if someone supposedly messes up, then, um, they want to cut that
MP loose from it, or rather cut themselves — the party — loose from that
scandal. So that's the first thing that gets done.
So they put out — issue a statement saying, yeah,
'this person behaved badly. We've had a serious talk. We've said that
this is really, really stupid,' and the party, which has nothing to do with this business —
and, um, Paasi regrets it, or this person regrets it and is truly remorseful, and it's
really stupid, and this will never happen again — but this has nothing
to do with the National Coalition Party in any way. And this, even though we'd had
a really good, good mutual conversation with the group leader at the time,
then, all the same, like, my own group,
the National Coalition MPs' group, supported me like crazy through all sorts of
channels — hugs in the hallways, encouragement, messages of support
by email, this and that. Um, some people were on X defending me, coming out over this
tabloid-headline stuff.
So this kind of oddity, this kind of discrepancy — that the public
party throws you under the bus, while your own people support you like crazy — but, like,
preferably not visibly. The Finance Minister supported me publicly,
along with a few other Finns Party MPs. That support
meant, of course, an absolute hell of a lot in that moment.
But also other party members — I mean, MPs —
cheered me on, the ones who'd actually been through the same situation themselves. I mean, that's really
a situation every journalist ought to get to experience.
because it's, it's quite the pressure cooker when it just won't let up, and, and,
um, and, and, um, you're ashamed of the publicity that comes out of it,
and words get put in your mouth that were never there. They distort things
without a care, and it's quite the
defamation package, especially in this case, on that
front, since this is a very stigmatizing thing — um, namely that I
'threatened some female individual' in the line of work, or in general —
well, that's just complete bullshit.
That's how it is, in my opinion. It's, um, like a textbook
cancellation attack, and they try to slap on that kind of permanent label. And that's
why I myself immediately hit back, like, on X, with a
supportive statement, because it was just so blatantly obvious that it was
this kind of, um, orchestrated attempt to slap a certain
brand of stigma onto you. And I have to keep going — that then, then this
is how the media operates — remember now, this isn't opinion,
this is first-hand knowledge. And the media then operates
in such a way that, first of all, the reason Helsingin Sanomat ran that kind of story
was, of course, that if the story had been that National Coalition's Paasi pounded
his fist on the table and, like, gave the opposition a talking-to,
then every one of my voters would've been thrilled, totally, like, absolutely,
'wow, that's our guy,' like, really great.
So they had to get some kind of stigmatizing, negative crap into it,
so that the story wouldn't turn out that way. That's why this setup got put in there. Yeah.
But that was, in my opinion, pretty transparent. And then, like, what the media then
does is — Hufvudstadsbladet then picked that story up
from there and ran a whole piece based on just that. Mm.
And that's how it then got chained around, through this
whole media landscape, and, and, and, um, they managed to produce
this kind of tabloid-level thing, which then shows up everywhere. That's just how it is,
in that sense. It's probably good, by the way, that you also now have your own
media outlet, so you can go through these things there on Paasipodi. I mean,
for me too, people have very rarely tried to cancel me. One time it was
close, and I just took that whole issue and brought the person on as a guest the next
week, and it just fizzled out from there. So in that sense I find it — and that was
a good idea of yours, taking over that parliament podcast studio,
so, at that point, maybe a tip for others too, that, that it works. But
if we go now with roughly the assumption that, since the government program
had already, like, been sealed by the time you basically stepped into the parliament chamber,
then I'll give you the right to still be a bit of an
outsider and critical of this government program. So let's start
think about the sequencing of it. So, so, in my opinion, this is, of course —
the right-wing government has, for the most part, done good things, but in my
opinion this has been sequenced completely wrong. So, for example, now that during 2026
the big tax cuts are coming, why weren't they done right
at the start, so that we'd already have their effect baked in and we'd have gotten
economic growth right away? That's, in my opinion, maybe the biggest mistake,
that they waited this long, and that at the start this kind of easy, easy
lever for impact was left unused. That's a good question. I don't know why not,
but, but maybe here it's, like, good to quickly recap a certain
political reality that I've, that I've come to realize.
Mm. And it was this — that, um, before a government is even formed,
every party writes up a kind of wish list of what, what
they'll bring into the government program, if one day
we get there. Mm. Then, once that moment comes, of okay,
'now we're putting together a government,' then an individual politician's
wish lists have already been melted into the party's wish list, where they've
already been watered down and turned into compromises once already. And then
the parties negotiate among themselves, which waters it down even further —
combining the different positions into some kind of best-possible mix,
from the point of view of all the parties. That's really the whole point.
And out of that comes this great, mighty government-program document, in which
everything's written down — it's the book. It's like the Bible. Everything's written into it,
all the goals, pretty much — well, how do I put it — not exactly at a general level,
but they're put in there nonetheless. And once that's been settled,
then, then the government sets out to implement that program, and
the minister posts get handed out — different people become ministers —
and then the items from that government program that belong to a
particular ministry, or a minister's role, or duties —
those then get broken down into work at that ministry, and then they
write — they write up some draft,
and consult, or request statements on that draft. Then they fold those
statement responses into, into that government bill, which
then goes to committees — to the relevant committee, say
the Transport and Communications Ministry's bills go to the Transport and
Communications Committee, and there they hear from, say, 60, 70, 80
experts, and a response is drafted, and then the bill goes
back to the ministry, and then the ministry takes whatever it takes
from those comments, writes it into the government bill, and then, then it goes to
its first vote. And that's, like, the fastest round this whole thing
can possibly go through — but that's the process, and it takes time.
Um, but anyway, so, um, this is what then gets ground through the mill. You've got
the government program, the Bible, and then you just start grinding through these
laws one by one. And at the start, nothing happens, because everything's still
stuck in the ministries, and then they start coming to the committees. There
the amount of work starts to grow, and, and then in the plenary chamber they start
voting these things through at an accelerating pace. And
really, the only thing being done here is
implementing the government program — trying to race through it as
fast as possible, because on any given day the government could fall, and then the whole
thing collapses and that's it. It's game over, and at that point the
government program becomes toilet paper, and the whole thing has to reset to zero, and, well,
in principle, the things that are already in the pipeline might still get
through, but, but as a rule, no. And that's basically the setup, and that's why
I've come to state that, that, well, that politics —
um, meaning democracy, I mean, means that if you have, if
you've got the Finns Party, National Coalition, Christian Democrats, and the Swedish People's Party all agreeing, for example, on the same
thing — like, 'damn it, let's cut business subsidies
in half. Now, goddammit, now we show who's boss. Now we're going to make a
clean break from these do-nothing previous governments.' Everyone's
unanimous. Okay, fine, let's do it that way. I'm not saying that's exactly what happened, but,
just as an example. But then once you start looking at
things line by line, then one item works for one party, but not for another.
One cut doesn't suit the Swedish People's Party, another doesn't suit the Christian Democrats, a third doesn't suit
the National Coalition, a fourth doesn't suit the Finns Party. And then that 50% cut target
shrinks, in practice, down to some kind of, like, size, some
laughably small amount. And that's how it is with
everything — that's what democracy is, and it means that even if
a governing party — or, I mean, the Prime Minister's party —
has clear goals, wants certain things, it's still not
an absolute ruler. This, this is — this is, well, this — this hits
this, this fact, this reality — it hits pretty much everyone out there,
except, like, the experienced politicians, because they never had
that kind of assumption to begin with. But sometimes it feels like the professional politicians don't
even understand that — like, even National Coalition voters, in a way,
assumed that if we now say we're going to stop living on debt, that
actually means that during this government term we'll cut
enough that it actually stops.
So, so, like, and hopefully we can still get it to stop, but
but, um, and, and so on. But I think we're about to run short on time here, and, and
on this — but I still have to get in one more thing here, like a kind of
in defense of that, still — when this sitting
Orpo government was being put together, first they reportedly sat for four, five weeks
listening to experts, so that everyone got the same
picture of the situation. And then it was decided they'd take
the kind of measures these experts wanted. Do everything,
make enough adjustments. If the adjustments aren't enough, then adjust
more, and set up a growth working group,
and, damn it, throw in everything. And then, once that growth working group was set up,
something came out of it. And they'd also, as requested,
asked for measures, um, from lobbying organizations and
citizens and everyone possible. All 601 growth-oriented
measures are being put into production. 601 of them.
And it takes two — two hours, 45 minutes to read every single one through. Paasipodi,
episode 25, if I recall — I read through those 601 growth decisions. It took 2 hours,
45 minutes. I mean, an insane number of decisions.
And as for these cuts, the whole time — since the goalposts have kept
moving away, economic growth hasn't come, and they've kept tightening the screws,
cutting, adjusting more — and now, when it comes to the 10 billion,
has enough been done? If you ask me, no — they should have done
twice as much. But, but, in that light, if I had been that same
prime minister way back when — well, I'm a bit the type who always takes
a bit — I think I know how to put myself in proportion to
the experts' comments, and I know that experts typically pull
a bit toward the conservative side — if things are bad, they'll say it's not
quite as bad as it really is; if things are good, they'll say it's not
quite as good as it really is. Um, so I'd have liked to
aim for — if I'd been the one deciding, I would've aimed for
a bit more in cuts, to get a margin, a safety margin. Now
this thing will surely get pulled right up to the wire, right to the finish line, and we'll get whichever way
it shakes out. Yeah. But maybe my question,
still, is, um, about that tax timing thing. You've also had
as a guest Elias Erämaja — our chief economist, so to speak — and, um, on that
right at the start of the government program we had this kind of discussion
about the fact that here in Finland, we had, back then, and even still — a couple of days
before this recording — the world's second- or third-highest top
marginal tax rate. And there was just this incomprehensible kind of debate
over whether we could even remove that solidarity surtax — two percentage points —
and, like, we couldn't. And that felt completely
incomprehensible, that we couldn't even start there — whereas now, again,
in 2026 we're bringing that top marginal tax rate down from 59 — a completely insane level —
down to something like 52, which is [still] an insane level. Not a completely insane level, but still
anything over 50 is just crazy. So, so this is something that should
have been done right away, because it would obviously have been the most effective
measure. And in a way I just, like, don't understand why it wasn't
front-loaded right at the start, this — the single most effective thing. I can't say why, but I
do know this: that whenever you cut taxes, the
money has to be found from somewhere — except that, in a way, there's
a small delay before it comes back through that dynamic effect, because
if you're really — I mean, taxes are always disincentive taxes, so you
get less of whatever you tax more. And if you're taxing
at the world's third-highest level on something, then you're probably going to get
the world's third-lowest amount of that thing — that is, earned income. And, like, that's really
how it obviously plays out. I just don't get how stupid
that debate was — and maybe, in the government's defense, on A-Studio, Sixten
Korkman and, um, Patrizio Lainà, everyone was going on about how it could possibly
be that Finland — one of the world's six highest-tax-rate
countries — could even consider lowering that tax rate here at all —
the whole debate was just totally insane, about how we
could possibly replace the disappearing tax revenue, because otherwise it's the end of the world. We've
somewhat gotten past that now, and maybe now, in its defense,
now that, in a way, this year, '25, has been really bad, then next year, once
those effects fully kick in on income tax, and the 13.5%
VAT cut also kicks in partially, then, then I'm actually pretty
optimistic about 2026 — that we'll have growing domestic
demand, tax revenue will come from that, and we still have that shockingly huge
backpack — 84,000 euros per citizen in public consumption spending. That backpack
definitely needs to be lightened. But on the private side, we've got
quite a lot of investable purchasing power now, and the stock market's also risen,
in '25, by something like 35% here. Okay. But foreigners own almost all of that.
It doesn't, it doesn't rain down here domestically, because we've
also had ownership destroyed, among other things, by that kind of wimpy decision not to bring in
a Swedish-style inheritance-into-capital-gains tax setup instead. So from that,
big minus for us. But, um, now it feels like — well, I mean — let's actually put up
this classic chart here — I posted it for fun on LinkedIn, because one other
acquaintance was just criticizing this — the wealth trend since 2024: Finland's
risen from something like 75 grand up to 150,000 euros; Sweden, from around 80,000
euros, has risen to 300,000 per adult, after that inheritance-tax-into-capital-gains-tax
reform. So really, that much more wealth has genuinely
flowed into Sweden — doubled, compared to us — such that on that wealth,
the capital-gains tax collected from sales made on it would be, like,
would be many times more than that measly 1.2 billion of ours that
comes in here in Finland. We're not
— that's not where that money would come from. We're not exactly of one mind on this
matter, of course not. Well, yeah, but I mean these two — these are two big
minuses for the right-wing government. Taxes two years too late, or
a year and a half too late. And then, um, that inheritance-tax opportunity
got postponed, like, possibly until after a 'blue-red' coalition era — National Coalition plus the Social Democrats — so, six
years down the line. And even the marginal-tax cut has
gotten a mile-long outcry over it. Yeah, yeah. But that's the same kind of
'Krista Kiuru leaning'-style noise that just comes out of that crazy press,
and it's, it's exactly the same thing — that these dynamic effects are just
obvious, and, and there shouldn't really be two ways about it. But, but, well, I've been thinking
now, of course — especially, this right-wing government would certainly
gladly cut earned-income tax to, say, a flat 25 percent
— well, that's actually what foreign workers get, expats get, that is,
yes, all the experts who come to Finland,
and expats — meaning returning Finns too — get 25%
withholding tax for the next seven years.
But, but anyway, the point here again is that, of course,
this sitting government would of course have cut taxes across the board — all sorts of
pointless taxes, VAT, whatever systems, straight to the ground — if it didn't have to worry
about the fact that the deficit — it can't, it has to shrink at the same time, and it certainly
shouldn't be growing. And yet, still, these decisions from the previous
government keep feeding, um, this kind of
mess and chaos and bad, growing problems during this government term. So,
for example, a simple thing like this:
interest expenses were 0.8 billion under the Marin government, and now they're 3.2 billion
today. That's the same amount the Finnish taxpayer lost in the Uniper deal.
3.2 billion — and in four years' time it'll be five.
I mean, just think — and I have to mention, in a Rahapodi episode with Alexander
Herlin, we went through how removing the interest-rate hedge — the derivative —
and replacing the collateral position brought costs from the debt. So, so, um,
somewhere, some numbskull decided, during the Marin government, over at the
State Treasury, to drop this — or, or rather, to keep going with this
floating-rate funding, when it could have — so, concretely, what this was about was
that there was, quite concretely — the state had issued
a bond that generated 50 million euros a year for Finland. That
was a guaranteed income, because — since it's discounted and so on — you know,
that's the whole deal: 50 million gets paid to Finland for having taken out that loan.
Finland doesn't pay — Finland gets 50 million. I mean, it's the same as if you went and
took out a million-euro mortgage for yourself, and you got paid 50 grand a year
for having taken out that loan. That's the situation it was. And then there'd been
some strategy for the last 15, 17 years that had actually served
well, right up to the point when rates came down — it had served well. So,
you convert that fixed rate — variable rate — into a short-term rate via a swap,
through a swap arrangement. And somehow the light hadn't gone
on at that point, when rates were negative, like, 'wait a second,
maybe we should rethink this interest-rate strategy of ours.' And that's why they went
with the old playbook and swapped that — and, as luck would have it, it turned out
so unfortunately that rates just went and rocketed straight through the roof
just a few months later, basically. It was just this
unbelievable cluster[bleep]. So, and, well, in that, they took the long end
and converted it to short, right when this yield curve was about to rise — so that's
— actually, I've got a one-month
Euribor rate on my own mortgage, and I've actually been happy with it, even during these rising periods, because over
time it's been lower. But then, um, there's a further twist here: when you
swap into it, since that curve has started rising up from negative territory,
you then have to put up, um, put up collateral for
that derivative that's sitting at a loss, and you have to finance that too. So now
these sins of the past, like — and these State Treasury people still go around
somewhere, like, giving talks or remarks, where they say
that historically this has generated 8 billion, but then, on top of that,
they don't count this, like, realized loss, nor the derivative's
collateral-position funding cost. So,
whenever you interview the State Treasury, ask them straight up whether
these have now been factored into that financing cost — please don't
just talk about those past interest savings, but about the whole
mess of a position. And now we've got, tucked away, a growing national debt whose
interest costs are rising, and where, in a way, risk management could fail, and
then, on top of that, our credit rating — the whole financing security — rests on 98%
foreign bondholders. So this State Treasury hasn't even
done the least little bit of thinking about how we could get at least some of this
national debt financed domestically. Unlike pretty much every other
country in the world — like, say, Italy and others that are
among the crisis countries — they've been trying forever to
direct their debt-servicing at home too. Some restless host of the Rahapodi podcast, um, he
went, back then, in the era of negative interest rates, shouting all the way on YLE,
that we should take out 100 billion in loans. Negative interest rate — so
really invest it in something productive, that is —
and that's how I think about it: let's make Finland an
superpower of entrepreneurship, let's make everything possible. Or, then again, under the Marin government it would have
just raised the discretionary 20 billion of spending
to 80 billion. And, um, of course with the wrong decisions
you get the wrong outcome. And it would've just been called
a 'future investment,' when it's really an income transfer to left-wing
friends, basically. Do stupid things, win stupid prizes.
But, um, yeah, yeah. But there's the actual
analysis — that locking in a fixed rate with a big principal did exactly this.
Right. Yeah. And, and they basically took out a hundred-year fixed-rate loan, which they
then paid back in two years. Mm.
If I recall, 40 percent — 40 cents on the euro. Yeah, they took that euro and then paid off the whole
thing — that's basically how it is, because, I mean, this exact
State Treasury situation — we've got this, um, this loss-making
swap position that has to be capitalized, whereas the state could otherwise just buy
that loan back from the market at a lower price, so
somehow, I mean, we really do have some terrible
financial journalists, honestly. But, but now maybe let's get back to this, your
National Coalition, um, government-position thing. Okay, you're
a backbench MP, but now the home stretch is starting. So we've
hopefully got this stock-market-discounted
recovery year coming, where these tax cuts, and, um, partial
interest savings start lifting the national economy's incentives
to recover. Construction has been hammered down
flat to the ground, so it feels like there ought to be room
to bounce back. Hopefully. Domestic demand has been
somewhat scared down too, so in principle you could actually well afford
— like, before this, at lunch, we actually treated ourselves to a proper
diet Pepsi here — a bit of that everyday-luxury kind of consumption.
But, um, it still kind of bugs me that there hasn't been
any heavier lifting done — that on the spending side, 159 billion in public
consumption spending — well, it's easy for me, it's easy for me to say, yeah, if it had been
up to me — right?
But you remember now, what I
think, or even if I had been — had been prime minister — that wouldn't
mean it would actually happen, because
all the governing parties would have to be unanimous on that
matter. But if you were to ask me now, with the benefit of hindsight,
I'd say they should have originally cut —
front-loaded those cuts, as was the plan, but more aggressively front-loaded —
with the idea that these cuts would not only remove
the growing debt accumulation, but would also make it possible to finance those
tax cuts. In other words, cut enough that we're able to
cut — to lower taxes. So, through cuts, we first remove
and cut enough that the debt accumulation stops, and then, on top of that,
even more, so we can get taxes lowered. And
now, we have lowered taxes, but unfortunately we're still having to cut
more, because all sorts of surprises keep coming from the right and
the left. But I do have to say that, yes, the Orpo government —
honestly, every single thing that's been done has been the right decision.
Maybe the timing should have been different. Maybe they should have been a bit bigger,
but, I mean, all of these — and I think it's kind of crappy that,
that in the view of economics nerds, the IMF, and
everyone else, they've all agreed — 'hey, great, you're
cleaning up this mess' — and then economic growth just doesn't show up, and the
goalposts move again, and then you do more, and more, and more.
But what that leads to is that, in the political arena, it looks,
in the eyes of voters, like, 'ah, the targets aren't being met' — they just aren't
being reached. In other words, living on debt just can't be stopped,
and, um, story after story keeps coming out that's
negative for the average Finn. It's a bit like — if you're doing, if you
have to reduce headcount at some company,
you let go of enough people all at once, so that you don't create
that kind of, like, drip-feed layoff spiral, that kills
the whole team's motivation. So it's extremely important that,
you take the whole batch [unclear] and clear the table
properly in one go, so that it's definitely enough — and then, with the remaining crew,
you sincerely set out to save the company, come rain or shine,
and, with kind of that same mentality, they should have cut enough,
quite a bit too much, honestly, so that they wouldn't need to come back to these
cuts ever again during this particular government term,
and, and, all at once, like that. And what puzzles me, as a layman — and this is because
again, I don't understand — I'm not a professional politician. Maybe someone
like that could give a sensible answer to this, but it's that, when
we had that Murto growth working group, why didn't we have
some other person's — say, an organizational-cleanup — cuts working group,
a super-expert cuts working group on trimming down organizations.
So we have 4,200 organizations in Finland that get money from the state. They don't raise
a single cent themselves, and, and there are
— vacations, I mean, organizations that exist purely to organize vacations,
and, and there are political — um — organizations. There are also
organizations that do genuinely important work, like Aseman Lapset [a children's charity]
for example, or something similar. But there are also, like, 15
of them doing, in principle, basically the same things,
so, so this whole organizations thing, and then business subsidies — these are exactly the kind of
things that absolutely should have — I mean, they should have gone through the whole
budget, in its entirety, line by line, and dug into every single line,
asking, 'wait a second, could this be merged with something else?
Can we shrink that group that way? Is this totally
pointless?' And if you'll allow me,
um, here I do sincerely hope — of course nobody's hoping for anything else —
that we get economic growth going now, and this thing takes off like a shot from a cannon,
and so on. But we'd also need — what, what has puzzled me the whole time,
and was actually the reason I went into politics, I can say quite sincerely, is this
lack of crisis awareness. We've got health-and-social-services spending, interest costs, and defense spending
inevitably rising. Interest expenses, because — well, I won't say who's to blame.
Health-and-social-services spending, because Finns are aging. Even though of course we can
make things more efficient by changing how we operate, it's still
growing regardless. You can't really, as a baseline, cut it
all that dramatically, given the assumptions we have about how well
we take care of people in Finland. Then there's defense spending —
that's obviously rising too, of course, because we have a neighbor that's once again thrown itself
onto a war footing. That's 36 billion out of the state's 90
billion euro budget. That means that if
we needed to cut — they should have originally, should have cut that 20
billion — that 20 billion
would have needed to be aimed at whatever's left over once health-and-social-services,
interest, and defense spending are left untouched.
That 20 billion out of the remaining 53 billion — that hurts. That hurts like hell.
I mean, that's the massive figure with which we wouldn't have
adjusted by just ten — we'd have cut that 20.
That's what it would have taken to actually get the, um, debt accumulation stopped,
and at that point there wouldn't even have been a single tax cut in the bag yet.
But just think, if I'd been Petteri Orpo, and I'd gone
into the Council of State and proposed something like this to, say, Anders Adlercreutz,
or Essayah, or — well, Riikka might actually have been fairly on board with it, but, but
still, still, I mean, it's really just, like,
that's just pure political suicide. They wouldn't just say no — they'd say, 'have you
taken the wrong medication for breakfast?' No, no, there's just no way it would have
happened. But that's what should have been done. Why? Well, because if
the opposite happens from what we're all hoping for — that we get peace in Ukraine —
then these hardliners — professional military men with a general's
rank — they say it'll be about two years
before, um, Putin tests NATO's Article Five — meaning, if one NATO
country gets attacked, then, in effect, you're attacking against all the countries, and
everyone comes to help. And on this, Helena Petäjistö just
wrote her latest column on MTV3 about this exact topic,
which is also based on these same hardliners' assessments, and
so on. It describes exactly that — some small place gets taken, say, Narva,
which is right there on the border, and then people discuss, well, maybe if it stays
just at that, then it's not such a big deal. And France wouldn't really be interested in
going off and raising hell. Like, are we really going to risk a third world war, and
Trump might not either. Like, hell, we're not about to, over some backwater village or
anything, go start a third world war. And, and, um, and
then the next attack comes at some other point, some other small backwater village, and
smaller, smaller, smaller — and the goalposts just keep getting moved a little
further forward, and that's how this plays out. So we're living in this kind of
reality right now, unfortunately,
and here in Finland we're bickering over whether state culture subsidies —
culture subsidies, whatever they're called, subsidies going to culture — whether they can
be cut by 3%. Mm. For third-sector organizations,
where there's, like, overlap — just 3%.
Mm. And what happens? Out of that comes, of course,
an almighty uproar, because there are, um, like-minded journalists — Helsingin Sanomat and
Yleisradio full of them — and it gets scrapped. Mm.
And this is, like — this is really, like,
the perfect picture of political cowardice [unclear]. Mm. So, so, I mean, in no way does
that mean anything. Just think, if I were to cut — say you were a salaried employee, and I
said, 'hey, listen, sorry, but I'm cutting your salary by 5%, because
times are tough right now — can you live with it?'
Well, would you, like, would you throw — would you throw
yourself on the floor and throw some kind of screaming tantrum over it? Well, no,
of course not — I'd go code some AI productivity tool, and through that boost in productivity,
my salary could get restored back to the same level.
Right, exactly,
that works too. Yeah. But this is the level we're operating at right now.
So, shouldn't we still wrap this up on a positive note of expectation,
that if the stock market has now risen that 35 percent, that's some kind of
forecasting instrument. Um, well, the stock market also rose over 100% in Argentina, which
managed to stabilize its economy and generate GDP growth —
so, in my opinion, let's take that most recent figure of 7.7%. So
that comes to mind [unclear], so, so
let's take this now as a kind of positive omen, and believe that we've got
some good growth years coming, and the dynamic effects kick in a bit ahead of schedule, and
the state's finances also start stabilizing a little. So I wish everyone a good
2026 — all our listeners, viewers — and thank you for coming on,
Martin Paasi. I suggest we have one more short conversation, just among ourselves,
about the guests you've managed to line up on Paasipodi. Of course,
besides me — I've apparently been, by far, the most-featured guest in
the entire history of humankind — you're the only guest who's come on three
times, basically. So it's definitely worth going to listen to those [unclear].
I mean, I haven't even held back — I've ranted even more there than I do here,
so I'd say these guest appearances are fun in that sense, because, because you get to
be even a bit more colorful than here on my own home turf.
Thanks for this, and see you on the inner-circle side —
bye bye.