Sunday, November 12, 2006

Fair Trade isn't

Gavin Ayling is spot on with his analysis of the Fair Trade bollocks.
Fair trade means that those lucky few who get themselves involved in a cartel can sell their products for a marginally higher price which, at least in theory, gives them dignity. What it means in reality is that a majority of food growers now must compete not only with CAP and US assisted first world producers but also cartel members.

And those in the cartel get only marginally more than they ought to (because the system is clunky) while their goods cost a lot, lot more.

Well, it's also worth pointing out—for those who do not read Private Eye—that the people who really make the massive amounts of cash are the retailers and the Fair Trade company itself.
It is, like many socialist ideas, good in intention but cruel and counterproductive in practice.

This is because most socialists are fuckwits for whom the phrases "unintended consequences" and "economics" might as well not exist.

The only truly fair trade is free trade, ceterum censeo Unionem Europaeam esse delendam.

7 comments:

Anonymous said...

Gavin Ayling is talking rubbish: Fair Trade works because it takes commoditised goods and raises their value to consumers by giving them a credible brand.

Non-Fair Trade farmers aren't harmed; the extra money received by producers is entirely extracted from the Guardianista buyers who are willing to pay a price premium. It's not a socialist system at all - it's capitalism in action.

(I wrote an article expanding on this point recently for Contagious Magazine, but irritatingly I don't own the copyright and it isn't on the website yet.)

John B

james higham said...

The only truly fair trade is free trade, ceterum censeo Unionem Europaeam esse delendam.

This is true and yet the decision to join the cartel is essentially free trade. It's the law of the market [read 'jungle']. this is Timmy Worstall's free market.

Some will sink. Incidentally, your mention of cartels supports the thesis I've just posted on the 'subterranean organizations' who control things, esp. in Europe.

mark said...

'delendum'

Anonymous said...

James is right to a point... My main concern is not about foolish people buying into a flawed idea to make themselves feel better while supporting the EU's principles (choked on a laugh there, sorry). Rather I am concerned about a local government supporting said cartel.

Worse still, some Councils have become "Fairtrade Councils" which means they source much of their own supplies etc. from Fairtrade sources.

Anonymous said...

Mark: it's a gerundive, not a gerund. Agrees with "unionem".

Mike said...
This comment has been removed by a blog administrator.
Mike said...

Anti-fair trade sentiments translate into support for open slather free trade markets. Sadly, when governed by ineffective regulation developing markets have limited or no access to markets, and so perpetuating the cycle of poverty.

Groups like Oxfam lobby the WTO to change trade rules to stop exploitation, health crises and poverty. Where a liberalized trade market has failed impoverished third world producers, Fair Trade is what we've got at the moment to find alternatives to poverty.

The brand or ideology of the Fair Trade movement takes the lowest priority. This distinction is key.

A proportion of the earnings go to community projects. You only need to drive in the highlands of Papua New Guinea to see how appalling their roads and infrastructure is.

Community projects organised by Fair Trade collectives have placed vital infrastructure in communities. This is for everyone's benefit.

It's also worth noting that Fair Trade is considered an experiment in a better economic model to alleviate poverty.