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Fair Trade Coffee Is a Raw Deal

I got a minor in Economics in college. I found the study of price theory especially fascinating. Yeah, I was a wild and crazy guy in college, right? I didn’t do much with that knowledge otherwise. I’ve got fifteen hours of classes under my belt, whatever that’s worth. Today I’m merely an armchair economist.

Yet from time to time something around me triggers flashbacks to my price theory days. It happened recently when I started seeing all this “Fair Trade” stuff everywhere. Coffee, tea, chocolate, trinkets… anything! My first inclination was to think about the coffee that isn’t labeled as fair trade. Does that make a normal cup of coffee “unfair” trade? Hardly. Two parties agreed to engage in a transaction. A farmer traded coffee beans to a coffee broker for cash. Both sides engaged in the transaction on there own and both received something of value in return. Were that not to be the case, I’d argue the transaction wouldn’t have taken place at all. Thus it is, by my definition, a fair trade.

But this isn’t “fair” in the eyes of many well-meaning folks today. You see, a cup of premium coffee costs a pretty penny these days. Yet the farmers growing the stuff account for mere pennies of the final price. That’s gotta be unfair, right?

Not really. Coffee is grown all over the world. There is a lot of the stuff. But that doesn’t matter. Welcome to the Fair Trade movement. We all know the idea… those of us in the affluent burbs pay a little more for coffee with the hopes that some of the money goes towards paying the farmers a little extra. It is a pleasant thought. Who doesn’t want to help someone in the developing world, right? It is well meaning, kind, generous… and downright harmful in the long run.

Remember back to that Econ 101 class from college? You know, the one you slept through. I was the nerdy kid staying after class to talk to the professor. Anyway, you remember supply and demand, right? Sure, easy stuff. Remember price floors and ceilings? The Fair Trade movement seeks to create an artificial price floor on products. They try to influence a market by bringing the price up to a point higher than normal. What will result is farmers attempting to produce more. This will eventually result in an oversupply of coffee. Farmers will ultimately have to dump product on the market or let it rot. This will hurt all farmers, particularly those not participating in the fair trade movement.

So is the fair trade movement a noble idea? Sure. Perhaps it will make you feel better drinking the coffee. But in the long run, fair trade initiatives can create oversupply and hurt farmers. It is a lesson in Econ 101… don’t meddle in markets! Hope you enjoy the coffee.

Cubicle Contributions – Charity at Work

Someone asked me for money today. No, there are not homeless people in Alpharetta now. And no I wasn’t at Underground Atlanta, I was in my cubicle. And no he wasn’t a homeless guy that managed to slip past security. This was a co-worker, albeit one that rides a Harley and wears a leather jacket. Did I avoid eye contact and move along? Nope, I wrote him a check.

Let’s call him Ted, my Harley-riding software developer co-worker. Every year Ted participates in the Ride for Kids which is a rather large fundraiser for the Pediatric Brain Tumor Foundation. This coming Sunday is their Atlanta event. If you wake up early on Sunday morning you might catch them cruising up GA-400. It is a cool sight to see, and I’m not a motorcycle guy by any means.

Is it cool for Ted to hit up his fellow cubicle dwellers for cash contributions? Or is he crossing the line, bordering on pestering? Is it appropriate to ask co-workers to support your charitable endeavor? I say absolutely, so long as you follow a few rules. But before I get into my rules, here is why I give to stuff like this:

People want to give but don’t. They need to be asked. I truly believe that most people are giving people. We just get busy in our daily grind and giving becomes something we don’t do. Sometimes it just takes a kind yet firm invitation to give that gets us off our butts. Charity events like this create that little push. I’m all for being pushed, a little.

Do some research before you give. Even though you’ve only giving a few bucks to a co-worker, don’t give if you’re not comfortable with the charity. In the case of the PBTF… I did my research and learned they are favorably ranked on Charity Navigator. Do some homework on any organization you donate money to, office fundraiser or not.

Giving creates some office goodwill. I’m not trying to buy my way into the good graces of my co-workers. But helping Ted builds a bit of cubicle goodwill. I don’t suggest keeping a tally of this, requesting a return favor a few weeks later. That’s not cool. But Ted is likely to remember my support of his cause. That’ll come in handy when I ask him to fix that shoddy code he wrote!

I’d rather help an individual’s fundraiser than the corporate campaign. This one might not make a lot of sense. But I’d rather help Ted or maybe someone doing a walk-a-thon over the big corporate United Way campaign. Ted’s a good guy and deserves the credit.

If you’re going to raise money at work, try following the these tips. First, don’t lean on people too hard and don’t pester them. An e-mail is an okay way to start. I’m not opposed to an in-person request so long as it is sincere. And don’t be offended if someone says no or gives almost nothing. Second, don’t let it interfere too much with work. Don’t waste a lot of your time and others. And along those lines, don’t go plastering stuff on every bulletin board in the office either. Keep it personal. Finally, thank your donors. Handwritten notes go a long way. Or better yet, include something with your note, perhaps a small piece of fancy chocolate or something.

I didn’t give Ted a lot of money so I’m certainly not trying to boast. As a matter of fact, I only gave the minimum to qualify for my company’s matching gift program. But nonetheless it is something. It’s for the kids, right? Maybe Ted will win a nice set of steak knives for raising the most cash.

Kids Donating Birthday Presents

Abundance. Life in the affluent burbs is all about abundance. We have an abundance of stuff. Clothes, useless kitchen appliances, $300 hand bags, cars, backyard grilling items. You name it, we’ve got it and a lot of it. As my kids get older I’m starting to notice that they are developing this abundance thing as well, with their toys. I try my best to teach them that they are fortunate to have this abundance of toys, but I don’t think they don’t get it.

We celebrated a birthday this past weekend for my youngest. I got to thinking about this idea while he was opening his mountain of presents. I wish I could take credit for this one but I first heard about it at church years ago. Here’s how it works… As the birthday approaches, you talk to you kid about donating one of his presents to charity. You explain that some children are not as fortunate as you… you know the drill. The important part is that you want junior to decide to do this on his own. Don’t force them into it but rather offer it as an idea.

The charity here locally that is pushing this is called And One to Grow On. Click the link and check out their website. They will guide you through the process once your little one decides to go through with it. First, they will provide you with a card to include with your party invitations. I’m not sure if this is completely necessary but it promotes the charity. Once your party takes place, AOGO makes it easy to donate the gift. The have drop off locations for toys or they will arrange to have it picked up.

If you don’t want to go with this specific charity, I’m sure you could accomplish the same kind of thing on your own. There are dozens of local charities that will take a new unopened toy.

To me this isn’t about the gift itself. Let’s be realistic, one toy isn’t going to change the world. This is about teaching your child to think of others and give. It isn’t a huge sacrifice and your kid won’t miss one toy. Yet this is something that might spark your child into becoming a giving person. If you can raise a child in our gilded suburbs to think this way as an adult… consider yourself a successful parent.

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