TRADE OFF
Free Trade is an economic theory that is defined as trade between state or country where the government does not discriminate against imports by applying tariffs or interfere with exports with subsidies. The concept of free trade is based on a mutual agreement between two different countries that the employment it offers to both sides of the trade is beneficial. Each of the two country’s wage level depends primarily on the productivity of the country’s labor force, and is not based on the specific trade policy.
Even though the concept of free trade seems that if offers the largest economic gains for the world, there are pitfalls to this system. The smaller voice will not always be heard and dominant countries can turn into monopolies. The development of trade agreements will become unbalanced and the exploitation of cheap labor will take effect. The fair treatment of workers and the environment will not be first priority in agreements. However, there are benefits to this model.
The biggest benefit of free trade is competition, and in turn, this competition leads to innovation, improved products, and better paying jobs in any country that is involved. It allows prosperity and economic freedom to occur in developing as well as developed countries.
Almost everything you own has a label
on it that says where it came from -
made in China, made in the Philippines.
So how did it end up in your hands?
At the beginning of the semester we started a journey seeking reconciliation in our own lives in regards to consumerism. We sought reconciliation through our research, the creation of our film, and through the practice of making ethical purchases. For the past three months, each of us have been committed to researching and making ethical purchases in a category of our choice. This experience as well as our Christian faith, our individual backgrounds, and our research has informed our project and has shaped our consumerism for the rest of our lives. We are COR group 6. This is the beginning of our journey towards reconciliation, and we invite you to join us.
An Interactive Documentary
Fair Trade is a type of international trade that provides farmers with a way out of poverty by guarantying fair prices and sustainability. It is a global certification that allows consumers to identify products that were made in an ethical manner and invest in the workers’ families, farms, and communities.
When you buy Fair Trade items, that means that the product has been produced by small-scale farmer organizations or plantations that meet Fair Trade social, economic and environmental standards. The standards include protection of workers’ rights and the environment, payment of the Fairtrade Minimum Price, and an additional Fairtrade Premium to invest in the improvement of their business or the betterment of their community . This often includes investment in schools, transport, health care, sanitation, an improved environment, and better business equipment and practices. One disadvantage of this type of trade, however, is the expensive certifying process that farmers have to go through in order to sell their products. Sometimes this does more harm than good when the farmers and merchants are trying to make their way out of poverty.
It is true that many Fair Trade products are more expensive to purchase, and living an ethical lifestyle in this way can be difficult for low-income families or college students. However, for the artists, crafters, farmers and small business owners whose products you are buying, those few dollars make a huge impact. Fair Trade not only sets the minimum social and environmental standards in production and trade but also strives to support the development of small-scale farmers and plantation workers in need of help. From its early days in Pennsylvania, fair trade continues to move forward across the globe, because of the efforts of consumers, entrepreneurs, non-governmental organizations, and other communities.
Direct trade is a form of trade where the consumer purchases the product directly from the producers. This method of trade cuts out all the middle men involved in the other forms of trade. By doing this, it ensures that both the producer and consumer are satisfied with the prices paid and the work done. Direct trade is a micro form of free trade without regulations, restrictions, or certification processes.
So if direct trade is so great for everyone involved, why would anybody ever use a different method of trade? Unfortunately, direct trade is very limited in it’s availability. In fact, coffee is really the only market where direct trade has had any sort of impact at all. Even with coffee, it’s not very practical for a large company to source all of their products from one farm.
It also not practical for a consumer to buy their coffee straight from a farm. That would require, as mentioned earlier, a connection and a relationship with a specific farm. While direct trade is promising in the coffee industry, there are still too many issues to be worked out for it to be a realistic option on a global level.
Clearly there are pros and cons to fair, free, and direct trade. We have come to the conclusion that there isn’t one right answer, but that isn’t a bad thing. That doesn’t mean that we shouldn’t or can’t do anything. In fact, it’s quite the opposite. Having options gives us freedom to try different things, to continually research and reform our purchase patterns.
As Christians, our faith should inform our entire lives, including our purchase habits.
Living in an increasingly globalized society, responsible and ethical purchasing intersects with Christ’s call to love our neighbors as ourselves, and to participate with God’s call to co-create with Him.