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Against Monopoly

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Monopoly corrupts. Absolute monopoly corrupts absolutely.





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The Tao of IP

When I saw the title of this Cato podcast--"Intellectual Property Versus Reason" (October 20, 2008)--I was hopeful and interested. Then I noticed it's an interview with the Nobel-winning, er, physicist Robert B. Laughlin, author of the new book, The Crime of Reason and the Closing of the Scientific Mind. Physicists and engineers are notoriously scientistic (see Yet More on Galambos; also Galambos and Other Nuts, Libertarian Activism--comments and C.P. Snow's "The Two Cultures" and Misesian Dualism). But, still, the title implied Laughlin thinks IP is, well, unreasonable (Cato scholars' IP positions seem to be mixed and largely utilitarian).

As I listened to the 16-minute podcast, I had a succession of impressions. For the first 6 or so minutes, I could not tell whether Laughlin was pro- or anti-IP. I know a bit about IP but I was not even sure what he was talking about much of the time. Oh, Laughlin is articulate enough--he speaks slowly, ponderously, and often pauses dramatically, as if struggling to pick just the right Deep Thoughts in response to Serious Questions--and even pronounces a French word or two properly. But soon it becomes obvious that his views on IP are just a mess, and he is, indeed, infected by the scientistic virus that physicists are susceptible to.

It soon become clear that Laughlin believes there is a tension between economic prosperity (which requires IP) and "human rights" (in particular the "right to learn," which IP impinges on). At first he seems to be very concerned that human rights will "give way" to IP and economic prosperity--even pessimistic about this--even while he himself seems to grant that we ought to be concerned about prosperity--and, thus, IP. So he's pessimistic that IP is infringing the human right to learn, yet he not only thinks nothing can or will be done to stop this--after all, we've now entered the information age, where IP rights are even more important to economic prosperity--he even seems to think that we should not abolish IP. We need to "supply the data" to "the legislature" (Congress), and achieve the right "balance", even though he admits he doesn't know what the right solution even is--it's "above my pay grade." Naturally, then, he doesn't blame the Congresscritters for how they have voted to date on IP issues, whether pro or con; their efforts are sincere and based on the best data possible. One wonders why he is depressed, or why he even wrote a book. I guess Nobel laureates can sell just about anything they slap their name on, which is reason enough.

I can't bring myself to read his book now, but from this interview it seems apparent that he holds a number of erroneous views: that both the state and the democratic process are legitimate, and that legislation is the right way to make law; that IP is pro-property rights; that IP is necessary for and promotes prosperity; that there is a conflict between human rights and economic rights; not to mention his implicit scientism. In his confused attempt to weigh in on legal and economic and policy issues he reminded me a bit of physicist Fritjof Capra's New Agey The Tao of Physics (hence the title of this post).

A few other things to note: from the Cato description of his book:

"Though we may feel inundated with information today, Nobel laureate Robert Laughlin argues that intellectual property laws and government security demands are increasingly restricting access to the most useful information. Government rules and businesses' legal pressures to sequester information threaten the development of new knowledge, he says. The rights of free people to investigate their world are threatened. Laughlin's fresh perspective and light, sometimes whimsical, bent do not mask the central warning of his readable book: that we risk bequeathing our heirs a world where knowledge is criminalized and our intellectual tradition of unfettered inquiry is lost."

So he sees IP as "criminalizing" knowledge ... yet is not completely opposed to it. So we need only a reasonable degree of criminalization of knowledge. I guess Laughlin chooses IP over reason... sometimes.

Publishers Weekly (from the Amazon.com listing) identifies some of the weaknesses in Laughlin's book:

"The provocative premise of this short book is that even as we appear to be awash in information, governments and industry are restricting access to knowledge by broadening the concept of intellectual property to include things as diverse as gene sequences and sales techniques. According to Laughlin, the right to learn is now aggressively opposed by intellectual property advocates, who want ideas elevated to the status of land, cars, and other physical assets so the their unauthorized acquisition can be prosecuted as theft. With examples drawn from nuclear physics, biotechnology and patent law, Laughlin, a Nobel laureate in physics, paints a troubling picture of a society in which the only information that is truly valuable in dollars and cents is controlled by a small number of individuals. But while Laughlin poses urgent questions, he provides neither in-depth analysis nor potential solutions. Many intriguing arguments--for example, that electronic technologies such as the Internet, which inundate us with useless information, are not instruments of knowledge dissemination at all but agencies of knowledge destruction--are offered but none are usefully explored.

So Laughlin views IP as "restricting access to knowledge"--if he instead viewed IP as an infringement of property rights, he would have a harder time making the mistake of thinking IP is on the side of economic prosperity and property rights. The "right to learn," whatever that is, is not any primary kind of right, and would seem to be jeopardized by government education and propaganda more than by patent and copyright. Again, IP undercuts and infringes property rights, and harms innovation (see here, here, here, here)--if he realized this, he would not set up the false alternative of prosperity versus human rights. And the idea that IP is more important in the information age is also flawed.


Comments

It is important to understand the difference between intellectual property and monopoly, and if one does, there is no conflict with human/natural rights.

There is a grievous semantic error when people conflate the artificial monopoly of copyright/patent (unethically granted by state) with the natural monopoly of physical property (imbued by nature).

You may be interested in my recent attempts to elucidate the difference here: New Music Strategies.

Crosbie:

I would love to see your proof that the "natural monopoly of physical property" is imbued by nature. The history and definition of property ownership has been debated and controversial over the last two millenia, and has only been more rigidly defined over the last 400 or so years. There has been debate as to whether property ownership is in the best interest of society and whether it is natural. Ralph Waldo Emerson, in spite of being a landowner himself, was opposed to land ownership and thought land ownership to be unnatural. Others throughout time have held that land ownership is alien to nature.

Incidentally, I suspect that Emerson would have been a great believer in "infinite goods."

I also enjoy this quote from British philosopher Jeremy Bentham: "there is no such thing as natural property; it is entirely a creature of the law. ... Property and law were born together, and would die together. Before the laws, property did not exist; take away the laws and property will be no more."

So, my question is: What is your proof the the "natural monopoly of physical property" is imbued by nature?

Crosbie:

I would love to see your proof that the "natural monopoly of physical property" is imbued by nature. The history and definition of property ownership has been debated and controversial over the last two millenia, and has only been more rigidly defined over the last 400 or so years. There has been debate as to whether property ownership is in the best interest of society and whether it is natural. Ralph Waldo Emerson, in spite of being a landowner himself, was opposed to land ownership and thought land ownership to be unnatural. Others throughout time have held that land ownership is alien to nature.

Incidentally, I suspect that Emerson would have been a great believer in "infinite goods."

I also enjoy this quote from British philosopher Jeremy Bentham: "there is no such thing as natural property; it is entirely a creature of the law. ... Property and law were born together, and would die together. Before the laws, property did not exist; take away the laws and property will be no more."

So, my question is: What is your proof the the "natural monopoly of physical property" is imbued by nature?

Crosbie:

I would love to see your proof that the "natural monopoly of physical property" is imbued by nature. The history and definition of property ownership has been debated and controversial over the last two millenia, and has only been more rigidly defined over the last 400 or so years. There has been debate as to whether property ownership is in the best interest of society and whether it is natural. Ralph Waldo Emerson, in spite of being a landowner himself, was opposed to land ownership and thought land ownership to be unnatural. Others throughout time have held that land ownership is alien to nature.

Incidentally, I suspect that Emerson would have been a great believer in "infinite goods."

I also enjoy this quote from British philosopher Jeremy Bentham: "there is no such thing as natural property; it is entirely a creature of the law. ... Property and law were born together, and would die together. Before the laws, property did not exist; take away the laws and property will be no more."

So, my question is: What is your proof the the "natural monopoly of physical property" is imbued by nature?

Crosbie:

I would love to see your proof that the "natural monopoly of physical property" is imbued by nature. The history and definition of property ownership has been debated and controversial over the last two millenia, and has only been more rigidly defined over the last 400 or so years. There has been debate as to whether property ownership is in the best interest of society and whether it is natural. Ralph Waldo Emerson, in spite of being a landowner himself, was opposed to land ownership and thought land ownership to be unnatural. Others throughout time have held that land ownership is alien to nature.

Incidentally, I suspect that Emerson would have been a great believer in "infinite goods."

I also enjoy this quote from British philosopher Jeremy Bentham: "there is no such thing as natural property; it is entirely a creature of the law. ... Property and law were born together, and would die together. Before the laws, property did not exist; take away the laws and property will be no more."

So, my question is: What is your proof the the "natural monopoly of physical property" is imbued by nature?

Crosbie,

What exactly is the natural monopoly of physical property? I have a Dell computer on my desk. Do I have a monopoly of Dell computers, or any other brand of computer? If I do, it would be news to my neighbor, who also has one.

This is positively scary. Bill Stepp and I are asking similar questions?
It was a hasty post. I can tell I need to use the word 'monopoly' carefully around here.

However, I have a natural monopoly on my property. No-one else has it for sale. I have the market to myself when it comes to the sale of my property. If anyone wants to buy my property they have to come to me. If anyone attempts to compete with me in selling my property (they don't have a license, and try and sell it without my permission), the state will enforce my natural monopoly for me.

This is what I mean by the natural monopoly of physical property. If it's a physical object within your private domain that you own, you have a natural monopoly over it - over that specific item, not all similar items (since many other items aren't one's property).

If it's an imaginary notion of a pattern that pervades the universe, only supernatural beings can pretend to have such things as property, or merchants who'd quite like artificial monopolies over them.

So, calm down, I don't think I'm saying anything radical.

You have to at least recognise that property is a natural monopoly in order to recognise why some people think that artificial monopolies are property, e.g. "I wrote this intellectual work, copyright grants me a monopoly over reproductions, ipso facto I own all reproductions".

Given they inevitably conflict, artificial monopolies are unethical violations of natural monopolies (those arising from natural property rights).

All artificial monopolies should be abolished, and be explicitly forbidden in any constitution. The framers of the US constitution evidently didn't foresee how cunning legislators would be in re-instituting monopolies a mere 3 years after the ink had dried on their masterpiece. Being scrupulous in leaving no sanction for monopolies isn't good enough - you have to forbid them.

Crosbie,

Your lingo is bizarre and operationally meaningless, as the philosophers would say. The way you define monopoly empties it of any empirically operational meaning. It does make sense to say someone has a monopoly of producing a good or service because the government forbids anyone else from entering into competition with that supplier for the provision of the good or service he has a monopoly over. A copyright monopoly, for example, prevents non-copyright owners of the thing copyrighted from doing certain things with his legally owned copies of that thing.

I refer you to Rothbard's chap. on monopoly in Man, Economy, and State for more discussion of this point.

Bill,

The lingo I prefer to use is English as that is the language understood by my intended audience. My audience doesn't read Rothbard. My apologies if certain terms I use conflict with specialised meanings expected by economists, etc.

This is from Webster's definition of 'monopoly': 1 : exclusive ownership through legal privilege, command of supply, or concerted action 2 : exclusive possession or control 3 : a commodity controlled by one party

Artificial monopolies such as copyright and patent are legal privileges.

One has a natural monopoly over one's property given one has exclusive possession or control.

Crosbie:

One has a natural monopoly over one's property given one has exclusive possession or control.

I believe I made myself clear on this subject in my earlier post. People have a "natural" monopoly over their property only because the law says they do. Eliminate the law, eliminate the natural monopoly.

There was a school of thought up to the establishment of the laws of ownership the held that the natural owner of property was the person with the capability to defend that land. While I think our system is more civilized, the rule of strength seems like more of a "natural" monopoly than the rule of law.

The interesting factor is when you realize that the only monopolies that exist are those established by law, including the legal fiction of property monopoly. As an aside, you do not have an absolute monopoly or exclusive possession or control on your land. Example, more than likely you do not own the mineral rights on your land. The city, county and state have reserved rights (probably, though there are exceptions) to come on your land for purposes deemed appropriate by that government entity. So, does that then mean that you do not have any monopoly on your land? Or does it mean that you have a monopoly only to the extent the State permits you to have the monopoly. Further, the State can eliminate your so-called natural monopoly through imminent domain, meaning that your "exclusive" possession or control is merely transitory, at best.

Back to my discussion. Since the only monopolies are those that established by law, then the state (evil state, to use Bill's language) defines what constitutes property and what does not. Our legal fiction has decided that land is one kind of property. Interestingly, while the land itself is tangible, proof of ownership is intangible since it relies on pieces of paper and a paper trail. So, ownership is an intangible.

Now, the question is, what makes ownership of land, a television set, your body, a particular collection of words, an invention or anything else, belong to anyone? The answer is the same for all of them: because the State has deemed ownership to be established for each of these legal fictions.

Now, once you realize that there are no natural monopolies, only legal monopolies, and once you agree that any one legal monopoly is valid, then you no longer have an argument that any other monopoly is invalid.

So much for Saturday afternoon philosophy.

Crosbie,

Definitions 2 and 3 in the Webster's defn. are useless. To have exclusive use or control of something (such as my exclusive use of my computer) narrows the defn. of monopoly so much that it has no economic meaning or validity. In any event, that is not how economists use the term monopoly.

Webster was a pro-copyright cad, and lobbied all the states to adopt copyright. They all did except Delaware.

"Now, once you realize that there are no natural monopolies, only legal monopolies, and once you agree that any one legal monopoly is valid, then you no longer have an argument that any other monopoly is invalid."

Bull. (As usual.)

He may no longer have a specific argument, but he may well have others. There is overwhelming empirical evidence that legal protections of ownership of physical property not only foster prosperity, but seem to be a prerequisite for prosperity; and that legal protections of "ownership" of all sufficiently-similar things have the opposite effect.

He may no longer have a specific argument, but he may well have others. There is overwhelming empirical evidence that legal protections of ownership of physical property not only foster prosperity, but seem to be a prerequisite for prosperity; and that legal protections of "ownership" of all sufficiently-similar things have the opposite effect.

Where is your evidence that "legal protections of 'ownership' of all sufficiently-similar things have the opposite effect"? There are numerous studies, many cited by Boldrin and Levine, in fact, that show that some intellectual property can generate prosperity. I will not bore you with the details, but I recommend you read Boldrin and Levine's book.

"Where is your evidence that "legal protections of 'ownership' of all sufficiently-similar things have the opposite effect"?"

Everywhere. Read Against Intellectual Property and Against Intellectual Monopoly. Then reread them. Then read them all over again. Then do some googling, and read Question Copyright and other internet sites on the subject. Read and keep abreast of Techdirt. And so forth.

"some intellectual property can generate prosperity"

Temporarily, locally, and briefly, by creating a brain drain away from nearby nations.

In the long run, though, a sinking tide grounds all boats, even if your enemies', positioned over a submerged sandbar instead of a deep channel, happens to be the first to get stuck.

This same argument applies to all forms of protectionism designed to foster local industry at the expense of trade and neighbors' industry, by the way.

The evil long-term effects of protectionism are well known by historians and economists. The problem is that lots of blinkered individuals don't seem to realize that "IP" is really a disguised form of protectionism.

"read Boldrin and Levine's book"

Already have.


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