I don't see how this "fair trade" charade is benefitting the 3rd world countries. The arguments that socialists use is that "by getting more money, the producers are richer and are therefore better off". But this isn't the only consequence. There are several criticisms of "fair trade" that deserve attention, but they're not the most important ones. The small criticisms are: a) Supermarkets overcharge for "fair trade" products. e.g. if the producer gets extra $0.15 per pack of coffee, the supermarket will charge an extra $1.00 (abusing the honest intent of a naive liberal to milk it for cash). In other words, most of the premium you're paying to make the prices fair, in fact go to the corporations' pockets. b) What happens is that too much coffee bean is made with this attempted price floor, and big corporations win more by cheapened “non-Fair Trade certified” coffee. so a few coffee growers get a few extra dollars, but in general coffee bean prices fall, and non-'fair-trade' coffee growers lose out These 2 effects are bad enough, but there are even more devastating ones: c) Even if you double what you're paying coffee farmers it will not look "fair" enough to socialists at home. After all, it'll only be 1 or 2 cents more. Hardly a "fair" share, considering that a cup of coffee at home costs about 50 times more than 20 pounds of coffee in the 3rd world country. So in order for the corporation to attract the progressive and "moral" customers, it'll need to pay obscene prices for coffee (obscene with respect to the price levels in those 3rd world countries). So a coffee farmer will be paid as much as a lawyer or doctor is. And what are the consequences of that? Doctors and lawyers will stop being doctors and lawyers, and will start growing coffee. Why should they study all these years, making sacrifices, and make as much as farmers make? In other words, artificially increasing what you're paying coffee farmers will damage the economy of the entire country, and will have destabilizing social effects. d) As with all artificial price floors, and particularly with a severe price floor, inflation will go through the roof... everyone will start charging more for their services, thereby cancelling out the effect of the price increase... but not without painful adjustments caused by soaring inflation. e) The new class of rich coffee makers will invite and incite violence from their countrymen that are not getting such preferential treatment by rich corporations. Violence in competition to get a job on such a farm, violence to "take these filthy pigs' money and give it to the people", and violence from other sources. This whole "moral" and "fair" approach to trade is not as simple and beneficial as naive (yet good hearted) liberals think it is. by purchasing "fair trade" items they may do much more harm than the good they intend. I really want to be convinced that my assumptions are wrong so that I too can absolve myself of the guilt stemming from living in a 1st world country by buying a certain brand for a buck more. So go ahead, show me that I am wrong, so I can sleep better at nite.
Socialists? Your whole premise is mistaken. Supermarkets charge more because the volume is low. Since the volume is low, there are no widespread systematic effects on the coffee industry. It would be great if sustainable agricultural practices took over from the standard ones, but that won't happen since it is more costly and labor intensive, and most consumers (especially in other nations) don't care.
Easy. Give up living in a 1st world country and take up living in a third world country. Your guilt will be over almost immediately. Baron Max
So .....learn to live with your "guilt". Which obviously isn't so great that you can't just cast it aside, huh? Fuck the coffee farmers ......as long as you can have your lattes, of course. Baron Max
i'm not sure how much of your post is sarcasm and how much of it is really directed at my "guilt". personally, i'd never buy "fair trade" coffee just because it tastes so awful. But I'm not saying "fuck the farmers", and i am also not drowning in guilt. the guilt i talked about in post#1 is of social activists and PoliSci majors that are self-hating, but genuinely good people who didn't take economics courses. this responsibility they feel towards saving the planet's poor is misdirected. there are other better ways to help poor people around the globe. but i think it's best if they concentrate on the poor in their immediate vicinity. anyway, that's off topic. i'm just interested to know what other people, perhaps more informed about this, have to say.
Free trade is the only good trade. All barriers to trade must be removed at once. Here's the problem: Most politicians think that protectionism *helps* their country. They would rather prop up prices for the producers, rather than making sure that all consumers get the best product for the best price. Their protectionist policies actually hurt their own people more than they hurt foreign producers. Here's the funny/sad part: Countries won't stop hurting themselves until other countries stop hurting themselves. It has been put as an analogy: Imagine that you are rowing a canoe down a river, and your competitor/friend is rowing his own canoe alongside you. All of a sudden, your friend takes out a gun, and shoots a hole in his own canoe. So, what do you do? You pull out your own gun, and shoot a hole in your canoe as well. This is exactly what trade policies do with tariffs, import taxes, duties, trade limits, etc... They screw themselves because other people won't stop screwing themselves. And it is all fueled by the fact that producers spend money on lobbyist, and consumers don't.
THERE IS A DIFFERENCE BETWEEN FREE and fair trade. free trade.... means no tariffs.... allowing the lowest price to win. fair trade.. is what we used to have.. it used tariffs. tariffs... protect nations from cheap goods from other nations. tariffs... even the playing field. free trade.... is simply not fair... and its not trying to be. -MT
^ Now thats some pinko BS right there..... Buuuuuut anyway, the Fair Trade Blend we have at school is the best. Blows away most other coffee on pure taste. So I buy it.
Agree. MT is dead wrong here. The only "fair" trade known to man IS free trade. The market (coupled with legal protection from cheats) punishes and rewards better than a group of economic planners. This has been soundly proven many times over.
guys, thanks for your responses, but I feel you're digressing from the subject and arguing more about the validity of opposite ideologies. i have my own opinions about that, but i'd like to talk strictly about "fair" pricing of coffee, and whether the benefits created for the 3rd-world farmers by paying those premiums outweigh the harms caused by paying those premiums. thanks.
Those of us arguing against anything but Free Trade are obviously against "fair" pricing schemes. "Fair" trade is a way of rewarding inefficient producers. It will hurt developing economies as surely as welfare has hurt minorities in my country. If you want to be a coffee producer, and you are small, you should be able to compete more efficiently with your local market, and use the fact that you are local to your benefit. People that live around me use my services (as a picture-framer) because I am local. And I buy fruits and vegetables from our local farmer's market, etc... If a distant producer will use this to their advantage, they can get a foot in the door. If they develop a superior product along the way, they can branch out, spread across their city, their region, their country, the world. The derided Starbucks started out just this way, and now they are reviled for their success. The baffling thing about leftist economic thinking is that they are willing to cause harm to see that the weak succeed, and then rail against them when they do. It is guilt-induced loser-loving. Underdog syndrome. The biggest problem with Fair Trade crops is that the big manufacturers quickly abide by the required standards, stamp the Fair Trade logo on their goods, and out-compete the same people anyway. That is also what is going on with Organic Foods. As soon as there is a demand for Organic Foods, big (efficient) companies rushed to fulfill that demand. Now that they are profiting from it, health-food leftists are urging people AWAY from Organic Foods and to LOCAL Foods. Soon, the big companies will have satellite farms, to get within 200-250 miles of the retailers, in order to comply with this new demand, and the idiots who hate success will find the next thing. What will that be? Home-grown foods. Indoor gardens, small backyard kits. And who will make the supplies and sell the seeds and garden accessories? The big, efficient companies who do everything they can to please the consumer, and are vilified for it.
great post. though I'm a bit disappointed to find no body to have decent arguments against swivel's (or mine). i am genuinely trying to open my mind and desperately wanting to find a good solid reason why i should support at least this one leftist idea.
I quite like Tesco's Fair Trade instant coffee. In the tall squarish jar. It's not that expensive, especially compared to the top brands - Kenco, Nescafe, Carte Noire, etc. As for the main points of the thread - I have no idea. They sound plausible, if not probable. It's a bit defeatist, but maybe it's best just to pretend that it benefits the coffee farmers, nobody is adversely affected and the supermarkets don't inflate the price for greater profit. It must be in someones favour, else the idea would have been denounced long ago. Take that, buy the coffee and push the guilt to one side.
FOR ALONG TIME.... FAIR TRADE... USING TARIFFS... WAS THE NORM. free trade wAS obsurd... FOR ALONG TIME... you guys... have been clearly educated by the free trade promoters. i could continue to argue... but i see little point doing it here. -MT
It was considered the right thing to do back then. Like having blacks as slaves, and keeping women quiet and in the home. Are you really suggesting that the age of an idea lends weight to its credibility? If you are making this fallacy, and are unable to come up with arguments germane to the topic, then you are correct, there is little point of you continuing to "argue". Tarrifs are hand-outs. Bribes. Grease. Punishment. Pork. Sly deals. Tomfoolery. They lead us away from capitalism, and back to mercantalism. And mercantalism is a horrible system of government/economics. Horrible. If you can break away from the fallacious arguments, and actually try to support "fair" trade with logical points, we could have a discussion, which is what we all want. Don't give up. Give it a shot.
yes... AND TODAY... FREE MARKET COFFEE... is causing coffee farmers in India... to kill themselves... why?? because they cant pay their debts... why? because they cant sell their coffee.. why? because the world market is bringing cheaper coffee into India. that is the side effect of a global market. it takes time... time for all those who dont like it.. or benefit.. to kill themselves. -MT
