C4SIF.org

Falkvinge: The Copyright Monopoly Stands In Direct Opposition To Property Rights

by Stephan Kinsella on December 22, 2012

Yet another great piece by Rick Falkvinge:

The Copyright Monopoly Stands In Direct Opposition To Property Rights

A lot of today’s bad policy stems from the misconception that the copyright monopoly is related to property rights, an illusion peddled by the copyright industry’s own powerful lobby. The idea that the copyright monopoly would be a property right doesn’t just lack factual basis, but it is 180 degrees and one hundred per cent wrong, factually wrong. The copyright monopoly stands in direct opposition to property rights.

The copyright monopoly is a governmentally-sanctioned private monopoly. No liberal, socialist, green, capitalist, or conservative can defend those constructions from their ideology; this construction only fits corporativist and protectionist ideologies.

Allow us to illustrate with a tangible example: assume that we buy a copy of a chair. We say “a copy”, as it is automatically made from a master in the form of a digital blueprint in some sort of plant; colloquially, we’ve bought “a chair” at IKEA. We own this copy of the chair, we have our receipt here in hand. This physical object, in all its aspects, is our property. We are allowed to do a number of things with this copy of the chair:

We can take the chair apart, and use pieces of it for new projects that we make in our workshop.

We can look at the underlying pattern to examine how the chair is built, make an identical copy, and sell it.

We can put out our chair on the porch and use it there, and we can charge our neighbors to use it if we like.

All of this is typical for property. These are typical actions we can all take with our property without anybody raising an eyebrow. (To counter a common but false objection to this point: while there are some monopolistic protections possible for chairs, the overwhelming majority of chairs don’t come with patent or design patent monopolies, and the everyday chair is perfectly legal to reproduce using your own parts and labor, as is the normal case with property.)

In contrast, assume that we buy a copy of a movie. We say “a copy” as the disc with the movie is automatically made from a master in the form of a digital blueprint in some sort of plant; colloquially, We’ve bought “a movie” at the gas station. We own this copy of the movie, we have our receipt here. This physical object, in all its aspects, is our property. Yet, we are notlegally allowed to do certain things with this copy of the movie:

We are not legally allowed to remix the movie that we own and use parts of it for new projects.

We are not legally allowed to examine the underlying bitpattern and make an identical copy on a different storage medium which is the property of somebody else, nor are we allowed to sell a copy we have produced with our own property and labor.

We may not use our movie on the porch, and may not charge our neighbors to use it.

Somebody’s monopoly overrides our property rights and makes it illegal to use our legal property and exercise our normal property rights using our own work and labor.

The copyright monopoly is a governmentally-sanctioned private monopoly on certain forms of duplication and performance. It doesn’t just stand in opposition to property rights, but to free trade as well.

(Some people would argue that even property as such is a governmentally-sanctioned private monopoly, in order to downplay the fact that the copyright monopoly stands in opposition to property rights, but that would not be what we mean by “property” and “monopoly” as concepts. If I own an umbrella, I control that umbrella. If I have a monopoly on umbrellas, I get to control everybody else’s umbrella too, and get to call on the government to have that enforced.)

It is quite possible to argue for the copyright monopoly from a purely utilitarian, protectionist, or mercantilist perspective, but not from a “property is good” perspective: you will end up in the exact opposite conclusion. By extension, since we know that property rights are good for trade, we also deduce that the copyright monopoly is bad for trade and competition. This comes as no surprise, seeing how the copyright industry has been fighting tooth and nail against the more-efficient industries that would otherwise already have replaced them.

Update: I posted this in the comments:

Stephan Kinsella

December 24, 2012 – 13:59

“An idea cannot, by its nature, be property. This is fundamental.”

This is correct. It is literally impossible to set up a property right in nonscarce things like patterns of information, knowledge, or ideas. Laws and enforceable rights always use physical force (e.g., of the state’s goons) against scarce resources owned by other people–against their material property. A copyright “owner” can use the grant of this monopoly privilege to have the state use its goons to threaten physical force against an “infringer”–against his body (threats of imprisonment) and/or his money or other property. That is why IP rights like patent and copyright are disguised takings of property rights, redistribution of wealth from previous property owners to the IP holders: and I believe the best way to legally classify these rights is that patent and copyright should be viewed as negative servitudes over the body and/or other property of those affected by the IP right. In essence, the IP holder is given a “veto” right over how other people are permitted to use their own bodies and other owned resources. The IP holder in effect becomes a co-owner of others’ bodies and property. There is nothing inherently wrong with such an easement, if it is voluntarily negotiated by contract. But in the case of IP, there is no agreement by the person who is now burdened by the IP negative servitude; the state simply grants this right to the IP holder.

For more on this, see https://c4sif.org/2011/11/why-intellectual-property-is-not-genuine-property-adam-smith-forum-moscow/ and http://blog.mises.org/17398/intellectual-property-rights-as-negative-servitudes/

{ 1 comment }

UK copyright improvements

by Stephan Kinsella on December 21, 2012

Positive developments in UK copyright law:

Video mash-ups and song parodies to be legalised (just as long as they are funny)

Copyright law shake-up to make it easier to transfer files between devices

iPod and e-book users will not be criminalised if copy is for personal use

Record companies will not be able to block song parodies

By MATT CHORLEY, MAILONLINE POLITICAL EDITOR

PUBLISHED: 07:18 EST, 21 December 2012 | UPDATED: 11:29 EST, 21 December 2012

Film companies and record labels will not be able to force mash-ups and spoofs to be taken down from the internet under a major shake-up of copyright law.

Ministers have vowed to legalise parodies after countless viral hits have disappeared from sites like YouTube because multi-national firms failed to see the funny side.

It also means the creators of hits like the countless parodies of the Hitler film Downfall, Cassetteboy’s mash-ups of TV shows and the genius behind the Masterchef Synthesia (buttery biscuit base) will no longer be breaking the law by copying and editing popular TV shows.

Parodies of the 2004 film Downfall are now so widespread online there is even one which shows Hitler’s fury at the number of spoof versions

The shake-up, ordered by Lib Dem Vince Cable, also means the hilarious video of his boss Nick Clegg ‘singing’ his tuition fees apology would be freed from copyright control.

Move over, corn subsidies: plant patents “created the industrial food system that the modern food movement rightly decries”

by Stephan Kinsella on December 20, 2012

Take-away: “In essence, plant patent laws created the industrial food system that the modern food movement rightly decries.” From Slate:

Genetically Monetized Food

If the food movement really wants to improve the food supply, it needs to follow the money instead of wasting its time on labels.

By Frederick Kaufman|Posted Thursday, Dec. 20, 2012, at 9:50 AM ET

Over the past several years I have spent a great deal of time in high-security, limited-access genetic modification laboratories. While researching my latest book, I peered at glow-in-the-dark grapes (their seeds spiked with jellyfish genes), inspected attempts to create square tomatoes (a yet-to-be-decoded DNA sequence may dictate the shape of all fruit), and marveled at rice plants engineered to be immune to Asia’s deadliest rice blight. None of the GMO cornucopia I ogled is commercially available—yet. But even if these laboratory specimens never make it to the shelves, about 70 percent of processed foods in U.S. supermarkets already contain genetically modified ingredients.

Should you be concerned about the healthfulness of such foods? This question monopolized a good deal of the recent diatribes deployed in the lead-up to last month’s vote on California’s Proposition 37, which would have mandated labeling on GM foods.

But this is the wrong question.

Here’s why: GM foods’ effect on health is uncertain, but their effect on farmers, scientists, and the marketplace is clear. Some GM foods may be healthy, others not; every genetic modification is different. But every GM food becomes dangerous—not to health, but to society—when it can be patented. Right now, the driving force behind the development of new genetic crop modifications is the fact that they possess the potential to be enormously profitable, and the source of those potential profits is a seemingly innocuous bit of legal code:

Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefor.

That’s the gist of early American patent law (originally with the word art in place of the wordprocess)—and the reason why molecular biologists are spiking grapes with jellyfish genes and pulling all-nighters in pursuit of the square tomato. Originally, patent law applied only to nonedible inventions, but since the Plant Patent Act of 1930 was passed, genetically altered food has been subject to intellectual property protection, and the creation of new foods has become a reliable way to ensure profit streams for whoever patented them first. In 1930, genetically modified food meant apples grafted from one tree onto another, but 40 years later the statute was extended beyond the fruits of grafted saplings to plants that grow from seeds, like corn. “Utility patent” protection came later, in 1985, and expanded intellectual property rights to methods of engineering a plant, including genetic sequences inserted into a species’s genome.

The impact of these laws has been enormous. In essence, plant patent laws created the industrial food system that the modern food movement rightly decries.

Monsanto, the most reviled agricultural corporation in the world, has committed manifold ethical sins that have been widely reported in foodie media. What isn’t widely reported is that plant patent laws are the legal framework that enables these sins. It was utility patent protection that opened the door for Monsanto’s present-day global seed and insecticide portfolio, including rights to its infamous “terminator” or “suicide seed” technology (which effectively sterilizes second-generation plants and makes it not only futile but a legal violation for farmers to gather seeds for next year’s crop). Monsanto has prosecuted farmers who discover GM corn or soy sprouts growing on their land after the wind carries seeds over from neighbors’ GM fields. The basis for such ridiculous lawsuits? Plant patent laws: These farmers are inadvertently violating Monsanto’s intellectual property rights. Worst of all, Monsanto has deviously developed an insecticide technology (specifically, a weed-killer known as “Roundup,” discovered and patented by a Monsanto chemist in 1970) that works best when applied to the corporation’s patented GM seeds. Patent laws, in essence, have allowed the corporation to establish a vertical monopoly—if you want Monsanto’s high-yielding Roundup Ready seeds, you’ll need Monsanto’s Roundup insecticide; and if you buy Roundup insecticide, you’ll need Roundup Ready seeds. (Since large-scale corn and soybean farmers want the highest yields they can get, they tend to go ahead and buy both.)

The sum total effect of these actions on the global food system has been overwhelmingly negative.

America Invents Act provides patent marking relief (this is not good)

by Stephan Kinsella on December 20, 2012

I noted before that Obama’s patent reform law from 2011 (the America Invents Act) made almost no significant—or good—changes to patent law, despite the patent bar pretending that this was “major” or “radical” change (The American Invents Act and Patent Reform: The Good, the Meh, and the Ugly). The one good thing the law did was to broaden the prior commercial user defense, perhaps the only significant positive change in US patent law… ever. But it did not reduce patent terms or penalties, get rid of injunctions, provide an independent inventor defense (one of the reforms proposed by groups like the EFF, among others), eliminate patent trolling or software patents. And the AIA made things worse in a number of ways:

The best mode defense has been virtually eliminated.
The PTO can now prioritize examination of inventions of national importance or for a high fee.
The penalties for “false marking” have been drastically reduced.

Of course, we now see patent practitioners cheering these changes. E.g., USPTO’s fast-track examination: A case in point, and America Invents Act provides patent marking relief, both from Inside Counsel. The latter article bemoans the fate of companies who lose their right to obtain infringement damages if they don’t provide notice on their products that they products are patented. After all, this is not fair—patent trolls (“non-practicing entitites”), after all, don’t have to provide such notice. So instead of arguing that maybe patent trolling should be curtailed, the natural pro-patent instinct is to argue that “practicing entities” should find it as easy to extort money from innocent victims as patent trolls do. To-wit:

Patent owners that practice their invention are at a disadvantage compared to nonproducing patentees. The patent marking statute, 35 U.S.C. § 287(a), says that patentees that make and sell patented products or authorize others to do so, may mark their patented products and put the public on notice that the product is patented. However, failure to mark a patented product made or offered for sale limits the infringement damages available to the patent owner. In the absence of patent marking, damages are recoverable only for infringement that occurs after the infringer received notice of the infringement. Thus, for patent owners that make and sell a patented product without marking it, the patent marking statute operates as a forfeiture of damages, which may be substantial depending on the duration of infringement prior to providing the infringer with notice. There is no corresponding risk of forfeiture for nonproducing patentees.

From a practical standpoint, one of the challenges many patent owners face is the manufacturing cost of changing tooling and dies when a patent issues for a product that it may have been making and selling for years. This challenge is further complicated by the fact that a product, or components or subsystems of the product, may be covered by multiple patents, each with a different expiration date. From a legal standpoint, it may not be possible to know which patent or patents are likely to be most important from an enforcement perspective and which are most critical to be included in the patent marking strategy.

The recently enacted American Invents Act (AIA) provides some relief. Patent owners are no longer required to include the patent number on the product or packaging. They can now simply include the word “patent” or “patented” or the abbreviation “pat” together with an address of a posting on the Internet that associates the patented article with the patent number. The site must be accessible to the public free of charge. As a result, patent owners can now update a web site with their products’ patent information rather than changing their manufacturing equipment each time a patent issues or expires.

The AIA also reduces the risk of exposure to false patent marking lawsuits. …

Yeah, we wouldn’t want people to suffer any costs at all from using threats of state force against their competitors. Why make it easy for potential victims to know that they might be subject to a patent lawsuit? Why penalize a company for getting the benefits of using the patent extortion monopoly but not warning the victims? Why require the patentee to disclose the best mode, when the entire idea of the patent system is the “patent bargain”: the grant by the state of a temporary monopoly privilege “in exchange” for revealing to the public information (including best mode) that would otherwise be kept as a trade secret? And notice: “Patent owners that practice their invention are at a disadvantage compared to nonproducing patentees.” Yeah, but they are not at a “disadvantage” with respect to smaller companies and victims of their extortionate patent lawsuits, now, are they? Obama: SUCH a “reformer.”

{ 0 comments }

Mark Cuban Funds EFF’s New ‘Mark Cuban Chair To Eliminate Stupid Patents’

by Stephan Kinsella on December 20, 2012

This is just great. As Mike Masnick reports on Techdirt, Mark Cuban is putting his money behind efforts to crack down on patent abuse. I’m becoming a huge fan of Cuban: he stars on ultra-capitalist Shark Tank, one of the best shows on TV, and he also gets that patent law is anti-capialist (see Mark Cuban: Patent law is killing jobs).

Mark Cuban Funds EFF’s New ‘Mark Cuban Chair To Eliminate Stupid Patents’

from the go-julie dept

Some fantastic news from EFFland, where Mark Cuban and Markus ‘Notch’ Persson have agreed togive EFF $250,000 each in order to fund its latest efforts to stop bad patents. This includes naming EFF attorney Julie Samuels “The Mark Cuban Chair to Eliminate Stupid Patents.” This is a job title that only a few people deserve and, knowing Julie, she’s one of them. Over the years, EFF has done some really great work on patents, but they’ve often seemed like a backburner issue compared to other things — so we’re excited to see what comes next.

{ 1 comment }

Falkvinge: The Analog Letter: It’s Entirely Reasonable To Demand That Our Children Inherit The Rights Of Our Parents

by Stephan Kinsella on December 19, 2012

Still another fantastic piece by Rick Falkvinge:

The Analog Letter: It’s Entirely Reasonable To Demand That Our Children Inherit The Rights Of Our Parents

COPYRIGHT MONOPOLY

Whenever pirates demand the right to send anything to anybody without being tracked, we are somehow accused of wanting things for free. That’s not true. What we demand is simpler: we demand the laws to apply equally online and offline; we demand that our children inherit the civil liberties that our parents fought, bled and often died to give to us. It’s an entirely reasonable demand.

Let’s look at the classic letter to illustrate this. The physical letter, consisting of an envelope, a folded paper with writing on it inside the envelope, and a stamp. This was what personal communication looked like in our parents’ offline world, and it was enshrined with certain civil liberties. I’m going to focus on four of them.

First, the letter was anonymous. You, and you alone, determined whether you identified yourself as sender on the outside of the envelope for the world to know, on the inside of the letter for only the recipient to know, or didn’t identify yourself at all when sending a letter. This was your prerogative.

Second, the letter was secret in transit. Nobody had the right to open all letters just to make sure they didn’t contain something illegal or immoral – or something copied, for that matter. If you were under prior suspicion of a very serious crime, your mail could be secretly opened to find evidence of that crime – but no letter would ever be opened routinely to check for new crimes.

Third, the letter was untracked. Nobody had the right – nor, indeed, the capability – to record who was communicating with whom. Nobody was able to monitor all mailboxes to see when somebody dropped a letter in it, much less the ability to identify that person and connect them to the address on the letter dropped in the mailbox. It was a fundamental right to keep your connections to yourself.

Fourth, the mailman was never responsible for the contents in the sealed letter. How could they? They were not aware of its contents, nor were they allowed to make themselves aware of its contents. Their responsibility and accountability started and ended with delivery of the packages to the address on the envelope.

This is a set of civil liberties that our parents and grandparents literally fought, bled, and sometimes even died to give us. It is entirely reasonable that they carry over to our children in the environment they communicate in, just as the rights applied to the offline world of our parents.

But when you point this out, some will protest loudly. The copyright industry, in particular. “If you allow anybody to send anything to anybody else, even anonymously, we can’t make any money!”

To this, I respond, so what?

It is the job of every entrepreneur to make money given the current constraints of society and technology. Nobody gets to dismantle civil liberties just because they can’t make money otherwise – and perhaps especially if they can’t make money otherwise.

If a particular industry can’t continue to make money the same way in the face of sustained civil liberties, they get to go out of business or start selling something else. We don’t determine what civil liberties our children get based on who can make money and who can’t; we base them on what our parents fought and bled for.

This is the heart of the file-sharing debate. I don’t care a millisecond if an obsolete distribution industry goes out of business, but I do care about the civil liberties that our children deserve to inherit.

This article has previously been published on TorrentFreak.

{ 0 comments }

Falkvinge: There Is Never A Need To Justify Sharing Culture And Knowledge

by Stephan Kinsella on December 19, 2012

Yet another great post by Rick Falkvinge. See also my “Intellectual Freedom and Learning Versus Patent and Copyright.”

There Is Never A Need To Justify Sharing Culture And Knowledge

COPYRIGHT MONOPOLY

Just as some misguided people react with hostility to the fact that the copyright monopoly is not a birthright, they can react with hostility and demand a response to how sharing is “justified”. This, too, is misguided.

One example could be seen in the Reddit thread about The Pirate Bay being the world’s most efficient public library. For a while, the top comment was “whatever helps you justify it” (as in, the sharing of culture). This is a misguided expression based on the false premise that sharing knowledge and culture needs to be justified.

It is completely the other way around.

Humankind and civilization has advanced due to and because of people sharing knowledge and culture, and has never advanced when it has been locked up and contained. Sharing knowledge, information, and culture is also a good deed on an individual-to-individual basis. Whenever the ability to share and partake in knowledge and culture has been prevented, such as the burning of the library at Alexandria, it has always been regarded as a disaster for humanity in the history books.

And yet, some people believe that sharing – whether over The Pirate Bay, direct handover, or whatever other mechanism – needs to be justified.

It is true that the copyright monopoly has come at odds with the natural behavior of sharing and the right to share. But to enforce this monopoly, much more vital ideas in society – such as the postal secret – must be sacrificed, not to mention our cultural heritage. That is neither just nor reasonable, so that is what needs justification. It’s not just the copyright monopoly law itself that needs to be justified, but also individual compliance with the unjust monopoly law, on a case-by-case basis.

When somebody angrily asks you how you can share this and that knowledge “without permission”, state it as it is, that they are misguided, and ask how they could possibly justifyrequiring permission to share knowledge and culture. That goes counter to all of humanity’s history. Also, make sure to make a point that sharing never requires any kind of justification. (The current copyright monopoly laws are not enough of a justification, obviously, as they are unjust and completely out of touch with people’s actual and natural behavior.)

Sharing knowledge and culture is the natural state.

Therefore, any restrictions on sharing require very careful and strict justification.

{ 0 comments }

Falkvinge: The Copyright Monopoly Is A Market Distortion, Not A Birthright

by Stephan Kinsella on December 18, 2012

Excellent article on copyright by Falkvinge:

The Copyright Monopoly Is A Market Distortion, Not A Birthright

COPYRIGHT MONOPOLY

When you start questioning the copyright monopoly, many middlemen and other has-beens start acting offended – as if you have somehow questioned a natural right that they have by birthright. Nothing is farther from the truth.

The copyright monopoly is not a natural right. It is a government-sanctioned private monopoly, granted under the assumption that no culture would get created if there’s not a profit motive behind it, and that this profit motive can only be realized in a monopolized setting. Yet, when you question this assumption and this monopoly, some people react with unmitigated angry and fury – as though you have questioned their very right to life. This is puzzling, and indicates a lack of understanding of what the monopoly is and why it exists.

(People who like liberal capitalism should balk at “goverment-sanctioned monopoly”. People who lean towards labor values should balk at “private monopoly”. Still, it’s factually true.)

If property rights and normal competition were applied in the fields of culture and knowledge, there would be no such thing as the copyright monopoly whatsoever. It would be like any other field of entreprenurship – compare, for example, with how a professional chef needs to create new recipes and then can monetize them either by performing, by educating others, or by selling cookbooks, just to name a few methods. I use chefs as example on purpose here, as food recipes are explicitly not covered by the copyright monopoly – and yet, there are many cooks, chefs, and famous star chefs.

Some time in history (in 1709, specifically), publishers managed to convince legislators that no culture would get printed and distributed if the publishing guild couldn’t get the copyright monopoly reinstated, the lucrative monopoly that had previously been a censorship regime. Importantly, they didn’t argue that nothing would get created without a monopoly; they argued it wouldn’t get duplicated and distributed. Thus, fearing that no culture would be available for the population, legislators agreed to the monopoly on purely utilitarian grounds.

Later, this mutated into a purely utilitarian justification for this monopoly that limits normal property rights, competition, and trade mechanisms: “without the monopoly, little or no new culture would get created”. We see that all the time: “if you allow this monopoly to last for only 110 years instead of 120, how would the million-euro blockbuster movies get funded?”. Putting aside the argument that no movies have a return-on-investment horizon of 100 years in the first place (and many actually make their investment back opening weekend, making the copyright monopoly completely unnecessary), this argument keeps coming back: “if there’s no monopoly, no culture will be created”. [continue reading…]

{ 0 comments }

Scientific American on “The Meteoric Ascent of the Patent Troll and the Devastating Consequences for Innovation”

by Stephan Kinsella on December 15, 2012

h/t Wendy McElroy. For related posts, see:

The Meteoric Ascent of the Patent Troll and the Devastating Consequences for Innovation

By Neuro Bonkers | December 5, 2012 | 13
Share Email Print

Today it is perfectly legal for companies to buy and sell the rights to unlimited numbers of ideas, a company is not required to have any interest in making these ideas a reality. It is perfectly legal for companies to sit on patents and wait for others to create before either suing the creator or charging licensing fees. The following pair of quotes is pulled directly from the promotional material on the website of just one prolific patent troll:

“$2 Billion+ cumulative licensing revenue”

“70,000 IP assets acquired and nearly 40,000 in active monetisation programmes”

In fact it is not just legal, patent trolling is an industry on a colossal scale. According to research recently published by Boston University School of Law, last year patent trolls won a cool $29 Billion. One of the most worrying findings of research in to patent trolls is that the mere threat of a suit is enough to put the frighteners on and make creators pay up:

“The average legal cost to defend a patent case is $420,000 for small and medium sized companies and $1.52 million for large companies. The average settlement costs are $1.33 million for small and medium companies and $7.27 million for large companies.”

It appears that a vast majority of the money acquired by “non practicing entities” is creamed off, according to the research by the Boston researchers:

“no more than a quarter (of the direct spending by defendants ) could possibly represent a flow to fund innovative activity”

Despite this, the Boston University School of Law researchers demonstrate that money flowing in to the coffers of patent trolls is rising at a colossal rate. The following figures do not include indirect costs such as loss or delay of revenue or abandonment of new inventions:

Patent trolls however are by no means the only people in the bulk patent buying business; last August Google spent $12,500,000 on 17,000 patents. Perhaps most worrying of all is the catastrophic state of affairs with regard to the utterly overwhelming volume of software patents that continue to be filed year on year. According to a study published by Yale Law School last year:

Intellectual Property as a cause of American Prosperity?

by Stephan Kinsella on December 15, 2012

Arguments for IP are notoriously confused, hypocritical, inconsistent, incoherent, vapid, and all over the map.¹ A recurring error is the correlation-equals-causation fallacy. Fore example: postwar Japan prospered because it had a patent system;² countries with the most IP are the most prosperous;³ America’s prosperity and growth since its inception is due to its patent and copyright systems.⁴ As I noted previously:

This proves absolutely nothing, in fact, except that there can still be growth despite state intervention such as intellectual monopoly grants. Correlation is not causation. I hope Obama doesn’t see this–I’m sure he could whip up a similar chart correlating growth over the last two centuries with, say, increasing taxes, increasing federal spending, increasing federal size/employment, increasing military size, increasing efficiency at mass murder, and so on.⁵

The latest entry is in an article in City Journal by Guy Sorman (h/t Redmond Weissenberger), A Brief History of American Prosperity. Sorman writes:

Worry over America’s recent economic stagnation, however justified, shouldn’t obscure the fact that the American economy remains Number One in the world. The United States holds 4.5 percent of the world’s population but produces a staggering 22 percent of the world’s output—a fraction that has remained fairly stable for two decades, despite growing competition from emerging countries. Not only is the American economy the biggest in absolute terms, with a GDP twice the size of China’s; it’s also near the top in per-capita income, currently a bit over $48,000 per year. Only a few small countries blessed with abundant natural resources or a concentration of financial services, such as Norway and Luxembourg, can claim higher averages.

America’s predominance isn’t new; indeed, it has existed since the early nineteenth century. But where did it come from? And is it in danger of disappearing?

By the 1830s, the late British economist Angus Maddison showed, American per-capita income was already the highest in the world. One might suppose that the nation could thank its geographical size and abundance of natural resources for its remarkable wealth. Yet other countries in the nineteenth century—Brazil is a good example—had profuse resources and vast territories but failed to turn them to comparable economic advantage.

A major reason that they failed to compete was their lack of strong intellectual property rights. The U.S. Constitution, by contrast, was the first in history to protect intellectual property rights: it empowered Congress “to promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries.” As Thomas Jefferson, who became the first commissioner of the patent office, observed, the absence of accumulated wealth in the new nation meant that its most important economic resource was innovation—and America’s laws encouraged that innovation from the outset. Over two centuries later, the United States has more patents in force—1.8 million—than any other nation (Japan, with 1.2 million, holds second place). America is also the leader in “triadic patents” (that is, those filed in the United States, Europe, and Asia) registered every year—with 13,715 in 2009, the most recent year for which statistics are available, ahead of Japan’s 13,322 and Germany’s 5,764.

Notice that there is no argument whatsoever here to justify the assertion being made. The argument here assumes that innovation is critical to prosperity and economic development—true enough—and then correlates patents with innovation. But not only is this correlation problematic—not all patents are innovative and not all innovation is patented⁶ —but even if patents are correlated with innovation, correlation does not prove causation. It is equally as plausible, in fact more plausible, that innovation persists despite, not because of, a patent system.

As economist Fritz Machlup concluded in an exhaustive 1958 study prepared for the U.S. Senate Subcommittee On Patents, Trademarks & Copyrights:

No economist, on the basis of present knowledge, could possibly state with certainty that the patent system, as it now operates, confers a net benefit or a net loss upon society. The best he can do is to state assumptions and make guesses about the extent to which reality corresponds to these assumptions. … If we did not have a patent system, it would be irresponsible, on the basis of our present knowledge of its economic consequences, to recommend instituting one.

(For more on this issue, see The Overwhelming Empirical Case Against Patent and Copyright.) The US is trying to export to the rest of the world its fascist, protectionist, mercantilist IP laws, along with its approach to antitrust, terrorism, taxation, monetary policy and the like. Libertarians should not fall for the groundless assertion that unlibertarian policies of the US state are the reason for its economic prosperity.

See Absurd Arguments for IP; There are No Good Arguments for Intellectual Property; Intellectual Nonsense: Fallacious Arguments for IP (Libertopia 2012). [↩]
Dispatch from the Open Science Summit: Citizen Science, Microfinanced Research, Patent Trolls, and Pharma Prizes [↩]
See The “Productivity” of Patent Brainstorming [↩]
See Interactive Graphic Pretends to Illustrate How U.S. Patent System Has Driven American Economy; see also Americans for Tax Reform Uses Correlation Between Physical Property Rights and GDP to Argue for IP, USPTO/Commerce Dept. Distortions: “IP Contributes $5 Trillion and 40 Million Jobs to Economy”, Patent Lawyers Who Don’t Toe the Line Should Be Punished!. [↩]
See Interactive Graphic Pretends to Illustrate How U.S. Patent System Has Driven American Economy. [↩]
See Masnick: New Study Shows Patents And Innovation Are Not Related; Pierre Desrochers, On the Abuse of Patents as Economic Indicators, Quarterly Journal of Austrian Economics (Winter 1998); also Andrew Torrance: Patents and the Regress of Useful Arts, and the 2003 National Academies report on intellectual property; the full citation and quotation is in the introduction Torrance’s paper Patents and the Regress of Useful Arts, which characterize evidence linking IP and innovation as “emergent”—this is from the National Academies. [↩]

{ 2 comments }

Patents and Pot: Feds’ patents say medical marijuana is good, drug war disagrees

by Stephan Kinsella on December 13, 2012

The WSJ Blog, in On Intellectual Property and Pot, reveals the federal government’s schizophrenic approach to marijuana. On the one hand, in its zeal to prevent the nose-under-the-camel’s-tent of medical marijuana, it has to deny the medical benefits of marijuana (okay, well, granted, the medical benefit claims of inhaling smoke bearing a psychoactive drug into one’s lungs may seem a bit … counterintuitive); on the other, “the U.S. government’s own patents and research claim otherwise. … One 2009 patent application, for instance, extols the pain-relieving and “healing properties” of marijuana. The government’s own 2003 patent discusses the usefulness of “cannabinoids” in treating “ischemic, age-related, inflammatory and autoimmune diseases” as well as “Alzheimer’s disease, Parkinson’s disease and HIV dementia. In July, the National Institutes of Health licensed the rights of the latter patent to the pharmaceutical company KannaLife….”

As a legal brief notes, “How can the government credibly deny the benefits of medical cannabis when the government itself is funding cutting-edge research proving the medical benefits of cannabis and seeking patents based on such research?”

Well, it’s not surprising that the state is schizo on something related to patents. It’s not the first time:

{ 2 comments }

Students for Liberty: Internet Freedom in Jeopardy in Germany because of Copyright

by Stephan Kinsella on December 13, 2012

Nice post on the Students for Liberty blog about the danger copyright censorship poses to internet freedom. For more, see:

See more posts on Internet freedom.
“Where does IP Rank Among the Worst State Laws?” (Jan. 20, 2012)
“Should Copyright Be Allowed to Override Speech Rights?” (Dec. 20, 2011)
“Masnick on the Horrible PROTECT IP Act: The Coming IPolice State” (June 2, 2011)
“Copyright and the End of Internet Freedom” (May 10, 2011)

Internet Freedom in Jeopardy in Germany

by Fred Roeder

While Students For Liberty grows to a really international student movement, we also experience a lot of tough regulations, which hinder our internationalization. For a couple of years for instance Turkey totally blocked YouTube and our partners from the 3H Movement fought heroic battles against Internet censorship in Turkey. Surprisingly one of the toughest countries in terms of Internet regulation is my home country Germany. One example are for instance the great clips Gabrielle Shiner (http://www.youtube.com/watch?v=ZIJxFAecA-M&feature=related) made in order to advertise the first European Students For Liberty Conference in 2011. Some of those clips aren’t available on the German YouTube page due to the fact that we don’t own the copyrights for the background music.

Blocked ESFLC-YouTube Clips in Germany

A new area of even tougher Internet regulation is about to arrive in Germany: Just recently two major newspapers had to close due to financial problems and the lack of innovation in order to use the Internet as a new source for revenues (Financial Times Germany and Frankfurter Rundschau). Most German print-media outlets have so far failed to understand how to utilize the Internet as the new nexus for information and revenue generation. Due to the lack of innovation and good services they have to try to win market shares in the Internet by hiring lobbyists and applying good old cronyism. [continue reading…]

{ 0 comments }

The Declared Value System: Managing Monopolies for the Public Good

by Karl Fogel on December 11, 2012

This proposal is cross-posted at Falkvinge on Infopolicy and QuestionCopyright.org. Regular readers of C4SIF will find it, if anything, more preserving of the status quo than necessary. But in the current legislative climate, simply doing away with the copyright and patent monopolies altogether is, unfortunately, still unlikely. The purpose of this proposal is to show at least that there are ways to reduce their harm, by giving the rest of us an option on freedom. Monopoly is bad, but tempered monopoly — monopoly that can be forced to respond to market pressures — is an improvement on untempered monopoly. The onus should be on those who defend the current system to explain why certain kinds of non-private information should nevertheless be exempt from the normal traffic of human commerce and communication, and one function of proposals like this is to improve the debate by forcing such defenses to be made explicit.

What would a truly free-market approach to copyrights and patents look like?

The problem we have right now is this:

Declared Value point: monopoly value vs de-monopolization value, over time.

The flat green line represents the value to the public of de-monopolizing the work — think of it as “what the public would be willing to pay for unrestricted access”. The point where the curved blue slope crosses the green line is the point where there is no longer any public or private purpose to having a monopoly. From that moment on, the value of the monopoly to the rights-owner is equal to or less than the value of de-monopolization. Yet today, the monopoly continues beyond that point. The green line is simply ignored in the current system: we pretend it does not exist.

(The graph is a simplification, but not in ways that matter to this proposal.)

You might think there’s already a market solution. After all, in the current system, anyone could in theory be offered a fixed sum to liberate their work into the public domain.¹ But markets don’t quite work the way we’d hope. This is is why we have eminent domain in real property, for example. As soon as someone starts talking about building an airport in some farm fields, all of a sudden every farmer decides their field is worth ten times as much as it was the day before, such that no airports could ever be built if we did not use the pre-rumor valuations. It is the same with copyrights and patents: the mere expression of interest in re-use drives up the price instantly, and the perpetual optimism of rights-holders ends up stretching their monopoly past its natural market end — hurting everyone else and preventing further re-use, yet frequently without realizing the benefit the rights-holder hoped for. We all lose.

But unlike with land, there’s a way out, because there’s a third thing we can do besides sell or not sell: we can liberate. That makes all the difference. [continue reading…]

I’m using terms like “public domain” loosely here. That term is usually used in copyright law, not patent law, but it’s easy to intuitively understand what it means for patents: that no one has a monopoly, that is, there is no one with the power to restrict usage. [↩]

{ 1 comment }

William Leggett on Intellectual Property

by Stephan Kinsella on December 6, 2012

In previous posts I’ve noted the historical origins of the opposition to intellectual property¹ and in particular key libertarian and proto-libertarian thinking on this matter.² Probably the earliest and most consistent libertarian opposition to IP came from Benjamin Tucker;³ and, in modern times, Konkin, McElroy, and Palmer. Then, the Internet happened, and the IP issue eventually rose from the background to the fore, and Austrian, anarchist, and left-libertarians started examining—and opposing—IP with a renewed interest.

It seems clear that the father of libertarian IP opposition is Benjamin Tucker. He was incredibly good on this topic at a time when even radicals like Lysander Spooner were bad on it.⁴ Not that Tucker was perfect on IP: aspects of his argument against IP were muddled. As I explained in Molinari on IP:

even Tucker’s case against IP seems to have ultimately been somewhat confused. For example, he thought that Spooner’s mistakes on IP⁵ were connected with what Tucker saw as Spooner’s mistakes on land. That is, Tucker is good on IP, but almost by accident. He believes the argument for IP is based on the idea that you own the products of labor (“he who first takes possession of any material production of nature”), but this argument must be rejected, because this would imply you can own land too. And because he had problems with the ownership of land,⁶ therefore the principle behind IP must be flawed too.

Other influential libertarians who were bad or weak on IP include Ayn Rand and Andrew Galambos, and proto-libertarians like Paine and Jefferson. But there were other thinkers around Tucker’s time who were also good on the IP issue, including Tak Kak (James Walker)⁷ and the nineteenth-century Jacksonian editorialist William Leggett. [Update: see: Classical Liberals and Anarchists on Intellectual Property.]

Leggett’s views on this issue can be found in the final Part of his book Democratick Editorials: Essays in Jacksonian Political Economy, which contains three short essays (repixeled below) on copyright.⁸ As noted by Tom Palmer in his article Are Patents and Copyrights Morally Justified? The Philosophy of Property Rights and Ideal Objects:

Arguments such as Spooner’s and Rand’s encounter a fundamental problem. While they pay homage to the right of self-ownership, they restrict others’ uses of their own bodies in conjunction with resources to which they have full moral and legal rights. Enforcement of a property right in a dance, for example, means that force can be used against another to stop him from taking certain steps with his body; enforcement of a property right in an invention means that force can be used against another to stop him from using his hands in certain ways. In each case, an intellectual property right is a claim of a right over how another person uses her body.

As the pro-liberty journalist William Leggett, a leader of the Jacksonian Loco-Foco party and editor of the New York Evening Post, wrote,

We do not wish to deny to British authors a right; but we do desire that a legal privilege, which we contend has no foundation in natural right, and is prejudicial to “the greatest good of the greatest number,” should be wholly annulled, in relation to all authors, of every name and country. Our position is, that authors have no natural right of property in their published works, and that laws to create and guard such a right are adverse to the true interests of society.

Leggett opposed copyright and patent rights for two reasons: First, he argued that intellectual property rights stifled the free spread of ideas and damaged the public interest. [“If the principle of copyright were wholly done away, the business of authorship, we are inclined to think, would readily accommodate itself to the change of circumstances, and would be more extensively pursued, and with more advantage to all concerned than is the case at present.”] Second, he argued that such rights were in reality statutory monopolies that infringed upon the rights of others to the ownership of their own bodies:

Our position that an author has an exclusive natural right of property in his manuscript, was meant to be understood only in the same sense that a mechanic has an exclusive natural right of property in the results of his labour. The mental process by which he contrived those results are not, and cannot properly be rendered, exclusive property; since the right of a free exercise of our thinking faculties is given by nature to all mankind, and the mere fact that a given mode of doing a thing has been thought of by one, does not prevent the same ideas presenting themselves to the mind of another and should not prevent him from a perfect liberty of acting upon them.

Leggett’s argument, while containing strong consequentialist elements, rests on the intimate relationship between liberty and property:

The rights of corporeal property may be asserted, without the possibility of infringing any other individual’s rights. Those of incorporeal property may obviously give rise to conflicting claims, all equally well founded…. [I]f you assert an exclusive right to a particular idea, you cannot be sure that the very same idea did not at the same moment enter some other mind.

Here are the final three chapters from Leggett’s book:

[continue reading…]

The Four Historical Phases of IP Abolitionism. [↩]
The Origins of Libertarian IP Abolitionism. [↩]
Wendy McElroy, Copyright and Patent in Benjamin Tucker’s periodical Liberty. [↩]
Tucker on Spooner’s One Flaw. [↩]
Tucker on Spooner’s One Flaw [↩]
see Statist “Private Property” Is Theft [↩]
See Wendy McElroy, For Liberty, Life and Property….But Not The Ownership of Ideas. [↩]
Note: Liberty Fund’s 1984 volume states this book was published originally in 1834; this must be a mistake since the chapters included below bear an 1837 date. [↩]

{ 3 comments }

Share this:

Video mash-ups and song parodies to be legalised (just as long as they are funny)

Share this:

Genetically Monetized Food

If the food movement really wants to improve the food supply, it needs to follow the money instead of wasting its time on labels.

Share this:

Share this:

Mark Cuban Funds EFF’s New ‘Mark Cuban Chair To Eliminate Stupid Patents’

from the go-julie dept

Share this:

The Analog Letter: It’s Entirely Reasonable To Demand That Our Children Inherit The Rights Of Our Parents

Share this:

There Is Never A Need To Justify Sharing Culture And Knowledge

Share this:

The Copyright Monopoly Is A Market Distortion, Not A Birthright

Share this:

Share this:

Share this:

Share this:

Share this:

Share this:

Share this: