The Paradoxes of Certification in Fair Trade & Social Responsibility

New Orleans   The ineffective anarchy of FLO certification through the various national fair trade organizations (though not the USA, since ours has disaffiliated, further weakening the standards) is crumbling before my eyes based on their own inability to change and the constant assault by both major corporations on one hand, who assert that they can do better themselves, and progressives on the other, who assert that they can do better themselves.  Coffee producers who originally were the supposed beneficiaries of fair trade certification in Central America are now organizing their own self-certification programs in protest against FLO and what they argue are unfair fee structures and other practices of FLO that tilt the scale in favor of big cooperatives, almost as large as the corporations themselves.  ACORN International in our own report Unfair Fair Trade has echoed that case.

For Jane Consumer there has to be confusion, if the consumer even realizes this is going on, and as a purveyor through Fair Grinds trying to wend our way through this maze to undertake direct trade, while maintaining our established reputation as a the oldest and most consistent exclusively fair trade provider, we are caught on the horns of a dilemma, squeezed by pricing in the middle while trying to hold competitive prices for our customers and increase the livelihoods of the producers.  Oh, my!

Green Mountain, Starbucks and others tout their own programs exhaustively and claim that they serve fair trade by their lights even though it is only a small percentage of their coffee.  The latte licker there thinks it is all good without really knowing and can pick up brochures touting the program.  Part of the reason that the FLO affiliate in the US has left the pack is to try to make more of these big time deals and collect the fees for doing so.

Joining the New Orleans Archdiocese Fair Trade Committee last week as it was meeting at Fair Grinds; I got a quick education on the Catholic Relief Service (CRS) Fair Trade program for coffee.  Once again this is a self-certification program.  CRS has two types of relationships under the CRS Fair Trade banner.  One is a direct partnership with a dozen outfits around the world where it sources, some of whom are FLO certified and some of who are not, yet all are CRS Fair Trade “certified.”  The second partnership is with some of the great fair trade coffee brokers in the US, such as Café Campesino and Dean’s Beans, both of whom were fantastic providers for Fair Grinds Coffeehouse until we changed policy to acquire fair trade coffee directly at the Port of New Orleans from union workers and have it roasted locally to make it fresher.   If a consumer buys through CRS Fair Trade and those companies, a portion of the price (10% or so) goes to the CRS Fair Trade fund which CRS grants back to its partners and other worthwhile projects.

One of the members also sent me to Just Coffee, a coffee roasting cooperative in Madison, Wisconsin, which I hope to meet later this week to learn and observe.  The Just Coffee website indicates ad nauseum and very effectively the reasons why they left the FLO fair trade system some years ago to direct source from partner cooperatives – much as we are trying to navigate — because it was superior to FLO in so many ways.  Hear, hear!

But, what are we to really do with this mayhem around fair trade coming at us from every side?  Are we all in the best position to judge?  Hardly!  Do we need a fair and objective arbiter?  Absolutely!  So what is to be done?

Part of my uncomfortability with this fair trade mess goes squarely to the even larger, bigger headline problems associated with the scandal that passes for Corporate Social Responsibility (CSR) programs with big companies from the old Nike and sweatshop campaigns conducted by ACORN International’s partner, Press for Change, and the current slippery slope involving Apple and Foxconn along with many other Chinese suppliers of that company, Walmart, and others.  For years Apple has claimed it was all over wages and working conditions, regardless of how many stories from China contradicted the claims.  Furthermore the fact that the “certifiers” were so often miles away from being unbiased and trusted intermediaries, but in fact bought and paid for as a matter of business model, if not ethical lapses, also meant that their inspections and reports were worthless.  [Yes, I have also been arguing over recent months that the current inspection of Foxconn for Apple was bound to be a whitewash even though they have gotten better grades than the earlier tests would have warranted.]

Big time CSR programs now exist in all big companies.  I was sickened by even imagining the recent report of the head of the Environmental Defense Fund (EDF) bunking in a cabin with Walmart’s then CEO Lee Scott to work out enviro-deals.  All of these big money maneuvers and rationalizations demand a clean-handed middle force that can be relying depended upon as unbowed and unbought.

How can that be different for fair trade with a similarly huge imbalance of power between producers and brokers, and what now has to be conceded as total chaos among consumers in the developed countries?  We are simply saying, “Trust me!” and frankly, whether Fair Grinds Coffeehouse, Just Coffee, or Catholic Relief Service, I’m not sure we are really qualified and able to reliably play that role.

I love the coffee cooperatives we have visited and partnered with in Honduras, but I am a long way from an expert, and could be easily embarrassed far out on the limb of a coffee bush.  We can’t simply say “trust me,” because that is self-certification precisely like the big corporations claim, and unfortunately their size, branding, marketing, and advertising guarantee that they will win more customers on such a claim.

How can we find solid middle ground that is something sturdier than the quagmire where we currently stand?


My Bet: Apple Makes China’s Foxconn Blink

New Orleans   Foxconn, the huge Chinese manufacturing operation that provides the sweat and often the blood and tears that go into making all of the fancy and expensive Apple products, announced huge wage increases of more than 25% (bringing workers up to $400 per month!) and reductions of overtime in plants where workers sometimes work 7-day, 14 hour days.  The spinning business press wonders whether or not consumers will accept the small price changes and “blames” them for all of the widely reported Dickensian and deplorable conditions at Foxconn plants.

What balderdash!

We are now supposed to believe, according to a professor quoted by the Times that “this is the way capitalism is supposed to work….”

Well, not sure about all of that, but the way 21st century capitalism really works, Apple has certainly never stinted on putting fat juicy prices on its consumer products and sweating out the rest of the sub-contracts.  The new myth that the late Jobs and some of his fan-boys in the press are trying to promote is that Apple had to go to China because it was only there that the Foxconns’ of the world could scratch an Apple itch for a small change and mobilize 10,000 or more workers in the dead of night to work 24/7 to make it happen.  Believe me, Apple consumers paid for that without thinking – or knowing!  But, the real reason in 21st century capitalism was not the speed in China but the absurdly low wages, which is certainly a part of every century’s capitalism, and the benefits of state financed industrial infrastructure, which deserves pride of place here as well.

There cannot be any real doubt though the press releases from California and China will not say this, that the changes now being announced are the clear signs that Apple and others are finally realizing that the Fair Labor Association and other fig leafs covering their manufacturing mess are not working.  There can’t be anyone that doesn’t believe that Apple and Foxconn are not talking about this hour-by-hour, and both realize that their “slave” ship is going down and the only way to deal with the heat is to finally make real and substantive changes since the fabrications and so-called investigations are fooling no one.

I knew it was over flying back from Atlanta last week when the stylist young, biomedical resident sitting next to me starting ranting about Apple and its practices.  Out of nowhere!  When you start to lose that demographic, the phone lines of 21st century capitalism start burning even as far as China.