New at Reason

Julian Sanchez | March 8, 2006

Kerry Howley asks: Is fair trade coffee exactly what the developing world's been jonesing for, or just a lot of java jive?

Comments

|3.8.06 @ 1:56PM|#

That was informative, thoughtful, and fair.

I think you're right about the co-op requirement needing to change. And what's wrong with Fair Trade certifying the wages and working conditions of hired labor?

|3.8.06 @ 2:01PM|#

Good timing. I'm touching briefly on this topic during a speech at the national coffee association conference in Boca this Friday.

I haven't read the piece entirely, but what i've seen so far is par for the course. I may make copies and distribute to some people there.

A huge trend since the mid 90s has been "good for others" (or 'cause') marketing replacing "good for you" products ('no preservatives/calories/fats/sugars/etc').

It's also replacing the difference between 'mass' and 'premium' in a lot of ways. (wonderbread vs. bakery-fresh baguette). Cause marketing helps people spend more per unit, allowing them to indulge themselves without guilt. It's a form of 'premium' product class that purposely tries to shed any appearance of being 'exclusive', but rather eminently democratic. It's a way of being a yuppie but paying (literally) homage to hippy values.

In the same way fat people might drink tons of diet soda every day, and still think that's the way they're 'making an effort'... so too do Americans generally prefer to buy a conscience...or, rather, they define themselves largely through consumption habits. Everyone does, really, but in the US we're surprisingly brash about it. You hit the nail on the head with the 'consumption as a moral response' bit. It's not revolutionary though. 'Green' packaging, non-GMO foods, Organic foods... all of these things were playing to people's sense that "it's easier to buy a better world" then actually consume less, recycle more, etc. It's the easier choice, the one that lets them do the same things they always do but feel like they've contributed to society. It's the magic hamburger that cures cancer and whitens your teeth.

Anyhoo... glad to see this. I may pass out copies at the trade show to people I think might enjoy it.

yours,

JG

|3.8.06 @ 2:12PM|#

If you pass out copies, tell them to note the part that says Fair trade=zero employees, and ask them to explain how that helps the little guys struggling to feed his family.

Another good point was that co-ops which don't differentiate on quality and screw the hard worker to the benefit of the lazy slob.

|3.8.06 @ 2:22PM|#

http://www.theonion.com/content/node/33988

I think this explains both the need and demand for fair trade coffee as well as anythign.

wingnutx|3.8.06 @ 2:34PM|#

John, I think I have a new motto: Think globally, get your fucking act together.

|3.8.06 @ 2:37PM|#

Excellent article. One thing though, some of us have just found that coffee with certifications such as "bird friendly" and "shade grown" really just does taste better. These certified brands tend to taste better for a variety of reasons, from the type of beans that are shade grown (bird friendly more or less means the same thing) to the longer growing period and cooler conditions that come along with it. And though one wouldn't know from the article, many coffee addicts have never and would never pay $4 for a latte. That characterization got a little old.

|3.8.06 @ 3:01PM|#

�Be a coffee achiever,� David Bowie prodded consumers in a 1983 ad campaign.

And he hasn't achieved even one good song since.

|3.8.06 @ 3:11PM|#

What Russ you didn't like Tin Machine? :)

|3.8.06 @ 3:17PM|#

Well, it's a free market, so...if you can get dimwitted college kids to do your marketing for free, more power to you. The Berkely ballot measure is the point at which I say "no," of course.

In fairness to Fair Trade, it is absolutely true that the farmers in Third World countries are ignorant of market conditions and regularly get screwed by middlemen who are often organized into cartels. The planters live in mud huts and the middlemen from Kampala and Nairobi live in mansions in the city. Any fair trade advocate could do a lot more good simply by creating a trading firm that would educate farmers about the free market and undercut the local middlemen who are screwing them out of their crop.

|3.8.06 @ 4:07PM|#

ok, someone said something about bird-safe coffee, which implies that there is bird-unsafe coffee somewhere. so regular cofee is bad for birds??? HOW?

|3.8.06 @ 5:22PM|#

Hype aside, it is a better situation than assuming that all coffee is the same, and drinking Maxwell House, not because it is cheap but because you can't imagine that it is better.

They do their part in educating the public and creating a demand for different varieties.

As for the rest, no one forces you to drink Fair Trade Coffee, the same way no one forces you to drink Folger's, and the same way no one forces me to drink at the local coffe shop that offers Organic Mexican, Sulawesi, Malawi Galanga, Guatemalan Huauhtemoco, Bourbon Santo, etc. etc... one dollar a cup each.

|3.8.06 @ 5:52PM|#

Bird,
Got trees? Should I draw a picture for you? Mixed use farms, groves of mangoes mixed among the coffee bushes. Come on now, put on your thinking cap.

tomWright|3.8.06 @ 6:01PM|#

I think bird friendly means that they do NOT shoo them away when they crap on the beans.

|3.8.06 @ 6:05PM|#

This is just another example of well-intentioned but misguided people creating harmful economic distortions in the name of "fairness." By limiting their dealings to a specific and rigid subset of co-ops with no employees, the "fair trade" movement ends up subsidizing inefficient production and stifling innovation. Poor farmers who might have otherwise been experimenting with new management and production techniques are now limiting themselves to strict requirements set by people who don't know a single thing about either agriculture or economic development. As a result, the "fair trade" movement has virtually ensured that poor, third-world farmers will always be poor, third-world farmers.

|3.8.06 @ 8:23PM|#

I usually get my beans at the local Trader Joe's, which has a pretty good selection of different beans and blends, including some that carry the Fair Trade label, at decent prices. The Fair Trade coffee is by no means the most expensive it sells. Maybe I'm just not discriminating enough, or maybe I've compromised my taste buds by smoking a pack a day, but I have yet to settle on any particular bean/blend -- I've yet to find the *one* that I can readily identify as appreciably better than all the others I've tried. (Though, I do have some favorites.)

So you'll forgive me if I don't buy the claim that Fair Trade is compromising the quality of coffee production, or rewarding mediocrity at the expense of innovation. Such a claim ignores that it's the nature of cooperatives to be, um, cooperative. I imagine that a genuine lazy-ass freeloader who produces crap is pretty swiftly dealt with by his fellows, and that innovation is passed along to all the farmers in the cooperative. Perhaps I imagine incorrectly, but there's no reason not to think so, in the absence of evidence to the contrary. Neither the article nor my taste buds present any evidence to the contrary.

It's always amusing, in a vaguely pathetic way, to see supposed champions of free-market economics and libertarian values come down hard on a system that works within the free-market structure to reward cooperation at the expense of enforced individualism. It's such a knee-jerk reaction. The free market means that people are free to form associations and express values that make sense to them, not just associations and values that get the Ayn Rand Seal of Approval.

|3.8.06 @ 9:25PM|#

Chris: ah, but you miss the essential difference between a sloppy non-profit enterprise and that of a government. Fair Trade does not have the monopoly of force to compel obedience to its values. Your argument presumes that a government is merely another paid political agent, which it is not. It compels payment. If Fair Trade did not deliver on its promised virtues, then people would not support it. You don't have that option with the government.

It's entirely possible that Fair Trade doesn't do what it is supposed to do, and it does not really appear to, but it doesn't really have to. It merely has to convince its customers that it does and the customers are satisfied with the transaction. The farmers are apparently satisfied with the transaction as well, since no one is forcing them to participate. If the end user and the producer are both happy, then who are we to question? For all of Fair Trade's critics from within, they continue to maintain the relationship because it has value to them. They can opt out at any time.

People donate money to experimental dance troupes that would not be able to survive by selling tickets. They convince themselves that this makes them patrons of the arts. In effect, they are buying very expensive tickets. People give money to church's in the belief that their generosity is being recorded in Heaven. Fair Trade's customers may be buying an illusion, but the illusion has value to them. On the other end, the coops must make a little more for the same work or else they would sell to a less demanding customer. All parties are happy, or else they wouldn't make the deal. Who are we to complain?

It is not for us to judge absolute efficiencies in the marketplace. We are not the central planners who determine which transactions have value and which do not. No agency can determine what is most "efficient." Innovation is not an end in itself. Innovation is a process that leads to a happy customer and higher profits. If the customers would be unhappy with innovation, then it would be a malinvestment to devote time and energy to innovating. Better to take your innovative resources (which are always limited) and invest them in some other industry. Once, again, the producer's job is to make the customer happy and thereby increase his business. That's his only job. Industrial progress is only a means to an end.

|3.8.06 @ 10:12PM|#

James, I don't think anyone here is suggesting that Fair Trade be compelled to end their practices, or put out of business with legal pressure. We're basically agreeing with you, that Fair Trade coffee is based to some degree on illusions.
What I find refreshing about libertarians is that they stop there, whereas so many others would jump right into the next step of taking political action.
It seems like we can all agree that (1) the consumers of Fair Trade are being deluded by their utopian ideals and that (2) one result of this might just be that Fair Trade motivates third world coffee farmers into decisions that maximize short & mid term gains with the possible expense of foregoing other potential forms of social & organizational progress.

It's a little unseemly to me, since the buyers are not really playing the part of a true demand in the market. In a way they are distorting the market for coffee by using their economic position to throw a lot of extra cash into the ostensible demand for the product in order to feed their whims. "Here's 5 cents for the coffee. There's an extra buck in it for you if you'll do a little dance for me."

strat|3.8.06 @ 10:43PM|#

I think bird friendly means that they do NOT shoo them away when they crap on the beans.

Just remember that some folks are pretty fond of crapped-upon beans. If you haven't heard of Kopi Luwak, you're in for a treat, so to speak.

|3.8.06 @ 10:53PM|#

Coffee is a means to an end. The end is unshakeable intense concentration and knife-edge mental faculties and being the best god-damned fucking engineer at the plant. Fuck that relaxation and contemplation shit. That's why I drink nothing but fucking Maxwell House blue-label prepackaged, pre-ground coffee from the three-pound can. Fucking two tablespoons per cup.

Now get the fuck out of my way because I'm on the way to fix someone else's fuck-up. Watch out, bitches.

|3.9.06 @ 2:10AM|#

db,

I recommend that you read the following link supplied by John. I think you may see a resemblance of sorts between your post and the article in question.

http://www.theonion.com/content/node/33988

|3.9.06 @ 8:09AM|#

So customers pay not only for coffee but for a particular fantasy that gives them comfort.

Well, that is advertising for you. After all, kids ask for cereals not because they like their taste but because of the cartoons that sell them. And Keeblers's are made by elves.

It is surprising how much we accept from regular advertisers only to get our back up when the same practices are carried out by people whose idelogy is not the same as ours.

No one forces you to buy Fair Trade coffee. No one forces a particular group of growers to get certification. If they seek the certification is because they get a good price for it, at least more than they are getting in the regular market.

Think of it as buying into a franchise. You buy into McDonald's and have to dress your employees in certain uniforms, and offer only the menu that is approved by the parent company. YOu are free to buy into McDonald's or not, but once you do, you know what the rules are.

As for coffee, the Fair trade movement is doing its part in educating the public that not all coffee beans are alike, and that some may be tastier than others. This boosts sales not only for Fair Trade coffee, but also for other coffee growers who offer distinct varieties to an educated public.

In a market, the more the merrier.

(PS. as for Starbucks, I wish they did not burn the beans. The reason they make so many lattes with so much other non-coffee ingredients is to make the resulting brew palatable)

|3.9.06 @ 12:19PM|#

Some clarification regarding fair trade criteria...

"There are two sets of generic producer standards, one for small farmers and one for workers on plantations and in factories. The first set applies to smallholders organised in cooperatives or other organisations with a democratic, participative structure. The second set applies to organised workers, whose employers pay decent wages, guarantee the right to join trade unions and provide good housing where relevant. On plantations and in factories, minimum health and safety as well as environmental standards must be complied with, and no child or forced labour may occur."

"FLO Fairtrade Standards are different when you are a small producer organisation, organised in a demo-cratic way, such as a cooperative or association, or when you structurally depend on hired labour, as is the case in plantations and factories."

Everyone at Reason, of course, knew that they were being sold a line to make them feel superior, right?]

It's the small distortions that matter, of course.

|3.9.06 @ 1:35PM|#

I think it is silly to disparage an effort because it does not fulfill criteria which you do not believe attainable nor worthwhile. Judge it instead for how well it fulfills criteria that you believe attainable and/or worthwhile.

Does Fair Trade expand the market? Does it offer more choices to the buyer? Does it offer more choices to the producer?

By the way, there is no reason to throw hissy fits at the word "cooperative" In many countries joining a cooperative makes economic sense. It allows you to pool your assets and buy machinery (which you'll have to share, but it is better than having none), allows you to buy in bulk, and get a price discount that way, and gives you access to credit, access you might not have otherwise - cooperatives were created long before the world discovered microcredit.

Also, it allows to consolidate dispersed holdings into a productive unit.

In many countries a cooperative is a valid strategy for hard working people to go up the social ladder, so don't look down on it.

|3.9.06 @ 5:53PM|#

db,

I recommend that you read the following link supplied by John. I think you may see a resemblance of sorts between your post and the article in question.

http://www.theonion.com/content/node/33988

Like I hadn't already read it the day it came out.
My post is nothing like that because I make no pretentious attempt to pretend that I give a fuck about Juan Valdez.

|3.10.06 @ 10:40AM|#

Related
http://www.harvardmagazine.com/on-line/030640.html

|3.10.06 @ 11:41PM|#

You are right, science, we make buying decisions for reasons that have little to do with cost-benefit analysis. We buy fantasies as well as the products offered. Why else would advertisers put their products in luscious settings, with gorgeous models? Why does Avon put Selma Hayek in the cover of the catalog? So that buyers buy not just the mascaraa, but the fantasy of looking as gorgeous as Selma. And bath products are photographed in a luxurios bath with mood lightning and color coordination, even though they may be used in an old bathtub with a couple of chips...

I know, I sell Avon, and I sell dreams and a personal relationship as well as cosmetics perfume, jewelry, and the rest. My customers buy the latest cream in the hope that it will make them prettier, use it a couple of times, like the effect, then they forget to wear it, and a couple of months, chase the next dream...

That, and the ones that look longingly at fashions worn by very thin women, and imagine themselves wearing them, when they have very prominent hips. They know what their size is, but for a moment, they want to think of themselves as willowy... And, of course, what I say to them when showing thm certain ads "the stud is not included"....