Fair Trade, ethics and gesture politics

An exchange on Twitter with the free thinking and autonomous @untwining (Lisa Amphlett) who authors the excellent blog All About The Voluntary recently led to a decision that one of us would blog about Fair Trade.

This being the start of Fairtrade Fortnight, Lisa pointed me to a must-read piece in yesterday’s Telegraph by Philip Booth who makes a powerful argument that Fair Trade is neither fair, nor good for trade. Booth points out that ‘researchers sympathetic to fair trade have suggested that only 25 per cent of the extra price paid by consumers finds its way back to producers’.  He also points out that:

Fair trade is supposed to bring better working conditions to poor producers, together with higher prices and better social infrastructure. Questions have been asked about whether monitoring in the supply chain is sufficiently robust, and examples of unsatisfactory practice have been found. Furthermore, there are costs for producers. Poor farmers have to pay considerable sums to join up and often have to organise their businesses in particular ways: it is not suitable for all producers, especially in the poorest countries.

This is a consequence of Fair Trade’s structure that seems to be swept under the carpet or simply unknown to people who want to feel they are doing something ethical and playing a part in tackling poverty by choosing to buy products labelled as Fair Trade.  Booth’s piece also highlights an anti-competitive element of Fair Trade as he explains:

Fairtrade schools and parishes have to commit themselves to selling Fairtrade products. This is unfortunate for producers – who may be as poor – for other schemes, such as the Rainforest Alliance or Bird Friendly, that are designed to protect the environment.  And, of course, if we transfer our allegiance to a fair trade producer from a non-fair trade producer in a poor country, what happens to the farmer who loses his customer base?

It appears that despite these justifiable concerns, the government is pressing ahead with a supposedly ethical Fair Trade policy at the expense of taxpayers who have no way of holding politicians to account for it.  The plan is to introduce a requirement to purchase a minimum of 50% Fair Trade tea and coffee, and it will apply to central Government departments, prisons and the armed forces under Government Buying Standards.  This was confirmed in a written answer from DEFRA in Parliament yesterday… (click to enlarge)

What really stands out here is that last paragraph, where there is a clear recognition that the policy will result in increased costs to the taxpayer and that the decision has been taken without prior evidence of equivalent costs having been submitted by the Fairtrade Foundation.  Convinced by the righteousness of the policy government is pressing ahead regardless.  The public is entitled to evidence based policy making which is not happening.

It should be a matter of concern to everyone that government is engaging in gesture politics at taxpayer expense to follow a supposedly ethical policy, that research shows has the capacity to harm people in poorer countries, by selecting produce generated within a system over which there are question marks that do not appear to have been critically evaluated.

Perhaps it is time for voters whose parish, borough or city councils have imposed a Fair Trade procurement policy to challenge their authority for evidence of the benefits to producers in poorer countries of Fair Trade – rather than anecdotes – and write to their MPs asking for the same to justify the additional cost being passed on to us.

23 Responses to “Fair Trade, ethics and gesture politics”

  1. 1 Grumpy Old Man 01/03/2011 at 10:18 am

    There is also the problem that fair trade products sometimes don’t taste so good. Given equal quality, I’ll pay a bit more for fairtrade products. I will not pay extra for inferior goods.

  2. 2 Cassandra King 01/03/2011 at 10:33 am

    How much goes to feather nests and build empires, generous salaries company cars golden pensions?

    I always thought that fair trade was simply another tool for tranzis to spread their influence. I dont know if they realise it but central diktat subsidy of subsistence farming does not work. Top down bureaucratic dogma driven management reinforcing unsuitable uneconomic farming simply on the spurious grounds that self righteous pompous whitey likes to see the natives slogging away in the fields in the old way is no way to improve the lives of the poor. It feels like what it is, the new missionary fervour.

    All I see is lots of well off parasites playing ideological games with powerless people, a childish and really quite sad game played by really quite sad people on often desperate and therefore malleable poor people. Still if it all goes pear shaped then at least pompous whitey will be able run away from the mess with full bank accounts.

  3. 3 Untwining 01/03/2011 at 10:41 am

    According the Fair Trade website, suppliers can negotiate for *additional* premiums on top of everything else for higher quality goods — I assume in an attempt to combat the problem GOM describes. However, once pricing is fixed at an artificially high level by a scheme such as Fair Trade, optimum profitability does not necessarily come from going that step further. Bad for consumers, ultimately bad for suppliers.

  4. 4 permanentexpat 01/03/2011 at 10:55 am

    As always….follow the money.

  5. 5 PeteM 01/03/2011 at 12:00 pm

    Whilst fair Trade seems like a reasonable idea to help growers etc, avoid being paid at a price level which is advantageous to the buyer, like all things green,environmental,NGO etc. there’s always another dimension.

    I’ve checked the Fair trade site and can’t actually find any mention of the following but I’m fairly sure this is part of the “deal”. The site makes mention of the requirements the farmers etc. have to make to gain acceptance as a Fair trade Licensee.

    There is mention of environmental requirements. They in part require the grower etc. not to use modern farming techniques. Now if this initiative is aimed at helping the farmer/grower etc. surely they should be free to use the best techniques to get the most from their land leading to more crops etc. to sell and providing them with a higher income. I’m sure I’ve read this somewhere before but I can’t find it at the moment.If I’m wrong then sorry.

    However, prosperity is surely the key to success. The more people prosper the more choices they have and the more they stimulate a wider economy which then includes more of their population.

    Governments buying goods at higher prices which exclude their own populace is surely treasonable? Aren’t governments there to put the interests of the electorate and the country as a whole first?

  6. 6 WitteringWitney 01/03/2011 at 12:10 pm

    As far as I’m concerned you can add FairTrade to the other scams being implemented, like climate change, windfarms etc etc

  7. 7 Fay Tuncay 01/03/2011 at 1:04 pm

    I very much agree with you WitteringWitney. Another excellent blog AM I have posted this on the Caroline Lucas Facebook page so expect some incoming comments from her minions.

  8. 8 Untwining 01/03/2011 at 1:25 pm

    PeteM, you can find more about the requisite environmental standards in the FAQ section of the Fairtrade website… Might raise more questions than it answers ;-)


  9. 9 PeteM 01/03/2011 at 1:44 pm

    Thanks Untwining.

    I spent a bit more time on the website and it does actually say that they encourage organic and sustainable growing techniques and try to ensure good environmental practices.

    I still believe that benefiting the farmer/grower by just buying their product with simple reasonable enviro requirements would be most useful.

    Why do these organisation always want control? Why do they always require compliance? Quality maybe but nothing else.

  10. 10 MrT 01/03/2011 at 6:02 pm

    UnFair Trade…another little bunch just ripe for some critical and forensic analysis methinks.

  11. 11 Grumpy Old Man 01/03/2011 at 6:41 pm

    Further research would indicate that FairTrade is yet another futile attempt to make Tractor Factory economics work. Cassandra King’s take would appear to be essentially correct.

  12. 12 jameshigham 01/03/2011 at 7:02 pm

    Philip Booth who makes a powerful argument that Fair Trade is neither fair, nor good for trade.

    That’s been accepted wisdom for some time, AM.

  13. 13 David C 01/03/2011 at 7:21 pm

    Fairtrade is a mechanism for keeping the poorest and least productive countries out of western markets. By imposing minimum labour standards, those countries which do not have the ability to implement even those are excluded from the market.
    The campaigns against child labour are similarly counter-productive. It’s all very well railing against a 10 year old working in a mill, but if she’s the only source of family income, do we really want to lay her off and see the family starve?

  14. 14 Steve 01/03/2011 at 7:25 pm

    Yes I read that Cafedirect are employing militias to compel farmers to join Fairtrade cooperatives and to fight off the Men from Del Monte.

    Still their coffee and tea is delicious.

  15. 15 cosmic 01/03/2011 at 7:41 pm

    If people want to support FairTrade by buying products so labelled, that’s a matter for them. I’d advise them to look closely at this organisation rather than just assume they know what it’s about.

    However, I’m rather fed up with the government subscribing to all sorts of worthy causes such as wind power and dispensing largesse with money they’re borrowing on behalf of the tax payer.

  16. 16 Cassandra King 01/03/2011 at 7:51 pm

    Right here is is a perfect example of a laudable aim, that of looking after the interests of the poorest people usurped and perverted and exploited by people with a a political agenda further exploited by the carpet baggers and profiteers and shakedown merchants that follow the baggage train like scavengers.

    A system like so many that appear on the surface to be righteous and good yet just a little examination brings to light the reality and that reality is nothing like the glossy brochures pimped by desperate b list celebs and heart on the sleeve airheads. A system of keeping the peasant in his place and the persecution of those poorest who dare to follow the modern free capitalist models.

    One form of commercial exploitation replaced by an ideological exploitation were the new ‘plantation owners’ are sitting in comfy offices enjoying a great living courtesy of the goodwill of the consumer and the client captive poor farmer. What at first glance appears to be a fine and laudable aim is simply another form of exploitation.

    Want to help poor people around the world? Support genuine free trade, protest against the ugly and grotesque EU CAP. Protest against thug scum dictators of 3rd world nations who prefer to buy executive jets and Swiss accounts and Mercedes cars and luxury yachts instead of looking after their own people. Protest against despots buying arms and weapons and protest against the government handing over tens of billions of pounds that perpetuates the misery and poverty they claim they are trying to end. Protest against the corrupt UN gangs like UNEP/UNRWA and the rest of them who suck in money like hungry leeches. If you want to help the worlds poorest people then do not buy fair trade, it aint fair and it aint trade!

    The very best method of ending poverty in the 3rd world is good governance and free market free trade capitalism and an intolerance of despots and dictators and a firm belief in the superiority of our Western culture and systems.

  17. 17 kellys_eye 01/03/2011 at 8:24 pm

    How often do we see the phrase “…. at the expense of taxpayers who have no way of holding politicians to account for it.”?

    Far too bl00dy often.

  18. 19 David Duff 02/03/2011 at 9:05 am

    How odd! Only yesterday I took a passing side-swipe at Fair Trade. Without knowing much of the details, I simply relied on experience and reckoned it was a scam. My advice, for what it’s worth, is to buy your goods at places like Matalan which are dirt cheap crap but so cheap you don’t care if you have to replace them in a year, and it is sourced, I guess, from various impoverished parts of the world so some-one somewhere is earning a crust and none of the middle-men can be creaming much off the top.

  19. 20 Liz Elliot-Pyle 02/03/2011 at 10:42 am

    Sorry to go off-topic, AM, but could we please have the 5 star blogging back?

  20. 21 Autonomous Mind 02/03/2011 at 12:09 pm

    Hi Liz, in the interests of giving the public what they want, ok then. I have been focusing on a new contract that is keeping me busy and will for many months, but 5*B will return this evening.

  21. 22 Liz Elliot-Pyle 02/03/2011 at 1:31 pm

    Well thank you so much for that. How’s that for customer service!!!

  22. 23 Dave H 15/05/2011 at 7:01 pm

    FairTrade lost the plot (if it ever had a good one) when the big corporates jumped on the bandwagon. It’s good that in principle the big corporates conform to the ethical policy and treat the supply chain fairly, but I suspect that multiple definitions of ‘fair’ exist.

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