Fair Trade vs. Direct Trade

Stepping into my local coffee shop inquiring if they sell fair trade coffee – I was told that they had something better – “Direct Trade”. I was told this cut out the middle man in Free trade, and was the next step up. Excited, I bought the coffee, and then came home to investigate.The book “The Prospects and Pitfalls of Market Diven Social Justice” is an indepth study of just what the title implies.  Direct Trade is fairly new, and now discussed in the book.  One of their pitfalls is that they are not transparent, do not have set proceedures for investigating labor violations, and do not even have a standard of labor rights that they adhere to.  Instead, the website promotes the “trust us” trademark, which doens’t always bode well for workers.

The book points out that with the collapse of the international coffee agreement in 1989 the price of coffee was much higher than it is today – even above fair trade prices. Fair trade a few years ago only compromised about .5% of the coffee market. So here we have some people making a little bit of money, but it is bascally peanuts. And people buy it thinking they are doing good, when they don’t realize that even Wal-mart used to pay a higher price – more fair than they are now!

So even while fair trade has its pitfalls, some people within the movement are actually trying to change the marco-economic policies.   Selling Fair Trade products can viewed as only one small part to increase awareness and create fertile ground for cooperatives around the world who are trying to create an alternative structure to the corporate model. ie no hierarchy, democratic control of the workplace, and social conciousness. The foundation must be prepared first. Although other fair trade theorists have no such desire and simply want to increase marketability and do not believe the capitalist structure can or should be challenged. It is what it is.
The dangers of co-optation: If Starbucks becomes the major buyer of fair trade coffee this raises legitamate holy fuck type questions.  They have already pushed for changing the labor standards that are implemented through fair trade labeling, as well as the type of farmer whom fair trade deals with.  A typical recipient would be a small farmer in a co-op.  Large chains such as Starbucks prefer to work with large farms and the corporate hierarchy – so now the labeling has expanded to include large farms. If fair trade becomes mainstream through corporations, who then determines its course? Who holds the power? These alliances should be made with suspicion. The book points out that the World Bank, the IMF, Starbucks etc. are all in favor of fair trade – at the micro level. (just enough anyways – starbucks only buys 6% fair trade coffee). But none of them would ever support changing the fundamental structures of domination – macroeconomic policies.

About Musings over Coffee

Fitness enthusiast. Love to travel, mess up recipes, ponder random things, get riled up about the news, all of which nearly always coinciding with one of my favorite things in the world: Coffee.
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