Free-market economist Professor William F. Shughart II attempts to defend the need for IP in "Ideas Need Protection," The Baltimore Sun (Dec. 21, 2009) (previously published in the Christian Science Monitor). Subtitled "Abolishing Intellectual-property, Patents Would Hurt Innovation: A Middle Ground Is Needed," the piece suffers from flaws found in others defenses of intellectual monopoly and pattern privilege. For example, Professor Shughart writes:

Article I, Section 8, of the Constitution explicitly delegates to Congress authority "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."

While it is true that copyright and patent are constitutional, this does not make these laws just. What the artificial law-writing coup-leaders wrote a document designed to help the state seize more power is simply not relevant to the normative question of whether there should be IP.

Pro-patent law arguments rest on the assumption that the patent system generates overall wealth--that its benefits are greater than its costs--without ever making this case. Instead, they point to ways that the patent system benefits some people, and never bother to even try to tally up the costs to make sure it's a net positive. In other words, they don't even take their own justifications seriously. Shughart makes the same mistake:

Developing and successfully commercializing new products and technologies typically requires large investments of time and treasure. Most research and development (R&D) investments end in failure.

Granting a temporary monopoly to the rare breakthrough is necessary, therefore, to provide its inventor with an opportunity to earn a return on the investment that led to the new idea--and to encourage additional such investments. Such protection is especially important in the pharmaceutical industry, where, in its absence, new drugs could be duplicated by competitors, and the incentive to invest would disappear, stifling the discovery process.

The word "therefor" is unwarranted; this is a non sequitur. Later on in the piece, he writes:

Incentives matter. Although there may be a passionate few who don't require payment for contributing to the common pool of knowledge, technological advancement will be much more rapid if an explicit economic payoff is available.

Much more rapid--? How much more? Who knows? The IP advocates don't. So how do they know it justifies the cost?

I found this to be an refreshing admission of the stifling effect mercantilist intellectual monopoly has on the spread of ideas:

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 ...

Unfortunately, he supports these laws anyway. Shughart also candidly and explicitly admits the monopoly character of of patent and copyright:

Granting a temporary monopoly to the rare breakthrough is necessary...

(Some IP advocates get very irked when patents are called monopolies. For example (as noted in Are Patents "Monopolies"?), patent attorney Dale Halling, in a piece entitled "The Myth that Patents are a Monopoly," writes, "People who suggest a patent is a monopoly are not being intellectually honest and perpetuating a myth to advance a political agenda." But it is common for IP advocates to acknowledge this. For example, Richard Epstein writes "Patented goods are subject to a lawful monopoly created by the state in order to induce their creation ... The legal monopoly granted by the patent is the only mechanism that allows the producer to recover those fixed costs...." And Objectivist IP attorney Murray Franck has argued that "if the creator's rights are not protected, his survival is jeopardized. If another can market his creation, the creator is deprived of the money he would otherwise earn." See also my comments here, noting that even the Supreme Court and other federal courts slip up and admit the monopoly character of IP on on a regular basis.)

Consider this argument our author makes:

It is true that other means exist for creative people to profit from their effort. In the case of copyright, authors can charge fees for reading their works to paying audiences. Charles Dickens did this, but his heavy schedule of public performances in the United States, where his works were not protected by copyright, arguably contributed to his untimely death.

Can Shughart really be arguing that we need copyright, for otherwise another potential Charles Dickens might drop dead early? (This reminded me of a bizarre argument made by patent attorney Gene Quin, noted in this post. In an online discussion, IP opponent David Koepsell had mentioned "that in the 19th and early 20th centuries, two of the most innovative countries on earth (The Netherlands and Switzerland) had no patent systems at all." In response, Quinn says: "Thank goodness the Swiss did have a Patent Office. That is where Albert Einstein worked and during his time as a patent examiner came up with his theory of relativity." So ... we need a state-granted monopoly system ... so that Albert Einstein could have had a job in Switzerland. What does one even say in response to such an "argument"?)

Professor Shughart continues:

The hard questions are: What kinds of ideas should be eligible for patent and copyright protection, and how long should that protection last?"

What's needed is a middle ground. Even if we can all agree that intellectual property is an important social commodity, one size doesn't fit all in the modern Digital Age.

While a 20-year monopoly may be appropriate for new drugs, it may not be appropriate for software, a new electronic game or, as Justice Sonia Sotomayor seemed to suggest during questioning in the Bilski case, a new "speed-dating service."

A 20-year patent monopoly on a method for speed-dating may not be appropriate?! How would Justice Sotomayor know, really?

As for there being "hard questions"--who can answer them? And if "we need a middle ground"--even though we have no evidence to know where the "optimum" is--how can we achieve this? Who can do it? Shughart's answer: Congress and the courts:

Rather than abolishing patent and copyright protection for some categories of intellectual property, Congress and the courts should consider varying the length for which exclusive monopoly privileges are granted, depending on the expected commercial vitality of the creative work. [emphasis added]

The state is neither benevolent nor competent (well, they are good at two things: destruction, and propaganda). There is no reason to believe Congress or the courts want, or are equipped, to find the "right" answers to such questions. (As J.H. Huebert observes about government courts: "In general, judges and those who appoint them have no reason to want to limit government. … Have not judges been responsible for some of the most outrageous expansions of government power? And, after all, are judges not a product of the same political system that gives us legislators and presidents? What president would appoint judges who would tell him he cannot do anything he wants? What Senators would confirm a judicial candidate who tells them that everything they have ever done in office is unconstitutional? The whole enterprise of libertarian constitutional theory ignores all we have learned from public choice economics about the incentives of government actors.") There is no reason to trust state employees to determine the optimum length of patent and copyright monopolies for various types of inventions and artistic works, much less by using "the expected commercial vitality of the creative work" as a test.

Appendix:

N.B: My original draft was done in very sarcastic style. At the urging of some friends, I ultimately decided to rewrite it in more standard, serious, respectful, straight style. But for those who like a bit of humor, here's the original sarcastic post:

Shughart's IP Parody

In "Ideas Need Protection," subtitled "Abolishing Intellectual-property, Patents Would Hurt Innovation: A Middle Ground Is Needed," free-market economist William F. Shughart II has penned a wickedly funny parody of typical arguments in favor of IP. Brilliantly, he somehow managed to slip it by the editors of The Baltimore Sun as well the Christian Science Monitor, where it was first published, without either publication realizing it was a parody.

Shughart mocks the arguments typically given in defense of intellectual monopoly and pattern privilege, such as appeals to authority and positive law, when he writes:

Article I, Section 8, of the Constitution explicitly delegates to Congress authority "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."

Ha ha! As if what the artificial law-writing coup-leaders wrote a document designed to help the state seize more power is relevant to the normative question of whether there should be IP. Good one, Professor.

He goes on, mercilessly lampooning the intellectual monopolists:

Developing and successfully commercializing new products and technologies typically requires large investments of time and treasure. Most research and development (R&D) investments end in failure.

Granting a temporary monopoly to the rare breakthrough is necessary, therefore, to provide its inventor with an opportunity to earn a return on the investment that led to the new idea--and to encourage additional such investments. Such protection is especially important in the pharmaceutical industry, where, in its absence, new drugs could be duplicated by competitors, and the incentive to invest would disappear, stifling the discovery process.

I like this. First, he demonstrates how pro-patent law arguments rest on the assumption that the patent system generates overall wealth--that its benefits are greater than its costs--without ever making this case. Instead, they point to ways that the patent system benefits some people, and never bother to even try to tally up the costs to make sure it's a net positive. In other words, they don't even take their own justifications seriously. The point is reinforced by the totally unwarranted word "therefore" inserted above, in a blatant example of non sequitur. Revisiting this theme later on in the piece, our author writes:

Incentives matter. Although there may be a passionate few who don't require payment for contributing to the common pool of knowledge, technological advancement will be much more rapid if an explicit economic payoff is available.

Much more rapid--? How much more? Who knows! The IP advocates don't! "What are they jabbering about? How do they know?", Shughart seems to be saying, if you read between the lines.

Professor Shughart has no doubt noted that although it gives IP advocates a case of the vapors if you call IP a "monopoly," too many hapless IP advocates just seem unable resist admitting this. Thus, he writes:

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 ... Granting a temporary monopoly to the rare breakthrough is necessary...

This is just a perfect impression of the typical blunder made by patent and copyright proponents when they inadvertently acknowledge the stifling effect mercantilist intellectual monopoly has on the spread of ideas. This is a very common faux pas of the monopolists, who forget to hide the fact that IP is, in fact, a monopoly. When IP'ers stray from the reservation like this, it really irks the organized pro-patent forces. For example (as noted in Are Patents "Monopolies"?), patent attorney Dale Halling, in a piece entitled "The Myth that Patents are a Monopoly," writes,

People who suggest a patent is a monopoly are not being intellectually honest and perpetuating a myth to advance a political agenda.

But, as Shughart demonstrates, all too often the pro-monopoly forces can't help themselves and inadvertently let the truth tumble out of their mouths. For example, we have pro-patent Richard Epstein (see Epstein and Patents), noting that

Patented goods are subject to a lawful monopoly created by the state in order to induce their creation ... The legal monopoly granted by the patent is the only mechanism that allows the producer to recover those fixed costs....

And here we have Objectivist IP attorney Murray Franck arguing that "if the creator's rights are not protected, his survival is jeopardized. If another can market his creation, the creator is deprived of the money he would otherwise earn."

And see my comments here, noting that even the Supreme Court and other federal courts slip up and admit the monopoly character of IP on on a regular basis:

"Section 154 and related provisions [e.g. Sec. 271] obviously are intended to grant a patentee a monopoly only over the United States market...."; "Congress made the policy choice that the "carrot" of an exclusive market for the patented goods would encourage patentees to commercialize the protected inventions so that the public would enjoy the benefits of the new technology during the patent term in exchange for granting a limited patent monopoly. In other words, the public expected benefits during 'the embarrassment of an exclusive patent as Jefferson put it.'"; "We hold that the disputed royalties provisions do not inappropriately extend the patent monopoly to unpatented parts of the patented system"; "A patentee, in demanding and receiving full compensation for the wrongful use of his invention in devices made and sold by a manufacturer adopts the sales as though made by himself, and therefore, necessarily licenses the use of the devices, and frees them from the monopoly of the patent."; "The Florida statute is aimed directly at the promotion of intellectual creation by substantially restricting the public's ability to exploit ideas that the patent system mandates shall be free for all to use. Like the interpretation of Illinois unfair competition law in Sears and Compco, the Florida statute represents a break with the tradition of peaceful coexistence between state market regulation and federal patent policy. The Florida law substantially restricts the public's ability to exploit an unpatented design in general circulation, raising the specter of state-created monopolies in a host of useful shapes and processes for which patent protection has been denied or is otherwise unobtainable. It thus enters a field of regulation which the patent laws have reserved to Congress. The patent statute's careful balance between public right and private monopoly to promote certain creative activity is a "scheme of federal regulation . . . so pervasive as to make reasonable the inference that Congress left no room for the States to supplement it."; "Whatever weight is attached to the value of encouraging disclosure and of inhibiting secrecy, we believe a more compelling consideration is that a process patent in the chemical field, which has not been developed and pointed to the degree of specific utility, creates a monopoly of knowledge which should be granted only if clearly commanded by the statute. Until the process claim has been reduced to production of a product shown to be useful, the metes and bounds of that monopoly are not capable of precise delineation. It may engross a vast, unknown, and perhaps unknowable area. Such a patent may confer power to block off whole areas of scientific development, without compensating benefit to the public. The basic quid pro quo contemplated by the Constitution and the Congress for granting a patent monopoly is the benefit derived by the public from an invention with substantial utility. Unless and until a process is refined and developed to this point -- where specific benefit exists in currently available form - there is insufficient justification for permitting an applicant to engross what may prove to be a broad field."; "I agree with the Court that the question before us is a narrow one. Neither the future of scientific research, nor even the ability of respondent Chakrabarty to reap some monopoly profits from his pioneering work, is at stake. Patents on the processes by which he has produced and employed the new living organism are not contested. The only question we need decide is whether Congress, exercising its authority under Art. I, 8, of the Constitution, intended that he be able to secure a monopoly on the living organism itself, no matter how produced or how used."

Anyway, Shughart must have noticed this habit of inadvertently admitting the true nature of the patent grant--a habit that makes fellow IP advocates grimace and exclaim, "Damn! He admitted it too!"--and imitated it here to perfection. "Those crazy patent guys," Shughart seems to be saying, with a sly smile and a twinkle in his eye, "can't get their story straight."

Here's another patentism Professor Shughart tackles. Sometimes IP advocates trot out the most ridiculous arguments when they have no other response available, such as this bizarre argument by patent attorney Gene Quinn (noted in this post). In an online discussion, IP opponent David Koepsell had mentioned "that in the 19th and early 20th centuries, two of the most innovative countries on earth (The Netherlands and Switzerland) had no patent systems at all." In response, Quinn says:

Thank goodness the Swiss did have a Patent Office. That is where Albert Einstein worked and during his time as a patent examiner came up with his theory of relativity.

You got that? We need a state-granted monopoly system ... so that Albert Einstein could have had a job in Switzerland. I mean, what does one even say in response to this, which is not even a pretense at serious argument? Our observant author must have noticed this and other such arguments, which he is clearly mocking here:

It is true that other means exist for creative people to profit from their effort. In the case of copyright, authors can charge fees for reading their works to paying audiences. Charles Dickens did this, but his heavy schedule of public performances in the United States, where his works were not protected by copyright, arguably contributed to his untimely death.

See? We better have copyright--you don't want another potential Charles Dickens to drop dead early, do you?

Professor Shughart continues:

The hard questions are: What kinds of ideas should be eligible for patent and copyright protection, and how long should that protection last?"

What's needed is a middle ground. Even if we can all agree that intellectual property is an important social commodity, one size doesn't fit all in the modern Digital Age.

While a 20-year monopoly may be appropriate for new drugs, it may not be appropriate for software, a new electronic game or, as Justice Sonia Sotomayor seemed to suggest during questioning in the Bilski case, a new "speed-dating service."

The IP advocate is here portrayed as unable to even definitively object to a 20-year patent monopoly on a method for speed-dating--"it may not be appropriate"! And the part about "these are hard questions" ... who can answer them, oh who?-- and "we need a middle ground"--even though we have no evidence to know where the "optimum" is. But wait for it--Congress might know! --

Rather than abolishing patent and copyright protection for some categories of intellectual property, Congress and the courts should consider varying the length for which exclusive monopoly privileges are granted, depending on the expected commercial vitality of the creative work. [emphasis added]

Shughart is so right here: the proponents of intellectual monopoly, like all interventionists, do indeed have an utterly misplaced, naive faith in the state's benevolence and competence. Why, let's have Congress should figure this out! Oh, I'm in stitches. And the courts--yeahhhhh, they'll do a great job--the same courts witheringly described here by J.H. Huebert:

In general, judges and those who appoint them have no reason to want to limit government. … Have not judges been responsible for some of the most outrageous expansions of government power? And, after all, are judges not a product of the same political system that gives us legislators and presidents? What president would appoint judges who would tell him he cannot do anything he wants? What Senators would confirm a judicial candidate who tells them that everything they have ever done in office is unconstitutional? The whole enterprise of libertarian constitutional theory ignores all we have learned from public choice economics about the incentives of government actors.

I will close by noting my favorite line of this sparklingly humorous essay: to determine the right length of patent and copyright monopolies for various types of inventions and artistic works, Congress should be not only trusted to want to do this, but should use "the expected commercial vitality of the creative work" as the test! Oh, man. I'm crying.

[Mises; SK]

My article "Intellectual Property and Libertarianism" was published in the December, 2009 issue of Liberty; the March 2010 issue features the following exchange in the "Letters" section.

Philosophizing IP

Thanks to Stephan Kinsella for questioning the justice of intellectual property ("Intellectual Property and Libertarianism," December 2009). Like many libertarians, he posits property rights as the foundation of libertarian political theory, and suggests that because it is a derivative concept, we stop calling the nonaggression principle an "axiom." So far so good. But Anthony de Jasay suggests that the concept of "property" itself should in turn be considered derivative, from the still more fundamental principle of liberty of contract. De Jasay also defines "rights" and "liberties" more carefully and usefully than most libertarians, who use these loaded words all too loosely Kinsella included. (See de Jasay's "Choice, Contract, Consent," or "Before Resorting to Politics," reprinted in "Against Politics.")

Kinsella's attempt to show that no well-formulated property rights can apply to pure information seems dubious. Yes, information can escape physical confines and reproduce in ways that physical objects can't, but so what? Perhaps the real question is not whether IP should be classified ontologically with other forms of "property," but whether voluntary agreements can be reached (without the help of legislatures) that would make revelation, or publication, or mishandling of information a tort. Clearly some can; what of contracts to protect trade secrets, and other nondisclosure agreements?

Never mind that the concept of "self-ownership" has philosophical problems that Kinsella does need to take more seriously. I've been suspicious of "property rights reductionism" ever since I noticed that it led Rothbard to believe in his own IP rights as an author of copyrighted writings, even as he disparaged the IP rights of professional inventors. At least Kinsella avoids this inconsistency (if that's what it is).

Kinsella is right to seek the philosophical foundations of the IP question; let's hope he keeps digging.

Lew Randall Freeland, WA

What Would Edison Do?

It was a pleasure reading Stephan Kinsella's piece "Intellectual Property and Libertarianism." I'm in agreement with its content as regards the nature and source of property rights. What I find impossible to accept is the view that there is no good utilitarian argument in support of legislated patent and copyright law. Would Thomas Edison and his financial backers have invested so much time, effort, and money just for the pleasure of exercising intellectual creativity? I certainly wouldn't, and I suspect I'm not alone. Having said this, in a free society, would it be a legitimate government function to establish rights where none "naturally" exist, even if the consequence of such legislation would foster an improvement in the quality of human existence? By establishing such rights, or should I say "privileges," wouldn't the freedom of action of others be curtailed? Formulated this way I opt for principle over utility, as the slippery slope comes to mind.

Howard Shafran Shelter Island, NY

The Property of the Mind

Before finally getting around to the topic of his article on intellectual property, Stephan Kinsella trumpets the proposition that each person "owns" his own body; he "inhabits" it; he is its "occupant" and Kinsella uses those very words. He dismisses as "silly wordplay" the objection that each person just is himself or his body. But who is perpetrating wordplay? Who is tainting sound political philosophy with dubious metaphysics?

Kinsella echoes the old mind-body dichotomy, the notion of the self as "the ghost in the machine" (Gilbert Ryle's derogatory description of Descartes' dualism). On the contrary, each person's mind and consciousness are functions, remarkable functions, of his body and specifically his brain. Does Kinsella really mean that the self is distinct from the body? Does the one survive dissolution of the other? (Does the self exist even before its body is born?) Does Kinsella believe in ghosts or angels? What evidence, beyond very dubious evidence, can he cite? If Kinsella does not really mean what he says, he should use more exact words.

The self-ownership slogan finds some resonance in libertarian circles. But libertarians should go beyond displaying their authenticity to each other; they should try to persuade nonlibertarians. They should avoid irrelevant metaphysics. They should put their best foot forward, not their worst. I do not mean that they should dilute their libertarianism; rather, they should present it attractively.

Perhaps Kinsella could find some (feeble) excuse for his metaphysics, but he would still be putting a worst foot forward.

Leland Yeager Auburn, AL

Copy Shop

Stephan Kinsella's argument against IP is seriously flawed. For instance, he states that copyright is "received automatically, whether you want it or not, and is hard to get rid of." Copyright, that is, the right to make copies of your work, is inherent in the creation of the work. It is not "received" by law. You can waive your copyright easily by simply making copies and distributing them without the required copyright notice. Copyright law recognizes, defines, and controls to some extent your rights to control the copying and dissemination of your work.

He also states that "We libertarians already realize that . . . the right to a reputation protected by defamation law" is illegitimate. This libertarian does not realize such illegitimacy. The libertarian principle is that no person has the right to initiate aggression against another. Spreading lies or untruths to destroy the reputation of another person is clearly within the definition of aggression.

Kinsella makes a number of references to "homesteaders," mainly, I believe, to emphasize the difference between property that you can hold in your hand, i.e., the soil from your farmland, and the more ephemeral IP which is snatched out of thin air and dissipates in the wind, i.e., the sound of a melody. However, this comparison overlooks the intellectual content of real estate (property) improvement. A farmer who homesteads a parcel of land must decide what crop will be successful on that land. A pineapple ranch in North Dakota will not succeed. Once the crop is chosen, the farmer must implement a plan for the planting and harvesting of the crop. In the case of, say, music, running a melody over in your head or tinkering on a piano is just the beginning of the creative process. It must be transcribed and carefully inspected to make sure that each note is properly chosen and placed. Then you can make your copies, register the copyright and begin selling copies of your work. With a little luck, someone may make a successful recording.

Patents are similar. You come up with the idea, develop it into a saleable product, manufacture copies and sell them. When a buyer buys a copy of your work, either invention or literary work, what does he buy? Under the law, he buys that one copy of your invention. Defining what is embodied in that one copy can get messy because the human mind is messy, but the buyer does not buy anything other than that one copy. He cannot make copies and distribute them.

So what can you do with your copy of the work or invention? You can write a critique of the song or story, quoting reasonably from the work itself to illustrate your points of argument. You can read the story or sing the song to your friends for their enjoyment. You can take your copy of an invention and modify it to suit your needs. You can strip it of unnecessary decoration that does not make it work better. You can take it apart to see how it works, or to repair it or to improve the design so much that you feel justified in applying for a patent on your improvement. You can sell it to someone else. You cannot, however, begin manufacturing the item and selling it. That is true whether the item is a widget, a book, a sheet of music, or a recording.

David Kirkpatrick Klamath Falls, OR

Body of Work

Although Stephan Kinsella's article on intellectual property moves smoothly enough from premises to conclusions, those conclusions are (to me at least) so counterintuitive that the argument acts as a reductio ad absurdum, undercutting his premises rather than proving his conclusions.

Let us say that a given work exists only in the memory of the author's computer. At this time the work could not be more obviously the author's; in a keystroke he can change it in any way, or abolish it forever. Overnight a hacker invades the machine, copies the work, and reproduces it. This is theft, is it not? If so, then the author retains ownership of the work even after it has left his hard drive. Why, then, would his ownership suddenly be reduced to naught at the instant that he sends it off to a prospective publisher? Reportedly, a British firm offered to publish "Lolita" if Nabokov would consent to the removal of four sentences. Nabokov refused, and the book was not released in Britain until a year later, by a different publisher. Surely this was right.

Kinsella takes it as axiomatic that one's property rights begins with one's own body. I think that many authors would consider their ownership of their works as more intimate, and more obvious, than their ownership of their bodies.

Jamie McEwan Lakeville, CT

Kinsella responds: Mr. Randall asks whether trade secret and nondisclosure agreements could be used to construct a form of IP. I do not believe they can, because such agreements cannot bind third parties. Only by assuming that knowledge is a form of property can you bind third parties, but this assumes there is IP. I address this in further detail in the "Contract vs. Reserved Rights" section of "Against Intellectual Property," available at StephanKinsella.com. As for philosophical problems with the notion of "self-ownership" self-ownership just means that you have the right to decide who touches or uses your body, not some other person. What could be more libertarian, or less controversial or problematic?

Mr. Shafran is no doubt right that Edison or other patentees may have benefitted from the patent monopolies granted to them by the state. But the utilitarian case requires a benefit to the economy as a whole, not merely to particular beneficiaries of wealth redistribution. Studies almost universally conclude that there is no such gain that patents actually restrict innovation. See the post at tinyurl.com/pat-innov for more information on these studies.

Professor Yeager misunderstands my comments. I am, like him, nonreligious. Viewing the mind as distinct from (though not unrelated to or independent of) the brain, and the self as distinct from the body, does not imply a soul or ghosts or angels. It does not imply that there can be a self without the body, or a mind without the brain. It merely implies a distinction. One may think of the mind as an epiphenomenon of the brain, but it is not the brain itself. Likewise I can run and remember with my body but running and remembering are not the same as my body. The "silly wordplay" I referred to is the use of the trite observation that we "are" our bodies (in some real sense) to object to the idea of self-ownership. But atheism is not contrary to self-ownership. Self-ownership is the libertarian idea that you have the say-so over who uses your body that others need your permission. Self-ownership is the rejection of slavery and aggression. It is perfectly compatible with the idea that there is no soul; that you die when your body dies. In any event, Yeager's atheism does not prove there are intellectual property rights, or that we are not self-owners.

Mr. Kirkpatrick upbraids me for stating that copyright is received automatically. He asserts that copyright may be waived "by simply making copies and distributing them without the required copyright notice." Wrong. Copyright notice is not required at all, nor is copyright registration. See Sections 102 and 401 of the Copyright Act, or the "Copyright Basics" brochure at copyright.gov. Copyright notice has not been needed since 1989, when the law was amended per the Berne Convention.

As for reputation rights, Murray Rothbard explained in "The Ethics of Liberty" why there can be no reputation rights: your reputation is merely what third parties believe about you. You do not own their brains or what they think about you; they are entitled to change their minds about you. Kirkpatrick writes, "If I grow a potato in my back yard, it is my potato. If I write a song in my kitchen, it is my song. They are both my property." By such reasoning one could argue that you own your wife, your parents, and your country (note the possessive pronoun!); if you discover that the earth is round then "it is my discovery" and you could own that fact. The mistake here is in failing to realize that not every "thing" that one can conceptually identify is an ownable type of thing. Scarce resources are capable of being owned because of the possibility of conflict over use of such things. Other things, such as "songs," information, and patterns are not ownable things at all. In acting, humans select scarce means to achieve desired ends. Their choice of ends, and means, is guided by information. To successfully act, the scarce resources employed as means need to be owned, because by their nature as scarce resources only one person may use them; but the actor need not "own" the information that guides his choice of means, since he can use this information even if thousands of other people also use this information to guide their own actions.

Mr. McEwan is correct that the hacker is a thief, since he is using the author's property (his computer) without his permission. But this does not mean that the information he gains access to is property. If the author revealed some private fact say, that he had a glass eye and the hacker discovered this and revealed it to the world, the author would have no right to demand that everyone forget this fact or not act on it. Likewise if the information was a novel, musical composition, recipe for a nice soup, or schematic for an improved mousetrap.

[Mises; SK] [Mises; AM]

One of the big problems with monopoly is the corruption involved. John's post about campaign contributions by corporations - I'm not sure that banning them is really effective though - reminds us that one of the problems is that the monopolization of government power through bribery helps sustains those monopolies. It's also true that monopolies have strong economic incentive for "marketing" including bribing those who are responsible for the welfare of others. Case in point - the pharmaceutical companies bribery of doctors to get them to prescribe their patented products. Why don't book publishers bribe professors to assign their books to their students? It seems they do.

Yes, we post bad reviews too...just there aren't any...As with any good review, there is value added beyond the book itself.

George Leef's review of Against Intellectual Monopoly

Find out how here.

From Mises Blog:

Intellectual property is the principle that the creator of an idea has a right to certain controls over all the physical forms in which his idea is recorded. The extent of this control may be different depending on whether the idea is considered copyrighted, patented, or trademarked, but the essential principle is the same in all cases. This presumed right of the creator of an idea is often believed to be similar to the right that a homesteader has to land he has settled, but the analogy is false. Intellectual property is necessarily a statist doctrine. FULL ARTICLE By Daniel Krawisz

See here, and here, he says:

I'll tell you something interesting about Priceline. Because Priceline was invented in a room, it was an invention. One of the things we did is applied and got U.S. patents on the invention. How do you like that? Then, along comes this little company and you might have heard of it. It's called Microsoft. Microsoft owned this other company called Expedia, at the time. They said, This Priceline thing looks like it is going pretty well. We ought to do that too. We'll just download some of the code right from the website, right from the HTML. Just take that HTML. So, somebody came into the office and said, Well, Jay, just like you said, Microsoft's in our business. I said, Oh, that's not good. But the fact is, in the United States, the intellectual property laws are reasonably strong and although most people didn't understand what Priceline had patented, they thought we had patented some auction, stupid people, we have nothing to do with auctions at all. Some New York Times reporter called it a reverse auction and nobody every got over it. I never forgave the reporter for it. We were branded as an auction, but we weren't. We were a demand collection system and because of that we sued Microsoft and Microsoft decided maybe it wasn't the best idea to copy us. They turned off that functionality on Expedia. Since then, nobody has copied Priceline. It has been ten years. For as long as our present patents last, I don't expect anybody to copy Priceline. Since Microsoft isn't going to copy, that is probably a good sign that others probably shouldn't either, but it proves a very important point. It proves the power of intellectual property, at some level, to provide space for a startup that is truly novel, that is warranting a patent, or we had several patents in this case, to give it the breathing room to invent something new, create value. Eventually, Priceline will have to compete on its invention when the patents expire. However, there are plenty of people competing with Priceline. They're just not copying it. Somebody is offering LastMinuteFares.com and somebody else is offering JoinMyClub.com. In other words, there is a million people competing with Priceline. They just can't copy Priceline's essential idea which is name your own price, put up a credit card for a flexible set of terms and conditions where, if those terms and conditions are accepted, you basically own the product. That's the core Priceline patent. So, there's how Priceline, again, anticipated copying. Let's just say there was no intellectual property. What would that mean? That would mean Priceline would have to go quickly, right? They would have to keep innovating.

Yeah--we're from the government, and we're here to help you--to "give you space," to "give you breathing room"--while we tax and regulate the living crap out of you!

[StephanKinsella.com cross-post]

On occasion you get some defender of patents who is upset when we use the m-word to describe these artificial state-granted monopoly rights. For example here one Dale Halling, a patent attorney (surprise!) posts about "The Myth that Patents are a Monopoly" and writes, " People who suggest a patent is a monopoly are not being intellectually honest and perpetuating a myth to advance a political agenda."

Well, let's see. First, see my post Epstein and Patents, noting that the pro-patent Epstein writes:

Patented goods are subject to a lawful monopoly created by the state in order to induce their creation. No one thinks that new pharmaceutical drugs will be invented by private firms that cannot receive a rate of return sufficient to recover [various costs]. … The legal monopoly granted by the patent is the only mechanism that allows the producer to recover those fixed costs….

Is the pro-patent Epstein being dishonest?

And see my comments (1, 2) on The Three Stages of Invention post, excerpted below:

First, as to whether patents are monopoly grants--hell, even the feds admit this: "Section 154 and related provisions [e.g. Sec. 271] obviously are intended to grant a patentee a monopoly only over the United States market...." U.S. Supreme Court, Deepsouth Packing Co. v. Laitram Corp., 406 U.S. 518 (1972). See also: King Instr. v. Perego, by the Court of Appeals for the Federal Circuit ("Congress made the policy choice that the "carrot" of an exclusive market for the patented goods would encourage patentees to commercialize the protected inventions so that the public would enjoy the benefits of the new technology during the patent term in exchange for granting a limited patent monopoly. In other words, the public expected benefits during "'the embarrassment of an exclusive patent as Jefferson put it.'" Graham v. John Deere Co., 383 U.S. 1, 10-11 (1966).)

See also Engel Ind. v. Lockformer Co. ("We hold that the disputed royalties provisions do not inappropriately extend the patent monopoly to unpatented parts of the patented system"); Carborundum Co. v. Molten Metal Eq. Co. ("A patentee, in demanding and receiving full compensation for the wrongful use of his invention in devices made and sold by a manufacturer adopts the sales as though made by himself, and therefore, necessarily licenses the use of the devices, and frees them from the monopoly of the patent.")

And: Rice v. Santa Fe Elevator Corp., 331 U.S. 218, 230 (1947):

The Florida statute is aimed directly at the promotion of intellectual creation by substantially restricting the public's ability to exploit ideas that the patent system mandates shall be free for all to use. Like the interpretation of Illinois unfair competition law in Sears and Compco, the Florida statute represents a break with the tradition of peaceful coexistence between state market regulation and federal patent policy. The Florida law substantially restricts the public's ability to exploit an unpatented design in general circulation, raising the specter of state-created monopolies in a host of useful shapes and processes for which patent protection has been denied or is otherwise unobtainable. It thus enters a field of regulation which the patent laws have reserved to Congress. The patent statute's careful balance between public right and private monopoly to promote certain creative activity is a "scheme of federal regulation . . . so pervasive as to make reasonable the inference that Congress left no room for the States to supplement it."

Brenner v. Manson, 383 U.S. 519 (1966):

Whatever weight is attached to the value of encouraging disclosure and of inhibiting secrecy, we believe a more compelling consideration is that a process patent in the chemical field, which has not been developed and pointed to the degree of specific utility, creates a monopoly of knowledge which should be granted only if clearly commanded by the statute. Until the process claim has been reduced to production of a product shown to be useful, the metes and bounds of that monopoly are not capable of precise delineation. It may engross a vast, unknown, and perhaps unknowable area. Such a patent may confer power to block off whole areas of scientific development, without compensating benefit to the public. The basic quid pro quo contemplated by the Constitution and the Congress for granting a patent monopoly is the benefit derived by the public from an invention with substantial utility. Unless and until a process is refined and developed to this point -- where specific benefit exists in currently available form - there is insufficient justification for permitting an applicant to engross what may prove to be a broad field.

Diamond v. Chakrabarty, S.Ct. (1980), Brennan's dissent:

I agree with the Court that the question before us is a narrow one. Neither the future of scientific research, nor even the ability of respondent Chakrabarty to reap some monopoly profits from his pioneering work, is at stake. Patents on the processes by which he has produced and employed the new living organism are not contested. The only question we need decide is whether Congress, exercising its authority under Art. I, 8, of the Constitution, intended that he be able to secure a monopoly on the living organism itself, no matter how produced or how used.

Now you can argue that patent holders do not necessarily have "monopoly power" (see The Importance of Patents for Economic Development - 1999, by Prof. William Hennessey), but as Rothbard et al. have pointed out, the government's concept of monopoly is flawed; the only issue that matters is whether there is a legal monopoly granted. See, e.g., Hoppe, A Theory of Socialism and Capitalism, ch. 9, pp. 185-86:

The monopoly problem as a special problem of markets requiring state action to be resolved does not exist. In fact, only when the state enters the scene does a real, nonillusory problem of monopoly and monopoly prices emerge. The state is the only enterprise whose prices and business practices can be conceptually distinguished from all other prices and practices, and whose prices and practices can be called "too high" or "exploitative" in a completely objective, nonarbitrary way. These are prices and practices which consumers are not voluntarily willing to pay and accept, but which instead are forced upon them through threats of violence.

See also Rothbard, Man, Economy, and State (with Power and Market): "The only viable definition of monopoly is a grant of privilege from the government."

Now it is, indeed, clear that a patent is a monopoly grant to someone that permits them to charge above-market prices; this is exactly the goal of the patent law: to provide this monopoly profit to inventors so as to incentivize them to innovate and file for patents. And it is why, for example, Blackberry paid over $600 million to NTP in a recent patent suit; and it is why consumers will have to pay more for Blackberry services than they otherwise would, etc. Did NTP have "monopoly power" as defined by the government's antitrust scheme? I don't know. Probably not. But did they extort RIM/Blackberry by use of the government-granted patent monopoly? Of course.

See also Arnold Plant, The Economic Theory Concerning Patents for Inventions, sections 16, 19, 20, 24:

The patent system may, on the one hand, be expected to affect the making of inventions in two ways. The first is to divert inventive activity into those fields in which the monopoly grant will be expected to prove most remunerative. It may, secondly, affect the total amount of inventive activity.

... the utilitarians assumed that the patent system was responsible for the greater part of inventing activity. The question which they one and all failed to ask themselves, however, is what these people would otherwise be doing if the patent system were not diverting their attention by the offer of monopolistic profits to the task of inventing. By what system of economic calculus were they enabled to conclude so definitely that the gain of any inventions that they might make would not be offset by the loss of other output? By no stretch of the imagination can the inventing class be assumed to be otherwise unemployable. Other product which is foregone when scarce factors are diverted in this way completely escaped their attention.

... at the beginning of this century Professor J. B. Clark was still writing: "If the patented article is something which society without a patent system would not have secured at all - the inventor's monopoly hurts nobody… His gains consist in something which no one loses, even while he enjoys them."? No inkling here that the patent inducement to invent diverts scarce human effort from other production, and that the subsequent exploitation of patents again interferes with the disposition of scarce factors which would obtain under competitive conditions.

... It seems unquestionable not only that a very considerable volume of inventive activity must definitely be induced by price conditions, but also that that activity is diverted by price movements from other types of endeavour as well as from other fields of invention. Entrepreneurs faced with new difficulties or with new opportunities will divert not only their own attention, but that of every technician who can be spared, from the business of routine production to that of urgent innovation. They will not rely exclusively upon those types of professional inventors whose autonomous output pours out in a stream of unvarying size, and some of whom may be prepared, in return for the inducements which the entrepreneurs can offer, to transfer their spontaneous activity to their service. It cannot be assumed that all who are capable of innovation spend their whole lives in inventing. Many of them are also able administrators and production controllers; some in the past have been clergymen and barbers, and in our own time there is a steady flow of technicians from the research laboratories of pure science into those of industrial invention and out again. ... The patent system ... enables those who "have the monopoly of the right to use a patented invention to raise the price of using it ... and in that way to derive a larger profit from the invention than they could otherwise obtain. The effect must surely be to induce a considerable volume of activity to be diverted from other spheres to the attempt to make inventions of a patentable type. [emphasis added]

See also Rothbard, Man, Economy, and State, ch. 10, sec. 7:

It is by no means self-evident that patents encourage an increased absolute quantity of research expenditures. But certainly patents distort the type of research expenditure being conducted. . . . Research expenditures are therefore overstimulated in the early stages before anyone has a patent, and they are unduly restricted in the period after the patent is received. In addition, some inventions are considered patentable, while others are not. The patent system then has the further effect of artificially stimulating research expenditures in the patentable areas, while artificially restricting research in the nonpatentable areas.