Wake Up to the Economic Crisis Connected to Your Cup of Coffee
By Meridith Kruse, Urbana Indymedia
Since returning from Nicaragua I have closely followed the news from this region. The news has not been good. During the summer of 2000, I stayed with a family in Matagalpa that lived in a small wooden shack set in the thick green mountainside. The juxtaposition of extreme poverty alongside fertile land stood as a vivid reminder that the legacy of colonial turned corporate exploitation continues to severely limit the lives of those living in Latin America today. In the mornings I would walk with the children to a nearby river and gather water to pour over rows of coffee plant seedlings. The children told me it would be four years before the plants would produce a crop. I wondered, after years of painstaking care to produce this first crop, what would be the compensation for their labor? From what I have read and seen, suffering and starvation will be their only reward.
On Tuesday, August 28th 2001 the headline in the Seattle Post reads, "Weak from hunger, Nicaragua peasants flee the fields". The article traces the path of 480 campesinos who, fired from their job at Los Milagros coffee plantation, join hundreds of others in a mass exodus from coffee-dependent communities. Across the country coffee refugees, without work and desperate for food, congregate in makeshift camps and wonder what to do.
What are the larger factors that have created this crisis? Many things are at work. One factor that stands out is the push by the World Bank to invest heavily in Vietnamese coffee that in turn caused a surplus in the market and left wholesale prices for coffee in a tailspin. In 1996 Arabic coffee (high grade coffee grown in Nicaragua) sold for $3 per pound, today the same amount sells for 51 cents. Worldwide coffee prices are well below the cost of production causing massive unemployment and starvation among growers. Yet the average retail price for roasted coffee remains high. What gives?
Under the "Free Trade" economic model countries, desperate for loans, appeal to the World Bank for assistance. Loans are given, but only if certain conditions are met. These conditions include cutting social spending, privatizing one's economy, eliminating regulations on foreign ownership of resources and businesses, eliminating tariffs, and re-orienting economies from subsidence to exports. The Free Trade system is based on the belief that if a country makes itself as hospitable to foreign investment as possible, even when this means weakening environmental and labor codes and prioritizing export commodities over food security, advancement will occur. Unfortunately the only advancement has been the wealth of multi-national corporations, many of whose annual sales are greater than the entire GDP's of coffee producing countries.
Free Trade is a bankrupt model that has lead to greater economic inequality, environmental degradation, and social unrest throughout the world. Not surprisingly, George Bush's continues to promote of this failed policy with the Central American Free Trade Agreement. While our "leaders" continue down this misguided path, it is up to the people to propose, create, and demand an alternative. Fair Trade offers us the opportunity to do just that.
In contrast to unregulated Free Trade, Fair Trade Certified Coffee assures consumers that the coffee we drink was purchased under Fair Trade conditions. To become certified, an importer must meet stringent international criteria; pay a minimum price per pound of $1.26, provide much needed credit to farmers, and offer technical assistance such as help transitioning to organic farming. Fair Trade Coffee is grown by approximately 300 farmer cooperatives in over 20 countries across Latin America, Africa, and Asia. According to TransFair, a non-profit third-party certification organization, in 2001 more than 550,000 farmers and their families earned a decent living in democratically-run Fair Trade certified cooperatives.
The Fair Trade Coffee campaign goal is to empower both consumers and retailers on a local level to participate in the creation of a more just global economy by purchasing Fair Trade Certified Coffee.
