Sunday, May 15, 2011

On IPR Abolition 5: Various Comments to Ownership of Ideas

After posting Part 4 of this discussion series on IP in my facebook wall, it attracted a number of comments. For brevity purposes, I will enumerate the comments and questions from 6 friends – Froilan, Say, Siegfried, Marvin, Dominic and Donaldson. Here they are:

1. Here's a libertarian's comment on this group: "Lets put it this way... I bought a book from a great author and I love to share it with my friends and relatives for free, re-print it using my paper, ink, printing machine, my valuable time and produces 100 the same copy with the full name of the author and title. And the author is nowhere to be found or maybe he's already dead. Still I have no right?" SO EVIL!

In a society that respects property rights, which include IP rights, no one may infringe upon anyone's right (copyright, patent right, etc.) however noble the intention. But in an anarchic society, reprinting copies of an author's book even without the latter's consent either for good intention or for profit is deemed perfectly "moral" [and legal].

2. What does one actually own under an intellectual property rights regime? I believe ownership of property can only be physical ownership. Under a property rights regime, I own physical stuff like chairs and houses. Under an intellectual property rights regime, what do I physically own?

3. As to IPRs, I do feel they are materially different, and intrinsically weaker, than property rights in land and goods, simply because land and goods can only be used by one person at a time, while intellectual goods can be used by multitudes simultaneously. IPRs sole justification is thus a claim on the fruits of one's labour, which is important but has to be balanced by the need to avoid socially harmful extended monopolies that pre-empt potentially beneficial markets. There is considerable scope for misuse when IPRs are claimed without an intention to use the invention, just to pre-empt competitors, or when farmers are not allowed to produce their own seedgrain from patented seeds, to cite two notorious examples. And the extension of Disney's IPR to Mickey Mouse by the US Congress shows how open this all is to political manipulation.

4. I agree with your blog's general direction from an evolutionary economics (neo-Schumpeterian) point of view.

In the present world, much 'intellectual property' is the result of conscious effort and work not just of individuals but also of institutions like R&D laboratories or research universities - new knowledge comes more and more from the work of teams. Some form of IP protection provides incentives for such innovation work to happen. Societies that provide the fairest protection, like the U.S., Switzerland, EU, become the most innovative and therefore best able to deliver rising living standards to its citizens. Two examples:

a) For drugs and medicine, the safety and efficacy standards of the U.S. Food and Drug Administration (FDA) to protect the populace from quacks and snake oil salesmen require a fixed stress test period of seven years that is quite expensive and a big barrier (and still gives incomplete protection for cases like mutative risks from toxic compounds - mercury- or lead-based - that accumulate in the parent but affect the offspring, i.e. thalidomide or nicotine/saccharine that are consumed in minute quantities and take up to thirty years to become high risk of local cancer to the consumer).

If one agrees that the FDA provides value to society, in concept, then drug developers ought to be given enough time to obtain returns on their directed effort to develop drugs.

Even this reasonable period may still not be enough without government spending on the science research (not just application development) that requires finding new and basic knowledge that are not appropriable to discoverers, not in the best interest of society to provide temporary monopoly cover, or too expensive for even large corporations or countries to invest. Four examples - (a) Manhattan project for national defense in the development of the atomic bomb, (b) DARPA project for alternative distributed command-and-control channel in case of nuclear that was eventually released to the public domain in 1995 when risk from war with the Soviet Union to become the Internet/WWW, (c) CERN collider in Europe to discover the behavior of atomic particles for leading-edge Physics, and (d) mapping the human genome for future development on next level gene-based drugs.

b) Thus far, patents that provide temporary monopoly protection for about seventeen years (that in the case of drugs 7-10 years are already used in the approval process) and seem to be the fairest and at the same time most advantageous to society in providing incentives for innovation.

Obviously, there is some administration needed to do this in behalf of the total population and thus taxes to pay for such administration. As mentioned above, the U.S. patent system, on the whole, provided fair protection and created the richest and most innovative society.

With the recent crises, some budget proposals are made to gut the U.S. Patent Office under the general ideological rubric, without looking at the details, of creating small government.

Let us watch the reduction of U.S. dominance in having 19 out of 20 top universities in the world and the migration of research laboratories overseas now happening (as pull in) because of the search for talent but maybe accelerating in the future because of lack of IP protection from patents (as push out).

5. So I'm going to warn a friend who is passionately creating and innovating a device that will surely help his father because of disability. He might get sued…. As Mr. Michaels concluded that "The recognition of IPR is consistent with the pursuit of democracy, property rights and economic development... Now is the time to strengthen IP laws to drive technological development in the digital age and to provide certainty for investment in the future."

Are we asking here for more Government intervention? I think the drive for technological development and advancement will come from the market, the competition, not from more regulations.

6. The intellectual property regime is full of grey areas.

Here are my response and rejoinder to the above six comments and questions.

On #1, I think that even if the author is alive, is around nearby, he won't mind that his book is being copied and distributed for free to more people. What he would object would be if his book is copied and sold for a good price or profit by some guys.

On #2, In the IP regime, one owns ideas, an invention, a composition, a molecule or compound of molecules. Ideas are ownable. For instance, one  million rock songs from 100,000 rock bands and singers worldwide, one million copyrights (on each of those songs), what's wrong with this? Invention of drug molecule to control if not kill breast cancer, such molecule is a product of hard work, huge investments, long R&D work, involving several dozen scientists. In a No-IP regime, anybody can also claim, "I also invented that useful drug molecule" even if they spent not a single $ for its discovery.

On #3, Patented seeds number in millions. Rice seeds in the IRRI seed bank alone, should be several tens or hundreds of thousands, each may be patented. The reason for the expansion of so many different seeds is biotechnology and agri- or bio-engineering. The seed patent system has encouraged thousands of seed scientists to invent new breeds, new varieties, with very specific properties. Say a rice with vitamin C, a rice harvestable in just 2 1/2 months, a drought-resistant rice that can survive with just few days of rain up to harvest. On Mickey's patent, thanks for it, other cartoon producers simply say, “So we cannot use Mickey for our tv program? We will just invent our own cartoon characters.” That is why Winnie the Pooh, Tigger and Pooh, Dora, Dibo, Pocoyo, Pororo, Angelina Ballerina, Chuggington, Little Einsteins, Barbie, and several dozen other cartoon characters were invented. All competing with each other, and little kids today know more cartoon characters than 2 or 3 decades ago. The IP mini-monopoly system created more and more products and services, more innovators, all competing with each other.

On #4, Amen to your points, Marvin.

On #5, Don't warn your friend, encourage him to pursue it. Each invention, especially health related, requires some form of "clinical trials". If he succeeds in his invention to help his father, he can show it as proof, he can go to IPO and register his invention for IP recognition, only if he wants it. Or he can share it with the rest of humanity, no problem on both actions. Re Michael Williams' concluding note, No, no need for "additional" government intervention. The interventions and regulations are already there. What he is referring to, is for governments not to bend to the anti-IP academics and socialists to relax if not abolish the IP system.

On #6, Yes, IP has lots of grey areas. But if we focus on "more private ownership, more capitalism; more social ownership, more socialism", I think we can reduce the grey areas and limit the debate to a few issues.

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