The alleged case for copyright is that some temporary monopoly is “needed” to incentivize artistic creation. Yet given that there is no evidence that this is so,¹ and how copyright is used to censor and chill speech and expression and to justify expansions of the police state and regulations of Internet freedom,² one would think that libertarians and free marketeers would be calling for the complete abolition of copyright.

Unfortunately, this is not the case. While most Austrian-influenced libertarians, left-libertarians, and anarchist libertarians are now against IP,³ pragmatic and utilitarian-type “moderate” libertarians tend to avoid taking a radical, principled stance on IP. Most of them think the patent and copyright systems are “broken” and need to be reformed, but not abolished. They accept the basic idea that patent and copyright are necessary to stimulate innovation but that these laws have now “gone too far.” For example, libertarians Timothy Lee⁴ and Alexander Tabarrok⁵ pose as radical IP mavericks but are not in favor of abolishing patent and copyright.

In a recent Bloomberg article, A Free-Market Fix for the Copyright Racket, libertarian writer Virginia Postrel discusses growing criticism “of today’s copyright regime from intellectuals and activists on the right.” As she writes:

Making the intellectual case, the Mercatus Center at George Mason University, a hub of free-market scholarship, has just released “Copyright Unbalanced: From Incentive to Excess,” a collection of libertarian and conservative critiques. The book doesn’t oppose copyright per se, but it excoriates the current system’s lengthy terms and expansive enforcement powers.

“Whatever your philosophical position, if you are skeptical of government power, you should likewise be skeptical of the copyright system that has developed over the last century,” writes Jerry Brito, the volume’s editor, in the introduction.

Brito, who directs the center’s technology policy program and teaches law at George Mason, argues that copyright is more akin to the tradable emissions permits used to regulate air pollution than it is to traditional property in goods or real estate. Copyright is a “created order,” in which congressional action deliberately generates scarcity to produce a public benefit.

Just as an effective emissions-trading system depends on getting right the exact number of permits and total amount of emissions, so a good copyright system depends on setting the right terms, limits on fair use and enforcement mechanisms.

“If copyright is weak, then it will provide little incentive to create,” Brito writes. “But if it is too strong, then it will limit the public’s ability to enjoy and build on creative works, which after all is the reason why we have copyright in the first place.”

Striking that balance is tricky, even without political pressure. And lawmakers have shown little interest in trying to reason out the optimal solution. Instead of balancing the interests of consumers and future producers with financial incentives to create new works today, copyright has become an expanding monopoly privilege for well-connected industries.

Note the bolded text. The book from George Mason University, “a hub of free-market scholarship,” doesn’t oppose copyright “per se.” The editor, Jerry Brito, buys into the argument that “If copyright is weak, then it will provide little incentive to create”—even though there is no evidence for this contention—and even though this is not a principled way to determine which laws and property rights are justified and which are not, in the first place. Thus, he agrees that we need to “strike the right balance” and “set the right copyright term.” Apparently these free market IP reformers know that 100+ years of copyright term is “too long,” but that zero is “too short,” so we have to—somehow—find the “right term” so that we “strike the right balance.” (See also Tabarrok’s groundless “Laffer curve” type model of copyright term optimization, discussed in Patent Policy on the Back of a Napkin.)

I suppose if gasoline rises to, say, $10/gallon, the state ought to impose Nixonian price controls—after all, it’s obvious, isn’t it, that $10 is “too high.” Yet you don’t want it to be only a penny a gallon—that’s “too low” since it would not stimulate enough gasoline or oil production. We need to strike the right balance and find the right gasoline price somewhere between $0.01 and $10 per gallon. After all, what’s the point of having a government if you’re not gonna use it?

It’s pretty sad when Republicans are more radical on IP reform than libertarians are.⁶

1. See The Overwhelming Empirical Case Against Patent and Copyright. [↩]
2. See Death by Copyright-IP Fascist Police State Acronym; SOPA is the Symptom, Copyright is the Disease: The SOPA Wakeup Call to Abolish Copyright; Where does IP Rank Among the Worst State Laws?; Patent vs. Copyright: Which is Worse?; Masnick on the Horrible PROTECT IP Act: The Coming IPolice State; Copyright and the End of Internet Freedom. [↩]
3. See The Four Historical Phases of IP Abolitionism, The Origins of Libertarian IP Abolitionism, and The Death Throes of Pro-IP Libertarianism. [↩]
4. See Copyright Shill’s Defense of the Status Quo. [↩]
5. See Patent Policy on the Back of a Napkin. [↩]
6. See Heroic and Radical Republican Study Committee Copyright Reform Proposal Retracted under Pressure from MPAA and RIAA. [↩]

In my post Heroic and Radical Republican Study Committee Copyright Reform Proposal Retracted under Pressure from MPAA and RIAA, I noted that a recent radical proposal for copyright reform released by the Republican Study Committee was almost instantly pulled under pressure by Big Content. In an update, I noted that Cato’s Timothy Lee, who poses as an IP-reform maverick but, as noted here (also here), is not against IP on principle, wrote on Facebook: that the report “was retracted because it was intellectually indefensible” (which I guess is something different than merely “indefensible”), citing IP shill Scott Cleland’s post The Copyright Education of Mr. Khanna — Part 2 Defending First Principles Series. Let’s look a bit more closely at Mr. Cleland’s alleged demonstration that the RSC’s copyright report was “intellectually indefensible”.

Mr. Derek Khanna, a new Republican Study Committee (RSC) staffer, distributed apolicy brief on copyright “myths” last Friday that the Committee very quickly disavowed and pulled down because it had not been vetted to ensure that it fairly represented the Republican Study Committee’s views. Don’t expect this policy brief to ever get the official support of RSC because Mr. Khanna has obviously and grossly mischaracterized Constitutional first principles, property rights, and free markets beyond recognition.

There are at least five fundamental flaws in Mr. Khanna’s characterizations.

At least! Well, you would think five would be enough. Let’s see…

1. Congresses and Supreme Courts have not totally misread the Constitution for over 200 years.

Mr. Khanna’s effective assertion that two centuries of Congressional and Supreme Court interpretation of the U.S. Constitution’s treatment of property rights, and copyrights in particular, are really “myths” that misinterpret what he posits the Founding Fathers really meant to do in promoting “progress of science and the useful arts,” puts his opinion squarely at odds with America’s two centuries of experience with Constitutional rule of law.

How can an opinion be “at odds” with positive law rulings of state employees? These are the same kinds of observations made by legal positivists and statists who say that the Civil War “settled” the issue of secession. But let’s go on.

While there is a perfectly legitimate copyright debate that can be had on the appropriate definition of how long “limited times” for exclusive right to “writings and discoveries” should be,

Well how long, exactly, should they be? Zero? 14 years? 150 years? Forever?

Mr. Khanna’s “myths” brief is fundamentally not about that, but about a frontal assault on two centuries of Congressional and Supreme Court interpretation of Article I, Section 8, Clause 8.

Why…. why… how dare he disagree with two centuries of state interpretation of the document that grants them power to regulate the economy! Heavens to Betsy! Someone grab the fainting couch! Anyway, what is the argument? Cleland simply has a bare assertion here: that Khanna has assaulted two centuries of official interpration of the copyright clause. Well so what? Why does that make it wrong? And even if the official interpretation of the copyright clause is correct, that doesn’t mean it’s morally justified.

2. Mr. Khanna’s copyright views are not conservative.

Mr. Khanna’s hostile views towards copyright are at war with those of the Founding Fathers because property is strongly protected in the Constitution and the Bill of Rights.

So many confusions in so few words. First, there is the implication that being for property rights has something to do with being “conservative.” Not so. Second, there is the identification of the Founding Fathers with all that is good and right and property; this is just legal positivism mixed with an appeal to authority. The Constitution does not strongly protect property; it enables the central state to ride roughshod over property rights and in fact empowers the Congress to enact legal monopolies (patent and copyright) that in fact do derogate from and violate property rights. The Founding Fathers were not some genius statesment who gifted us with the sacred right of limited government and private property; rather, they were racist, power-seeking white males of privilege who knew what words they had to say to the people to delude them into thinking the new state being foisted on them was legitimate. The Constitution is not some genius system of checks and balances “bestowed” on us; it is  the plan of evil geniuses who succeeded in seizing and centralizing power by using the right words and incantations to speak to enable them to get away with it. It is as if they knew some elaborate scheme to figure out how to rob a bank, and everyone praises them for the cleverness of the scheme.

James Madison understood protection of private property rights was a first principle in stating in Federalist #10 that the protection of property rights “is the first object of Government.” That comports with John Locke, whose social contract philosophy undergirds the American Constitution; he said: “The reason why men enter into society is the preservation of their property.”

Mr. Khanna’s copyright views actually closely parrot the collectivist views of the famous Professor Larry Lessig who founded Free Culture and Creative Commons, championedFree Software and CopyLeft, and called for convening a new Constitutional Convention because “Democracy in America is stalled” by the “corruption” of money in politics.

It is also important to note that Marx and Engels said their theory could be summed up in one sentence: “Abolition of property.”

Calling state-granted monopoly privileges “property” does not make it so.¹ In fact, such monopoly privileges undercut and invade private property rights.² It is not collectivist to oppose state monopoly privileges. In fact a strong belief in private property rights is the primary reason to oppose such anti-competitive monopoly grants.

In any case, notice that, as with point 1, there is simply no argument whatsoever here. Cleland may be right that Khanna’s views are not “conservative”. so what? When has conservativism ever been for honest interpretation of the Constitution? (Hint: how many “conservatives” will now disavow Lincoln’s war against southern states’ constitutional right to secede?) When has conservatism ever been for justice and individual rights and a consistent, strong defense of Lockean-style property rights? Answer: never. The reason is: only libertarians are for this, and conservatives are not libertarians. They are just statists of one stripe.³

3. Copyright is property not monopoly.

Mr. Khanna’s gross mischaracterization of the “exclusive rights” of copyright as a monopoly is classic Lessig-ian buzzword blackmail to demonize ownership of private property by mischaracterizing property exclusive rights with a word he knows people don’t like — monopoly.

Well there is a reason people don’t like monopoly: but the only true monopoply is that of the state, which conservatives do not oppose. Instead, they favor, like other types of socialists, the monopoly state enacting anti-monopoly laws that persecute private businesses who cannot and do not achieve real monopolies, all the while the same state hands out monopoly grants of privilege called patent and copyright and disguised as intellectual “property” rights.⁴ But there is no question that patent and copyright are monopolies, as is admitted (gleefully) by even their ardent defenders.⁵

A copyright is not a business or market that can be monopolized, copyright is a Constitutional property right for a product that can be bought and sold, or protected from use by others.

Is this supposed to be an argument? It is just some bizarre legal positivistic appeal to authority.

To show how silly this mischaracterization is, do we believe we have a monopoly over use of our car or home? No it is our property and because it is our property we have the right to decide who can use our car or enter our house. The only purpose in mischaracterizing property as a monopoly is to promote hostility to property and individual ownership of property separate from the state.

The purpose in mischaracterizing state monopoly privilege grants as “property” is to bamboozle people.⁶ Not the other way around. The property rights in a scarce resource like a car or house are grounded in a Lockean theory of original appropriation and contractual title transfer. Copyright is just a negative servitude granted by the state that takes property from previous owners and transfers it to state-favored recipients.²

4. Mr. Khanna is flat wrong asserting “Copyright violates every tenet of laissez faire capitalism.”

No genuine conservative or free market proponent would imagine positing that property, or a whole category of Constitutionally-protected property like copyrights, patents or one’s home property, violate the entire concept of capitalism. At its most basic level, capitalism is about capital which is private property. Capitalism is property and property is capitalism. Capitalism simply cannot exist without common law enforcement of property rights and contracts.

Well, patent and copyright do not emerge from either common law of property or contract; it requires legislation. Khanna’s obvious point is that IP is anti-competitive and anti-property, and thus anti-capitalism—and this is recognized by those who support patent and copyright. For example, they say:

Governments adopt intellectual property laws in the belief that a privileged, monopolistic domain operating on the margins of the free-market economy promotes long-term cultural and technological progress better than a regime of unbridled competition.⁷

Is this “conservative”? Yes, it is; and it has nothing to do with competition, private property rights, and free markets. Or, here is another supposed defender of capitalism:

To paraphrase the late economist Joan Robinson, patents and copyrights slow down the diffusion of new ideas for a reason: to ensure there will be more new ideas to diffuse …⁸

Cleland is (unfortunately) free to favor and help foster this fascist protectionism on the remnant of the free market we have remaining, but he is not free to have his cake and eat it too: he cannot coherently claim to be for property rights and free markets while supporting anti-competitive, protectionist monopoly privilege grants by the criminal state.

Even capitalism’s biggest opponents, Marx and Engels, knew the opposite of capitalism was “Abolition of property.”

More question-begging. It is IP proponents who are socialistic, since the legislated state grants of monopoly that they favor undermine private property rights just as socialist expropriations, regulations, and taxes do.

5. Copyright is law not regulation.

Once again, Mr. Khanna uses deceptive language to mischaracterize and de-legitmize copyright in buzzword blackmailing it as government regulation and subsidies. Property is a Constitutional right.

Yeah, well slavery was constitutional for a while, and today, income tax and tariffs and war and the draft and the drug war and welfare and government schooling and social security and Obamacare and regulation of the right to bear arms are also “constitutional.” So who gives a damn whether a given law is “constitutional” or not? It means nothing.

Copyright is enforced via the courts as law enforcement not regulation. It’s absurd for Mr. Khanna to characterize Government law enforcement to protect all citizens’ life, liberty and property as a “subsidy” rather than a purpose and core function of the Government.

In sum, Mr. Khanna is promoting Lessigian anti-property thinking (that more American innovation and progress will emanate from the utopian altruism of a property-less system, where taking what others produce without permission is called “sharing),” as superior to America’s Constitutional political and economic system of property and economic incentives.

What do Mr. Khanna and Professor Lessig think the Founding Fathers meant when they said in the preamble of the Constitution “… secure the blessings of Liberty to ourselves and to our Posterity…”?

Our Founding Fathers understood two centuries ago, as most Americans still understand today, that “free,” meaning no property, will not “promote the progress of Science and the useful Arts,” (innovation) and that “free,” as in no-cost, is not best for the people or for America because it is not economically sustainable for today or for “our posterity.”

The inane mutterings of this inept copyright shill show vividly how intellectually bankrupt is the case for IP. One can only hope that this presages a collapse of the modern IP-protectionist edifice.

1. See Intellectual Properganda. [↩]
2. See Intellectual Property Rights as Negative Servitudes. [↩] [↩]
3. See Hoppe, “The Socialism of Conservatism,” in A Theory of Socialism and Capitalism. [↩]
4. See Abolish antitrust law and the real monopoly: the state; The Schizo Feds: Patent Monopolies and the FTC; EU newsflash: patents are anticompetitive!; Pro-IP Libertarians Upset about FTC Poaching Patent Turf; State Antitrust (anti-monopoly) law versus state IP (pro-monopoly) law; see also When Antitrust and Patents Collide (Rambus v. FTC); Antitrust vs. Trademark Law; Price Controls, Antitrust, and Patents; IP vs. Antitrust; The Schizophrenic State; Intel v. AMD: More patent and antitrust waste. [↩]
5. See Are Patents ‘Monopolies’? [↩]
6. See Intellectual Properganda. [↩]
7. See Intellectual Property Advocates Hate Competition. [↩]
8. See Shughart’s Defense of IP. [↩]

Just the other day, the Republican Study Committee (the conservative caucus of House Republicans), chaired by Ohio Representative Jim Jordan released a brief two days ago entitled Three Myths about Copyright Law and Where to Start to Fix it. The brief attacks current copyright law and proposes sweeping, significant changes—reducing statutory damages, expanding fair use, punishing false copyright claims, and significantly limiting copyright terms. But then it was pulled, no doubt under pressure from Big Content (a copy of the report is available here).

More below from Mike Masnick at Techdirt; see also Peter Brantley, The magically disappearing copyright report.

See also Copyhype, Republican Study Committee Policy Brief on Copyright: Part 1, citing Derek Khanna, “Reflection on the House Republican Study Committee Copyright Report,” Cardozo Arts & Entertainment Law Journal vol. 32, no. 1 (2011); see in particular Part V, “Addressing the Natural Rights Counter Argument”; and Derek Khanna, “Republican Study Committee Policy Brief: Three Myths About Copyright Law and Where to Start to Fix It” (same issue). See also KOL030 | Interview with Derek Khanna.

Update: On Facebook, Timothy Lee, who poses as an IP-reform maverick but, as noted here (also here), is not against state granted IP monopolies, writes: that the report “was retracted because it was intellectually indefensible,” citing IP shill Scott Cleland’s post The Copyright Education of Mr. Khanna — Part 2 Defending First Principles Series (which I dissect here).

That Was Fast: Hollywood Already Browbeat The Republicans Into Retracting Report On Copyright Reform

from the so-that’s-how-that-works dept

So, late Friday, we reported on how the Republican Study Committee (the conservative caucus of House Republicans) had put out a surprisingly awesome report about copyright reform. You can read that post to see the details. The report had been fully vetted and reviewed by the RSC before it was released. However, as soon as it was published, the MPAA and RIAA apparently went ballistic and hit the phones hard, demanding that the RSC take down the report. They succeeded. Even though the report had been fully vetted and approved by the RSC, executive director Paul S. Teller has now retracted it, sending out the following email to a wide list of folks this afternoon:

From: Teller, Paul
Sent: Saturday, November 17, 2012 04:11 PM
Subject: RSC Copyright PB

We at the RSC take pride in providing informative analysis of major policy issues and pending legislation that accounts for the range of perspectives held by RSC Members and within the conservative community. Yesterday you received a Policy Brief on copyright law that was published without adequate review within the RSC and failed to meet that standard. Copyright reform would have far-reaching impacts, so it is incredibly important that it be approached with all facts and viewpoints in hand. As the RSC’s Executive Director, I apologize and take full responsibility for this oversight. Enjoy the rest of your weekend and a meaningful Thanksgiving holiday….

Paul S. Teller
Executive Director
U.S. House Republican Study Committee
Paul.Teller@mail.house.gov
http://republicanstudycommittee.com

The idea that this was published “without adequate review” is silly. Stuff doesn’t just randomly appear on the RSC website. Anything being posted there has gone through the same full review process. What happened, instead, was that the entertainment industry’s lobbyists went crazy, and some in the GOP folded.  [continue reading…]

From ars technica. Another day, another insane patent lawsuit:

 

Chicago options market goes nuclear, files $525 million patent suit

In a long war between two options exchanges, patents are the most dangerous weapon.

by Joe Mullin – Nov 14 2012, 7:00pm CST

There was a time, not long ago, when the titans of the US financial world ran away from patents. During the Bilski case, big banks filed an amicus brief (PDF) on the same side as Google, asking the Supreme Court to disallow so-called “business method” patents to no avail.

However, a few key financial institutions have embraced patents enthusiastically. This week, the Chicago Board Options Exchange has taken finance-patent wars to a new level. CBOE filed a lawsuit against a competing options exchange, International Securities Exchange (ISE), demanding $525 million for the infringement of three patents: US Patent Nos. 7,356,498, 7,980,457and 8,266,044. The board asked for the first patent in 1999, at the height of the patent-everything craze, and the patents were issued between 2008 and 2011.

In its complaint, the Chicago board says the patents cover its Quote Risk Monitor system. That lets traders “actively control their risk exposure” by telling CBOE the “risk threshold” they want to take on.

The bad blood and litigation between these two exchanges goes back years. The European-owned ISE was the first US all-electronic exchange when it opened in 2000. The Chicago Board Options Exchange was the first options exchange, period, when it was founded in 1973.

ISE first sued the Chicago board back in 2006, claiming infringement on its own patent—filed in 1999, just two months before CBOE’s first patent filing. CBOE beat that lawsuit at the district court level, but this May, it was revived (PDF) by the nation’s top patent appeals court. Now it looks like the lawsuit against Chicago is going to go forward, whether the exchange likes it or not—and filing their own “defensive” patent suit is the best way to get leverage.

The high-stakes suit-and-countersuit between two major options exchanges raises the question: will patent disputes infect the world of corporate finance like they have the tech world?

 

Read more>>

From Wired: another story of copyright used for censorship and protectionism. No offense, Silas Barta.

Copyright and Planned Obsolescence: The Shady World of Repair Manuals

• BY KYLE WIENS

Tim Hicks is a 25-year-old Australian with an interesting hobby: He trawls the nooks and crannies of the internet looking for manufacturer service manuals and posts the PDFs online for free. Hicks was frustrated that there wasn’t a single website out there with every laptop service manual. He started the site – aptly named “Tim’s Laptop Service Manuals“ – because he fixes laptops himself.

Tim’s site now streams over 50 gigabytes of manuals every day. Or rather … it used to. In a recent strongly worded cease-and-desist letter, Toshiba’s lawyers forced Tim to remove manuals for over 300 Toshiba laptops.

Tim’s many fans have expressed surprise at Toshiba’s onslaught – check out some of the Redditcommentary — and I’m outraged, too. Not just because of this specific case, but because of what it means for the lifetime of our devices, the future of repair and e-waste, and the abuse of copyright law as a weapon for planned obsolescence.

Keeping manuals off the internet ensures the only path for beleaguered customers is sending broken devices back to high-priced, only-manufacturer-authorized service centers. By making it so expensive and inconvenient to repair broken electronics, this policy amounts to planned obsolescence: many people simply throw the devices away.

Toshiba has discovered a new way to enforce such planned obsolescence by cutting the repair market off from critical service information. But the cost to society is significant: The e-waste problem is growing; we’re losing thousands of domestic jobs as independent repair shops shut down; and consumers are being forced to replace their hardware much frequently than they should have to.

Read more>>

sdfs

From TorrentFreak: RIAA Celebrates 15 Year Jail Sentence For Movie and Music Pirate:

The RIAA has welcomed a mind-boggling jail sentence handed to a man who sold pirated movies and music. The 37-year-old man pleaded guilty to six felony counts of selling counterfeit media after he sold five movies and one music CD to an undercover investigator without the permission of copyright holders. As a result he will go to jail in Mississippi for 15 years to be followed by three years of supervised release.

Severe jail time for … copying patterns of information. Censorship hell. See also:

• Six Year Federal Prison Sentence for Copyright Infringement
• Where does IP Rank Among the Worst State Laws?
• Man sentenced to federal prison for uploading “Wolverine” movie

As noted in Safeway Bakery Bans Photos to Keep Its Cakes From Being Mocked Online and Ways to Play it Safe.

In this Yahoo article, we are told woes of Dan Brown, an American producer of the patented “Bionic Wrench,” who is upset that a competing product, “Max Axess,” is too similar … and is made in China. Brown had been selling his wrench with Sears, but then Sears started also selling the Max Axess wrench as part of its Craftsman line.

While I was at Libertopia last month (see Intellectual Nonsense: Fallacious Arguments for IP (Libertopia 2012)) I was interviewed a few times. One of them was by Silver for the People/Future Money Trends: see Stephan Kinsella – Copyright Laws Cost the U.S. $ Billions in Economic Growth. Video is below; audio file is streaming below as well and may be downloaded here (30MB).

Update: a transcript is appended below.

[podcast]http://www.stephankinsella.com/wp-content/uploads/media/kinsella-future-money-trends-interview-copyright-2012.mp3[/podcast]

Transcript:

From the comments section to Wendy McElroy’s Daily Anarchist article The Basics of Copyright:

Scott:

Sorry I didn’t get to meet you at Libertopia; my best wishes to you regarding those issues.

Regarding your comments about NDAs: I agree with you here: “What I find less practical is contractual copyrights for general publications.” But to me this is not an argument for copyright, but rather a further argument against it: many people argue that copyright is just the outcome–or could be the outcome–of some private contractual schemes. But it is not and cannot.

You also write:

Just as the original farmer appropriates land from the un-owned physical commons to create a productive farm, and therefore owns the farm and the produce grown upon it, the artist or writer appropriates un-owned language and concepts from the commons of our cultural heritage to create a *work* of art or literature. That work is the property of its creator.

I have read Kinsella’s work and his position denies that property originates in a person’s labor. When I objected he accused me of supporting a “labor theory of value,” which is nonsense. What I support is a labor theory of _property_, first described by Locke, and which is the basis for most libertarians’ concept of property rights.

Most libertarians are confused by Locke’s own confused argument and his overly metaphorical way of arguing for rights. His labor theory of property, as you accurately describe it, did, IMO, give rise to the labor theory of value, and also to what I refer to as property “creationism”. Labor is just an action, however. It is not some substance that we own. We no more own labor than we own actions. ations are just what you do with things you own, including your body. I discuss this in various posts, namely: Hume on Intellectual Property and the Problematic “Labor” Metaphor. (And in others: Locke on IP; Mises, Rothbard, and Rand on Creation, Production, and ‘Rearranging’; Locke, Smith, Marx and the Labor Theory of Value; see also Rand on IP, Owning “Values”, and “Rearrangement Rights”;  and Thoughts on Intellectual Property, Scarcity, Labor-ownership, Metaphors, and Lockean Homesteading.)

Locke is wrong that you own your labor, and he is wrong in arguing that the reason why you own things you homestead is that you have mixed with the unowned thing, something that you do own (labor). Rand is wrong to rely on this to argue that we own “values” that we “create.” Values are not things. Value is subjective, a relationship between an actor and some end of action, whether the end be a scarce resource or some outcome desired by the actor. As Mises explains, value and preference are demonstrated in action; and as Rand herself echoes, values are things you act to gain and or keep. That is, when you act, you always seek some end, and thereby you demonstrate that you do value the end you aim at more than others, which are opportunity costs of the action.

The confusion lies in thinking that creation is one of 3 sources of ownership. It is not. Rand hersefl recognized that we do not metaphysical create things; we only rearrange them. Mises, Rothbard say the same thing. When we labor on an already-owned scarce resource that is a raw material or factor of production, we rearrange it to result in a more-valuable object. In this way we create wealth or value, that is, we and/or others value the rearranged thing more than it was valued before. But no new property rights are thereby created. To produce requires ownership of the factors; production is the rearrangement or transformation of already-owned things. It results in wealth, or increases the value of the things owned, but does not result in new ownership.

The mistake stems from this sloppy, overly metaphorical way of thinking that Locke used in his argument. He double-counted by saying we own labor; it’s sufficient to say you own your body. Ownerhsip of your body is sufficient to let you do what you want with it–to act as you please, to labor as you please. You don’t own your labor, however, and you don’t own your action. You own only scarce resources, such as previously-unowned things you homestead, or your body.

Not that Locke himself, and the founders, did not believe that his homesteading idea applied to IP. He did not think it meant you had a natural right to own ideas that you create, even if you expended “labor” to “create” these ideas. (Despite strained arguments to the contrary by people like Adam Mossoff, Merges, and Eric Claeys.) SEe the links above on this.

When you act (yes, labor, fine) on a previously unowned resource you establish a better claim to the property than anyone else since you have an earlier claim than they do (see on this Hoppe and de Jasay, even Hume). Not because you “own” the labor you mixed with it. Not that anyone who argues they should be able to take the object from you is himself making an ownership claim, that is, he wants to take it and have title to it. But having title to it means he wants to be protected from anyone who comes later and tries to take it from him. He would object to this, which means he is recognizing that as between two possible claimants for a given contestable resource, the latecomer loses. But if you work backwards wtih this assumption, this means the first homesteader has a better claim than anyone in the world, since everyone else would be a latecomer. The only person who has a better claim would be someone the original owner contractually assigns title to.

It is a fact that nonscarce things like patterns of information can NOT be owned. This is not a normative argument: it is a fact. It is literally impossible to own a novel, a poem, a painting, a design for a motor. All disputes are always, necessarily, over who gets to control (own) a particular scarce (rivalrous, contestable) resource. If Bieser sues me for making copies of his drawing, what he wants is for physical force (from the state courts) to be used against my body or my owned objects, to either take these things (such as money in the case of damages) or to coerce me not to use my body or owned objects in certain ways (e.g., if he gets an injunction from the court ordering me not to print certain patterns on my own paper with my own ink). To enforce rights in “IP” always necessarily requires undermining already-existing property rights in already-existing things. Legally speaking, IP rights are negative servitudes (negative easements) (see my post Intellectual Property Rights as Negative Servitudes): it grants to the IP holder a veto right over how others use their own bodies or other owned scarce resources. I.e., the IP holder is made a co-owner with others, in their own property. It is a trasnfer of proeprty rights. A negative servitude or easement is perfectly legitimate if it is voluntarily granted by the original property owner; this is often done among neighbors in the form of restrictive covenants, say, where you agree not to paint your house outlandish colors unless your neighbors agree; they have a veto right. BUt it is not legitimate if the state just grants this veto right to people, when the burdened estate owner has not agreed to it.

Bieser goes on:

Just as the original farmer appropriates land from the un-owned physical commons to create a productive farm, and therefore owns the farm and the produce grown upon it, the artist or writer appropriates un-owned language and concepts from the commons of our cultural heritage to create a *work* of art or literature. That work is the property of its creator.

This argument is flawed in so many ways. First, it analogizes a work of art to land, while ignoring the difference between them: the land is a scarce resource, a pattern of information is not. Only scarce things are ownable things. Second, this argument would not justify modern copyright, and certainly not patent; patent affects even people who independently invent something. Copyright also covers more than just literal reproduction; it prevents people from making derivative works. If I write a new Han Solo novel I am also making a new pattern, but this is itself prohibited by copyright. and all this is based on the ridiculous idea that the only actions people are entitled ot perform are actions that are not similar to actions others have performed in the past. It is truly a breathtakingly stupid idea.

When published, it is true the work is no longer “scarce” in the same sense a physical object is said to be scarce. But neither is it superabundant in the same sense that the air and the oceans are. It is limited in time, as it did not exist before some person first labored to generate it.

Equivocation. The physical object that carries the pattern–say, a physical book–is a scarce object, but the pattern in it is not. And the pattern is not scarce just because it required labor to generate it. Information, once made public, is nonrivalrous, no matter how much effort is required to produce it. Every economist recognizes this. No one can seriously deny this.

Kinsella has remarked that it is a strange notion of property that has a time-limit on it, but it’s not strange at all. For while the farmer obtained his land from the natural world, the artist appropriated his raw materials from a social commons that had been created from the prior labor of those who came before him. Therefore, a moral debt is owed to that commons

A moral debt? What a ridiculous “defense” of state-granted monopoly privileges. There is NO MORAL DEBT AT ALL that comes from learning and taking advantage of knowledge accumulated over the centuries by previous men! And if there were, this is an argument against IP not for it; it shows that everyone is using ideas from others for free, and has no right to lock up theirs with IP.

, which the artist repays by releasing his work to the commons after enough time for him have enjoyed the fruits of his labor. (What that length of time should be is a detail to be arrived at by the same social processes that determine the details of other laws.)

This argument is so transparently ridiculous that comment on it is hardly needed. BUt it is clear that no libertarian can take this seriously.

I’m a big fan of David Friedman, and his father, Milton, both of whom helped put me on the anarcho-libertarian path in the 1980s and 1990s (see How I Became A Libertarian). Even though I recoil from Milton’s minarchist deviations, and I disagree with David’s positivism and empiricism. Milton acknowledged the distorting effects of patents, as I’m sure David would, but David cannot seem to bring himself to oppose IP on principled grounds (see David Friedman on Copyright).

[update: David Friedman on Intellectual Property]

In a recent post, MMORG as the Future of Fiction?, David Friedman writes:

Nowadays, a lot of the intellectual property protected by copyright law is in digital form. This raises an obvious problem for enforcing copyright, since digital files are easy to copy and easy to distribute.

One possible solution is technological protection, distributing the content in some form that lets the user use it but not copy it. That solution has a problem, sometimes referred to as the analog hole.

Notice that we only need a “solution” if there is a real “problem,” and the only problem Friedman identifies is “enforcing copyright.” But since copyright is unlibertarian, just like tax or conscription or drug laws are, it’s not a “problem” when the state is unable to enforce it; in fact it’s a good thing. Friedman comes up with bizarre “solutions” to this non-problem, like people writing novels that are distributed and dynamic:

Years ago, thinking about this issue, I tried to dream up a version of a movie that would not be fully revealed, perhaps one where the viewer could see it from different points of view each time he viewed it. It eventually occurred to me that something of that sort already existed, and I was spending a good deal of time watching it. World of Warcraft, as I pointed out in my previous post, is a story as well as a game. Because it is a story that is told by having the viewer participate in it as a character, walking through a mostly predetermined plot, it is not fully revealed in one use. What I want is the experience for myself, not a recording of someone else having it.

So here we have a proposed distortion of culture, literature, and intellectual creation all in the name of enforcing artificial anti-copy-rights. IP law leads to all kind of distortion in other areas of social life: it skews technical and scientific research (Milton Friedman on the Distorting Effect of Patents;  The Forgotten Costs of the Patent System); it distorts other areas of commerce and culture (The Effects of Patent and Copyright on Hollywood Movies; Destructive Creation). Now David Friedman is proposing that the field of literature be contorted, twisted, and distorted to solve a “problem”—people can learn from, copy from, emulate, and compete with information others make public, as if this is a “problem”—by making novels dynamic and POV-oriented.

How about we just give up on the ridiculous, statist, 20th century idea of property-in-ideas, instead, and let people be free to do whatever the hell they want? Let a thousand flowers bloom, and all that?

Nice piece at Laissez-Faire Today by IHS’s Isaac Morehouse on his move from a pro-IP to anti-IP position: My IP Journey (October 31, 2012).

Updated version: How I Changed My Mind on Intellectual Property (also published in Keith Knight, The Voluntaryist Handbook).

See also KOL216 | Morehouse Interview: Why Intellectual Property Sucks.