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March 15, 2010 - Freedomain Radio - Stefan Molyneux
01:07:33
1616 Stephan Kinsella on Intellectual Property from Freedomain Radio
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Great. Thanks so much for joining us.
I was just going to ask Stefan, just to start off, could you say a couple of words about how it is that you actually got interested in these kinds of issues of liberty and, you know, principles?
Well, I think – I guess around 11th grade, I read – a librarian at the Catholic high school I went to recommended The Fountainhead to me because I read a lot and was interested in philosophy, and that pretty much started it.
Then I went to engineering and then finally to law school, and in law school, I started getting even more interested in political theory and things like that and including intellectual property theory and all related aspects of libertarian theory.
Right. And you, because I know that you have a sort of law training, and in the book you go through some of the other ideas that were around in the sort of libertarian movement about intellectual property.
Right. How was it that you came to sort of address this question, you know, was this something that you were thinking about all the way through studying law, or what led to this book?
Well, I mean I didn't know very much about IP law at all until I sort of read what Rand had said about patents and copyrights in one of her books early on.
And her arguments made a little bit of sense to me but not quite, but I assumed that she knew what she was talking about.
But the more I studied libertarian theory and kept thinking about IP law, I kept trying to figure it out and figure out a way how what she proposed made sense.
And there was just too many problems with her theory there.
She shifts to this utilitarian, almost ad hoc type of rationale in her book.
Actually, in law school, I wasn't interested in IP at all.
I wasn't going to be an IP lawyer.
I never even thought about it, to be honest, until I got out of law school.
But when I started practicing IP law as a young lawyer, I kept thinking about these issues and finally came to the conclusion that the reason I was having trouble finding a justification for IP was because Rand was just wrong, that there is no justification for IP. And once I thought about it that way, a lot of the pieces fell into place and the whole system made a lot more sense then.
Right. And I was wondering, when you were looking at this, obviously, A lot has happened in terms of people thinking about IP with the rise of the internet and with people copying things online and the whole discussion about whether or not IP in a sense is just unsustainable anyway because copying music for example and other digital things is becoming so prevalent.
Was that sort of in the background when you were thinking about these things or were you just looking at it more from an abstract perspective?
No, it was really pretty abstract, and it really had very little to do with the fact that I was starting to practice IP law.
Since I knew something about the law because I was practicing it, I decided to go ahead and, in the beginning of that article, just lay out systematically exactly what the law is because there's a lot of confusion among libertarians about what the law is when they discuss this topic.
But I have never claimed to make an argument from authority that because I'm an IP lawyer, I know more about IP policy than others.
In fact, it annoys me when IP lawyers do that, and most of them, of course, naturally are pro-IP but don't give very good arguments for it.
So it was pretty abstract.
I think I started writing early – mid-'90s anti-IP. And finally I put them all together in that article which became a monograph and I remember it was around 2000 or so.
I just actually had a talk with Professor Hoppe last week at the Austrian Scholars Conference in Auburn and he was telling me he was the editor of the JLS at the time and he accepted my article and he actually gave it its title and he told me that when he accepted the article he didn't think it was you know he liked the piece but he didn't think it was that big of a deal and I said I didn't either But it's sort of the timing was fortuitous because,
like you say, the rise of the internet and technology has sort of magnified and exacerbated a lot of the problems with IP and made them more obvious to a lot of people.
I mean if you just subscribe to enough blog forums, you'll see dozens of examples every week of outrageous applications of copyright and patent law.
Right. Well, I know that there's a lot of people on the call so if anybody would like to ask any questions or make any comments while we have Stefan on the line then please do go ahead.
I have a question.
Go on, Steph. All right.
Yeah, thanks again. It's always great to chat with the author.
The scarcity question, it seems to me, you know, riding roughshod in with non-legal expertise, it seems a little bit like begging the question, which I'm sure just means I don't follow something, but when you talk about scarcity, the lack of scarcity in ideas, I think the way that my mind goes, when you sort of bring up this example that if I have a technique for harvesting cotton that's superior, if you borrow or take or copy my technique, I don't lose anything.
I think that I do, you know, just from a pure economic standpoint, which is I lose the exclusive economic advantage of being the only person who can use that technique.
So it would seem to me that what's scarce in the realm of IP is not ideas or songs or whatever, or the copying thereof, but the profits that can accrue to the exclusive use of such a thing.
And I think that's where the scarcity shows up for me, and I was wondering if you could talk a little bit about that.
Well, I think in a way that's correct.
I don't know if you lose the exclusive right to it.
I don't know if you ever had the exclusive right to it.
I mean that would be the question.
Do you have a right to profit?
Do you have a right to exclusively use this idea?
And I mean the way I approach it is libertarians at least tend to agree that for scarce resources, things that are actually scarce.
Things that there could be conflict over, that the way we assign property rights is basically something along the lines of a law camp or a few principles.
Whoever has the first – whoever homesteads the item first is its proper owner.
And so once you agree at least on that, then it becomes clear that assigning rights in the profit or in the value of something conflicts with these other rights.
And so right off the bat, we have sort of a conflict with what I think most libertarians would agree with in the first place.
But I think the problem in general with saying that you have a – you've lost your exclusive right to profit off of this idea is that we don't have property rights in the value of things.
Value – and by that, I would include reputation rights, the value of something.
You could say that if Walmart sets a shop next to a mom-and-pop store, They harm them on an health store and they rob them of their business, but of course they're not entitled to that business.
They don't have the right to the custom of their customers.
And so I would say that you have to think in terms of the praxeological status of human action.
So action is the use of means, which are scarce resources in accordance with our understanding of causal laws, to try to achieve some end.
And to use the means, That is necessarily scarce.
I mean, it necessarily implies that if you're using it, someone else can't.
So it makes sense for there to be ownership or it makes sense to understand why there would be a need for ownership of these means.
But information is sort of what guides your action.
It's just a plan you use to guide your action.
And many people can use the same pattern of information, the same recipe at the same time.
So it doesn't really make sense for you.
You have to have ownership of that pattern to have successful action.
You have to have ownership of the means because you don't have to have ownership of the information that you select to guide your action.
Well, yeah, but I think that the effect of profit that would result from an exclusive use of a process is something that would be scarce because the profit would flow to you rather than to someone else.
And, you know, if you're the guy who comes up with this great cotton farming thing, then you can maybe make enough money to buy up everybody else's farms and become, you know, a fat capitalist pig farmer magnet or something like that.
So I think that the scarcity argument, it seems to put the cart before the horse.
Because if there is a such thing as intellectual property, then what is really being managed is not the ideas themselves, but the profit that results from the exclusive control of those ideas.
Now, I'm not a fan of IP, certainly not in its current context.
I'm just trying to sort of understand the thinking behind it.
So I think you and I would agree on the non-initiation of force.
In this area, but I'm just trying to understand the difference between the ideas themselves and the profits that would arise.
And the profits that would arise would fall under the scarcity, but I agree with you, the ideas would not.
Profit is just an economic description of the difference between money inputs and money outputs or something like that.
So the actual money that you have, okay, you could say that's scarce good, the gold.
So, let's talk concretely.
I don't make a sale of my new razor blade because someone else has copied the same scheme I used to make my razor blade, and they sold a similar razor blade to a customer that I other would have sold my razor blade to.
So, I don't receive that piece of gold.
The other guy receives that piece of gold.
So, that's a concrete example of what you're talking about.
Because I don't have the exclusive state-enforced monopoly to sell that type of razor blade, Someone else receives a piece of gold from a third-party customer instead of me, correct?
I don't want to go into the state-enforced because I think we're in agreement on that.
If we can just stick with the one that's in your book, which I think would be more helpful.
Let's say I come up with some great way of harvesting cotton that produces twice as much cotton.
It's some ingenious machine, right?
So it produces twice as much cotton.
Well, clearly, if I retain exclusive use of that process, I'm going to be economically efficient.
Much better off than if everybody else can use it, right?
Yeah, you'd be better off because you would receive pieces of gold from people that you otherwise would not, right?
Right, and I would be able to underbid other farmers, and so it would be, I mean, there's economic efficiency, at least for me, let's say, and hopefully for my customers, but that to me is where the question of scarcity is most important, because the gold that comes to me as the result of me being a great cotton producer is scarce, because obviously money is scarce, except in a fiat currency economy.
But you see the argument you have here, I think, the scarcity comes then to the question of who owns that piece of gold?
Now, you have a third-party customer who owns the gold.
We all agree to that.
He has the right to give the gold to whoever he wants to.
He can give it to me or to someone else.
If he chooses to give it to someone else instead of me, then my competitor owns that piece of gold now.
So the scarcity argument follows the piece of gold.
When you say you don't have the exclusive right to use it, to me, that's the sort of disguised way of saying… You don't have the right to use force to stop someone else from making a similar – using a similar process.
So I don't know how you would have an exclusive right to do something without initiating force against competitors.
How would you have such an exclusive right without initiating force?
Oh, okay, yeah. So, I mean, we can certainly jump into that.
That's a fascinating question, and I'm certainly not going to claim to be any kind of expert in this field, but my general guess would that it would fall, the way that I view IP is that it would fall more under the context of contract law, right?
That you would have contracts with people, and you wouldn't have any fundamentally separate contracts, or there would be no separate contract universe in IP than that would be from, you know, employment contracts or Absolutely.
I agree. That's the way that I would see it being enforced.
Now, do you have the right to initiate force if someone violates your contract?
Well, I think, I hope not.
I mean, I hope that there's other ways of managing the situation, but certainly violations of contracts, I mean, I think in a truly free society would be dealt with by ostracism and lowered contract ratings, which would raise your costs and this and that and the other.
But I think that The way IP would work ideally is, you know, there's a contract that is, you buy like a book or something, it's like renting a car.
You don't have the right to rent a car and then sell it on eBay, and you don't have the right to buy a book and then, you know, resell it at a profit or if you don't have a contract.
So I think it's not something that should be separate, which unfortunately it is under the status system, but it should be under the rubric or umbrella of contract law as a whole.
Yeah, I agree actually completely with that.
But, you know, just as you are, I think, an anarchist like me, And yet you believe that there are certain contractual mechanisms that could replace or perform some of the functions that we pro-stated see the state performing now, and the institutions and agencies that would arise under a private contractual regime, you would not call that a state.
Likewise, if you want to arrange certain secrecy or exclusivity provisions by contract, I mean I don't have a strong objection to calling that intellectual property, but we might as well say it's a subdivision of IP. It's private IP or something like that that doesn't really justify the public IP that is the problem now.
And once you admit that it's a contractual issue, then you have strict limits on how third parties can be brought into these contractual webs.
And IP, as I understand it, primarily patented copyrights.
The essence of it, and believe me, if you talk to any advocate of IP, especially a mainstream statist IP attorney or someone, they know full well that if you take away the ability to ensnare third parties in these rights, they totally disappear and dissipate.
That's why they fight so hard, for example, with proposals to add a copying requirement to patent law, which is similar – which is already present in copyright law.
They know that if you're free to reverse engineer or to independently come up with an invention, that it would basically take all the teeth out of patent law.
So the entire essence of patent law and even copyright law is its ability to affect third parties who have not signed a contract.
But if you wanted to advocate – and I gather from what you said earlier you're not in favor of the current regime.
You might be in favor of some regime, and you probably would be in favor of something having to do with contract or completely – Compatible with libertarian theory.
Most people, most libertarians in my opinion, in my experience, who say they're not in favor of the current IP system but they are in favor of some IP systems, they have a much more extensive IP system in mind, but they won't tell you exactly what it is because they don't know.
So I'll say, well, look what patent law does, and they'll say, well, I'm not in favor of that.
So every terrible example I think of… They say, I'm not in favor of that, and they'll say, well, what are you in favor of?
They'll say, well, I'm not an IP expert.
How do you set me to know? It's almost like a theist who argue for God, and when you ask them to define it, they say, well, I can't define it.
It's almost the same thing, so it leaves me frustrated as to what to oppose or argue against if they can't even define what they're in favor of.
Right, right. No, and I think that in a free society, you wouldn't say employment law.
You would just say, I guess, contract law or whatever.
It may not even be called law, but it probably would.
But some sort of common law. And there will be gray areas, of course, right?
I mean, if you are the eighth person to receive stolen goods, are you really responsible for returning it to the first person?
I mean, those things are hard to figure out.
Or let's say you're living on land that was taken from the Cree 150 years ago.
There's going to be some gray areas, of course, right?
That's just the nature of the beast.
The purpose of a free society is to solve the 98% of the problems that are pretty obvious and then leave the intellectuals to quibble about the remaining 2%.
So I'm very much in favor of just having it as an umbrella of voluntary contract law.
I do think that there may be different levels, right?
So there may be some people who say, I don't really want to be part of this contract law system when it comes to intellectual property, in which case they would need to be able to have it enforced against them nor enforce it against other people.
I mean, there could be different levels or layers, and it would be a competition for what would be the most cost-effective way of doing it, with, I think, the rubric that there is no way to involve third parties in a dispute.
That having been said, and I'm sorry to monopolize, I'll just ask one more question, which was yearning-burning in my head before tossing you to the other wolves, which was...
The question around the idea that if you have IP, that you have a lien or some sort of third party ownership over every piece of property in the world, right?
So if I write some stunningly filthy and ingenious limerick that other people can't write that down if I've copyrighted it and so in a sense I have ownership over everybody else's property.
There were two things that popped into my mind which I'm sure are fairly easy to dismiss.
The first is that The first is that it's not really possible because people aren't going to randomly – like, nobody randomly writes out Hamlet, for instance, right?
So it's not really barring something that people would do in the normal course of events.
And if they would do it in the normal course of events, like writing happy birthday, you can't copyright that because that would be sort of in the normal course.
The second objection was that we have that anyway.
Like, I can go and buy a knife, but that doesn't mean I have the right to plunge it into someone, right?
So laws against stabbing are laws against, like, that's in a sense, exactly property rights over everyone's property.
So I was wondering if you want to clarify those for me.
Yeah, so let me take the first one first.
It is true that One aspect of copyright law just covers what's called literal copying, just an actual duplicate of the original item like a copy of an MP3 file for a song or something like that.
I agree with you that that is extremely unlikely, probably practically impossible to occur without copying.
So there is actual copying done in those cases.
And if copyright law were restricted to only that and there were no patent law, then the – The danger done or the harm done by copyright law would be much, much drastically diminished, which is exactly why copyright advocates fight tooth and nail to keep from expanding the fair use exception and to – and they fight to prevent abolishing the derivative works aspect of copyright law, which makes it much broader.
In other words, copyright law is not just literal copying.
If you've heard someone whistle the tune for – John Williams themed to Star Wars and it kind of gets in your head.
You make a rap song that's sort of centered around that.
You've never had a contract.
You've never really even copied anything.
You're sort of just generally aware by a cultural osmosis of these ideas.
Or you may know who Superman is because you've heard people talk about it, but you never did any copying.
And so you – but under copyright law, you could not make a Superman movie, for example, even if you've never read or seen an actual Superman comic or novel or movie.
But – Let's say we restricted copyright to literal infringement, literal copying.
Still, our computers are infested and filled with all these perfect digital copies that just from browsing the web and people emailing us things.
Under copyright law, theoretically, the owner of that pattern has the ability to control your property, say your computer, which has that image on it.
You can't – Or let's take another example.
Documentary movies or just regular movies that are filmed in public places have architectural works in the background, buildings, statues, such as the – there was recently a big dispute about the Korean War Memorial statues in Washington,
D.C. Someone took a picture of those statues, and they were put on a postage stamp, and then the Postal Service was sued for copyright infringement by the original sculptor even though… He was paid to do these works by the government, and they're on government land, and they were taken by a photographer.
I'm sorry, just to back that up, when I'm on vacation, and this may occur for you as well, I get paid a fair amount of money to move my pasty hide out of people's vacation photos so they don't have to look at it again in the future, and that's just another way of achieving that.
That's negative copyright.
That's right. All right, pants on is extra.
So – and then the other example, could you remind me what was your second question about – oh, about – yeah, about stabbing the knife, etc.
You see, I would say this.
I would say that I think that that example is used because of a sort of uncareful way of – that libertarians often say, well, your property rights aren't absolute.
They're not – because you can't use your knife to kill someone.
Well – It's really got nothing to do with property rights.
In other words, I can't kill you.
I can't murder you because you have a property right in your body.
In other words, the very rule that says I am not permitted to act so as to cause your body physical damage to the physical integrity of your body is because of the presupposition that you do have property rights in your body.
That means I can't – I have no right to damage your body with any physical means, any efficacious causal means, whether I own it or not, whether it's my knife or a neighbor's knife or some knife that I stole from a store.
So in other words, let's say I steal my friend's knife.
He owns the knife, but I still am not entitled to kill you with it.
So really it's not a limitation on ownership that I'm not able to kill you.
It's just a limitation on my action.
So in other words, ownership of goods simply means I'm the one who gets to decide how to use it.
But of course I'm not entitled to decide to use it in a way that bothers someone else's property rights.
So I don't think there's any conflict at all between saying that there are some things I'm not able to do with my property.
It's not because there are limitations on my property rights.
It's because there are limitations on… My actions because other people do have property rights.
Right. So in a sense, it's an affirmation of property rights, i.e.
the personal property of another person, not a denial of property rights.
Yes. And if libertarians had a disagreement over who got to own, say, a piece of property that's scarce, a scarce resource that someone found, then I wouldn't use the same argument.
But I'm assuming that libertarians agree that if Stephen Molineux has a printing press … that he made himself out of metal.
He found on his land that he was the first to homestead, that you are the owner of those goods, that you do have the right to use them, and you have the right to do anything you want so long as you're not trespassing on the property rights of someone else.
Then you cannot come along and say, well, it trespasses against my exclusive right to own this idea.
I mean why? You have to come up with an argument for it, and I don't see the argument for it.
It seems to me that property rights are complete by specifying the homesteading principle with respect to scarce resources.
Right, right. Okay, no, that really does clear it up.
And I mean, I have a few more questions, but I don't want to hog the show that isn't even my show.
So if other people would like to ask questions, I'll slither back into my contemplative layer.
Plus, if two-step and discuss it, we're likely to confuse people.
We both have pasty-faced bellies.
I have a quick question, and this is just an invitation to complete conjecture.
I know there's no way to tell the future, but I guess there's two ways that I imagine IP could go.
You could say, there's one argument to say, you know what, the rise of Copying and the way that digital media is going now IP is just going to be unenforceable and the system will have to change because there's no way that you're going to be able to enforce these laws and so consequently you know it's just going to become kind of a joke law and there's another way of looking at which you could say well this has been one The one flowering of copying,
and now comes the clampdown, and there's going to be this huge increase in state power to enforce IP law, and despite the fact that people will be able to find ways to copy, the machine will just keep getting bigger and bigger.
How do you see things going?
Well, I mean, in a way, two directions.
I agree with you in a way. I mean it's like the drug war.
I mean the drug war is just as absurd if not more than IP law, and it's unenforceable, and yet the government keeps ratcheting it up and making it worse, although maybe there's some signs of decriminalization in some states because of the budget issues.
I think as a practical matter it's going to be impossible to really enforce this stuff.
Too much, but I don't know if they're going to stop doing it because there's so much political and corporatist pressure behind it, and the laws are getting a little bit more draconian.
We have a secret copyright treaty coming up, which I suspect will pass because these guys are good at doing this kind of thing.
Like in response to your earlier question, this was more abstract for me, and there are other people who have written on more practical What kind of mechanisms would we come up with in a free society to address some of the problems that are legitimate problems that advocates of IP see?
And I used to think, well, there'd be DRM to some degree.
There might be big contractual regimes, and I still think that.
But I'll say in the last couple of years, my thinking has changed on this that I think that learning is a good thing.
Emulation is a good thing, and I think it's an essence of the free market.
In a human civilization and progress, it's a good thing that information is not scarce.
It's a good thing that we can infinitely duplicate and learn from the insights of others and pass it now from generation to generation and increase the store of information.
And in a sense, that's all IT is.
It's just information. So – and I also think that But people will just have to adjust and adapt, and I think they will.
And I think the young people and the dynamic sort of internet culture people are already doing it.
I mean they're putting their stuff out there.
They want to be known.
I mean like I think Cory Doctorow said that the danger is not that people are going to rip you off.
It's obscurity. You want people to learn and know who you are.
And I think you just throw it out there, and you get known.
You establish your reputation. You use your skills to survive in the world.
How people do it, I'm not exactly sure.
I'm not sure how big blockbusters would be made in the absence of copyright law.
Maybe they wouldn't be made. I suspect they would.
I'm not sure exactly how. Fantastic.
Has anybody got any questions or thoughts to put to Stefan?
I just wanted to follow up by saying that I think also the government likes having the artists and the artist managers dependent upon the government.
It lends them to be a little bit less critical of the government.
I don't think it's any sort of smoky backroom conspiracy, but I think that it is something that...
The ownership of the cultural elite has been pretty important for regimes throughout history, and I think that IP is more a way of hooking those people into the existing system, like the welfare state does with certain sections of society.
It's just a great way to keep people loyal to the hand that feeds them.
I never thought about that.
That's a good point. In a way, the state is sort of like their patron, right?
Because the state guarantees them, in a way, some way to make money.
Yeah, you don't get any ugly pictures of the king from the court painter, right?
But sorry, I interrupted somebody who had, I'm sure, a more intelligent thing to say.
Yeah, I'm wondering, because with any piece of technology or any product, you have an almost infinite number of generations leading up to it with almost infinitesimally small incrementals of improvement with each one.
And what do you guys think it is that sort of help these status agencies to determine where the stop point is for a patent or for copyright?
What really helps them determine, like, here is where you can't improve on this thing anymore?
I'll throw my two cents in if anyone else wants to comment on this.
I don't know if I... I have a lot more insight than others on this issue, but I will say that I don't want to diminish – I don't want to diminish the role of creativity, obviously, and the mind.
And objectivists and Randians go completely apoplectic when you oppose IP, and they think you're basically saying that there's no role for the mind, the mind is unimportant, creativity is unimportant.
Of course it is. Of course it is important.
And I also don't want to say that there are no great thinkers in history, but I do think that our view of the kind of great man view of history has been exacerbated by just standard history and just by maybe some of our capitalist pro-business worship.
I mean you take all the famous inventors that we hear about like Eli Whitney with the cotton gin and others.
You're right. I mean if you think about where they are on a chain of progress, they're just one little dot in progress that goes back thousands of years.
Thousands of incremental improvements, and he stands on the shoulders of people that came up with ideas that he improved upon.
And okay, maybe the delta between his improvement and the previous guy's is greater than average, maybe even a lot greater than average, but he's still just one dot in sort of this kind of generally rising slope of technological progress.
And what he wants to do is build upon the progress But draw like this bright circle around his contribution and get a monopoly protection on it to basically stop progress or extract the rent from it.
And how does the government do it?
Well, they do it with arbitrary patent law.
I mean this is one problem I have with it.
It's completely arbitrary, and I mean I see this from the inside practicing.
The laws that the government uses are completely unobjective, non-rigorous, vague, subjective… They change over time.
They change where you see a patent that was granted 10 years ago, 15 years ago, and everyone sort of laughs, and they see that it was obvious in hindsight.
But back then, the Patent Office didn't see that or wasn't able to see that or didn't care to see that.
Now, copyright is a little bit different.
I do think most copyrighted works are original, but the question is if it builds upon the work of another.
That's called a derivative work.
That's the exclusive right of the original works maker.
So you just don't have the right to … incorporate other people's work into yours even if it's original.
For patents now, patents are a little bit different.
Patent, you can build on it.
You just can't use it without their permission at least for 17 years or something like that until the patent expires.
So I mean from a libertarian perspective, if you look at the current scheme, it is so manifestly and obviously unjust.
It boggles my mind how any libertarian could hold it unless you're the type of libertarian… Who thinks that Congress and the legislature and big statutory schemes like the Americans with Disabilities Act and FEMA and Social Security, if you think all those are legitimate, then I suppose you might think that this huge statutory scheme is legitimate too.
But other than that, I don't see how anyone can think this type of legal system is legitimate.
The other thing I just wanted to mention as well is that the government is very good at bribing organizations whose costs it has enormously raised, right?
So, for instance, if you look at, we haven't talked about this much, and people don't bring this much in IP discussions, but of course, medicine is something that patents are, you know, you can measure the number of lives that they cost.
Why do drug companies need such lengthy patents?
Well, because it costs a billion dollars because of government interference to get a drug to market.
Exactly. And so because they've raised their costs so much, they need to bribe them.
Otherwise, the whole thing would fall apart.
They need to bribe them with extensions of a patent law over medicines.
And the same thing is true if you look at movies.
I mean, why are movies so ridiculously expensive?
I know a little bit about this, having made one.
It's because the unions have such a tight and expensive control over the movie-making process that if patents and controls over the distribution of movies were not given So they raise the costs ahead of time, which, of course, raises the cost for consumers, and then they enforce the IP as a way of bribing those whose costs they've raised, which, again, is paid for by the consumers.
So I just wanted to sort of mention that's, I think, another incentive.
No, that's a good point. And not only that, they make it illegal for people to come up with alternative ways to get around some of these, the cost of exclusion, for example.
You know, and by that, I mean, like, the antitrust laws, the monopoly laws.
I mean, they very well may be … contractual mechanisms that big pharmaceutical companies or Hollywood companies – who knows?
They would come up with to try to make this project feasible in a non-IP world, but they're prohibited from doing that because it's illegal for them to collude and conspire and all these things.
So basically the government, not only do they raise their costs by the FDA laws, the regulatory process, tort law… Taxes, which basically make everything more expensive.
Everything they do makes it – raises costs, and then they make it impossible for them to come up with contractual regimes that would get around these things.
So all they leave them is – one thing is the copyright and patent law, and not only that, there's no guarantee that with a patent or a copyright, you're going to make enough money to make a certain project viable.
In other words, if your argument is utilitarian – I mean most patents are useless.
They just sit on walls or independent vendors' offices, and they're just proud.
They spent $15,000 to get it and to show it off as a red ribbon copy on their wall.
But even some libertarians have literally suggested that the government should have like a – I don't know – a $100 billion taxpayer-funded prize fund administered by a government-appointed panel of experts… And they give out these incentive awards at the end of every year to all people that have had worthy creations.
It's like a Government MacArthur Award.
I mean they do this already with government interference with science and funding, right?
But so once you accept the mentality that we need to have patents and copyrights to give you a little bit more profit to make certain projects viable, well, how do we know that's enough creativity and innovation?
Maybe the government has to give you – tax people and give money to these guys.
to have even more innovation.
And the other tragedy, too, is that you end up with a pretty conservative kind of media, right?
Because if you look at drug companies, because it's so expensive to develop a drug, you'll get drugs for boners and heart attacks, but you won't get drugs for, I don't know, lupus or I don't know, whatever is some sort of less common kind of illness.
And the same thing is true in the media.
It's very expensive to produce, and you get this great gold rush, so to speak, or this sort of land claim of intellectual property afterwards, which means that you'll get, you know, big budget, which has to appeal to the widest majority to make the most money, but you won't get the kind of smaller budget films and the distribution that would go on that I think would give more and more challenging perspectives.
You can get those from foreign films, but it's not really quite the same.
Anyway, I don't want to get us too off topic.
I think people get used to the way things are.
They see a certain percentage of big Hollywood hits and the big bandana-type rock stars, and they cringe in horror at the thought that we might have more serious artistic efforts and more independent artists or whatever the landscape would look like in a less distorted regime, and they're basically conservative at heart because they can't stand the idea of change.
They think the way it is is the way it has to be.
And if that's what you've grown up with, then it's almost by definition what you're going to end up being used to.
If you grow up with change, it's like those people who still long for the days of Stalin, right?
If that's what you grew up with, then that's kind of what you want to continue.
So I think it would be quite a change.
But I think, Greg, you had a question for Stefan.
Yeah, near the beginning of the book, you rightly point out that IP essentially centers around when the use of force is justifiable.
Yes. But I think, and I could be misinterpreting what I read, I think that you meant that in the sense of when is it justifiable to defend my property with force.
Is that correct? I honestly don't recall.
What the context of that was.
I probably was just setting the context from a – I was presupposing a libertarian framework of understanding of the proper use of force and its relationship to property rights.
In other words, when you define a property right, you're basically saying it's permissible to use force in a certain – to defend that property right, although I would tend to agree with Stephan, by the way, on the – On the probably galactic prevalence in a free society of ostracism and things like that instead of actual physical violence in those cases.
But anyway, theoretically, right.
To define a property right… Implicitly defines a correlative right to use force, to enforce that right.
Right, right. And so the question to me actually is, where does the original initiation of force take place?
Because to say that I have the right to use force to defend implies that someone has used force against me already.
So I was wondering, in the context of intellectual property, where does the actual initiation of force first take place?
Like, is someone actually aggressing against me if they copy my song or if they photocopy my book or they repeat a manufacturing process that I use or whatnot?
Is that actually an act of aggression?
Well, okay, so I think I follow your question.
Let's break it down to the different elements, okay?
Now, we have to decide whether there's a contract or not.
If there's a contract, then it's debatable and it depends upon your concept of contract rights.
What would happen if you copy something in contravention, violation of contract.
But let's do that aside.
Let's assume there's no contract.
So let's say you come up with a – we gave earlier a new method for harvesting cotton or something, or even a simpler example.
Let's say that – let's take some cavemen, and one guy – everyone is living in caves, and one guy gets the idea to stack a bunch of logs and make walls and lift them in a little hut, and they get them some advantages.
And his neighbors see that, hey, this guy has got a house, and so they start making houses on their land.
If the first guy runs over and burns down the second guy's house, I would say that's an initiation of force.
I would agree. Now, the advocate of IP would have to say it's not, and he would have to say that it's a response.
In my view, we have to, as libertarians, we have to break down force into initiatory and responsive force.
That's my sort of binary classification.
It's either initiated… Which to me is a shorthand for invasion of others' property, so really it's dependent upon the concept of property.
But still, there's initiation and there's forces in response to initiation force, which is responsive force, and that would include restitutive force, defensive force, or even retributive force theoretically.
But basically it's not initiated.
It's in response to force that was initiated.
So to say that the log cabin inventors burning down those neighbors' houses… Responsive force.
You'd have to say that the first guy building his house was initiated force.
Now, the only way to argue that is to say that the first guy had a property right, and the building of log cabin houses all over the world.
And to me, that's begging the question because that's what the property – that's what the IP advocate wants to prove.
So you can't rely upon standard libertarian principle to – Argue this.
You have to come up with an extra argument.
You have to give a reason why that this guy building a house gave him any rights outside that house, other people's property, which they already owned.
Now, in today's society, the way the force happens is because of the government.
So you have – Intel will file a patent on a chip design or something like that.
And they'll get a monopoly grant from the government, and if someone else violates it, they'll send them a threatening letter.
They don't pay them money or stop doing what they want them to do.
Intel will go to the courts, and the court will – if Intel wins, the court will order its agents to go and seize money from the bank accounts of the loser, or they will issue an injunction saying you cannot make this product, and if you do… It's contempt of court, and we will come put you in jail.
So there is literally force used by the state, and what we have is we have libertarians saying that is justified force in response to aggression by the competitors.
So this is the sorry state we have now.
We have libertarians basically siding with the thugs of the state against people who are only producing useful products to sell to people.
Right, right. And it's basically...
See, to me, that's the actual initiation, right?
Well, sorry, but unless you accept the argument that the future profits of exclusivity is what's being stolen.
I'm not saying that's my argument, but that is the IP argument as far as I understand it, that the future profits...
So the log cabin thing is like, well, if other people don't buy, sorry, if other people don't build the log cabin, then they're going to pay me five bushels of wheat for me to build it for them, and so I'm out five bushels of wheat.
This guy has stolen from me the five bushels of wheat that I would have over the exclusive right to build a log cabin, and therefore I'm going to burn his log cabin down in some Rockian orgy of homicidal violence because I'm out five bushels of wheat.
Do you think that already makes any sense yourself?
Well, this is the challenge, which is to me, this is why it's such a loopback procedure to argue these things, because in a sense, if you accept intellectual property, then you are out five bushels of wheat, and you have every right to go and get those five bushels of wheat back.
And if you do invent something from Intel that might make you a billion dollars next year, and then somebody takes away that billion by copying it...
Then they have initiated force because you are owed a billion dollars.
It's sort of like stealing somebody's stock portfolio.
Well, maybe it'll make money, maybe it'll lose money, but I want to have the opportunity to make money.
So I think – I don't have a great answer for it because I'm just not that smart or experienced in the topic.
But I just wanted to point out that this is the framework that the two – Sides are working.
So the one side says, you don't have a right to potential future profits.
And the other one says, well, they're not potential future profits if I already have the right for exclusive control over the process.
And so I think that's the justification for IP, that you are stealing the money that I would have made if I'd had exclusive control.
But again, it all seems like begging the question.
Sorry, don't mean to interrupt. Go ahead.
Phrases like exclusive control, I mean, what does that even really mean?
Well, it means that if I invent the computer chip, you can't just reverse engineer and copy it.
And so they're saying, if I have control over this computer chip, I come up with some computer chip in my basement that's ten times faster than the fastest computer chip at one tenth the price, I'm going to be a multi-bazillionaire, right?
And if somebody just goes and steals and copies that, then I'm out my multi-bazillion dollars, and that's been a direct theft from my invention.
That's the pro-IP position, again.
I just wanted to clarify that for people.
But to be clear, patents, and this is the language that's given mostly by IT, the stealing language, but patents don't require copying at all.
So in other words, it not only prevents you from copying the idea, reverse engineering it, or stealing it, it prevents you from even independently inventing it.
It even can prevent you from using the idea if you came up with it independently before the other guy, and you just basically didn't want to get a patent on it.
So you didn't go to the patent office, you didn't disclose it, and someone else independently invents it later, They apply for a patent.
They get a patent on it. They can stop the first stack from doing it.
So it's more than just copying.
No, and that's right. And I think the good example of that is that Amazon one-click thing that's in the back of the book that someone else may have come up with a one-click way.
They've never been to Amazon, and they then can't use that.
And I think that's really, really tough to defend, even for pro-IP advocates.
I can sort of see something really complicated and exclusive, but something that's developed independently is not something that obviously is not copied, right?
The question is proving, the challenge is proving the independent creation.
Why is that hard to defend, though, if your position is that Amazon's imputed income is going to be damaged by somebody else having a one-click?
In fact, Ayn Rand did defend this.
In her book, she did defend this process.
I mean, it was a stretch of an argument, but she did try to defend that.
You mean that even if you didn't derive it, that it was still illegal?
Well, she defended in her article what she thought was the practice that the first guy – like, she invented the idea that, let's say, two guys at the same time.
And the first one to get the patent office gets the patent, which is actually not the U.S. law.
She actually did not understand the law.
But she thought the law was the first guy to get the patent office would win.
So she came up with an argument, why can't she get it, even though the other guy independently invented it.
So I think her position would extend to someone who – Well, yeah, it actually does.
In fact, when you have a tie to patent office, it's a sign that the idea, the tie that comes with the idea, it wasn't, it was obvious anyway, you know?
We actually have a...
We have a recent example of this, too.
By your own argument, Steph, Apple was actually justified in doing what they did by suing HTC for the slider widget on the Google phone.
Yeah, I don't know.
I just, I think that, I mean, to me, Apple and Microsoft suing anyone over stuff that they all stole from Xerox way back in the day just seems kind of funny.
But I don't know enough about that.
And I mean, I wouldn't even venture to understand this is not my argument.
This is just an argument that's important to understand if you're going to look into.
You know, I always think it's really good to give your opponents the best possible arguments that you can in order to make sure that your position is as battle-hardened as possible.
Yeah, but Steph, your opinion that the pro-IP guy's way of putting is that it's a property right and this exclusive right to the stream of profit, just something like that.
Yeah, that I'm going to make X amount of money by exclusive control, and if you violate my exclusive control, then it's like stealing a cab that I have, in a sense, right?
I mean, I'm out that income.
Yeah, but you denigrated that rightfully, I think you say, question begging.
I thought you also said that the opposite view was question begging too, which I don't think it is.
I think the libertarian perspective that you have a property right in property that you homestead, it's not question begging.
It's a statement of what the libertarian is.
And I agree that stating it is not proving it.
I don't think it's question begging. I think it's just assuming that we all agree.
I think you can defend it with other arguments which you come up with and others to come up with.
But I think that – like an exclusive right to profit is actually disingenuous because they're avoiding stating starkly what they're really in favor of.
What they're really in favor of is control of other people's property so that they can make profit.
It's not the right to the profit. It's the right to control other people's property to stop the – they can't really make profit.
Yeah, sorry to interrupt, but I think, again, to play the IP position, I think that they would then say, but if other people would, in a sense, accidentally or independently come up with it, then it shouldn't be a law.
But if nobody is going to, you know, the moment the Bohemian Rhapsody is going to come out, nobody is immediately going to say, oh, I just finished that exact same song in my basement.
The odds against that would be so large.
So where it's functionally impossible for other people to use their property to duplicate the profit-generating item, Then they are copying and stealing from the ingenuity and creativity from the original creator.
So I think that there's those two poles, one where it's very clear, like you don't accidentally recreate an Intel chip, and the other one where, you know, it's a two-line poem that somebody else could come up with, that those two poles would be pretty far apart.
And I think the hardcore IP guys would say, we're only really concerned with the ones that would be impossible for other people to accidentally reproduce.
Well, I think, again, I think if they were to see that, they were getting up 99% of all IP laws damaged, and they're not going to do that.
But let me just make a point on the profits idea.
This is all typical of a type of libertarian thinking, which is not representative of the way Austrians think of things.
Austrians and Austro-Libitarians think of property in terms of the actual scarce resource itself as defined by certain borders, and they think of trespass and donating those borders, which means using the property rights, I'm sorry, using the resource without the order of permission.
The objectivists, and this is another reason why the objectivists believe reputation rights and defamation law, they basically believe in property rights and the value of things.
And the fundamental problem with that As Rothbard pointed out in the Ethics of Liberty is that value is a subjective phenomenon.
Value is what other people think as saying something to be.
And to have a property right in that is not to have a property right in other people's minds basically.
And so this is one reason why over the last few years I've come to think of reputation rights as another type of IP. It's not typically classified as IP, but I think clearly it is.
It goes by the same type of – The objective is to say, give labor on something, and they say you create a value.
I think a value is a noun, right?
It's a thing floating out there that is a value.
If you create a value, then you're, of course, the owner.
I mean, who else would be the owner of this value other than the creator?
They never ask the question, what types of things are ownable in the first place?
What types of things are property in the first place?
So basically if you believe in IP, you're going to have to believe in defamation law, reputation rights, and I think basically they're all just protectionism by the government.
The government is giving laws to favored parties, favoritism, and they're protecting their markets.
It's nothing but modern markets.
Right, and if people say, well, you're creating a value, again, this is why, to me, these always become like determinist arguments in that it's always begging the question.
I don't mean that that's what you're doing, Steph, but that approach where you say, well, you've created a value, well, but it's only really a value because you have intellectual property exclusivity, right?
So in a sense, it's not a value if there's no IP. So it's begging the question about whether there should or shouldn't be to say there is a value.
I would say we don't create values.
We actually make things that we own more valuable by transforming them.
But we don't actually create – even Rand did this.
There's a passage in the writing where she says we don't ever create matter, always rearrange it, and she's correct about that.
And the fundamental problem for libertarians is we bought into the idea that it's sort of a loosey way of looking at rights.
People will say, well, how do you get property rights?
They'll say, well, there's several ways you can get property rights.
Someone can give you something.
You could transform your own property.
You could find something unowned and homestead.
Or you could create something new.
And they kind of throw these things together in a big sort of gumbo of ways of coming up property rights and things.
But if you look at it closely, creation is not really an independent way of coming to own things.
I remember I had a discussion on the Mises list several years ago.
It was one of the reasonable objectivists.
And he was sort of trying to He was trying to discuss intelligently, but he was trying to fit it into the framework.
So he was trying to argue that if you transform your own – let's say you have a piece of steel, and you hammer it into a sword.
Right now, an objective is to say you've created a sword.
You've created a value, and therefore you own it.
But they don't seem to realize you don't need to say – That you own things you create to own the sword because you already own the steel.
All you did was change its rearrange its shape.
Yeah, because if you stole the steel and made a sword, you wouldn't own the sword, right?
Of course. So creation is not necessary, it's not necessary nor sufficient for ownership.
And the reason why creation said, well, but the sword is a new thing, and the only reason you own this new thing is because you created it.
So creation is a source of ownership.
But you see, if you have to resort to kind of argument, I mean, it's just semantics at that point.
Okay, fine.
But that's still going to give you the right to find your reputation because you created it, because it's not analogous to the skill.
Right.
I also think, and this is a point you raise in the book too, Steph, that there is, we don't know what the opportunity costs of IP are.
What would be present in the world in the absence of IP and, you know, of course my own story is fundamentally about that.
That, I mean, if I tried to sell my show, I'd still be yelling at traffic in my car.
But the fact that I've given everything away for free, so to speak, has really opened up a business model that wouldn't have been there before.
So if I'd chosen to exercise intellectual property rights, I would have an entirely saner career.
But I think it would be very interesting to see what kind of decisions would be made in business and in the arts, in particular, without this.
What kind of resource flow would change without IP? And I think you would get a lot of creativity that currently isn't there.
I agree. I'd love to see it.
I think we're seeing a bit of it with the digital commons and with – here's a striking thing about copyright.
At least with patents, you don't have a patent unless you apply for one.
And if you want to prevent someone else from getting a patent on the same idea that you had, you can just publish it.
You can just publish an article somewhere.
And that makes a prior art and makes someone unable to get a patent on it later.
But copyright is the thing the government gives you, whether you apply for it or not, whether you put a copyright notice or not, whether you want it or not.
And you can't get rid of the thing.
I mean let's say you wanted to be part of the public domain.
Everything you do is the public domain.
Like you do, as a matter of fact, the problem is you could sue someone tomorrow for copying your show.
Even if you said before that you weren't going to sue people because you still have a copyright on it.
So the government gives you this stupid right, and they won't even let you disclaim it.
They won't even give you a process by which you can do it.
You can only have a contract with a particular person that they sign for consideration.
Other than that, there's no reliable way to do it.
People try these things. They say, well, just dedicate it to the public domain.
You can't. I mean you can say it in words.
But that doesn't stop you from filing a lawsuit.
Copyright is like the Roach Motel, right?
You can check in, you just can't check out.
Well, yes, it's like any other right, like anti-discrimination rights.
If you're a minority and you want to apply for a job at some company, you might want to tell the employer, listen, if you fire me, I promise I will never sue you for racial discrimination.
But that comes as meaningless and the employer knows it.
You can't make that promise because you do have the legal rights to super racial discrimination later.
With due sensitivity to Steph's vacation schedule, I just wanted to make sure, sorry, I just wanted to make sure we got, if there are any other questions, I know that the sunlight is calling you to slowly explode on the beach.
I just wanted to make sure we got all the questions in that people might have.
I had one, but this is an argument that I use often that none of the pro-intellectual property people can seem to tell me that I'm wrong about.
So, for example, the current Patent laws of the United States allow people to patent living organisms where that patent extends to future generations of the patented organism.
So big seed companies like Monsanto, for example, have been suing farmers Whose fields have gotten pollinated by corn that was grown from Monsanto seeds, but the pollen has traveled and has, you know, replicated itself in fields where the farmers didn't buy seeds from Monsanto.
So Monsanto is then suing those farmers for patent violations for, you know, growing Monsanto quote-unquote corn without being Paying Monsanto.
So I don't understand, like, how anyone can say, number one, that that's deprived Monsanto of money, because the farmers didn't want to grow that kind of corn in the first place, and how the patent would apply to future generations of an organism that's self-replicating.
Well, I mean, I've heard those stories too, and they're just another example of a Of an obvious and manifest injustice of the patent law, and the problem is – this is just another one of those things.
Point them out to the IP advocates, at least libertarian IP advocates.
They'll say, well, I'm not in favor of that.
I mean they just basically buckle on every bad example you give them.
They'll just say, well, I'm not in favor of that of course.
Right, of course. You say, what are you in favor of?
They say, well, I don't know.
I'm not an expert. Right, like you hear horror stories in the Bible, and it's like, well, I don't like that stuff.
Well, it's great.
The example of it is similar to what used to be called submarine patents under U.S. patents.
That was the phenomenon whereby you could file an application and they could They could stay in what's called prosecution between filing and when they issue you.
They could stay in prosecution for theoretically – in fact, this guy, Jerome Hamilton, filed all these windshield wiper patents and other things.
He called them like in the 50s, but he kept kind of just refiling them and turning the claims to the patents as he saw technology change.
And eventually, other people invented intermittent windshield wipers and things like that, and he just waited decades until everyone had adopted it.
So in other words, the industry had adopted it already.
Just like – you reminded me of this because the farmers basically were getting these seeds in their fields, and it's not even their fault.
They're just growing because they were just given it, right?
So the submarine patents was the phenomena where, say, 40, 20, 30, 40 years later, finally I would let this patent issue, and it would submerge like a submarine.
Big, juicy targets to sue because the entire industry has embodied technology, point technology, because they didn't copy it from him.
They independently invented it later, and they just started using it.
So he sues everyone. He got it.
His patent lawyer was worth $500 million in his fees, literally, when Lemelson died.
Lemelson was worth $1.5 billion or something.
He's just one example of many of these kinds of things.
That danger was… It was a little bit in 1995 when the government changed patent law a little bit to reduce the term of patent from 17 years from the data filing to 20 years from the data filing.
So now there's a penalty.
The only thing that's hidden is the less term you have left.
So the submarine patent problem has sort of I think that's a good example you gave of the Monsanto case.
The other question that I usually have for IP people is The patent law also, it allows you to, you know, as far as I understand it, to patent anything that has not had a prior patent on it.
So for example, again, like when companies like Monsanto go into seed banks and they patent like heirloom varieties, like seeds that were You know, sat there since the 1800s and nobody really invented them.
And then, you know, they used their patent to jack the price up.
That's another example of the same thing.
But I agree with you.
Yeah, I agree with you.
IP people. Sorry.
Go ahead. It's like Ben from Mars.
But I agree with you that the response that I always get on both of those questions is, well, I'm not in favor of that, and then they can't tell me what they're in favor of, which is rather annoying.
No, it is. It is.
So maybe we should just basically put a petition out there with like 100 checkboxes.
Do you agree with this, this, this, and get all the pro IP people to agree that they're against every one of those things.
I guess then we're done.
There we go. Well, Stefan, thank you so much for taking the time to talk to us.
I know that you probably do need to get back to the beach.
So I really appreciate your coming and taking part in the conversation.
Thank you much. Thanks.
Have a great vacation. Bye-bye.
Do you have any...
Thanks a lot. No, I'm here.
Did you have another question? Yeah, I just wanted to ask, did you have any other publications coming out?
Anything to tell us about what are you working on now?
Well, I have not much on IP, probably, but I'm working on a collection of essays of my legal theory-related articles, including this one.
And the next thing I'm working on is sort of like 30 or 40 hours.
Common libertarian myths and misconceptions.
It'll sort of be a short, punchy, fun read.
But other than that, just taking my time with new projects and libertarian papers, which is the journal I started, so I'm spending a lot of time editing that and getting new submissions for that.
And I presume that people can find that online, the libertarian papers.
Yeah, that's libertarianpapers.org.
It was founded in January of last year, 2009, and… It's going really well.
We had 44 papers last year, and the winner of the Alfred Prize was announced at the Austrian Scholars Conference in Auburn last week, which is one of those papers.
And it's going really well.
I've already gotten several submissions just from the papers presented at the Austrian Scholars Conference at the Means Institute in Auburn.
So that takes some of my time, and it's fun to do it.
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