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Against Monopoly

defending the right to innovate

Politics and IP

Monopoly corrupts. Absolute monopoly corrupts absolutely.





Copyright Notice: We don't think much of copyright, so you can do what you want with the content on this blog. Of course we are hungry for publicity, so we would be pleased if you avoided plagiarism and gave us credit for what we have written. We encourage you not to impose copyright restrictions on your "derivative" works, but we won't try to stop you. For the legally or statist minded, you can consider yourself subject to a Creative Commons Attribution License.


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On Print Runs and Pulping Books

I just came across an interesting thing I had not known about the effect of state meddling on publishing. See Wikipedia here and here, noting:

Thor Power Tool Company v. Commissioner, 439 U.S. 522 (1979) was a United States Supreme Court ruling which changed the way companies are allowed to depreciate their unsold inventory. Thor's inventory was overestimated, and was written down to scrap, but it did not immediately scrap the items or sell them at reduced prices. Thor treated the write-down of excess inventory as an adjustment to closing inventory increasing the costs of goods sold and reducing tax due. Reducing tax liability may not have been the drive behind Thor management's incentive to reduce inventory, but a welcome by-product; new management may have wanted to reduce the previous year's profits so as to seemingly increase their performance in the following year.

An unforeseen side effect of this decision was that it became less profitable for publishers to keep slowly but regularly selling books in print (their backlist). Some argue that this has made it harder for midlist authors to make a living because books tend to be remaindered or pulped and go out of print more quickly.

In other words, a de facto change in the tax laws concerning inventories made it profitable to pulp unsold books earlier and this has had an adverse effect on authors who have slow but steady sales. As Levine noted to me, this ties into the whole issue of digital technology. On the one hand, digital technology makes copyright de facto obsolete, and it can make it harder for creators to recoup their investment because the market may be flooded with cheap copies quickly. This is what the pro-copyright forces argue (so therefore we need draconian copyright laws to overcome all this). The basic facts are true, but there are many facts that go the other direction. This is one of them--by selling electronic or print-on-demand copies directly to buyers authors don't face "early liquidation" by publishers.

Senator John McCain Battles Jackson Browne In Copyright Lawsuit

Singer Jackson Browne has sued John McCain for copyright infringement after a state Republican party ad supporting McCain used a snippet of Jackson's song "Running on Empty".

Some background of the case HERE and HERE.

Courtesy of The Hollywood Reporter blog, McCain's Motion to Dismiss the lawsuit can be found HERE. [PDF]

McCain's "Anti-SLAPP" Special Motion To Strike the complaint can be found HERE. [PDF]

While I support McCain's legal efforts in this instance, it is hard to feel sorry for him as he has little moral credibility on the issue. Leaving aside all other aspects of Presidential politics, McCain has stood aside for years in the Senate and allowed copyright law to metastasize out of control into the current cancer it is.

Then, after McCain's campaign first got BURNED with the law that he supported, he had the GALL to SUGGEST that SPECIAL fair use considerations should be given to politicians and their campaigns - but not necessarily to the general public. Because after all, we wouldn't want to make meaningful reforms to copyright law, now would we?

For shame Senator! But good luck with with your fair use defense in your copyright infringement suit using laws that apply to everyone equally.

Re My Objections to IP: Nevermind

Since IP causes only about $40 billion or so a year damage to the economy, I hereby withdraw my objections. That amount is obviously trivial, in view of trillion-dollar bailouts, trillion-dollar wars, scores of trillions of dollars of debt. And as for the $80 billion tax-funded innovation prize fund--chicken feed. Let 'er rip!

The U.S. 'Copyright Czar' - Be Afraid. Be Very Afraid....

From Wired.com:

U.S. lawmakers approved the creation of a cabinet-level position of copyright czar as part of sweeping intellectual property enforcement legislation that sailed through the Senate on Friday.

Read the whole thing. This follows up David K. Levine's alert here.

You know things are bad when an organization like Public Knowledge is forced to essentially state, "Well, it could have been worse. Let's all be grateful for that."

Who do we have to pay off in the House to kill this monstrosity? Oh, that's right. I forgot. They have already been bought off by the other side...

Demopublicans United on IP

Replying to IP practitioner Russ Krajek's post McCain vs Obama on IP Issues: There is No Contest:

Russ,

A few comments.

You write: "All the participants agreed on the same underlying principle: intellectual property rights are important and should be protected. In general, both sides agreed on the general goal of more rigorous patent examination that would, in theory, result in stronger patents. ... the general recognition of the importance in IP protection and its role in the economy was emphasized. ... The ‘problem' is that patents being issued today do not generate the confidence and respect in the public that, as a matter of public policy, one would expect."

Why would one "expect" this from the government? The state can't do anything well except destroy and damage. Why would anyone expect it to do anything constructive well?

"The bad press and attacks on patents in general have eroded confidence in all patents."

Why is this a bad thing? If patents are a net harm on society, why shouldn't people be skeptical of them? Why isn't it better that patents are weak?

"An inventor who obtains a patent cannot enjoy as much of the benefits of the patent as public policy would dictate."

Perhaps true; but why would anyone think the level of benefits that public policy "would dictate" are justifiable?

"Patents should be issued for inventions which are new, useful, and fully disclosed. Inventions that do not meet all three requirements should not be issued. Seems pretty simple, but the execution of the solution is down and dirty and decidedly not glamorous."

It doesn't seem simple to me. These requirements are purely arbitrary, unscientific, non-objective, legislated criteria, administered by a federal bureaucracy and federal courts--i.e., by a bunch of government employees. Why would anyone think this could ever be simple or just?

"I was glad to know that advisors to both candidates had a firm grasp of the issues and fundamentally agreed that strong Intellectual Property rights would be good for the country as a matter of policy."

Why do you assume that strong IP rights are "good for the country"? I mean, how do you know this? Why do IP practitioners always assume this--just because it is in their interest for the patent system to stay in place does not mean it is good for the country. No one can deny that the patent system imposes costs on the economy. How do its proponents know that the benefits are greater than the costs? Russ, what are the net benefits, in dollar terms? What are its benefits? Its costs? If you don't know, how do you know the net is positive?

It's the Pattern Privilege, Stupid

As noted in Patent Reform Touches DNC in Denver,
Rep. Zoe Lofgren, D-Calif., told a crowd in Denver on Tuesday that it is crucial for Congress to pass legislation to update the U.S. patent system next year ... A proposal that would curb judicial "venue-shopping" for favorable courts is critical as is language to address patent abuses, she said. "How do you legally set a framework that prevents abuses and allows for a vigorous system that protects intellectual property?" Lofgren asked aloud. "It's not easy to come up with solutions."
Right. Call me crazy, but it almost seems like it's impossible to avoid "abuse" if one sets up a state-granted innovation-monopoly system! Hmm, I wonder how we could avoid that abuse... I wonder....

Just in case Joe Biden turns out to be Obama's pick for VP....

Wired has a primer on Biden's views relating to IP.

Not good news. But then again, few Congressional leaders offer much in terms of better alternatives. (Sigh)

Patent Reform: More Derision

A patent attorney friend had this idea:

"Perhaps the Supreme Court and CAFC ought to simply make its opinions re UN-patentability more derisive. That might really go a long way. Maybe have Scalia write things like: 'Really, a new gas pedal, REALLLY??? Give me a break even I could have 'invented' that. Don't bring me that weak s@#t, meat*.'"

*Bull Durham paraphrase

Intellectual Property and the Support of the State

An Open Letter to Leftist Opponents of Intellectual Property: On IP and the Support of the State

We libertarian opponents of IP sometimes perplex IP advocates and leftists. There's an analogy here to the way libertarians, and especially anarcho-libertarians, are treated by mainstreamers. The press does not know what to do with libertarians, for example. They typically use "libertarian" to denote civil-libertarian ACLU types; while libertarian thinkers and institutions are often described as "conservative." And "anarchy" is usually associated with chaos, bomb-throwing, or leftist anarchists--rather than with anarcho-libertarianism, which is the only genuine form of anarchism. (See my What It Means To Be an Anarcho-Capitalist.)

There is a common assumption in society that "intellectual property" is a legitimate type of private property right. Thus socialists and leftists oppose IP because of their hostility to private property rights, capitalism, corporatism, and industrialism. Thus, many IP opponents are leftist, anti-capitalist types (for example, Richard Stallman and Eben Moglen are, IIRC, at least somewhat leftist [if I am mistaken in this, I stand corrected; in any event I would welcome email providing backup of this, or examples of other leftist anti-IP arguments).

Likewise, many libertarians accept the fallacious notion that IP is a type of property, and thus support IP because they support property (and because many well-known libertarians, such as Ayn Rand, were strong advocates of IP).

Conversely, those who innately or independently oppose IP, are often classified as leftists, or even believe themselves to be leftists (I believe a similar phenomenon explains why the press tend to be left; they naturally tend to be pro-freedom of speech and freedom of press, but accept the mainstream dichotomy that if you are for personal liberties, you are against economic liberties, and vice-versa; they do not understand that economic and personal liberties are essential and complement each other).

The truth is that the only principled case against IP is the libertarian one, as I've argued in my Against Intellectual Property. The problem with IP is that it undermines and infringes on private property rights: it lets some person gain rights of control over the property already owned and acquired by others (for example, a patent or copyright gives the holder a veto right over certain uses others might put their own property (their bodies, paper, raw materials) to). To oppose IP is to uphold private property rights--libertarian rights. To oppose IP while also supporting socialism is a confusion.

And more than this. IP is not possible without legislation; legislation is not possible without the state. And conversely: with a state, you always get legislation; and legislation always leads to a proliferation of bad laws (see my Legislation and the Discovery of Law in a Free Society).

What this means is that not only is your case against IP weakened if you do not adopt libertarian principles and reasoning to undergird it. But if you support the state at all--if you are not an anarcho-libertarian--then you do not really oppose IP. If the state exists, it will legislate, and it will probably enact IP laws, along with plenty of other bad laws. So, if you support the state, you really can't complain about IP laws. As Ludwig von Mises pointed out, "No socialist author ever gave a thought to the possibility that the abstract entity which he wants to vest with unlimited power—whether it is called humanity, society, nation, state, or government—could act in a way of which he himself disapproves."

IP opponents must not oppose only the "worst excesses" of IP. They must oppose all IP, root and branch, on principled, pro-private property, grounds; and more than this: they must oppose the state itself, and legislation as a means of making law.

So shape up, non-libertarian IP opponents. If you want to make a real case against IP, you must ground it in sound political principles. For some suggested reading, see:

(Cross-posted at Mises Blog)

Copyright and Intellectuals

While IP may not stimulate true innovation and creativity, Hayek suggests that copyright might stimulate something more pernicious: the intellectual class. In The Intellectuals and Socialism, he writes:
In the sense in which we are using the term, the intellectuals are in fact a fairly new phenomenon of history. Though nobody will regret that education has ceased to be a privilege of the propertied classes, the fact that the propertied classes are no longer the best educated and the fact that the large number of people who owe their position solely to the their general education do not possess that experience of the working of the economic system which the administration of property gives, are important for understanding the role of the intellectual. Professor Schumpeter, who has devoted an illuminating chapter of his Capitalism, Socialism, and Democracy to some aspects of our problem, has not unfairly stressed that it is the absence of direct responsibility for practical affairs and the consequent absence of first hand knowledge of them which distinguishes the typical intellectual from other people who also wield the power of the spoken and written word. It would lead too far, however, to examine here further the development of this class and the curious claim which has recently been advanced by one of its theorists that it was the only one whose views were not decidedly influenced by its own economic interests. One of the important points that would have to be examined in such a discussion would be how far the growth of this class has been artificially stimulated by the law of copyright.
Yet another strike against copyright!

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