Free trade, fair trade, and socialism: Workers' Liberty 3/17

Fair trade, free trade, and socialism

Published on: Sat, 09/02/2008 - 21:17

Paul Hampton

Trade is a vital part of the neoliberal economic, political and ideological regime that now dominates the world economy and most national states.

At various summits in recent years the world’s most powerful governments have promised to introduce a better deal on trade, aid and debt for the world’s poorest countries, especially in Africa.

At the same time, there are many charities and NGOs making proposals to make trade fairer. A number of organisations came together in 2006 in the Make Poverty History coalition, call for trade justice. Others advocate buying only goods with the fairtrade

Free trade

Published on: Sat, 09/02/2008 - 21:15

Paul Hampton

Whether you live in Mexico or Morocco, South Korea or Spain, you can buy food produced on the other side of the world. Toys made in China, jeans in Guatemala, trainers in Indonesia and cars made in Brazil are sold thousands of miles away. This is the golden age of world trade, if nothing else.

The world trade order today

By 2000 world trade was 20 times larger than it had been in 1950 — far outstripping the growth in world output (GDP), which had grown nearly seven times over the same period. Trade has grown especially fast since the late 1980s, twice as fast as output.

This is not the first

Fair trade

Published on: Sat, 09/02/2008 - 21:11

Paul Hampton

Many of the young people, NGOs and unions who mobilised for the big demonstrations in Seattle in 1999, or in Edinburgh for the G8 summit, argue that the alternative to the neoliberal, free trade agenda of the multinationals, the big powers and the WTO is some sort of “fair trade”. Three million people have signed Oxfam’s petition to “make trade fair”.

Few opponents of free trade argue that trade per se is harmful, although the localisation school emanating from green politics certainly appears to do so. Instead most charities and NGOs want the rules of the game changed.

“Fair trade” and


Published on: Sat, 09/02/2008 - 21:08

Paul Hampton

The most drastic alternative to free trade, popular on the green wing of the global justice movement, is localisation. Localisation means that: “everything that can be produced locally should be produced locally”.

According to Australian green Gary Buckman, the localisation school “generally sees global trade as an inherently destructive economic force and believes that the only way poor nations will get any richer is through less trade, not more”.

Proponents of localisation such as Colin Hines argue that reducing the volume of international trade would give nations both economic and

Socialist policy on trade

Published on: Sat, 09/02/2008 - 21:07

Paul Hampton

A revolutionary alternative to both “free” trade and “fair” trade is the perspective held by the Alliance for Workers’ Liberty (AWL). It is based on the core ideas of Marxists a century ago, applied to the circumstances we live in today.

Karl Marx and Frederick Engels first wrote about world trade in the 1840s, when British capitalism was the dominant industrial force in the world economy and free trade had just become the commercial policy of the British government.

In England the Corn Laws that had kept the price of food high (and the landowners rich) were repealed in 1846, sparking a great

Marx's major works on foreign trade

Published on: Sat, 09/02/2008 - 21:01

Paul Hampton

In his notes on the history of economic thought in 1861-63, first published as Theories of Surplus Value (but in fact the second draft of Capital, volume 1), Marx comments on the way a rich country can exploit a poorer one.

He argued: “Say, in his notes to Ricardo’s book translated by Constancio, makes only one correct remark about foreign trade. Profit can also be made by cheating, one person gaining what the other loses. Loss and gain within a single country cancel each other out. But not so with trade between different countries. And even according to Ricardo’s theory, three days of labour

Proudhon, patron saint of fair trade

Published on: Sat, 09/02/2008 - 20:59

Paul Hampton

Pierre Joseph Proudhon (1809–1865) was a founder of anarchism and author of the book What is Property? (1842) to which he gave the celebrated answer, “it is theft”.

Proudhon was one of the most prominent radical thinkers of his day, and in works such as System of Economic Contradictions — or The Philosophy of Poverty (1846) and Credit, Free of Interest (1858) was an early advocate of some fair trade ideas. He argued that workers should receive the full value of their labour, but would be free only when they could acquire the means of production, become handicraftsmen (women, as Marx

Independent working-class politics in the Third World

Published on: Sat, 09/02/2008 - 20:57

Capitalist development is a fact of the last fifty years. World GDP increased nearly seven-fold from 1950 to 1998, with an average growth rate of nearly 4% a year, according to OECD figures.

During the so-called “golden age”, 1950-73, world GDP grew by almost 5% a year; over the “neoliberal” period since 1973 the world economy has grown by 3% a year. In both periods growth was faster than at any time in history – the world economy is estimated to have grown by just over 2% a year between 1870 and 1913 and just under 2% a year between 1913 and 1950.

Real GDP per capita rose by over 2% a year

South Africa: workers defeat apartheid

Published on: Sat, 09/02/2008 - 20:53

Paul Hampton

A strike wave began in Durban in 1973 involving nearly 100,000 workers. It shook the racist apartheid regime (where only the white minority could vote) that had ruled for 25 years. Students played an important role too, calculating cost of living indexes and doing research for workers.

From the early 1980s, there was a massive upsurge in working class struggle. On 1 May 1986, 1.5 million workers “stayed away” from work to demand an official May Day holiday – the largest strike in South African history.

The strike wave swiftly made organisational gains. The COSATU trade union federation, formed

Workers' Liberty 3/17: free trade, fair trade, and socialism

Published on: Wed, 23/01/2008 - 23:10

Paul Hampton

Workers' Liberty 3/17 examines the facts about world trade, the arguments about fair trade, the lessons to be learned from the writings of Marx and Engels, and the outlines of a socialist policy. Download pdf here, or read online.

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