Fifth Rejoinder to Eerlijke Handel on Fair Trade or Free Trade

This is my response to Eerlijke Handel's latest post in our discussion.

We seemed to be making progress in terms of agreeing on definitions Eerlijke, but your latest post seems to be several steps backwards. What is this new thing you’re talking about: “economic power”? How can it be misused (except by allying with political power)? What is “exploitation”? How can a voluntary trade possibly be exploitative? What is slavery? How can a voluntary relationship be called slavery?

I defined slavery very clearly in my post, and subsequently elaborated it in responses to you. Do you have difficulty distinguishing between coercive and voluntary? Do you think consentual sex and rape are the same thing? Do you think boxers commit the crime of assault against each other when they fight? Do you think you inviting me to your home is the same as me breaking into it?

Clearly, the most important ethical distinction between two types of trade is whether or not both parties consent to it (i.e. whether or not it’s a voluntary trade). There is no such thing as slavery or exploitation except where there is coercion, i.e. one party threatening another with violence or using violence to make him comply. Impoverished people working voluntarily are not being “exploited” by their employers, no matter how little they are paid; they are choosing to work because it’s the best option available to them right now; otherwise they would discontinue the relationship.

Regarding your criticisms of my method (especially the use of ceteris paribus, and how economic analysis relates to “the real world”), I encourage you to investigate the Austrian School of Economics. The Mises Institute has a wealth of resources on all sorts of topics, including the epistemology of economics. A discussion about epistemology (which would be necessary for me to convince you that my economic method is valid) is perhaps too far from our core topic here.

Regarding the success of Fairtrade, this is not a “flaw” in the market at all. Lots of people demand Fairtrade and the market delivers it; it is a market success. What do you think this proves? How is it relevant to my critique at all? It sounds like a circular argument: you are saying that lots of people demand Fairtrade therefore more people should demand Fairtrade. What I am saying is that no-one who has the end of helping the poorest people of the world should demand Fairtrade, because there are more effective means of achieving that end.