The Economist’s report on organic, local farming and fair trade foods (Dec. 7) argues against the long-term viability and effectiveness of these initiatives, drawing three conclusions:
- Even if organic farming does consume a little less energy and produce a little less pollution, that must be offset against lower yields and greater land use.
- Fair trade food may help some poor farmers, but may also harm others. i.e. Fair trade guarantees a premiere which undermines both incentive to diversify the crops and will to compete in an open market.
- Even if local food reduces transport emissions, it also reduces potential for economic development.
Despite my lack of familiarity with the value chain and cost-benefits of fairly-traded foods, I am personally inclined to agree with the intellectual and rational conclusions of this feature article. (Ten Thousand Villages USA’s product mix is focused on handicrafts, unlike Ten Thousand Villages Canada which has a broader fairly-traded food selection.) The treatment of the subject though is understandably cold.
Living in the U.S. and working for an American corporation (whose parent company is public), it is plausible, if not easy, for me to rationalize the business and structural advantages argued for in this article. However, the wrinkle in my worldview comes from the stories we tell about the unmistakable benefits of fair trade to our unemployed or underemployed artisan partners.
In this video, Santiago, a coffee farmer from Nicaragua, reflects on the tangible changes of fair trade farming, including the guarantee of beans and rice, not just salt, with his tortillas. In this first-hand account, Meagan Chesrown, a UT student and volunteer at our Austin store, reflects on the life changing impact of fair trade on the lives of women in a Guatemalan cooperative. One year after the earthquake in Pakistan, our artisan partners are not only self-supporting but also able to provide immediate relief and long-term assistance to other artisans and rural communities.
Granted, the last two examples I cited were of artisan, not food, partners. Which is why I e-mailed representatives of Ten Thousand Villages USA and Equal Exchange soliciting their experience and fleshed out thinking. I hope to hear from them and look forward to sharing their reactions.
2 responses so far ↓
FLO Response to The Economist « Ten Thousand Villages of Austin // January 27, 2007 at 10:17 pm
[...] The Economist’s critique of fair trade prompted a mostly negative reaction. Among the letters to the editor, here is Fairtrade Labelling Organizations International’s response: SIR – You stated that Fairtrade is a subsidy that encourages overproduction. In fact, Fairtrade is a voluntary model of trade that brings consumers and companies together to offer organisations, that represent small farmers and hired labour, a price for their produce that covers the cost of sustainable production and provides a sustainable livelihood. Fairtrade is a market-responsive model of trade: the farmers receive the Fairtrade minimum prices and premiums only if they have a buyer willing to pay them and many producer groups also sell in the conventional market. Our experience is that producers ses their additional income from Fairtrade to improve their homes, send their children to school and improve the quality of their existing crop, rather than to increase production. [...]
Alastair Smith // June 16, 2008 at 1:20 pm
The economist’s critique is now being repeated with equally simple levels of theoretical understanding and pervasive lack of evidence.
For example: Unfair Trade, published by the Adam Smith Institute.
For an (comprehensive) independent academic response on many of these criticisms please see:
http://www.brass.cf.ac.uk/news/index.html#120508
Of particular interest might be the forth part which provides a framework to understand why Fair Trade is needed in the first place, and how it compensates for the inadequacies of relying on free markets to help the poor.
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