Social and Economic Developments

Finland Table of Contents

Over the centuries, Finland underwent various political changes, but its society and economy remained fairly static. At the beginning of the nineteenth century, Finland was a predominantly agrarian country; about 90 percent of its population was engaged in farming. The scourges of war and famine had kept down the population, which in 1811 numbered just 1 million, only about 4 percent of which lived in cities.

Except for some copper, Finland was without important mineral deposits. During the nineteenth century, its sole natural resource was timber, and this became to be the basis on which industrialization was launched. By the mid-nineteenth century, wood was beginning to be in short supply in Central Europe and in Western Europe, but at the same time it was needed in unprecedented quantities for railroad ties, mineshaft supports, construction, and paper production. Finland thus found a ready and expanding market for its wood.

The development of the lumber industry was retarded for a time, however, by the lack of a modern economic infrastructure. Into the breach stepped the Finnish government, which promulgated a number of measures aimed at creating the needed infrastructure. Railroads and inland waterways were developed, beginning in the 1850s and the 1860s, to connect the interior of the country with the coast; and harbor facilities were built that, through merchant shipping, connected Finland with the rest of the world. In addition, the Bank of Finland and the monetary system were reorganized, antiquated laws restricting economic activity were repealed, and tariff duties on many items were reduced or were abolished; thus, the Finnish government promoted industrialization and general progress in Finland.

The 1860s and the 1870s witnessed a tremendous boom in the Finnish lumber industry, which put Finland on the road to industrialization. Between then and 1914, the lumber industry spawned a number of associated industries for the production of wood pulp, paper, matches, cellulose, and plywood. The profits earned in these industries led in turn to the creation of numerous other enterprises that produced, among other things, textiles, cement, and metal products. Finland's leading trading partner by 1910 was Germany, followed by Russia and Britain. The trade in lumber products also stimulated the rise of a relatively large and modern Finnish merchant marine, which, after 1900, carried about half of Finland's foreign trade. Meanwhile, however, the steady conversion of merchant shipping from woodenhulled sailing ships to iron-hulled and steel-hulled steamships curtailed Finland's traditional export of naval stores.

The growth of industry was accompanied by the emergence of an urban working class. As in early industrialization elsewhere, the living and working conditions of the new industrial laborers were poor, and these laborers sought to improve their situation through trade unions. Trade unions were legalized in 1883, and soon a number of them were established, including, in 1907, a national trade union organization, the Finnish Trade Union Federation (Suomen Ammattijarjestö--SAJ). Workers founded a political party in 1899 to represent them in the Diet, and in 1903 it was renamed the Finnish Social Democratic Party (Suomen Sosialidemokraattinen Puolue--SDP). By the elections of 1907, the SDP was already the largest single party in politics. Both the SAJ and the SDP were heavily influenced by their counterparts in Germany, and, as a consequence, their doctrines had a pronounced Marxist character. The SDP grew even more radical, in part because of the resistance of the middle class parties to virtually all aspects of social reform, but also because of its strict adherence to the Marxist dogma of class conflict. One example of its radicalism was its persistent unwillingness to cooperate with any of the other political parties. Another was its program, which began in 1911 to change from upholding the right of farmers to own their own land to demanding that land be nationalized--a change that cost the SDP most of its support among agricultural laborers.

In spite of industrialization, Finland in the early twentieth century was still predominantly an agrarian state. Agriculture also had undergone modernization, however, a process that had had a significant impact on Finland. The introduction of the potato in the eighteenth century had significantly reduced the threat of famine; the gradual introduction of scientific agricultural techniques during the nineteenth century had brought about further increases in productivity.

The ultimate consequence of this increased agricultural productivity was a significant increase of the population from 865,000 in 1810 to 2,950,000 in 1910. Some of this surplus rural population was absorbed by the growing urban factory centers, but the rest of these people were forced to stay on the land. Because the amount of arable land in Finland was limited, about twothirds or more of the agricultural population was relegated to the status of tenant farmers and landless agricultural laborers. These people's lives were precarious because of their large numbers and their dependence on the vagaries of the harvests. The tsarist government did little on their behalf, and the Diet, which was dominated by middle-class interests, showed no great concern for them. As a result, from about 1870 to 1920, approximately 380,000 people left Finland, more than 90 percent of them for the United States. Of those remaining in Finland, many were initially attracted by the SDP, until its pronounced atheistic outlook and its aim of nationalizing land alienated them. A program of land reform, begun after independence, eventually integrated these agricultural laborers into the Finnish economy.

One expression of popular discontent with the status quo during the nineteenth century was the rise of religious movements that challenged the formalistic and rationalistic Lutheran state church. Of special significance was the Pietist movement, in which the farmer-evangelist Paavo Ruotsalainen (1777-1852) was the most important figure. The Pietists popularized the notion of personal religion, an idea that appealed to the agrarian population. Pietism eventually had much influence within the Lutheran Church of Finland; it was also influential among Finnish emigrants to the United States, where, among other things, it provided an effective counterweight to Finnish political radicalism.

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Source: U.S. Library of Congress