Friday, April 29, 2011

Capitalism Brings Us Together - Fair Trade Edition

I gripped on a live stream of a Fair Trade event. The CEO talked with some of the people who are leaders in Fair Trade Co-Ops on the impact Fair Trade has had on their life.

The morality here is two fold.

First, I'll admit I've always been a little close minded about Fair Trade certification. Knowing that one of the requirements is that farmers have to be part of a cooperative always turned me off. A cooperative always seemed a little Marxist to me.

But here I am, at a Fair Trade event, something I would have never considered before. And there is only one reason. I'm getting paid. In other words, capitalism. Capitalism brought me face to face with people who I may have disagreed with in the abstract but who are good people nonetheless. That's the first point.

Also, I actually learned something by listening to these farmers (who incidentally hail from, right to left, Peru, Costa Rica, and Kenya; blue shirt is Mr.CEO). 
  1. A cooperative is more of a democratic community than a communist utopia. Yes, the profits are shared so that even the laziest farmer gets the same as the hardest working but it's voluntary. I think that is the main point. These farmers have decided that the trade-off makes them better off in the end. 
  2. They genuinely care about the quality of the product and the consumer liking it. This is important. They have teamed up with Fair Trade not for handouts but as a marketing tool. 
  3. Because of it's voluntary nature, Fair Trade certified products are a new form of capitalist driven charity. When you buy these products you are subsidizing these farmers lives over and above the market value of their productivity. This may be even better than traditional charity because the money flows through productive means.
  4. They are genuinely happy with this arrangement.
The second point and the most important point is that the Fair Trade certification organization is a byproduct of genuine capitalism, as all charity is. You can't have charity if everybody is poor. 

I am not entirely convinced about Fair Trade though, for a few reasons. 
  1. Fair Trade products have a price floor which means their price stays above a certain level even when market prices drop. The CEO compared it the having a minimum wage. And we know that the minimum wage is good for those who have it but basically prices workers out of the market causing higher unemployment. Which brings me to...
  2. What are the requirements for being in a co-op? It seems that those within the co-op benefit but what about those left out? Also...
  3. What if you don't want to be part of a co-op? What if you don't want to go to the general assembly every year and fight over who gets how much? Why can't you be an independent land owner who treats your workers "fairly" and still get the certification? Is that fair?
Anyway, had a good time and learned something new. All in the race for the almighty dollar! Thank you, capitalism.


No comments:

Post a Comment