Free, Fair, Faux, Phun

NCP takes on the giant (the global economic system)

 

We all want to know what to do about a global economic system that seems unfair to millions of people—including us. And given the size and power of those who benefit from and defend this system, it often feels like we’re confronting a giant of Jack and the Beanstalk proportion who would have us too for dinner.

 

Free Trade is the dominant global economic model, by which governments agree not to hinder the flow of products and profit and not to seek unfair advantage, while giving up the right to restrict trade based on environmental or labor-rights considerations. This system is enforced by groups like the World Trade Organization, which are agencies with the power to bring charges against any member nation that doesn’t abide by established treaties, including overriding national priorities in favor of the economic interests of corporations or trading partners.

 

People like Fatima from El Salvador toils at the bottom rung of the $81 billion global

coffee industry. In her mountainside Salvadoran village, this single, illiterate, mother

of four earns $3-$5 for picking 100 pounds of coffee—a chore that takes all day. Is it

sufficient? “No,” she said, with a look of grim resignation, “I can barely feed my children

and keep them in school—but what choice do I have?”    

 

Some tout a globalized and Free-Trading world as a flawed-but-basically-useful system, as it has lifted many millions out of poverty in our world. While this is perhaps the case in some situations, consider:

   •The real increases from globalization have occurred at the top of the pyramid, with the

CEO’s of clothing corporations, for instance, making $11-18,000 an hour as the women on

the assembly line earn 10-40 cents an hour.

   • While they may have a job, working conditions for those in the globalized supply chain

(safety, child care, harassment, forced overtime), and living conditions are often

deplorable.

   • Free Trade depends on being subsidized by the environment, as the high cost in

pollution and climate change gases created by global shipping is shifted to the ecosystem

and to the future.

​

Fair Trade is often held up as the alternative to Free Trade. Here, conscientious consumers

purchase products made by better-paid and treated Poor World workers. Currently, Fair

Trade is a miniscule percentage of the US consumer economy (.05% of coffee sales,

for instance). As pointed out by many analysts, this is noble but insufficient, at least if

our goal is to create a fairer world. Which is not to say it shouldn’t be done, but that by itself it’s not enough.

​

Other Fair Trade considerations:

• Distance: most FT items are produced in far-away places, necessitating long-distance shipment—and a large carbon footprint.

• Equity: the wage differential between highest and median income employees in a typical

• US corporation is 250:1—does the average difference of 100:1 between the CEO of a FT

company and the workers in other countries (assuming $100,000 annual wage/benefit

• package for the US Fair Trade executive, with 240 actual workdays, and $4 per day for

the FT worker in another country) do enough to close this gap?

• Fickleness of the global market: Along with ever-changing Rich World consumer

preferences, markets may dry up altogether, leaving Poor World producers at the mercy

of international markets.

• Cost and size: achieving certification is a significant cost to poor producers; typically FT

organizations only do business with cooperatives, not individual producers, who are left to

fend for themselves.

• Best use of consumer dollars: Fair Trade products are sometimes purchased out of a

desire to “help those people” and may not be money spent on truly useful or needed

items. If not used for essential purchases, would this money be better invested in

programs designed to promote justice and support producers’ self-sufficiency within their

own economies?

• Tolerates affluence: Fair Trade does little to challenge the affluence of purchasers—

indeed the model is based on consumers’ excess disposable income. Does this let us

off-the-hook too easily when dealing with global inequalities? Indeed, some of this

income may have derived from investments in the very corporations that exploit people

and planet for gain.

• Individual virtue: FT folks have bought into the individualist mantra of capitalism—kind

of a divide and conquer approach. So long as “changing the world” is left to individual

purchases rather than groups

developing strategies for systemic change, our world will remain un-changed.

 

Esther met with our delegation in Yangon, Myanmar. She works in a garment factor in Myanmar.

She has a 1st grade education, and her parents are both day laborers, meaning sporadic physical

labor at a very low pay. She left her village in the delta when was 13 to seek work in the city.

She came to Yangon wanting to be a fashion designer or a singer. She started working in a

garment factory in 2018. She makes warm clothes—so these are bound for the EU or US. She

works 10 hours per day at 35 cents an hour.

​

 So both Free Trade and Fair Trade are a bit Faux—short of creating a genuinely equitable economic system.  This leaves…

​

​   Phundamental changes. Here’s how NCP sees rebuilding the system, starting from the bottom up:

    • People in the Rich World step back from the globalized consumer economy by reducing consumption, supporting local producers and refusing to invest in exploitative corporations, meanwhile educating themselves and others about the impacts of globalization on planet and people. This may include boycotts of egregious offenders (think Nestle in the 70’s, Gandhi’s homespun cotton, the Boston Tea Party!).

    • Resources freed up by less consumption are re-invested in

life-affirming projects, organizations, movements and retirement funds.

    • Pressure is applied to lawmakers to revise or scrap trade deals that

put profit over people and planet.

    • A meaningful carbon tax is put on all fossil-fuel-generated energy,

which would be a boon for the planet and for local producers,

as products-from-a-distance would be dis-incentivized.

    • Our global neighbors are supported in becoming successful in their

own economies rather than dependent on the global market. Microloan

projects supportined by NCP's Give a Girl a Chance fund in one example

of this.

​

"Our daughters no longer have to migrate to the cities to work in the

sweatshops!" women in this village in the Southwest delta of Myanmar tell our

delegations. The women's microloan projects have given them enough income to

keep their daughters in school and at home, rather than being sent off at an early

age to the big cities.

  

That’s our modest recipe for creating a more just global community. For the analysis of smarter people than us, see books on the Reading List at the NCP website.

 

​