Ethical consumerism: worthwhile or harmful?

2006-12-17

in Economics, Politics, The environment

In the December 9th issue of The Economist, which I am just starting today, they come out against organic food, Fair Trade, and the idea that buying locally grown food is superior to relying on big retailers and large commercial farms (Leader and article). Organic food means producing lower yields for the same area of land: a big problem when you have a growing population and a desire to preserve wilderness. Fair Trade keeps farmers in poverty by encouraging farmers to keep growing commodities with volatile prices and low margins; moreover, most of the premium consumers pay goes to the retailer, rather than the farmer. As for local food, they say that large scale farming and food retailing produce food using less energy and resources (sheep are cheaper to farm in New Zealand and ship to the UK than to farm here). The solutions to problems like poverty and climate change, therefore, lie in carbon taxes, reform of agricultural trade policy, and the like.

Fair trade has always been a somewhat problematic concept, in my eyes. The whole basis for the legitimacy of exchange is in the process: the voluntary nature of the agreement means that both people who engage in it must perceive themselves to benefit. Now, there can be problems with this:

  1. The people may be wrong about what is in their interests
  2. Third parties may be affected
  3. The choice to trade may not be voluntary

All of these are real problems in many economic circumstances, but it is not clear why paying more for a label alleviates any of them. If we abandon the idea that the legitimacy of exchange is confirmed through its voluntarism, then we are left with the task of developing a comprehensive framework based on a teleological conception of justice (what people end up with, as opposed to how they get it). Even if that is desirable, achieving it is not simply a matter of paying a few more dollars a week for coffee or bananas.

As for the problems with local and organic food, the issues there are primarily empirical and thus hard for me to evaluate. If the price of carbon emissions was included in that of food (and all other products), I would see little problem in eating tomatoes from Guatemala or apples from New Zealand. Similar criticisms are leveled in Michael F. Maniates’ interesting article Individualization: Plant a Tree, Buy a Bike, Save the World?. Maniates’ major point is that you will never get anywhere with a few token individual gestures. What is necessary is the widespread alteration of the incentives presented to individuals. Otherwise, you have a few people who salve their consciences by walking to work and buying from a farmers’ market, while not actually doing anything to address the problems with which they are supposedly concerned.

While the position taken by both The Economist and Maniates may overstate the point, both are worth reading for those who have accepted uncritically the idea that important change can be brought about through such ethical purchasing.

PS. Unfortunately, Oxford doesn’t have full text access to the journal Global Environmental Politics. If someone at UBC or another school could email me the PDF, it will save me a trip to the library and some photocopying costs, not to mention the integrity of the spine of their August 2001 issue. Here is a link to the page on their site for this article and another to a Google Scholar search that has it as the top hit.

[Update: 1:10am] A friend has sent me a much appreciated copy of the above requested PDF.

{ 17 comments… read them below or add one }

Jessica December 18, 2006 at 8:57 pm

While I don’t know if an across the board change to organic methods is the solution, the current method of agriculture practiced in the US and elsewhere is completely unsustainable long term. Does the Economist mention the dead zone the size of

Jessica December 18, 2006 at 8:58 pm

While I don’t know if an across the board change to organic methods is the solution, the current method of agriculture practiced in the US and elsewhere is completely unsustainable long term. Does the Economist mention the dead zone the size of New Jersey in the Gulf of Mexico as a result of agricultural phosphate run off?

Milan December 18, 2006 at 11:03 pm

Jessica,

As with so much else, it is a question of tradeoffs. One of the reasons for which I am quite willing to entertain the idea that the genetic modification of foodstuffs might be a good thing is the prospect of it reducing the need for chemical fertilizers and pesticides.

Do you want me to zap the first comment, with the cut off closing sentence?

Tristan December 20, 2006 at 4:43 am

As you probably expect, I wish to weigh in on these issues. I don’t have a copy of this week’s economist (or any other copy of the economist, for that matter), I can only respond directly to issues raised in your blog post. The two issues I want to respond to are first – inneficiency of fair trade, organic etc.., and second – the ethical issues that concern volutarism in trade.

The points you raise for the inneficiency of organic, fair trade farming pressupose the indefinite perpetuation of existing state of political affairs. It only makes sense to include carbon emmisions offsets in the fruit that you continue to ship halfway around the world if you live in a world which never has spikes in the price or difficulty of shipping. If local farming is not sustainable in a world-carbon emmisions mathamatical equation, it might still be sustainable considering the possible radical increases in difficulty of world transport given any kind of strain on global systems. I.e. war, natural disaster. A good example of this is Nelson BC, where there use to be a dairy. Now in the interests of maximum efficiency, the dairy is many hours away by truck. This story repeats itself everywhere. Thus, if there is ever some reason why infrastructure is disturbed, individual communities are very much less self-sustaining because they don’t produce their own food, power, water, etc…

Second, you imply that choosing to buy fair trade amounts to abandoning the notion that the ligitimacy of exchange is confirmed through it’s volutarism. No. It amounts to believing that the situations that prevail in banana republics, (Economic imperialism), do not allow for such a confirmation. Voluntarism only exists where situations of dire need do not. There is no voluntarism in poverty – voluntarism is essentially opposed to neccesity. You are wrong to assume that buying fair trade amounts to introducing a teleological conception of justice into the market- rather, it amounts to regulating the conditions under which choices to work are taken. This is a thoroughly deontological model because it’s concerned with the situations under which choices (voluntary ones, ideally), are made. I think this is deontological because dictating the situation under which decisions are made amounts to changing the rules, not proscribing an outcome.

Of course, fair trade is also teleological. It’s teleological concept is merely human rights – as the rights to food, shelter, education, fair treatment, a decent life. The modern concept of “humanity”. Now, if this is a concept that is “too teleological” to enforce in the market, then by our own definitions we have become instruments of monstrous evil. We must uphold the standards of humanity that we set elsewise we fail to be human on our own terms.

Lastly, you charicature “Fair trade” as a label, when obviously it is a certification procedure. If you wish to critique the various certification procedures and claim that it is merely a label, then do that, but don’t assume the critique – this is what you clearly explain to be “begging the question”.

Tristan December 20, 2006 at 7:49 am

There is another issue here, since you called your post “ethical consumerism”. There is a supposition that in the free market, people will freely choose not to support industries that are hurtful to causes or values that they take near at heart. These will simply be “built in” to their economic calculations. This is, of course, 90% of the time complete bunk, because we can’t expect people to do the research themselves – this is what we have a state for, to regulate, because people can’t self-regulate their purchases.

So, ergo, to decry the very notion of “ethical consumerism” is to deter the rise of the very phenomenon the market has for dealing with exploitation (both of human and earth). The critique of so called “ethical consumerism” needs to take the stance that people believe they are being ethical consumers, but good intentions are not enough we need more vigilance, better NGOs to do the certificiation etc, etc. The very fact that people are willing to pay more for the belief they are doing less harm is proof that they are willing to pay more to do less harm – all we need is to assure that their paying more ends up equalling less harm.

Milan December 22, 2006 at 8:14 pm

Tristan,

The points you raise for the inneficiency [sic] of organic, fair trade farming pressupose [sic] the indefinite perpetuation of existing state of political affairs. It only makes sense to include carbon emmisions [sic] offsets in the fruit that you continue to ship halfway around the world if you live in a world which never has spikes in the price or difficulty of shipping.

Regarding local farming, you assume that transportation is the only industry vulnerable to the threats you describe. It does little good to have your tomato greenhouses just up the road if you have no electricity to heat or light them (not that I think this is likely), or no chemical fertilizers of the sort necessary to sustain intensive agriculture. The reasons for which growing food close to home protects you from external shocks are not clear. Indeed, you would expect a global trading system with many producers and consumers to be fundamentally better defended against such shocks than individual nations (or sub-national areas) ever could be.

Second, you imply that choosing to buy fair trade amounts to abandoning the notion that the ligitimacy [sic] of exchange is confirmed through it’s volutarism. No. It amounts to believing that the situations that prevail in banana republics, (Economic imperialism), do not allow for such a confirmation.

The objections raised in the article are the following:

Fairtrade food is designed to raise poor farmers’ incomes. It is sold at a higher price than ordinary food, with a subsidy passed back to the farmer. But prices of agricultural commodities are low because of overproduction. By propping up the price, the Fairtrade system encourages farmers to produce more of these commodities rather than diversifying into other crops and so depresses prices—thus achieving, for most farmers, exactly the opposite of what the initiative is intended to do. And since only a small fraction of the mark-up on Fairtrade foods actually goes to the farmer—most goes to the retailer—the system gives rich consumers an inflated impression of their largesse and makes alleviating poverty seem too easy.

I never said that they entirely trump the case for Fairtrade, but they do raise some doubts regarding it – particularly in comparison to alternative approaches. Despite your claim to the contrary, Fairtrade is essentially a brand that has positioned itself in the market on the basis of certain advertised characteristics. The whole idea of ethical consumerism is based upon the formation of such brands and the effects they have upon consumer choices.

I agree that consumers rarely take into account the full ethical ramifications of their purchasing decisions. That does not mean we should unquestioningly accept any solution that claims to mitigate the problem. The relative merits and difficulties of things like Fairtrade, local farming, and organic food need to be debated if the kind of progression you describe is to take place.

Tristan Laing December 22, 2006 at 8:44 pm

I generally agree with these objections. The key point that needs to be made is: ethical consumerism is good. Fair trade, organic, might not be ethical consumerism.

Milan December 22, 2006 at 8:47 pm

Tristan,

I sent you a copy of the Maniates’ article. While it doesn’t undermine the case against ethical consumerism, it does raise some important questions about it.

Antonia December 28, 2006 at 6:07 pm

Discussed aspects of this briefly yesterday before seeing your posting. Ethical purchase priorities can differ widely from product to product and producing region to producing region. Look forward to reading your post and comments in full, when I have leisure, and discussing this with you.

Milan January 15, 2007 at 12:30 am

There is something to this:

SIR – An important element motivating acolytes of the ethical-food movement is snob appeal. Now even something as prosaic as grocery shopping can display someone’s financial and educational status.

Bryan Young

Dallas

Anon September 14, 2007 at 11:44 am

And here’s the essential break between lite green and bright green thinking: the reality is that the changes we must make are systemic changes. They involve large-scale transformations in the ways we plan our cities, manufacture goods, grow food, transport ourselves, and generate energy. They involve new international regulatory regimes, corporate strategies, industrial standards, tax systems and trading markets. If we want to change the world, we need to forge ourselves into the kinds of citizens who can effectively demand such things.

Dire practicality demands that we reject the privatization of responsibility. None of us can make this great transformation happen alone, and it removes pressure from our leaders to take needed steps when some suggest that the changes that need to be made in the world start with our personal choices. They don’t.

Can strategic consumption be one of the tactics we use? Of course. But the power most of us can actually exert at the cash register is extremely limited. Far, far more important are our public lives: our roles as citizens, as change agents within our businesses, as advocates in our communities, as investors and philanthropists, as opinion leaders in general (and if you’re reading this site now, you are, however uncomfortable it may be, an opinion leader).

Source

Anonymous November 19, 2007 at 4:29 pm

Think globally, eat globally

By Free Exchange | Washington, DC

TIM HARFORD, Undercover Economist and recent addition to the economics blogosphere, tackles the “locavore” craze in a solid Forbes column. Locavore, for those of you who missed its Oxford Word of the Year coming out party, refers to an individual attempting to maintain a diet of locally produced food–with local generally assumed to mean within about 100 miles. Many wonderful qualities are (dubiously) ascribed to locavorism, including increased happiness in agricultural communities and rejuvenated local economies, but the primary selling point appears to be a reduction in global carbon emissions. Global trade in food requires extensive shipping and, it’s assumed, high emissions. Eating local involves shorter shipping distances, and should therefore lead to reduced carbon output.

Tristan December 2, 2007 at 1:30 pm

After reading over this debate again, I get the sense that everything revolves around the “externalities” point. Is it not reasonable to make it an ethical demand to “eliminate externalities”? If this was the case, the appeal of fair trade coffee is that it should (and if it doesn’t, its bunk), eliminate externalities?

Of course, Milan, you are entirely right about subsidies causing over production. Hegel goes over this exact point in Philosophy of Right, paragraph 245

§ 245

When the masses begin to decline into poverty, (a) the burden of maintaining them at their ordinary standard of living might be directly laid on the wealthier classes, or they might receive the means of livelihood directly from other public sources of wealth (e.g. from the endowments of rich hospitals, monasteries, and other foundations). In either case, however, the needy would receive subsistence directly, not by means of their work, and this would violate the principle of civil society and the feeling of individual independence and self-respect in its individual members. (b) As an alternative, they might be given subsistence indirectly through being given work, i.e. the opportunity to work. In this event the volume of production would be increased, but the evil consists precisely in an excess of production and in the lack of a proportionate number of consumers who are themselves also producers, and thus it is simply intensified by both of the methods (a) and (b) by which it is sought to alleviate it. It hence becomes apparent that despite an excess of wealth civil society is not rich enough, i.e. its own resources are insufficient to check excessive poverty and the creation of a penurious rabble.

Remark: In the example of England we may study these phenomena on a large scale and also in particular the results of poor-rates, immense foundations, unlimited private beneficence, and above all the abolition of the Guild Corporations. In Britain, particularly in Scotland, the most direct measure against poverty and especially against the loss of shame and self-respect – the subjective bases of society – as well as against laziness and extravagance, &c., the begetters of the rabble, has turned out to be to leave the poor to their fate and instruct them to beg in the streets.

. April 3, 2008 at 10:23 pm

How the myth of food miles hurts the planet

Ethical shopping just got more complicated. The idea that only local produce is good is under attack. There is growing evidence to suggest that some air-freighted food is greener than food produced in the UK. Robin McKie and Caroline Davies report on how the concept of food miles became oversimplified – and is damaging the planet in the process

. April 1, 2009 at 11:29 am

Carbon labels present taxing problem

VIEWPOINT
Alexander Kasterine

Labels showing products’ carbon footprints will not help tackle climate change, says Alex Kasterine. In this week’s Green Room, he argues that carbon labelling schemes will harm exports, especially from developing nations, without making much impact on emissions.

. October 15, 2009 at 10:53 am

Chamber of Horrors
The U.S. Chamber of Commerce must be stopped. Here’s how to do it.
By Eliot Spitzer
Updated Thursday, Oct. 15, 2009, at 1:23 AM ET

The U.S. Chamber of Commerce—the self-proclaimed voice of business in Washington—has been wrong on virtually every major public-policy issue of the past decade: financial deregulation, tax and fiscal policy, global warming and environmental enforcement, consumer protection, health care reform …

The chamber remains an unabashed voice for the libertarian worldview that caused the most catastrophic economic meltdown since the Great Depression. And the chamber’s view of social justice would warm Scrooge’s heart. It is the chamber’s right to be wrong, and its right to argue its preposterous ideas aggressively, as it does through vast expenditures on lobbyists and litigation. Last year alone, the chamber spent more than $91 million on lobbying, and, according to lobby tracker Opensecrets.org, it has spent more than twice as much on lobbying during the past 12 years as any other corporation or group.

The problem is, the chamber is doing all this with our money. The chamber survives financially on the dues and support of its members, which are most of America’s major corporations listed on the stock exchange. The chamber derives its political clout from the fact that its membership includes these corporations. Yet we—you and I—own the companies that support the chamber and permit it to propagate its views. Our passive, permissive attitude toward the management of the companies we own has enabled the chamber to be one of the primary impediments to the reform of markets, health care, energy policy, and politics that we have all been calling for. It is time for that to change.

. October 12, 2010 at 11:30 am

“Instead of confronting the shift in values, we have sought to adapt to it. Once-progressive political parties have tried to appease altered public attitudes: think of all those New Labour appeals to Middle England, which was often just a code for self-interest. In doing so they endorse and legitimise extrinsic values. Many greens and social justice campaigners have also tried to reach people by appealing to self-interest: explaining how, for example, relieving poverty in the developing world will build a market for British products, or suggesting that, by buying a hybrid car, you can impress your friends and enhance your social status. This tactic also strengthens extrinsic values, making future campaigns even less likely to succeed. Green consumerism has been a catastrophic mistake.

Common Cause proposes a simple remedy: that we stop seeking to bury our values and instead explain and champion them. Progressive campaigners, it suggests, should help to foster an understanding of the psychology which informs political change and show how it has been manipulated. They should also come together to challenge forces – particularly the advertising industry – which make us insecure and selfish.”

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