Here is my paper... because apparently there were some who wanted to read it. I want to say that because of the class requirements, the draft is pretty superficial, but all the sources that I used were sooooo good and in-depth. Anyway, hope you learn something :)

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Running Head: FAIR TRADE




Fair Trade: The Revolution
Noelle Connolly
Eastern Washington University


March 2008

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As a revolution, the fairtrade movement is not typical. Although spurred by inequality, this movement was not initialized by the poor, frustrated laborer, but by the wealthier, socially-conscious activists in northern countries. The fairtrade movement is a revolution in a very different sense of the word. As a non-violent movement, it does not seek to ‘overthrow’ the powerful and exploitative Multi-national Corporations (MNC’s), or destroy the capitalist global economy. Instead, it strives to change the behavior of buyers and sellers in order to bring social equality to the marginalized small-scale laborers of the Southern hemisphere.
The first phases of fairtrade developed in charity organizations and church groups as a movement which sought to challenge the traditional concepts of production and consumption (Low, Davenport, 2005). They promoted all forms of products, from furniture to handicrafts. Agricultural products were only a small part of the bigger picture. The fair trade movement as we know it began in the mid-20th century, when non-profit importers partnered with southern hemisphere farmers, forming non-governmental organizations (NGO’s) called Alternative Trade Organizations (ATO’s). Focusing initially on coffee and agricultural production, these organizations sought to create a better profit opportunity for small-scale farmers by avoiding the middle-man in across-border trade, who usually received most of the profit as the product transitioned between producer and buyer (Fairtrade Labelling Organisations, 2006). Over the years, ATO’s grew, and the small movement finally began to gather speed. Eventually, A Dutch ATO introduced a fair trade label, which they named Max Havelaar, after a character in a book about Dutch colonialist exploitation. This label provided a “way to increase sales without compromising consumer trust in Fairtrade products and in their origins” (FLO, 2006). The idea spread to other organizations, and umbrella groups began to form, such as IFAT, NEWS!, EFTA,
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Transfair USA, the Fair Trade Federation, and the Fairtrade Labelling Organisation (FLO), which set standards and regulate certifications and which are recognized and respected globally.
The movement could not have been set in motion at a better time. Many factors contributed to a situation ripe for change and the development of fair trade organizations. As economic institutions such as the IMF and World Bank began to focus on developing free, capitalist economies in developing countries, complicated social problems began to arise. Subsistence farmers found themselves unable to compete on the oversupplied global market (Low, Davenport, 2005). Awareness of the inequality proliferated by liberalization policies had mobilized large numbers of social organizations. However, this injustice gave way to “important new movements striving to create a more socially…sustainable society” (Raynolds, 2000: 298). Through the World Wide Web and other media outlets, organizations appealed to the moral sensitivity of the Northern hemisphere. These organization began “to create new networks of exchange that escape the bonds of simple price competition” by condensing the space between the human producer and the priced commodity, forcing the consumer to take into account the ethical question of why their products are so cheap (as cited in Moore, 2004: 81). An increasing awareness of the wealth disparity between the global North and global South thus played a role in creating an obliging consumer market for fairtrade products. By using all aspects of the market, including retailers, producers, and consumers, the fairtrade movement has been classified as working “in and against the market” (Raynolds, 2000). Fairtrade does not attempt to destroy the capitalist system that may have created the social inequality in the first place. Instead, it endeavors to challenge and change the system, to force it to consider social and ecological consequences of low labor costs. This peaceful revolution is characterized by the emphasis on
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social justice and an effort not to overthrow the capitalist system, but instead work in it, and manipulating norms of the market in order to achieve social parity, especially for those currently exploited by the system.
The goal of the movement is to challenge the traditional, price-driven market, and “re-embed commodity circuits with ecological and social relations” (Raynolds, 2000). But the drivers of this movement are not the poor, exploited farmers who are at the center of the cause; the FLO website describes the movement as a “partnership between non-profit importers, retailers, and small-scale producers” (FLO, 2006). Unlike most revolutions and civil movements, fairtrade was not spurred by mistreated people, but by socially-minded buyers. In this case, it would be implausible for the marginalized to unite and revolt against the market. The likelihood of all exploited persons to have the ability or motivation to do this is miniscule. If only the people of one country was able to achieve such unity, the ‘race to the bottom’ has assured that there are other regions ready and willing to facilitate the displaced MNC’s. Instead, because the wealthier companies of the North hold more power in setting prices and determining wages, they were the only ones who would have been successful in instigating change. In Geoff Moore’s analysis of the industry structure of the fairtrade movement, the emphasis placed on the role of ATO’s (all of northern origin) and “conventional organizations, typically supermarkets” (2004: 76) shows how reliant the movement is on such bodies. Undoubtedly, it would be impossible to progress the movement without the powerful voice of these importers, retailers, and thus making them the stimulators of the movement.
The efforts of the NGO’s have been reciprocated with an increase in fairtrade sales. Total gross sales of all North American fairtrade organizations increased by 48% from 2002 to 2003
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(as cited in Wilkinson, 2006), and continue to increase at an exponential rate. Coffee has become one of the most prominent fairtrade industries. Fairtrade specialty coffee shares in the industry from 2000 to 2006 grew from .6% to 4.3% (Wilkinson, 2006: 227). However, although the change is dramatic, it is still only a fraction of the global sales, and the numbers are even lower in non-coffee markets. Another challenge the movement faces is educating the consumer. Creating a socially aware customer is imperative to the success of fairtrade, as the foundation of the movement is a social justice issue. By using “campaigns (fair trade coffee on campus, fair trade towns, fair trade weeks, etc) [the movement] promotes political campaigns and advocacy to ‘make trade fair’ in international forums” (Wilkinson, 2006). These campaigns target the already existing politically and ethically minded consumer, and also create more consumers like them. The sub-movement of ethical consumerism can be quite appealing, especially to Northerners who believe in the power of individuality (as cited in Low, Davenport, 2005, p. 495). While contributing to the growth of an economy, the individual consumer can feel that they are making a difference and “promoting positive social change” (Low, Davenport, 2005) in the world by choosing fairtrade goods. Fairtrade was born from people naturally inclined towards the ideas of social justice, such as religious groups, leftist political groups, and others attracted to 3rd world equality. (Low, Davenport, 2005).
The goal here is to mainstream these ideals to be naturally a part of the international market. One prominent concern of any consumer has always been the quality of the product. As Moore notes, “Fair Trade products are often in direct competition with branded products and so need to be of sufficient quality to compete” (2004: 78). Achieving a high quality product is very important to lending credibility to the movement. Marketers use this knowledge in their
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strategies. Sometimes, they champion the “quality of their product, and use the fair-trade label as an additional marketing tool” (Low, Davenport, 2005). This suggests a second challenge of the movement, mainstreaming the fairtrade product. The above method creates division in the movement because it focuses simply on selling the product and many fear they may lose the message in the process (Low, Davenport, 2005). They believe the “collective focus” of the movement will be lost as the individual attempts to “solve global problems” (Low, Davenport, 2005: 496). However, most fairtrade organizations are pushing to mainstream fairtrade market practices and products with consumers and retailers. Mainstreaming of the fairtrade movement and products is imperative to its success, as it must work within a market driven by competition. As discussed above, the fairtrade movement works in the market, not against it. Not reaching out to a broad clientele would detract from the movement’s effectiveness.
The responses of governments around the world have been positive and supportive. One main issue of government agendas has recently been poverty alleviation. As noted in Wilkinson,
The fair trade movement, therefore, despite its still marginal relevance for global
trade flows, finds itself at the heart of the central political issue of the day for national
governments, global institutions and corporate players alike – if trade is the road to
growth and poverty reduction what are the rules which should govern trading practices
and the trading system? (p. 18)
These rules are being set by the ATO’s, and global institutions are paying attention to their rallying cries. Since fairtrade is the perfect avenue to address social concerns without idealistically denying the power of the market, governments who promote free trade and MNC’s who are motivated by profit are able to participate in the movement, relatively ncompromisingly.
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Multinational corporations are also an important actor in the movement toward socially equitable market practices. Coffee has been the most available fairtrade product, as proved in its ubiquity in large retail chains such as Starbucks, Safeway, some convenience stores and even Wal-Mart, the notoriously unfair retail store (Raynolds, 2002). As proved above, fairtrade products still only account for a fraction of sales in North America and Europe, the fact is that the demand is increasing at an impressive rate, and MNC’s are seizing a growing opportunity to reach a socially conscious consumer base. Some consumers who may have previously avoided such MNC’s because of their participation in exploiting a poor, foreign labor force are now able to relieve their conscience and shop at such stores. It is arguable whether the movement benefits from the participation of MNC’s. Although these agencies may have their own agendas, the mainstreaming of fairtrade ideals in general has undeniable benefits. As the increase in fairtrade sales has shown, the positive results may outweigh the negative consequences of marketing a diluted message that the everyday consumer might not fully understand.
The end result of this fight for social justice has still to be seen. Hopefully, there will not be an end, but the movement will continue to progress until all aspects of trade are fair and the market operates as much on the principle of fairtrade as it does on supply and demand. Until then, proponents of the movement will have to be satisfied with rapidly increasing fairtrade product sales, growing awareness of the issues fairtrade addresses, and a widespread acceptance and approval of fairtrade as a positive social revolution.




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References
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Message? The Ethics of Marketing Fair Trade in the Mainstream. International
Marketing Review. Retrieved March 6, 2008 from www.emeraldinsight.com/0265- 1335.htm.
Fairtrade Labelling Organisations. (2006). About Fair Trade. Retrieved March 6, 2008 from
http://www.fairtrade.net/about_fairtrade.html.
Raynolds, Laura. (February 6, 2000). Re-embedding Global Agriculture: The International
Organic and Fair Trade Movements. Agriculture and Human Values. Retrieved March 6, 2008 from http://0-proquest.umi.com.libsys.ewu.edu/pqdweb?index=0&did=5010650
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Wilkinson, John. (2007). Fair Trade: Dynamics and Dilemmas of a Market Oriented Global Social Movement. Journal of Consumer Policy. Retrieved March 6, 2008 from http://0- proquest.umi.com.libsys.ewu.edu/pqdweb?index=0&did=1311050941&SrchMode=1&si d=8&Fmt=6&VInst=PROD&VType=PQD&RQT=309&VName=PQD&TS=120544478 1&clientId=5545
Raynolds, Laura. (2002). Poverty Alleviation Through Participation in Fair Trade Coffee
Networks: Existing Research and Critical Issues. Prepared for Project Funded by the
Community and Resource Development Program, The Ford Foundation, New York