Fairtrade are making an awful lot of hullaballoo about making a million and one swap outs over the course of a week – they want a million and one iterations of customers replacing their normal bananas, chocolates, coffee and whatever else, with the Fairtrade equivalent.

And gosh, isn’t that a worthy idea? I mean, everyone knows that Fairtrade gives farmers more money and is generally a good thing. Or something like that.

But as usual, the truth is slightly different from the marketing illusion:

Fairtrade effectively ensures that people “get charity as long as they stay producing the crops that have locked them into poverty”. Fairtrade reduces the incentive to diversify crop production and encourages the utilisation of resources on marginal land that could be better employed for other produce. The organisation also appears wedded to an image of a notional anti-modernist rural idyll. Farm units must remain small and family run, while modern farming techniques (mechanisation, economies of scale, pesticides, genetic modification etc) are sidelined or even actively discouraged.

Fairtrade director of communications Barbara Cowther admitted in the documentary A Bitter Aftertaste that the organisation had no real policy on mechanisation – this despite the fact that it is central to agricultural development.

By guaranteeing a minimum price, Fairtrade also encourages market oversupply, which depresses global commodity prices. This locks Fairtrade farmers into greater Fairtrade dependency and further impoverishes farmers outside the Fairtrade umbrella. Economist Tyler Cowen describes this as the “parallel exploitation coffee sector”.

Coffee farms must not be more than 12 acres in size and they are not allowed to employ any full-time workers. This means that during harvest season migrant workers must be employed on short-term contracts. These rural poor are therefore expressly excluded from the stability of long-term employment by Fairtrade rules.

I have been described as “a heartless sociopath” because I do not subscribe to the modern fantasy that it doesn’t matter what happens as long as your motives for doing what you do are kind and noble. Here we have some kind-hearted, generous people promoting a scheme that locks its members into poverty and non-members into even worse poverty, yet they are lauded for their actions, while my suggestions that we should just get out of the way and stop trying to help them and just buy what they sell gets me branded as horrid, unkind and deranged.

The world’s a funny place, really.

First Class posts on Monday Letters From A Tory

March 1, 2010 at 22:25

1
JuliaM March 1, 2010 at 18:20

“…while my suggestions that we should just get out of the way and stop trying to help them and just buy what they sell gets me branded as horrid, unkind and deranged.”

Oh, you’re not alone in that. My usual response to ‘Fairtrade coffee..?’ is ‘Only if it tastes better or is cheaper’.

Which usually gets me a look as if I’d admitted to strangling kittens….

2
Alan March 1, 2010 at 19:04

“I have been described as “a heartless sociopath” because I do not subscribe to the modern fantasy that it doesn’t matter what happens as long as your motives for doing what you do are kind and noble.”

The road to hell is paved with good intentions. The fair trade welfare trap is one of them.

Free trade not fair trade.

With all the climate change alarmism and the ‘global solution’ being pushed I have long been puzzled why free trade has dropped off the radar of advocacy groups and Governments.(If it ever was there at all) Fair trade is a means to distract from the same protectionist policies at the consumer end that prevent free trade by being well-meaning at the producer end.

Worse, from the description given here ‘fair trade’ is simply a cover for ‘organic’. It will never allow poor farmers in backwaters to increase their wealth. It is a policy that encourages subsistence over development which to me seems fundamentally evil, given the clear health, wealth and environmental benefits that being richer brings.(You live longer, have smaller families, can buy cleaner technology/energy/resources and afford environmental protection policies and things like national parks.)

What is even worse than all that being blocked is that free trade would lower our cost of living while increasing the wealth of poorer producers. A redistribution of wealth by choice from richer people buying goods and services from poor people. No Government directing of funds needed. No NGOs creaming off a vast portion for themselves either.

There is a glut of national Governments who lean well to the left and don’t want people to work their way out of poverty. They prefer to pay them to stay where they are and stay on the scrapheap. It is as if the third world in particular is some kind of petting zoo to these people.

3
binlid March 1, 2010 at 21:11

I have long argued that Fair Trade is anything but. However, as long as people feel that by buying goods with the Fair Trade endorsement they are “doing their bit” the myth will perpetuate.

Alan: Your excellent response has certainly made me want to research Fair v Free more fully.

4
John Pickworth March 1, 2010 at 22:33

You’re not “horrid, unkind and deranged”

Fairtrade is just another facet of the do-gooders doing BAD. I resolutely avoid buying any product that displays the fairtrade logo.

5
Fair trade – you have to be joking March 2, 2010 at 01:48

I actually had dealings with this crew as a producer and all I can say is that they’re an expensive burden and utterly useless to the people they are supposed to ‘protect’. For a start you know they take a very large chunk of cash out of every transaction, so much so it is more than the farmer makes in profit after paying for seed, fertiliser etc and its that (instead of increased profit to the farmer) that pushes the price of fair trade products up.

Coupled with that they are lazy and arrogant. I know of a number of farmers who contacted them but only about 5% ever got a reply even after repeated emails. They force farmers into growing crops they are not necessarily suited for but won’t take products they don’t understand (which appears to be anything other than coffee).

They are typical smug metropolitan do gooders, with an eye to making shedloads of personal profit, who couldn’t give a toss about the farmers they are supposed to ’support’. Thank you for bringing this to everyone’s attention.

6
Biffo March 2, 2010 at 03:21

U’mm – maybe that’s why the coffee tastes so bad.

7
Joe March 2, 2010 at 08:15

Very thought provoking article, Anna.

I also was very much taken by the response from Alan.

Further reading is on the horizon.

Thanks both.

Joe

8
Joseph Takagi March 2, 2010 at 10:02

I used to buy it because I thought it was a better way to get money into people’s pockets rather than through governments or the big African charities. I don’t buy into that any more. I’ve figured that you’re just paying a premium, most of which is taken by the retailer/supplier (like charity christmas cards), so I may as well just buy better quality coffee.

But I don’t get some of the criticisms. If it encourages oversupply then prices will go down and some people will get out of it. Does it matter if it doesn’t encourage mechanisation? If they can work out that non-mechanised production puts more money in the bank because of some bleeding-heart liberals, then that’s their choice, surely?

No-one is forcing is suppliers or buyers into this arrangement.

9
BM March 2, 2010 at 14:15

Non fairtrade bananas are also getting rarer.