How to Improve Fair Trade: #3
3. Buyers and producers trade under direct long-term relationships
Buyers and producers are unique individuals. Each industry, from coffee farming to fishing to metallurgy to textiles to tourism etc., is also unique. All of these industries must take into account different factors, from weather to preferences to buying cycles, and they must do so with limited resources. There are an uncountable number of ways a trade relationship can be arranged with all of the different possible variables.
To only support ‘direct long-term relationships’ presumes that someone has a better understanding of all these special trades than the buyers and producers who are closest to their products and trades. First, let’s consider ‘long-term relationships’ using a textile producer who produces a fabric that quickly experiences a change in demand; let’s say the fabric goes out of fashion. In this situation, a long-term contract would benefit the producers, as they would have no one else to sell their product to if it wasn’t for this long-term relationship. The buyer would be stuck buying a product in which there was no longer any use for. In this case, this principle favors the producers over the buyers. The buyers will be hurt. Similarly, if other conditions were present, the producers could also be the ones hurt.
Second, I am unsure what is meant by ‘direct relationships’. There are many scenarios where direct relationships are not beneficial. Do we ever wonder why vending machines have a slot for a quarter rather than one slot for the farmer’s bale of hay and another for the shoemaker’s leather shoe and so on? Money is a technology that works wonderfully at saving us from the burden of the millions of direct relationships we would need to establish all throughout the global village in order to live a typical day.
Another example of the benefits we receive from indirect relationships is a supermarket. Why do we go to the supermarket instead of establishing a relationship with an apple farmer a vegetable farmer a sugar plantation a wheat grower and so on? The number of direct relationships necessary to fill a shopping cart with just the daily necessities would be amazing.
Favoring only one form of trade relationships is not fair. With the plurality of the global village, it is silly to assume that only one type of relationship can exist between buyers and producers. Choosing one relationship as the best favors people who fit the model of this one relationship and discounts any relationship that may try to differ. There are many external events that can favor one side of this relationship over the other, including weather conditions, trends and inflation. I am concerned that people in the ‘fair trade’ movement don’t think that buyers and producers are intelligent enough to make these decisions on their own.
