The price of being fair

Consumers are keen to buy fairly traded goods and the higher prices we are prepared to pay can be a

Like most projects in international development - aid, debt relief, microfinance - fair trade can help reduce poverty. What it cannot do is effect fundamental change in the world trading system. I tend to be suspicious of attempts to change market outcomes by fixing prices, which is what fair trade boils down to. But, in practice, the armchair economists' objections that high fixed prices lock farmers into overproducing (rather than abandoning crops with little future) seem a bit overdone.

Farmers selling goods certified under the Fairtrade label can only sell as much at the Fairtrade price as they have contracts for. I have visited cotton farmers in Mali who were fully aware of the dangers of relying too much on one crop, even with a higher price, and continued to rotate cotton with peanuts, maize, sesame seeds and so on.

But, now that Fairtrade is gaining a larger share of the total market, the threat could become more serious. Unless every single coffee buyer in the world, for example, buys the same amount of coffee as before at a higher price, Fairtrade may well be in the uncomfortable position of closing its books to new applicants or certifying farmers who cannot get any contracts at a Fairtrade price.

The risk of overproduction through price- fixing is not theoretical. Governments in Bangla desh and elsewhere guaranteed absurdly high prices for jute farmers, with the result that more and more jute was produced and shovelled on to the world market and prices collapsed. What farmers need to do - and Fairtrade could be a bit more explicit in encouraging them - is to use Fairtrade income to improve the quality of existing crops, diversify into others or move out of farming altogether. I was heartened to be told of Ecuadorean coffee farmers who felt that Fairtrade would give their children a choice not to grow coffee.

On this subject, a useful if little-known aspect of Fairtrade is the "social premium", a payment the co-operatives receive to be spent collectively. There are well-documented problems with Fairtrade's predilection for dealing only with co- operatives (farmers have usually been organised otherwise). But where it works, it can work. One Malian village I visited used its premium to build a crop store that enabled it to distribute supplies of grain evenly over the year.

Fairtrade has no way to make sure that farmers diversify or improve quality, and I have some sympathy with companies such as Green & Black's, which say they aid farmers more by helping them to improve quality and go organic rather than just guaranteeing a price.

Fairtrade is fine as far as it goes. I part company where a moderately sensible market intervention is dressed up as part of a mission for global "trade justice". Itself a creation of NGOs, the UK Fairtrade Foundation sits on the board of the Trade Justice Movement, a coalition of dozens of NGOs. The movement's analysis of trade - that poor countries are prevented from trading by unfair rules, tariffs and subsidies - is wrong and its suggested solutions are routinely misguided.

With a few exceptions (cotton in particular), rich nations' trade tariffs and subsidies do not significantly hurt developing-world farmers, and certainly not those in Africa. The products most African farmers grow are not subsidised heavily by Europe and the US, which concentrate their support on temperate crops such as beet and wheat.

Even in crops where rich and poor compete head-on, pursuing trade justice often means not backing poor against rich but weighing in on the side of one set of developing countries against another. Take the NGO cause céèbre of rice, of which there are now Fairtrade versions. Famously, the markets in Accra, Ghana are piled ceiling high with subsidised American rice that undercuts domestic produce. (Printing the Stars and Stripes on the sacks, as American rice exporters often do, is a particularly nice touch.) NGOs lead a steady stream of pliable celebrities and journalists round by the nose and invite them to be outraged.

But if they look carefully in the markets, they will also see rice from Vietnam and Thailand that is competitive without subsidy. If the US never exported another grain of rice, Ghanaian farmers still could not compete with Vietnamese and Thai imports. Protecting them with tariffs merely means transferring money to the rice farmers from everyone else in Ghana, by making them pay more for a staple food.

Prices in one of Fairtrade's biggest markets, coffee, were driven down a few years ago by huge expansion of cheap production in Vietnam and Brazil, the former helped by its government. One solution proposed by NGOs in the trade justice coalition, including Oxfam, is to hold up prices by "managing supply" - in other words, to form a global coffee cartel.

It is hard enough holding together a cartel like Opec, where countries either have the commodity or they don't. Trying to support a global price in a commodity where production can be expanded rapidly almost always fails. The previous coffee cartel, along with a whole bunch of similar commodity arrangements in decades gone past, collapsed precisely for that reason.

And can we seriously envisage going to Vietnam, a country poorer than Mexico, Ecuador and Peru, whose farm exports have helped it reduce poverty at a spectacular rate, to tell it to cut production? How is this trade justice? Why do Vietnam's coffee farmers matter less than Mexico's?

Fairtrade can be a useful support to farmers if it pulls them into the existing world trading system and helps producers diversify and go up the value chain. But it cannot function as a club whose members take on the hopelessly unrealistic and misguided quest of slaying the chimerical beast of trade injustice.

Alan Beattie is world trade editor of the FT

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The French millennials marching behind Marine Le Pen

A Front National rally attracts former socialists with manicured beards, and a lesbian couple. 

“In 85 days, Marine will be President of the French Republic!” The 150-strong crowd cheered at the sound of the words. On stage, the speaker, the vice-president of the far-right Front National (FN), Florian Philippot, continued: “We will be told that it’s the apocalypse, by the same banks, media, politicians, who were telling the British that Brexit would be an immediate catastrophe.

"Well, they voted, and it’s not! The British are much better off than we are!” The applause grew louder and louder. 

I was in the medieval city of Metz, in a municipal hall near the banks of the Moselle River, a tributary of the Rhine from which the region takes its name. The German border lies 49km east; Luxembourg City is less than an hour’s drive away. This is the "Country of the Three Borders", equidistant from Strasbourg and Frankfurt, and French, German and French again after various wars. Yet for all that local history is deeply rooted in the wider European history, votes for the Front National rank among the highest nationally, and continue to rise at every poll. 

In rural Moselle, “Marine”, as the Front National leader Marine Le Pen is known, has an envoy. In 2014, the well-spoken, elite-educated Philippot, 35, ran for mayor in Forbach, a former miner’s town near the border. He lost to the Socialist candidate but has visited regularly since. Enough for the locals to call him “Florian".

I grew up in a small town, Saint-Avold, halfway between Metz and Forbach. When my grandfather was working in the then-prosperous coal mines, the Moselle region attracted many foreign workers. Many of my fellow schoolmates bore Italian and Polish surnames. But the last mine closed in 2004, and now, some of the immigrants’ grandchildren are voting for the National Front.

Returning, I can't help but wonder: How did my generation, born with the Maastricht treaty, end up turning to the Eurosceptic, hard right FN?

“We’ve seen what the other political parties do – it’s always the same. We must try something else," said Candice Bertrand, 23, She might not be part of the group asking Philippot for selfies, but she had voted FN at every election, and her family agreed. “My mum was a Communist, then voted for [Nicolas] Sarkozy, and now she votes FN. She’s come a long way.”  The way, it seemed, was political distrust.

Minutes earlier, Philippot had pleaded with the audience to talk to their relatives and neighbours. Bertrand had brought her girlfriend, Lola, whom she was trying to convince to vote FN.  Lola wouldn’t give her surname – her strongly left-wing family would “certainly not” like to know she was there. She herself had never voted.

This infuriated Bertrand. “Women have fought for the right to vote!” she declared. Daily chats with Bertrand and her family had warmed up Lola to voting Le Pen in the first round, although not yet in the second. “I’m scared of a major change,” she confided, looking lost. “It’s a bit too extreme.” Both were too young to remember 2002, when a presidential victory for the then-Front National leader Jean-Marie Le Pen, was only a few percentage points away.

Since then, under the leadership of his daughter, Marine, the FN has broken every record. But in this region, the FN’s success isn’t new. In 2002, when liberal France was shocked to see Le Pen reach the second round of the presidential election, the FN was already sailing in Moselle. Le Pen grabbed 23.7 per cent of the Moselle vote in the first round and 21.9 per cent in the second, compared to 16.9 per cent and 17.8 per cent nationally. 

The far-right vote in Moselle remained higher than the national average before skyrocketing in 2012. By then, the younger, softer-looking Marine had taken over the party. In that year, the FN won an astonishing 24.7 per cent of the Moselle vote, and 17.8 per cent nationwide.

For some people of my generation, the FN has already provided opportunities. With his manicured beard and chic suit, Emilien Noé still looks like the Young Socialist he was between 16 and 18 years old. But looks can be deceiving. “I have been disgusted by the internal politics at the Socialist Party, the lack of respect for the low-ranked campaigners," he told me. So instead, he stood as the FN’s youngest national candidate to become mayor in his village, Gosselming, in 2014. “I entered directly into action," he said. (He lost). Now, at just 21, Noé is the FN’s youth coordinator for Eastern France.

Metz, Creative Commons licence credit Morgaine

Next to him stood Kevin Pfeiffer, 27. He told me he used to believe in the Socialist ideal, too - in 2007, as a 17-year-old, he backed Ségolène Royal against Sarkozy. But he is now a FN local councillor and acts as the party's general co-ordinator in the region. Both Noé and Pfeiffer radiated a quiet self-confidence, the sort that such swift rises induces. They shared a deep respect for the young-achiever-in-chief: Philippot. “We’re young and we know we can have perspectives in this party without being a graduate of l’ENA,” said another activist, Olivier Musci, 24. (The elite school Ecole Nationale d’Administration, or ENA, is considered something of a mandatory finishing school for politicians. It counts Francois Hollande and Jacques Chirac among its alumni. Ironically, Philippot is one, too.)

“Florian” likes to say that the FN scores the highest among the young. “Today’s youth have not grown up in a left-right divide”, he told me when I asked why. “The big topics, for them, were Maastricht, 9/11, the Chinese competition, and now Brexit. They have grown up in a political world structured around two poles: globalism versus patriotism.” Notably, half his speech was dedicated to ridiculing the FN's most probably rival, the maverick centrist Emmanuel Macron. “It is a time of the nations. Macron is the opposite of that," Philippot declared. 

At the rally, the blue, red and white flame, the FN’s historic logo, was nowhere to be seen. Even the words “Front National” had deserted the posters, which were instead plastered with “in the name of the people” slogans beneath Marine’s name and large smile. But everyone wears a blue rose at the buttonhole. “It’s the synthesis between the left’s rose and the right’s blue colour”, Pfeiffer said. “The symbol of the impossible becoming possible.” So, neither left nor right? I ask, echoing Macron’s campaign appeal. “Or both left and right”, Pfeiffer answered with a grin.

This nationwide rebranding follows years of efforts to polish the party’s jackass image, forged by decades of xenophobic, racist and anti-Semitic declarations by Le Pen Sr. His daughter evicted him from the party in 2015.

Still, Le Pen’s main pledges revolve around the same issue her father obsessed over - immigration. The resources spent on "dealing with migrants" will, Le Pen promises, be redirected to address the concerns of "the French people". Unemployment, which has been hovering at 10 per cent for years, is very much one of them. Moselle's damaged job market is a booster for the FN - between 10 and 12 per cent of young people are unemployed.

Yet the two phenomena cannot always rationally be linked. The female FN supporters I met candidly admitted they drove from France to Luxembourg every day for work and, like many locals, often went shopping in Germany. Yet they hoped to see the candidate of “Frexit” enter the Elysee palace in May. “We've never had problems to work in Luxembourg. Why would that change?” asked Bertrand. (Le Pen's “144 campaign pledges” promise frontier workers “special measures” to cross the border once out of the Schengen area, which sounds very much like the concept of the Schengen area itself.)

Grégoire Laloux, 21, studied history at the University of Metz. He didn't believe in the European Union. “Countries have their own interests. There are people, but no European people,” he said. “Marine is different because she defends patriotism, sovereignty, French greatness and French history.” He compared Le Pen to Richelieu, the cardinal who made Louis XIV's absolute monarchy possible:  “She, too, wants to build a modern state.”

French populists are quick to link the country's current problems to immigration, and these FN supporters were no exception. “With 7m poor and unemployed, we can't accept all the world's misery,” Olivier Musci, 24, a grandchild of Polish and Italian immigrants, told me. “Those we welcome must serve the country and be proud to be here.”

Lola echoed this call for more assimilation. “At our shopping centre, everyone speaks Arabic now," she said. "People have spat on us, thrown pebbles at us because we're lesbians. But I'm in my country and I have the right to do what I want.” When I asked if the people who attacked them were migrants, she was not so sure. “Let's say, they weren't white.”

Trump promised to “Make America Great Again”. To where would Le Pen's France return? Would it be sovereign again? White again? French again? Ruled by absolutism again? She has blurred enough lines to seduce voters her father never could – the young, the gay, the left-wingers. At the end of his speech, under the rebranded banners, Philippot invited the audience to sing La Marseillaise with him. And in one voice they did: “To arms citizens! Form your battalions! March, march, let impure blood, water our furrows...” The song is the same as the one I knew growing up. But it seemed to me, this time, a more sinister tune.