Fair Trade

Trade is a benefit to all parties – if it’s on fair terms. When it’s not on fair terms, it’s generally a benefit to one party and a loss to the other. Frequently the loss to the losing party is greater than the gain to the winner, but of course the winner often doesn’t care about that.

International trade is frequently like that. You can be pretty certain it’s like that when there’s violence or the threat of violence involved.

Trade between rich and poor countries is frequently between the rich country and the élite in the poor country, with the rich country and the élite in the poor country both benefiting. There’s a third party to this trade, however, whose loss almost always exceeds anyone else’s gains by a large margin: the poor in the poor country.

India, for example, is theoretically a democracy. But as in most places that are theoretically democracies, the power is not in the ballot box, it’s in the bank balance (that’s an oversimplification, but this is a broad brush picture). When a poor farmer’s farm happens to lie on coal or iron ore or bauxite (raw material for aluminium), or in a convenient place for a factory, a plantation for crops for export, or a huge hydroelectric scheme – suddenly it’s not his farm any more, the land belongs to the government. Who somehow mysteriously give it away for a nominal sum to some mining company or developer. The farmer may get derisory compensation, but most likely gets nothing at all. Some official may possibly pocket the farmer’s compensation, or it may never have been authorized in the first place. Farmers and their families are being murdered in this process – sometimes literally, sometimes by starvation. A few who are luckier end up in slums in the big cities, and maybe a few members of the family are lucky enough to get sweatshop jobs in the new factory or mine. Did I say lucky? You think they moved to the city for a better life? Better than getting beaten up or murdered by the developers’ goondas, or starving in the countryside because your land’s been stolen, yes, certainly.

Much of the aluminium and the products of that factory end up on the international market. Are the purchasers responsible for the situation in India, or is it India’s responsibility to make its internal dealings fair? Should the rich country “bring democracy” to India? Not the way they usually “bring democracy” to a country, that’s for sure. Maybe by refusing to buy aluminium or cars or anything from India until you’ve ensured that everyone involved gets a fair deal – and if that increases the price too much, then perhaps reconsider whether the trade is really bringing a nett benefit overall at all.

And of course that’s not just India – any poor country is in much the same position.

For more detail on what’s happening in India, see War in the Heart of India.