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Criticism of Fair Trade
Noah Enelow lists some discussion points
in his brochure "Fair
Trade: an Introduction". He states that:
“Fair Trade does not address the root cause of low coffee prices:
oversupply. Economist Tim Harford writes, ‘…The numerous
brands of fair trade coffee are likely to improve the income of a few
coffee producers… But they cannot fix the basic problem: too
much coffee is being produced. At the slightest hint that coffee farming
will become an attractive profession, it will always be swamped with
desperate people who have no alternative. …Only broad-based development … will
ever lift the living standards of the very poor.’ (Harford,
Undercover Economist, 229)
Rebuttals
-Fair Trade is designed as a complement, not a substitute, for good
policy. The system can work in tandem with policies on the international
level to address the oversupply of coffee, including agricultural
extension services to help farmers diversify their crops away from
coffee.
-Harford overestimates how easy it is to get into coffee farming.
He writes: ‘High coffee prices will always collapse, until
workers in sweatshops become well-paid (workers)… who don’t
find the idea of being even a prosperous coffee farmer attractive.’ (Harford,
229) However, he doesn’t present evidence for how many people
enter and exit coffee farming each year. Is it so easy for workers
to shift from sweatshops to coffee fields?
- Fair Trade is still capitalist: it doesn’t work towards building
an alternative to production for profit on the market.
Rebuttals
-Fair Trade encourages democratic producer organization through agricultural
co-operatives made up of small growers. It thus offers an alternative
to the plantation system of capitalist agribusiness that has dominated
commercial farming from Bolivia to Borneo. Thus, while Fair Trade works
through the market, it also weakens the system of wage labor, which
Marx identified as the locus of exploitation in the capitalist system.
-Fair Trade, through providing increased assets to small farmers,
has the capacity to change the class structure in societies such as
Peru, Brazil, and Indonesia, which are marred by extreme inequality
in land and asset ownership. The resulting increase in small farmers’ political
power can usher in a new era of socialist political organization, as
the election of Evo Morales in Bolivia has recently shown us. “
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