DD103 TMA01

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Robert Smith (F3101401) DD103 TMA01

So, I thought it might be appropriate to post my first TMA, now the cut off date is past, to maybe initiate some discussion. I ought to state that this TMA did not score highly (55/90) so there is not a lot of point in copying it, in case you were so tempted.

Part 1) Describe how the Production and Consumption of Coffee can help us to understand the concept of Justice.

Introduction.


The purposes of studying production and consumption are many and varied; greater commercial efficiency or effectiveness, perhaps, or the mitigation of environmental threats, or any one of a number of sociological, economic or political considerations. But here we are concerned the light it sheds on matters of justice.

Coffee and Distributive Justice.

This essay is focused on distributive justice, and in the economic sense, though there are ramifications for trade justice and social justice. So it is concerned with the way goods and services are rationed. In a free-market, liberal democracy, where people are encouraged towards unlimited desires, such rationing is generally according to how much money one has, and how willing one is to spend it. Whether the market is a ‘fair’ way of allocating the world’s economic goods and services, however, is questionable.

It is necessary, then, to arrive at some workable definition of distributive justice, so that we can decide when it is present, and when it is absent. Nancy Fraser offers such a definition; that all individuals should be in a position 'to participate as peers in social life' (Fraser, 2009, cited in Cereso et al, 2019, p38). This definition does not require that justice should be that everyone ought to have an equal amount of money, merely that the poorest should not be excluded from normal society by a degree of poverty determining that outcome. The case of Burte Arba (Open University, 2019) shows such social exclusion is reality for some coffee growers in Ethiopia.

I contend that the amount of money paid for the necessary beans, and specifically the disparity between the profits a grower can expect, and the amount a retailer in the affluent west makes, is prima facie evidence of inequality and the absence of such distributive justice. In a perfect world, perhaps naïvely, one would expect that all the actors in the value chain would take an equal share of the overall profit, but the coffee industry shows that this ideal does not correlate with the way the world actually is.

Rather, the world is such, in its current capitalist free-market incarnation, that agricultural commodities, such as coffee, are bought for the lowest possible price commensurate with their quality. This phenomenon arises out of the capitalist ideological conviction that the sole purpose of an economic enterprise is to maximise profit, which involves optimising the price of a product or service, while simultaneously minimising the costs of providing that product or service.

As evidence of this tendency, the DD103 Introductory block (Cereso et al, 2018, p33, figure 2) provides a useful breakdown of the costs involved in providing the western consumer a £2.20 cup of coffee. Whereas the coffee grower gets just £0.08 out of every £2.20, to cover all the expenses of planting, cultivating and harvesting, as well as pay himself a living wage, the retail outlets get £0.30 in profit alone. I submit this inequality is due to the structure of the market, and the difference between price-takers and price-makers.

Thus, when the market structure is such that there are comparatively few buyers, and many sellers for some commodity, such as unprocessed coffee beans, the tendency is for a producer to be a price-taker. When there are many buyers and fewer sellers, such as for cups of coffee in the developed world, the provider has the latitude to be a price-maker. Price-takers have little influence on the selling price of their product, while price-makers have a considerable influence on the selling price they charge. This disparity of power leads inexorably to inequalities of economic outcome.

All is not lost in the war of ethics versus avarice, however. There are movements afoot to properly reward the coffee grower for his efforts. Enlightened initiatives such as Fair Trade and direct trade are positive. Even Starbucks (Starbucks, 2011) is paying up to twice the market price for its coffee on long contracts, an arrangement which affords both them some security of supply and a decent, dependable living for its growers.

Conclusion.

That last conceded, my overall conclusion is that the coffee trade generally provides a good example of what happens when the accumulation of wealth is left to an unregulated free market, the end being considerable injustice. The result of the injustice is that the poorest and most powerless remain marginal and vulnerable, even economically oppressed, without ‘parity of participation’. ((Fraser, 2009, cited in Cereso et al, 2019, p38). Distributive justice, then, as evidenced through coffee, must be when these inequalities of reward are eliminated, or, at least, rendered less prevalent and severe. (760 words).

References

Cesero, K., Hunter, J., Morris, A and Wastnidge, E, (2019) Investigating the Social World: Introduction, Milton Keynes: The Open University.

Open University (2019) ‘Black Gold’, DD103 Investigating the Social World: Introduction. [online] Available at https://learn2.open.ac.uk/mod/oucontent/view.php?id=1467010&section=4.1 (accessed 29 September 2019).

Starbucks (2011) Goals and Progress: coffee purchasing, [online]. Available at: https://www.starbucks.com/responsibility/global-report/ethical-sourcing/coffee-purchasing (accessed 23 September 2019).