Introduction
The anti-globalization movement have been very successful in making slogans against world’s trading system. Strength held by international Non-Profits, especially through their supporters, has been the power behind this success. Some of the slogans include: “Another world is possible” that is the slogan for the World Social Forum, an annual meeting of the anti-globalization movement (Taggart). However the most successful slogan has been the “Fair Trade”. This slogan has two meanings that are addressed below. One meaning is used to attack effects of globalization to developing nations and the other is used to attack same effects to producers of developed nations.
“Fair Trade” for Poor Nations Producers
Fair trade enthusiasts claim that producers in developing nations sell their commodities at throw way prices to multinationals who process and sell at high prices in international markets. The fair traders thus intend to coarse people into buying commodities directly from poor producers. The following is stills small but it is making influence is making inroads through powerful Non-Profit Organizations (Booth). Affording to sell commodities above ongoing market prices makes these producers rely on the small creek of fair trade enthusiasts. This culture of dependence could hurt end up hurting the people it is intended to help incase their consumer change taste passion for fair trade (Nicholls, 2005, p, 242).
Most of poor sellers in developing nations also specialize in single commodities. The higher price incentive offered by fair traders will lead to small scale monoculture in agriculture countries. Failure to diversify production will therefore be disastrous in case of crop failure that characterizes the sector (Nicholls, 2005, p, 241). Fair trade also has the tendency to increase the exportation of raw materials to the developed world that may hinder the development of processing plants in developing nations.
It is rare to hear proponents of fair trade pushing processed goods from agricultural countries. Ironically, the same people that push for fair trade for developing nations are the ones that call for the developed nation’s fair trade.
“Fair Trade” for Domestic Producers
This other form of fair trade slogan is used to protect producers of developed nations from competition Here the concept of fairness is, claims some critics, does not mean voluntary participation in exchange but how local producers can benefit more than their competitors (Bovard). This slogan claims that it is not fair to subject local manufacturers to competition from lower cost manufacturers in other countries.
The slogan has become the basis for trade negotiations between nations, with each country calling for development of “fair trade” laws to protect its producers (Baghwati). Enthusiasts of this fair trade believe that blocking imports into their country will save local jobs if not create more, reducing domestic trade deficits and giving chance for local young industries to mature (Miller & Elwood). But economic history has shown the protected industries never mature, because they are never able to decrease their costs production that make them uncompetitive in the global arena.
This slogan is believed by citizens of complaining countries that it will save domestic producers. Politicians have therefore succeeded in drawing up policies in favor of fair trade instead of the open trade between countries because it is easier to gain bipartisan in the legislature and coerce the population to the resulting policies (Bovard). In fact during the 2000 IMF-World Bank joint meeting in Washington DC, a Business Week poll showed that the public are increasingly relenting to fair trade and protectionism compared to open markets. Of all respondents, a whooping 51% classified themselves as fair traders, that is, 37% as protectionists and only 10 percent as free traders (Photiades, 2000, p 1). Surprisingly, the calls for fair trade usually come from special interest groups that stand to gain from restricted trade with other countries (Hudgins, 1997, p 49).
“Fair Trade” is just one of many slogans that have been developed by anti-globalization movement to push for their agenda. Most of the slogans don’t make economic sense, but they have deeper meaning in them. It is that deeper meaning that gives them power to influence so many people, change national trade policies and find their way into mainstream media and academia. Successful slogans are the ones that get the attention of international Non-Profit organizations, such as how Oxfam successively got “fair trade” from poor nations’ commodities the attention of well wishers in developing nations. The slogans are developed without economic thinking in mind but have wide-ranging economic consequences. Most of the slogans are usually developed to create sympathy for specific groups of people.
References
Taggart, Harold. New Ground 82. 2002. Chicago Democratic Socialists of America. Web.
Baghwati, Jagdish. “Protectionism.” 2002 The Concise Encyclopedia of Economics. Web.
Booth, Phillip. Is Trade Justice Just? Is Fair Trade Fair? 2005. Institute of Economic Affairs. Web.
Bovard, James. The Myth of Fair Trade. 1991. Cato Institute. Web.
Bovard, James. The Immorality of Protectionism. Future of Freedom Foundation. 1994. Web.
Nicholls, Alex. Fair Trade: Market-Driven Ethical Consumption. Thousand Oaks, CA: Sage, 2002.
Miller, Vincent H., and Elwood, James R. Free Trade Or Protectionism? The Case Against Trade Restrictions. 1988. International Society for Individual Liberty. Web.
Hudgins, Edward, L. Freedom to Trade: Refuting the New Protectionism. Washington, DC: Cato Institute, 1997.
Photiades, John G. Some Thoughts on “Free Trade,” “Fair Trade,” and “Protectionism” San Diego, CA: Western Social Science Association, 2000.