Tuesday, December 20, 2005

Fair Trade Versus Clear Aid

Will Baude is confused about fair coffee supporters:
I have always been confused about why people wanted to pay more for their coffee and then trust the corporations they dislike to pass the money backwards rather than simply donating 25 cents to some international charity directly. Maybe it's just too hard to find a UNICEF jar.

Maybe I'm just confused here, but isn't there a virtually universal consensus that "trade not aid" is the way out of poverty for the third world? Aid breeds dependency and stifles native industry (or at least that's the refrain I hear from the economics right and center). Just giving to charity does little to get these country's toward long-term economic self-sufficiency. But if we can create a market for fair and non-exploitative business practices in the third world, it seems we get the best of both worlds: economic growth without mass worker starvation.

Trust is an issue, of course. But there is NGO-monitoring for precisely that purpose (of course, I'm not sure I trust them either). In any event, procedural kinks aside, it seems that a concerted effort to buy "fair-trade" is far more sensible given the true goals of the target market, compared to donating to a charity or aid-organization.

1 comment:

Isaac said...

When it comes to development most everyone has their pet panacea. "Trade not aid" is certainly a going concern (and a bandwagon I've been known to jump on at times) and most everyone would agree that some form of trade is rather important. But I don't think that anybody with knowledge of countries that have actually grown successfully (Korea, Japan, Taiwan...) would subscribe to such simplistic formulas.

Though your basic point that charity is probably a bad idea is sound.