Free-Market Fundamentalists against FairTrade

It's funny how the news often comes in matched pairs. Today, the BBC apologises to Band Aid for reporting wrongly that Band Aid money was diverted into military use. Today also there is a report from a free-market think group that Fair Trade is not much good.

First, the BBC. Band Aid, and the aid movement generally, took a knock to its reputation from the BBC report which implanted the idea that Band Aid money went to insurgent groups. Clearly the apology, as is the way with these things, had less impact on the public mind than the original report. Restorative justice demands that the BBC should run a few documentaries on the work of Band Aid in order to make reparations. I hope Bob Geldof will press for this.

Now, FairTrade. The report came from the Institute for Economic Affairs. It is their second pop at FairTrade, the first being in 2007. The Guardian report, by Simon Bowers, does go as far as to mention that they are a free-market think tank. But the damage is done by the headlines:
Guardian "Fairtrade Foundation accused of failing coffee farmers". 
Mail: "Unfair trade: Ethical food ‘is not lifting Third World farmers out of poverty’"
Telegraph: "Fair Trade does not help the poorest, report says"

FairTrade carry a rebuttal here. 

Noteworthy is the fact that the$1570 registration cost, widely reported in the newspapers, relates to groups of 50 farmers, not to each individual farmer. 

They also rebut the suggestion that only middle income countries benefit. FairTrade says "We work with raisin farmers in Afghanistan, coffee growers in the Democratic Republic of Congo, Rwanda, Ethiopia and Tanzania and cocoa farmers in Cote d’Ivoire to name just a few."

In fact, the IEA report is not totally critical, much as they would like to be. They say:

• Fair Trade brings certain benefits to producers, such as guaranteed prices, a social premium and the enforcement of particular labour conditions.
• Criticisms of Fair Trade are also exaggerated. At its current
  level of penetration it is likely to do little harm in terms of
  distorting markets.

Deep in the report are references to slave labour, (excluded by FairTrade, obvs). They complain about exclusion of child labour: "A prohibition on child labour may be damaging for families – and also for children who may be forced into other dangerous occupations." 

In the end, free-marketeers are ideologues and fundamentalists, steadfast believers in the dogma that the free market delivers the best of all possible worlds, despite all the evidence to the contrary.

What I find interesting is that free-marketeers are often also Christian fundamentalists, who believe in Original Sin. The question for them is this:

 

How come that sinful men, competing against each other for money, the love of which is the root of all evil, produces the best of all possible worlds?

The damage has been done. The headlines are out there, and the mainstream media will not dig deeper into the issue, because the mainstream media deals in impressions, not facts.