In Finland, the liberal-conservative National Coalition Party and the far-right Finns Party, whose members together add up to nearly 90 percent of the current government, have united around a shared political project: authoritarian neoliberalism. The right-wing government is taking from the poor to give to the rich while dismantling Finland’s rule-of-law state and civil society.

Prime Minister Petteri Orpo’s coalition government took office on June 20, 2023. That same day, it unveiled its plan to slash public spending — primarily on health care and social security — by €4 billion by 2027, while granting a tax cut to individuals earning over €85,800 a year in wages and salary. The plan also included undermining the power of trade unions.

Less than a year later, this April 16, Orpo’s government announced an additional €1.6 billion in spending cuts and a 1.5 percentage point increase in the value-added tax rate, signaling its rejection of progressive tax-reform proposals. The situation worsened in July when President Alexander Stubb, a member of the National Coalition Party, signed a controversial bill granting the government the power to block asylum seekers from entering Finland through Russia. The bill violated constitutional and international laws, as well as migrants’ human rights, and marked the partial fulfillment of the Finns Party’s long-standing goal of closing the country’s borders to migrants.

On August 8, Finance Minister Riikka Purra revealed that the 2025 budget would include an additional €100 million in cuts to public spending. A month later, reports emerged that Orpo’s government, along with the Ministry of Finance, had urged the European Commission to alter the criteria for assessing Finland’s public indebtedness. This move will make it significantly harder for Finland to comply with the European Union’s new fiscal rules without imposing further spending cuts.

These and other reforms highlight how neoliberalism is turning increasingly authoritarian in Finland. While the world often views Finland as a model of well-functioning social democracy, Orpo’s government has launched a relentless attack on the Finnish welfare state, eroding the pillars of the Nordic welfare model that made it so famous in the first place.

The Great Moving Right Show, Finnish Style

In his 1979 essay, “The Great Moving Right Show,” cultural theorist Stuart Hall reflected on Britain’s political shift to the Right during the 1970s. Hall sought to explain “how a capitalist economic recession is . . . ‘lived,’ for increasing numbers of people, through the themes and representations (ideologically) of a virulent, emergent ‘petty-bourgeois’ ideology.”

Hall’s inquiry centered on Thatcherism, the British variant of neoliberalism. It championed, he said, “the restoration of competition and personal responsibility for effort and reward, the image of the over-taxed individual, enervated by welfare coddling, his initiative sapped by handouts by the state.” Since then, neoliberalism has spread across the globe, including to Finland, where the early 1990s depression threw open the Overton window and paved the way for Finland’s transition from Fordism to neoliberalism.

The financial crisis caused Finland’s real GDP to drop by 8 percent in 2009. In its wake, the Finns Party emerged as a major force during the 2011 parliamentary election, becoming the third-largest party virtually overnight. Running a right-wing populist campaign, the party criticized Finland’s financial support for other EU countries that were more severely affected by the crisis. It argued that these resources should have been used to benefit Finns instead. While this redistributive message later proved to be mere rhetoric, the party capitalized on a void in Finland’s representative democracy left by neoliberal technocrats unresponsive to popular grievances.

Over the past thirteen years, the Finns Party has successfully normalized far-right ideas while shifting further to the Right itself. Last year, the party became part of the government for the second time, joining Orpo’s coalition. Its partnership with the National Coalition Party demonstrates how neoliberal and far-right forces have aligned.

Thirty-five years after Hall’s essay, political scientist Ian Bruff coined the term “authoritarian neoliberalism” to argue that authoritarianism has always been intrinsic to neoliberalism and that such tendencies have become increasingly pronounced since the financial crisis. This also offers the best way of reading Orpo’s government and its policies. Authoritarian neoliberalism serves as the ideological terrain on which the National Coalition Party and the Finns Party have discovered one another as like-minded political collaborators.

Robin Hood in Reverse

The public-spending cuts announced in 2023 amount to 1.5 percent of Finland’s GDP, with over 60 percent targeting health care and social security. Because society’s most vulnerable members depend heavily on public services and benefits, these reforms alone are projected to push 51,000 adults and 17,000 minors into poverty in 2024.

The new austerity measures introduced this April will further exacerbate inequality and force even more people below the poverty line. The accompanying tax reform, intended to generate an additional €1.4 billion in fiscal revenue, will disproportionately impact the lower end of the income distribution. Since the value-added tax is a flat tax, raising it causes the least trouble for the rich while hitting the poor hardest.

Before the government decided to introduce new spending cuts and increase the value-added tax rate, some NGOs and trade unions proposed alternative solutions to address fiscal deficits. The Finnish Federation for Social Affairs and Health (SOSTE) advocated for a progressive tax reform that would have raised over €3 billion annually while also reducing income inequality. Patrizio Lainà, chief economist of the Finnish Confederation of Professionals, went further, suggesting a progressive tax reform capable of generating €8 billion in additional revenues.

Both proposals included taxing capital at higher rates. Finland’s dual income tax system taxes labor income and capital income differently. Since the richest Finns primarily earn capital income — which is taxed at significantly lower rates than high labor incomes — the total tax burden becomes regressive within the top 1 percent. Despite this unfair situation, the government ignored these proposals and chose not to raise the corporate tax rate or the capital income-tax rate, even though these rates remain relatively low in Finland and are paid by those most capable of paying more.

Orpo’s government claims that spending cuts will boost employment by incentivizing the poor to accept job offers after their benefits are reduced. The aim is to increase employment numbers by some 100,000 individuals, which would ostensibly lower the social security bill by €2 billion. However, even if employment did rise by 100,000, the Ministry of Finance estimates that the poorest third of Finnish society would still experience income losses due to the reforms announced in 2023.

The plan to raise employment by cutting social security — backed up by questionable microeconomic estimates from the Ministry of Finance — is unrealistic at best and harmful at worst. More plausibly, the cuts targeting the incomes of the poor will reduce consumption demand, further weakening investments and GDP growth. This, in turn, risks lower employment levels and diminished productivity growth. Boosting employment would instead require public spending to stimulate labor demand and greater investment in employment services.

Higher inequality is a typical outcome of neoliberal policies, as Finland’s experiences since the early 1990s imply. Orpo’s government appears committed to authoritarian measures to raise the incomes of the rich at the expense of the poor — no matter the consequence.

Burying the Strike Banner

This May, Orpo’s government introduced amendments to Finnish legislation under the pretext of securing what it calls “industrial peace.” The reform increased compensatory fines on trade unions for engaging in industrial action, banned solidarity actions by one group of workers in support of another when deemed “disproportionately harmful” to employers, and limited the maximum duration of industrial action aimed at influencing political decision-making to just twenty-four hours. In reality, Orpo’s government used “industrial peace” as a euphemism for weakening organized labor.

The neoliberal side of authoritarian neoliberalism holds trade unions in contempt because unions allegedly make labor markets less efficient by introducing so-called inflexibilities. Meanwhile, the authoritarian side seeks to undermine unions because they promote workplace democracy by giving workers a collective voice.

Although these reforms shift power from employees to employers, Orpo’s government justifies them as necessary for improving the price competitiveness of Finnish goods and stimulating exports. According to the government, weakening trade unions will allow for a more “flexible” labor market, leading to lower wages and unit labor costs, which should ultimately boost exports. The hope is to revive the export-led growth model that characterized Finland between 1994 and 2008.

However, prioritizing price competitiveness over domestic demand is likely to harm future growth. Since the financial crisis, the Finnish economy has operated under a domestic demand-led growth regime, with private domestic consumption accounting for 60 percent of growth between 2010 and 2019. Yet, domestic demand has been hindered by the slowdown of real wage growth since 2010, leaving the economy stagnant. Undermining organized labor is likely to further inhibit wage growth and aggregate demand, perhaps even resulting in another lost decade.

Normalizing Racism

From the outset, Orpo’s government has faced accusations of racism. Finns Party MP Vilhelm Junnila, who was briefly appointed Minister of Economic Affairs, resigned in June 2023 after revelations about his past far-right messaging. In 2019, Junnila even delivered a speech at an event organized by the neo-Nazi group Kansallismielisten liittouma.

Finance Minister Purra, current leader of the Finns Party, also came under scrutiny in 2023 after the resurfacing of explicitly racist texts from 2008, including one that flirted with the idea of shooting young people with migrant backgrounds. Interior Minister Mari Rantanen faced criticism for spreading the far-right Great Replacement conspiracy theory online — a narrative that portrays a plot by which white populations are being “corrupted” and ultimately “replaced” by non-white people. And the list goes on.

Adherence to a top-down form of discipline — a hallmark of authoritarian neoliberalism — serves as a crucial ideological link between the National Coalition Party and the Finns Party. Orpo’s government views socioeconomic problems primarily as individual failings rather than structural issues, which explains its focus on disciplining those who suffer from such problems. For example, spending on health care and social security is framed as fostering laziness among so-called parasitic individuals, such as the poor and immigrants, who are portrayed as seeking to exploit the hard work of others. Finance Minister Purra is so into austerity that she has posed with a pair of large scissors as a joke about budget cuts. The government’s commitment to discipline also explains its comfort with increasing military spending — which has nearly doubled since 2020 — even as it claims to be deeply concerned about excessive public spending.

The government’s anti-immigrant stance is evident in several policies. For instance, Orpo’s administration plans a reform that would require migrant workers to find employment within three months of losing their jobs or else face deportation. Given that this deadline is unrealistic, the proposal effectively undermines the government’s stated goal of boosting employment, instead forcing migrant workers to leave Finland.

This July, Orpo’s government passed a pushback law granting itself the power to deny asylum seekers entry to Finland from Russia. The bill was introduced as a response to Russia’s late-2023 instrumentalization of asylum seekers, which involved a daily inflow of a few dozen individuals. The government gradually closed Finland’s eastern border starting in November 2023.

The pushback law violates Finland’s constitution as well as international and European refugee and human rights laws. Every legal expert invited to comment on the bill concluded that it should not be passed, and hundreds of researchers criticized the government’s failure to substantiate its claim that the number of asylum seekers in late 2023 posed a genuine security threat to Finland. By passing this bill, Orpo’s government has set a dangerous precedent, opening the door to further human rights violations.

Undoing Civil Society

Although Orpo’s government has emphasized that an “active and vibrant civil society is a key element in a well-functioning democracy,” its actions suggest otherwise. By cutting state funding to civil society, the government is effectively weakening the real democratic life in Finland.

For example, Orpo’s government has announced plans to reduce funding for social affairs and health NGOs by one-third (€130 million) by 2027, with over half of these cuts taking effect next year. These devastating cuts will force many NGOs to downsize their operations and lay off employees. The worst impact will be felt by society’s most vulnerable members, as these NGOs provide essential services that public health care and social security systems often fail to deliver.

In addition, in September, Orpo’s government announced a 10 percent budget cut for the publicly owned Finnish Broadcasting Company (YLE). Its operations are financed through the so-called YLE tax, a progressive tax paid by individuals over eighteen and organizations engaged in business activities. Such a cut can thus hardly be justified as a deficit-cutting measure.

It is not difficult to see who benefits from these cuts. Private media companies have a vested interest in reducing YLE’s output: the less media content YLE supplies, the greater the demand for privately produced media. The Finnish media landscape is already highly concentrated, limiting the diversity of public discourse. Cutting YLE’s budget by one-tenth will only exacerbate this issue.

Media researcher Marko Ala-Fossi has argued that reducing YLE’s funding “is not an end in itself; it is an attempt to achieve something else, to limit and prevent the production and availability of a certain type of content.” Especially the Finns Party feels that traditional journalism — which YLE produces — does not serve its interests.

The Self-Imposed Straitjacket

Both the British and French elections in July demonstrated that politicians pursuing authoritarian neoliberalism risk severe electoral backlash. Finland may have witnessed the first signs of a similar reaction in the 2024 European Parliament election, when Li Andersson, the leader of the Left Alliance, unexpectedly secured 15 percent of the total vote, setting a Finnish electoral record for an individual candidate.

However, moving beyond neoliberalism may require more than electoral successes. This year, Orpo’s government and the Ministry of Finance persuaded the European Commission to revise how it evaluates and forecasts Finland’s public indebtedness. Under the new approach, the surpluses of Finnish pension funds are no longer considered state surpluses, placing significant pressure on future governments to cut public spending — even though the economic reality remains unchanged. That Orpo’s government actively sought to limit Finland’s national sovereignty to ensure the continuation of austerity measures is remarkable and troubling. Adding to the irony, this move was orchestrated under a Finns Party finance minister, despite the party’s rise to power in 2011 on a platform that criticized Finnish elites for capitulating to the European Union.

Prime Minister Orpo and Finance Minister Purra have defended the government’s austerity measures by citing the need to avoid the commission’s excessive deficit procedure, which targets member states that fail to comply with the European Union’s fiscal rules. Ironically, this decision will likely necessitate even deeper spending cuts because the excessive deficit procedure includes special clauses designed to protect heavily indebted member states from overly harsh consolidation measures and their harmful consequences. Orpo’s government appears unsatisfied with the cuts announced thus far, aggressively pursuing a self-imposed institutional framework that would restrict democratic influence over future economic policy.