Alicia's Friday post discussed elements of our current trade policy that have contributed to the growth of a consumer driven movement to help refocus trade on its inherent human issues. Judging by some of the comments made on her post it is apparent that there is some confusion about what the Fair Trade movement really is.
The confusion is perfectly understandable as the Fair Trade movement is not as well entrenched in the US as it is in Europe or the UK and the term 'fair trade' has been used in discussions of international trade in different contexts for over a century. Ronald Reagan used the term 'fair trade' in a radio address in 1986 and it has been used in the US political landscape more frequently since then. During the 2006 congressional elections a group of 'fair traders' ran on platforms of government managed trade relationships that would ostensibly better protect American jobs and the American economy from labor competition and fluctuations in the global economy. This seemed to have struck a chord with the American public as many of these politicians won their elections.
However, when Alicia and I write about Fair Trade we are speaking of something rather removed from the debate between a managed economy and a completely free market economy. We are talking about a consumer movement that began in earnest in the US in the late 1950's when several Mennonite women from Pennsylvania began importing embroidery and weaving from women in Africa, paying these women fair wages, providing small loans to grow their operations and engaging in long-term stable trade partnerships that helped the African women build a better life for their families and communities. That Pennsylvania project is now Ten Thousand Villages, the largest Fair Trade company in America with over 150 retail outlets across the country. Many hundreds more Fair Trade businesses exist all over the US.
What makes the Fair Trade movement something different entirely from the political 'fair traders' is that it is operating very successfully in the free market and requires absolutely no government interference or lobbying. The movement relies on consumers choosing to purchase Fair Trade goods and so a Fair Trade retail business falls much more appropriately in the emerging field of social entrepreneurship and social enterprise than in the political realm of managed trade.
All of this is not to say that we in the Fair Trade movement are not concerned with US trade policy, far from it, which could also be causing some confusion. Indeed the recently signed 'free trade' agreements (Adam Smith himself would have called this label a gross misnomer) cited in Alicia's article and their utter lack of any regard for the humanity of indigenous labor and their prostrate reverence of the almighty US corporation provide the central motivation for creating a trade alternative that respects humans, the environment and seeks a capital profit only when it can also provide a social profit. The Fair Trade movement is a government-independent, market-based and consumer-driven response to an undemocratic marketplace. It ultimately hopes to provide a shining example of how a business can do good while doing well in a global economy.
Alicia and I will be writing more about the Fair Trade movement, what it strives to accomplish and how, its shortcomings and its victories and how it is monitored over the coming weeks. We hope the discussion continues.