So your argument, if I understand it correctly, is this:
Your conclusion is then that we shouldn't force farms into financial trouble, because then the second type turns into the first type due to needing to cut costs.
Here is my view of things:
For your view, the causal relation is from the meatprice to the animal welfare.
For me it's the other way around: the animal welfare causes the meatprice.
Current fairtrade farms aren't fairtrade because they want to sell expensive meat. Instead, they want to treat their animals well, which means they're fairtrade and which results in higher meat prices.
Now, to tie this worldview back into the argument we were having:
If 1000 people who previously bought from the supermarket stop buying, megafarms won't start treating their animals worse. After a while, they would reduce their chicken output over time in order to minimize leftover chickens.
If 1000 people who previously bought locally decide to stop doing that, it might increase cost for the rest of the fairtrade buyers, reducing their motivation for buying fairtrade. However, it wouldn't make the fairtrade farmers promptly drop their fairtrade motivations. It also wouldn't suddenly turn them into megafarms, since they don't have the volume for that.
I'm going to tap out at this point. First, this subthread revives a conversation that died eighteen months ago. Second, I don't hold out much hope of its generating new insight.
Last but not least, I started it out of curiosity, in order to obtain answers to specific questions about vegetarians' decision procedures; that's what I'm still interested in learning about, vs. defending my own (at the risk of coming up with weak rationalizations).
I have noticed that among philosophers, vegetarianism of one form or another is quite common. In fact, I became a vegetarian (technically a pescetarian) myself partly out of respect for an undergraduate philosophy professor. I am interested in finding out if there is a similar disproportion in the Less Wrong community.
I didn't request that this go into Yvain's survey because I want more information than just what animal products you do or don't eat; I'd also like to see nuances of the reasons behind your diet. There are a lot more shades than carnivore/vegetarian/vegan - if you want to be a vegetarian but are allergic to soy and gluten, that's a compelling reason to diversify protein sources, for instance. I'd also like to hear about if you avoid any plant foods (if you think they're farmed in a way that's environmentally destructive or that hurts people or if you have warm fuzzy feelings for plants, maybe). Here are some questions that come to mind: