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The Political and Economic History of Finland

Ancient History of Finland

Although there is evidence of very ancient occupation in the area of Finland the people who brought Finnish languge and culture came into the area sometime in the first millenium B.C.E. They were part of a westward drift of people from north central Asia. The related people, the Lapps, arrived in the area that is now Finland first. As Finns arrived in Estonia and commenced their migration into Finland about the first century A.D. the Lapps migrated north. There were other people who had lived in the area of Finland before but whether they were there at the time of the migrations of the Lapps and Finns is not known.

Linguistic analysis established several things:

When the Vikings began their trading/marauding expeditions in the ninth century they made contact with the Finns. But initially the Vikings made no permanent settlements in Finland because their attentions were devoted to the area to the east, now Russia, and trade ties with the Arab world.

When the Scandinavians were converted to Christianity there was an incentive to establish closer contact with the heathen Finns to convert them.

By 1150 A.D. the Swedes had established control in Finland and the conversion of the Finns to Roman Catholicism. The Russians however were bent upon converting the Finns to the Greek Orthodox version of Christianity and they began the conquest of the Finns in Karelia, the area to the east of the present boundaries of Finland. Finland was thus caught up in the political/dynastic/religious struggles for control in the region of the eastern Baltic Sea area.

By the year 1150 most of the Finns had been converted to Roman Catholic Christianity by the Swedes. The Finns of Karelia, in constrast, were converted to the Greek Orthodox form of Christianity by Russians. Thus commenced the separation of the Finns of what is now Finland from the Finns of Karelia.

Rome was not satisfied with the division of the Finns between Roman Catholic and Greek Orthox Christianity and promoted, or at least approved, a crusade to bring the Karelia Finns under Roman Catholic control. The Swedish crusade to capture Karelia was halted in 1240 and again in 1242 by strong Russian resistance led by Prince Alexander of Novgorod. These defeats did not dissuade the Swedes and the war continued for thirty years, finally ending with the Peace of Nöteborg Treaty in 1323. This treaty established a border which prevailed for three hundred years.

Once peace was established the Finns devoted themselves to extending their agricultural economy into the wooded area to the north of their traditional homeland. But Finnish agriculture was a precarious undertaking and most Finnish farmers had to pursue other endeavors such as hunting and fishing to ensure their survival. Immigrants from Sweden joined the Finns in the coastal areas.

As Finland developed agriculturally German traders began to visit Finnish shores. The city of Turku became the center of trade and the political capital of Finland.

The Reformation came to Finland without much turmoil. The population was converted to Lutheranism largely by dictate of the Swedish nobility. Finnish troops were conscripted to fight in the wars the Swedish Empire engaged in. One such war, between Sweden and Russia, lasted twenty five years (from 1570 to 1595) and was known as the Long Wrath.

Along with the devastations of war another calamity came to Finland at the end of the seventeenth century. In 1696 Finland suffered a famine in which a third of the population died. It was not until the 1730's that Finnish farmers acquired the potato as a reliable food source.

The climax of Swedish imperial adventures came with the Great Northern War. In 1700 an alliance of Denmark, Poland and Russia was formed to defeat Sweden and dismember its empire. Charles XII of Sweden ably conducted a successful defense but overstepped himself when he marched to Moscow and was defeated in 1709. He survived that loss but was killed in an attempt to conquer Norway in 1718. The Great Northern War ended with the Treaty of Nystad in 1721 in which Sweden gave up its territories on the eastern and southern shores of the Baltic Sea.

The end result of the destruction of Swedish power in the Baltic was was the acquisition of Finland by the Russian Empire. This was formalized in 1809. In the usual course of events a territory being acquired by Russia it would simply be absorbed politically into the Russian Empire. The Russian Tsar, Alexander I, made an exception in the case of Finland. Finland was made into an autonomous state ruled by Tsar Alexander I and called the Grand Duchy of Finland. Tsar Alexander issued to two decrees in 1809 that allowed the laws and institutions of Finland to continue as they were under Swedish control. The Finnish Diet accepted the Tsar's decrees and was dismissed. Generally the century of Tsarist Russian control of Finland was peaceful.

During that period of Russian control the key industrial development of the forest industries of Finland began. Finland began to export timber and lumber to Germany and later to Britain. The processing of the timber into pulp and paper in Finland also commenced. Ultimately the Finns became the preeminent experts in pulp and paper technology. Because of the timber-producth export industries Finland developed a merchant marine.

The nineteenth century saw the development of Finnish national consciousness. A Finnish language literature was developed based upon Finnish folk tales. The high point of this development was the creation of the Kalevala, the Finnish national epic poem by Elias Lönnrot based upon folk tales of the Finns.

Finnish Independence and Civil War

Finland and Russia were not linked politically except through having a common monarch. The Tsar of Russia was separately the ruler of the Grand Duchy of Finland. When the Tsar of Russia was overthrown, Finland technically became separate from Russia. Although it is often overlooked there were two revolutions in Russia. The first, in March of 1917, overthrew the Tsar. A social democratic Provisional Government under Alexander Kerensky took control. The Provisional Government neither acknowledged nor denied the independence of Finland. In July of 1917 the governmental legislature in Finland attempted assert autonomy. The Provisional Government of Russia reacted to this attempt by dismissing the Finnish legislature and calling for new elections. There was a bitterly fought campaign of socialist and anti-socialists for control of the legislature. The socialists captured 92 of the 200 seats but not enough to control the legislature. The socialists began to call for direct revolutionary action rather than acceptance of governance by the legislature.

The second Russian revolution , under the leadership of Leon Trotsky, was more of a coup d'etat overthrew the Kerensky government in October of 1917. The success of direct action in Russia led the socialists in Finland to copy those methods. A general strike in November of 1917 gave socialists temporary control of the country. The political leaders of the socialists however did not declare workers' control. A middle-class government was established in December which declared Finland independent on December 6, 1917. Vladimir Lenin, who came to power after the October revolution, was then faced with acknowledging Finnish independence or having his government take on yet another military burden. He chose to acknowledge Finnish independence on December 31, 1917. He was well aware that there was a strong Bolshevik movement in Finland was quite likely to bring Finland under the control of a Communist Party and hence political independence for Finland would mean very little.

While these political events were developing the middle class of Finland was organizing a Civil Guard and the working class was organizing a Red Guard. The Civil Guard subsequently became known as the White Guard. German officers were brought into the White Guard to establish military discipline.

The middleclass government controlling the legislature in early January of 1918 gave the White Guard, authority to establish civil order. In effect the White Guard became the state security force.

Radical elements took control of the Red Guards and decided to rebel before the White Guard could establish civil control. They called for the revolution to begin on the night of January 27-28. Simultaneously, the leader of the White Guard, Carl Gustav Mannerheim, called for the White Guard to commence its military action to establish civil control on that same night.

In Finland the Boshevik movement was largely confined to the cities. Among the farmers in the countryside there was strong anti-Bolshevik sentiment. The farmers in Finland were aware of what was happening to the farmers in Russia. They were not willing to allow that to happen to them.

The troops for the White Guard were mostly farmers. The Red Guards were mainly workers from the cities. As the battles developed the Whites controlled the northern part of Finland and the rural areas of the south. The Reds controlled the cities in the southern part of Finland. The Reds had upwards of one hundred thousand soldiers; the Whites had only about seventy thousand. But the Whites had the definite advantage of having professionally trained and experienced officers.

Both sides potentially had aid from outside forces. There were about forty thousand Russian army troops still in Finland. Germany sent units to help the Whites. Although the Russian troops could have been important they were withdrawn after Lenin's government signed the treaty of Brest-Litovsk on March 3, 1918. This treaty ended Russian involvement in World War I. The German troops landed in southern Finland and captured Helsinki on April 13th. With the stronghold of the Reds captured the forces of the Whites were able to defeat the rest of the Reds by early May of 1918. Thousands of the reds escaped to Russia rather than risk capture by the Whites.

In the last stages of the fighting the Reds carried out a reign of terror against people in the territories under their control whom they perceived as being their political enemies. Close to two thousand were executed in this reighn of terror. The Whites, when they found out about the Reds' reign of terror, reacted by treating the captured Red soldiers as criminals and executed about eight thousand. The Whites captured about eighty thousand Reds and they did not have the resources and facilities to properly care for them. About twelve thousand died from the conditions of imprisonment.

The Finnish Civil War lasted only a few months but about thirty thousand Finns died as a result of it. About three quarters of the deaths were from executions or privations of imprisonment rather than on the battlefields.

The bitterness from the Civil War lasted for generations. The wounds did not heal until the two elements united at the time of World War II to defend Finland from the Russians.

The Interwar Period

In the Interwar Period there were a number of politically important parties in Finland. The most important were:

PartyFinnish NameAcronymPolitcal Stance
Finnish Social Democratic PartySuomen Sosialidemokrattinen PuolueSDPWelfare State Socialism
National Coalition PartyKansallinen KokoomuspuolueKOKConservatives and monarchists
National Progressive PartyKansallinen EdistyspuolueEDLiberal and republican
AgrarianMaalaisliittoMLRepresents the interests of farmers
Communist Party of FinlandSuomen Kommusnistinen PuolueSKPCommunism and alliance with Soviet Union
(illegal until after WWII)

Finland and World War II

When Stalin perceived the likelihood of a German invasion of the Soviet Union he saw the city of Leningrad being vulnerable from the border being so close by. He offered the Finns a trade. In exchange for Finnish territory to the northwest of Leningrad he would transfer of Karelia to Finnish control. Carl Gustav Mannerheim, the political and military leader of Finland, was in favor of accepting the trade, but the members of the Finnish Diet would have nothing of it. Stalin heard of the Finnish refusal of his deal and calmly ordered the invasion of Finland.

The Soviet Union had vastly more military power than Finland but Finland under Mannerheim's generalship put up a valiant defense that elicited admiration around the world but no military support. The Finns had the advantage of fighting a defensive war in terrain they were familar with. There were episodes of incredible daring on the part of Finnish troops. In one case two Finnish commandoes came upon a detachment of about two hundred Soviet soldiers settling in for the night in a clearing in an isolated forested area. The two Finnish commandoes armed with submachine guns burst into the encampment and killed all two hundred Soviet soldiers.

Despite such acts of daring and courage the Finns were ultimately overwhelmed by sheer numbers and had to except a peace settlement in which the Soviet Union took the territory to the northwest of Leningrad.

When Germany invaded the Soviet Union the Finns joined with them in attacking the Soviet Union. Allied powers, who were generally very sympathetic to the Finns, demanded that Finland cease its support of German. When Finland did not end its military alliance with Germany the Allied Powers declared war upon Finland.

Finland soon regained its conquered territories, but as Germany began to lose the war Finland considered negotiating a separate peace with the Soviet Union. Representatives of Finland and the Soviet Union met in Sweden. The Soviets refused to make any concessions to Finland and demanded $600,000,000 in reparation payments. Finland continued its role in the war.

When the end of the war was finally drawing near in 1944 Finland again under the leadership of Mannerheim concluded an armistice. This armistice included the payment of reparations by Finland to the Soviet Union. The value was reduced to $300,000,000 over a six year period. The reparations were divided into three equal parts: 1. forestry and paper products, 2. agricultural products, and 3. machinery. Finland did not have the equipment and labor force experienced in producing machines, but it acquired them and completed the payments on time. The machinery and engineering industries that grew out of the reparation payment requirement became the basis for Finland's postwar economy. The resourceful Finns managed to turn the lemon of reparations into the lemonade of a successful export industry.


Real Gross Domestic Product of Finland

The recession of the early 1990's was as result of the political and economic collapse of the Soviet Union. Finland lost a large component of its export market with that collapse. After the recovery of Russia and the Finland's joining of the European Monetary Union its economy recovered and has been more stable than before.

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