My understanding is that the people who control the Fairtrade(tm) seal
of approval are doing so on a completely voluntary basis. The
producers and sellers who participate hope to attract more consumers
to their product for ideological reasons, even thought the price is
higher. This is a completely voluntary excercise.
I will point out that in a market unencumbered by Government
regulation, businesses that voluntarily adhere to the policies of
organizations like FairTrade will tend to be outcompeted by those
pursuing unfettered free trade.
And I predict consumers will vote with their wallets to shop at the
"free trade" stores. Consider the fabulously low prices at WalMart.
I agree that they are unlikely to become the industry leaders, but
there is still room for this niche market of people who view
capitalism as inherently unfair. Since it exists without any form of
coercion, everybody's happy.