Wednesday, September 14, 2005

Econo-nsense

Lest I ever be accused of being a vulgar libertarian anarcho-capitalist, I hereby submit before my fancied readership evidence that I oppose coercion and/or violence for the purpose of securing monopolies on so-called intellectual property, emphasis of course on the property aspect.

All disclaimers aside, a recent dispatch found on BroadbandReports.com reads:
Stephen Pinkos, U.S. Deputy Under Secretary of Commerce for Intellectual Property, took time this week to visit an elementary school to inform kids that "downloading others’ property without their permission is a crime and that such theft has real consequences on our economy."
If it weren't for the cornucopia of "Broken Window Fallacy" posts which flooded the economic literate memepool pre- and post-Katrina, I probably would have skipped right over that last bit and not given it second thought. But alas, such was not the case.

As usual, I would like to make the case that conventional wisdom has things backwards. As Kevin Carson explains here:
Property in tangibles and land is rooted in the fact of physical reality that two objects cannot occupy the same space at the same time. My wallet cannot be in my pocket and yours at the same time...

"Intellectual property" [sic], on the other hand, is a state-granted monopoly on something that is not finite by nature, and can be used by an unlimited number of people at the same time. And unlike tangible property, I cannot defend intellectual "property" rights by the mere fact of possession. In fact, I have to call on the state to invade someone else's space and coercively prevent him from arranging his own tangible property in a configuration, or using it to organize information in a configuration, over which the state has granted me a monopoly.
This first point being that I.P. is the unethical bastard child of corporate statism and has no justification or basis in natural law. So the contention that one who engages in I.P. infringement is stealing or performing an act of theft is most blatantly untrue, and the only party which can be said to violating rights are those who are proactively and coercively stemming the activities of the so-called infringers.

The second and main point here is the economic one; or at least one hopes so. For the sake of straw men and ham sandwiches, I'm going to have to assume that what Mr. Pinkos meant to say was that the economic consequences of I.P. infringement are "negative" and hence undesirable. I'm also going to assume that he is referring in particular to the financial decline of the entertainment industry which derives its revenue from the sales and rentals of films, music, books; brand and character licensing; TV syndication; box offices returns; -- in short, a monolithic mountain of monopoly-protected I.P.

As is often the case of late, Frédéric Bastiat's 155 years-old essay on "That Which is Seen and That Which is Not Seen" goes unheeded. What we may readily observe is the decline of entertainment industry revenue, which is relatively a highly visible, and might I add, a colossal figure. However, what goes unobserved is the same wealth being put to the more productive use of satisfying consumer desires with tangible goods in other industries.

This should make it apparent that claims of negative economic consequences are folly. Perhaps yet another time when I'm better informed on the free-rider issue can I address the possible consequences upon creativity, although on no certain terms would I ever advocate coercion to maintain the well of creativity.

2 comments:

jimstoic said...

If everyone who wanted, say, Windows XP, found a way to download and install it without paying, who would pay the cost of development?

Kevin said...

If nobody paid to develop Windows XP, perhaps there wouldn't be a Windows XP. And the world might be a better place. But there would be things like Linux, and virtually everything under the hood of the Mac OS X operating system, all of which developed because it was free. There are plenty of other ways to profit, as companies like Sun and IBM are figuring out.

Great article. I've always been on the fence with this issue, particularly in regard to compensation for artists (and that includes programmers.) I feel bad when I download an album or a piece of software I haven't paid for, even though I'm not physically stealing anything from anyone. I know I'm not the first person to suggest it, but perhaps the answer to the entertainment industry's problem lies in the open source movement?