Waylaid Dialectic

February 28, 2012

Fair Trade and Unfair Critique

Filed under: Trade — terence @ 7:51 pm
Tags:

I could almost agree with this anti-fair trade whinge on the Guardian. I certainly think stronger unions in some third world countries would be a good idea. Yet two aspects of the article bug me.

First, the overarching intellectual framework which seems to be something along the lines of: fair trade can’t solve everything; therefore fair trade is no good. This is an obvious logical fallacy. Not to mention a tired tool of argument that some on the left never seem to tire of using. It’s true that fairtrade isn’t a panacea. But the history of the last century suggests that the search for grand social cure alls is a fool’s errand. What’s more – effecting structural change in other countries is often very hard to do. Which means we may be waiting a long time for the rise of unions. Which means that if fair trade helps in a small way in the meantime, why not do it? It’s better than no help at all.

Second parts of the article are at odds with other parts. Specifically:

By doing that it throws responsibility for making sure farmers and workers are fairly paid back on to consumers – who may or may not be able to afford to take their morals shopping, especially in a recession – rather than on the big businesses, the international traders, the manufacturers and the retailers that make substantial profits out of the goods they sell.

Fair trade alone cannot address the core problem of excessively concentrated markets in which a handful of overpowerful transnational corporations dictate terms of trade and suck profits up into their own coffers.

If the problem is corporate capture of the supply chain leading to low wages then surely fair trade importers, by avoiding leeching corporate monopsony, ought to be able to pay workers higher wages at no cost to the consumer.

Or, if fair trade really necessitates higher costs to the consumers, then this can’t be because corporate middlemen are currently taking a huge bite out of the commodity train. Unless the fair trade organisations are doing the same too. Which they aren’t.

If corporate trade practices are the issue for the types of products that fair trade services then the costs of fair trade won’t be born by consumers. And if consumers have to bear the costs then the issue can’t be the corporate supply chain. Just can’t.

That our author can’t see this makes me suspect her mind was never open to fair trade in the first place. To many markets, not enough structure, or something.

I’m interested in left wing alternatives to the world we live in. But I don’t think their pursuit should blind us to smaller but more probable wins.

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4 Comments

  1. Interesting points, on a topic which remains (fortunately) unavoidable down Wellington way.

    Comment by Thomas Huggins — February 29, 2012 @ 5:06 am

  2. Thanks Tom – can’t complain about the fairtrade coffee in Cuba Street that’s for sure. Hope all’s good with you.

    Terence

    Comment by terence — February 29, 2012 @ 6:18 am

  3. Totally agree with you that we shouldn’t expect Fair Trade to be the solution to all the world’s trade injustices. At which point there are only two relevant questions to ask:
    1) Is Fair Trade inherently worse than the absence of Fair Trade?
    2) Is the existence of Fair Trade inhibiting the resolution of trade injustices because people think they are already doing something good about them?
    I think the answer to both is: No. Therefore Ms Lawrence should stop whining. If you like Fair Trade and what it stands for then buy it. If it offends your economically purist principles or you agree that children in developing countries should be able to engage in the labour market if they judge that is best for their families then do not buy it. End of tired argument.

    Except that maybe too many Grauniad readers do think Fair Trade is a panacea, and so it is good for someone to remind them that it is not. I doubt that is really the case, and if the point of the article was to inform then it could have been better written. However, she does actually end on a fairly positive note.

    Comment by MJ — March 2, 2012 @ 9:54 pm

  4. Thanks MJ – nice comment

    Terence

    Comment by Terence — March 3, 2012 @ 9:00 am


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