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Jan. 30, 2013 - Freedomain Radio - Stefan Molyneux
01:04:31
2314 Is "Intellectual Property" Real Property - Stefan Molyneux and Jeffrey Tucker
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Ladies and gentlemen, join us tonight.
Stefan Molyneux, host of freedomainradio.com, the most popular philosophy conversation in the world, and Jeffrey Tucker of laissez-faire books, both accomplished authors with resumes too long to even get into here.
We are tonight discussing intellectual property, whether or not intellectual property in any form is a valid concept of property.
And also joining us, our special co-host, Josh Lee, who is a software developer, programmer, has done everything in that field possible and is going to be making the case for at least a specific limited form of property rights tonight.
He's surrounded.
Sorry, Josh.
You're the one in the hot seat now because I would humbly, very humbly put myself in the same category as Stefan and Jeffrey here as a producer of so-called intellectual property who has completely disavowed the concept.
Well, let's start with Stefan here.
If you would please, sir, introduce yourself by way of your particular form of intellectual property that you produce and your attitude in your own business towards that concept.
Give it away, give it away, give it away now.
Let's get started with that.
I don't agree that intellectual property is particularly valid.
And the reason for that is it all comes down to me to...
What are you willing to shoot someone over?
Because as soon as you start talking about property rights, you talk about defensible, defensibility, right?
So if some guy comes with a rusty spoon to take my kidney, I assume that I'm allowed to, in any moral system, use force to prevent that person from taking said kidney.
And so once you start talking about property, you start talking about the use of force in defense of.
Now, someone comes to take a kidney, sure.
Someone invades your home, sure.
Somebody steals your car, you know, maybe shoot to wound, not to kill, but we can recognize that once we are delineating property, we are delineating the legitimate use of force in the defense of that property.
So, there's a gun.
Whenever you're talking about property, there is a legitimate gateway to self-defense, to the use of force.
And I can't get myself over the hump of some little girl downloading a copy of My Little Pony...
You know, SWAT teams coming in through the windows, up against the wall, spread them.
Like, I just, I can't get there for that.
And so, to me, if you can get there, I'd love to know how.
It just seems like a ridiculous overkill.
The government does that stuff all the time, Stefan.
What are you talking about?
How do you get there?
You just call yourself government, ignore all of these moral issues, and you can bust little girls for My Little Pony whenever you want.
Sorry, I should have been a little more clear there.
How do you get there without embracing evil?
That would be my, you know, how do you get there without treading on the faces of little girls who like My Little Pony?
So I give away all my stuff for free, and what it does is it drives me in terms of quality.
And I remember, I mean, I wrote software code for many, many years, and we never particularly...
Originally, we started having these hardware keys and stuff like that.
We just gave that up, and we said, you know what?
We're going to make the best software we can, and we're going to continually improve and have as high a level of quality as possible to the point where nobody's going to want to go anywhere else.
And it's the same thing with my books, with my shows, and all of that.
I just...
Keep producing the best quality content that I can.
And you want to try and make yourself as unique and valuable as possible.
And if you do that, then you don't really need to worry about copyright or intellectual property because you are simply producing new great content that people are going to be willing to pay for.
It's a huge overhead.
And, of course, in the absence of a state, you know, as a good old voluntarist or anarchist, in the absence of a state, there may be things like I can certainly see how if you've developed a particular logo that is associated with quality, you wouldn't necessarily want somebody else using it.
But the way to do that is the way they used to do it in ancient Athens.
If you tried stealing somebody else's poetry, you would be publicly shamed, ostracized, mocked.
I mean, we really undervalue the power of mockery.
And certainly those of us on the internet know all about the power of mockery since it's directed at us like a searchlight into the fly eyes of infinite sight at us so often.
But there's so much that can be done to manage and control human behavior through economic ostracism, through mockery, through the publication of people who are stealing other people's ideas and they're discrediting and so on.
So we can get a lot of quality, we can get a lot of payment without the ridiculous and dangerous overhead and the inevitable patent trolling that comes from running to the nanny state for your bullet-soaked embrace.
So on the positive side of that then, how does this suggest a different business model for you as a podcast slash YouTube slash e-book producer?
Well, it means give it away and ask for people to pay you after the fact.
I mean, this is not that typical of a concept.
I mean, if you go buy something from a Future Shop or Best Buy or wherever you go to buy your electronics, you get to try it out.
And if you don't like it, then you can take it back and give your money back.
You pay after the fact.
I'd like to see more of that model.
I'd sure love to see that in Hollywood movies.
Pay on your way out what you thought it was worth.
I think that might change things just a little bit.
But, yeah, consume it and pay as you see fit.
And that is a business model that works for me.
And it continually drives me to quality and continually drives me to be customer-focused, right?
I mean, to get the greatest quality, you need to be focused on your customer, not on anyone who might be downloading your protected content or somebody who might be copying you.
Just focus on the customer, do the best work you can, and, you know, may the best show win its share of donations.
And it works out really, really well.
Mr.
Tucker.
Yeah, you know, I think Stefan is exactly right, especially on that last point that if you get rid of IP, you do focus on serving the customer more than anything else.
I mean, you have to kind of, like, make it on your own without using the state to help you.
The only qualification I would make there is I don't actually believe that the absence of IP is incompatible with a robust and competitive and profit-making commercial culture.
In other words, I'm not at all convinced that we have to rely on sort of a donation model.
And by the way, One of the great things about the absence of IP is it allows people to make a choice.
Like in the WordPress world, they give away the software and then people charge for customization.
It seems to work.
Or in the Android world, the operating system is open source and free.
Google makes money in a different sort of way.
So you get to decide what you want to consider to be the non-scarce good.
And then come up with ways to scarcify at the margin in a way that makes it profitable for you.
As a matter of fact, I think that this is...
Not just a key to Stefan Molyneux's show or Laissez-faire books, but I think it's really the whole key to internet commerce itself.
Most everything you can get on iTunes, you can also pirate.
Most everything you get on Netflix, you can also stream for free.
So, what they're selling, what is iTunes selling, what is Netflix selling?
It's not so much units of a good, they're selling a service that customers are willing to pay for.
Well, Mr.
Tucker, if you would, could you describe in terms of what you produce, how you've organized your own affairs and your own business?
As a so-called intellectual property producer, how does this understanding relate to your business and define your business model?
Well, it's the strangest thing to reveal this to you because the topic is important to me, but it's actually sort of weirdly irrelevant.
I mean, I publish everything into the Commons.
None of the books, insofar as this is possible, I've had a couple of authors that have balked at this idea, but mostly I try to talk people into publishing using their Creative Commons license, which is what I consider the free market.
And, you know, it kind of gives me bragging rights, but it doesn't actually make any difference for the business model.
In other words, I think people overestimate the importance of IP for making their business work.
And I know this for sure, because I've talked to many successful businessmen who get, like, wildly and intensely interested in protecting their intellectual property rights.
They're willing to kill anybody, you know, who comes in their way, you know.
And smack down any competitor and defending their copyrights on the back.
They spend a lot of money.
This is the whole history of IP. You know, entrepreneurs spending vast amounts of money to maintain their monopolies when in fact, you know, quite often the reason it turns out they're making money hasn't really anything to do with their intellectual property.
It has to do with the fact that they're providing a pretty cool, you know, good or service to consumers who turn out to like it and pay for it.
You know, I mean, that's it.
I think people overestimate the importance of intellectual property for property.
In fact, mostly, as we saw from the latest case of this Newegg case, which is so exciting, most of intellectual property, you could call them rents, End up going to these trolls, these trolling third parties who aren't really doing anything.
They certainly aren't helping creators.
They're not helping enterprise.
They're just extracting, expropriating money from other people.
That's all it comes down to.
It's a racket, really.
It's a shakedown, yeah.
I know you're taking notes, and I know you're chomping at the bit to address all these points, but before you get into that, if you would please introduce yourself by way of your own professional history and how intellectual property has been relevant to that.
Yeah, absolutely, and actually that is part of the notes I was taking.
I'd like to just start off by saying I'm not a hard-line intellectual property advocate.
I was one of the Members helping develop Mozilla Firefox.
If you click file print, the page margin code, I did that.
You know, I've been involved in many open source products.
I do...
Wait, wait.
Josh Lee right here at studio has written lines of code that everybody in this audience has probably experienced at one time or another.
Possibly.
OpenOffice, I helped out with the file save or export as PDF functionality.
I used to be very involved in the open source environment.
I'm a big fan of your work.
I really like that.
That export to PDF function is just superb.
Love it.
The vTiger CRM software, I helped make a lot of the reporting, most of the reports in that.
I used to be very involved in that project.
So just let me start off by saying I'm not entirely against open source and free and sharing.
I just have some qualms about completely eradicating intellectual property as well.
I am an open source developer.
I do not I don't really know many nor do I enjoy closed source languages that you have to pay a license for.
I disagree with C++, Java.
I don't like those.
I stick with Python, PHP, anything open source.
I like Linux.
So that's the world I live in.
My background, I helped open a company.
We had no idea what we were doing.
We chased our tails around making software for different people, timber industry, furniture, Birmingham Police Department, Birmingham Traffic Center, Gadsden Industrial Development Authority, University of Alabama, Honda, eventually found our niche in medical software.
I did good with that company, sold it, opened a second pharmaceutical software engineering firm, sold that, and now I finally work for someone, first one I've ever worked for many other than Marine Corps.
I work at Global Telecom.
I'm their senior software engineer.
So that's my background, my introduction of myself.
Are they going to get you in trouble for being on the record?
About intellectual property tonight?
Are you going to have to couch anything you say or say that you're speaking only on your own behalf tonight?
I think I give a shit.
Alright, good answer.
Stefan, you have some background in software development as well.
How do you think that this perspective, now that you've had, have you always had this perspective or has your attitude changed over the time that you spent working in that field?
Yeah, I mean, definitely there is a desire to stop other people from using whatever it is that you're producing.
Of course there is, because that gives you monopoly rent-seeking.
That gives you an economic advantage.
If you can block other people from reusing anything that you've created, naturally, it's tempting, for sure.
But I just wanted to mention the idea that intellectual property is only enforceable through state law is one of these fallacies that drives anarchists completely mad.
And if I didn't have more of the show to do, I would do my pre-rehearsed anarchist-responsing scanner's head moment, which is the idea that, of course, you can have intellectual property without the state.
The majority of people in order for like a democracy to implement intellectual property or patents or copyrights, whatever you want, the majority of people must want it because they would vote for it.
I mean they would vote to have it in there and if they didn't like it you would assume at some level they'd vote to take it out.
So if the majority of people in any society want to recognize and value the people who are creating original content, Then you can have it enforced in any number of ways.
You can have contracts with people who buy a book saying, okay, you're only renting this, so to speak, and you don't get to sell this book anymore than you get to sell a rental car that you're renting.
I mean, you can put contracts in and try and enforce them in that way and so on.
And, of course, if people have a negative view of people who take other people's work and pass it off as their own, There's tons of things to do.
I mean, we don't throw plagiarists in jail.
We simply kind of expose them and usually they will suffer some scholastic or professional repercussion for whatever work they're passing off as their own.
So this can all work in a free society.
We just don't need the system that we have right now, which is just an invitation for people to squat.
And say ridiculous things like in the Newegg case, well, you're using a shopping cart metaphor and therefore you owe us a billion dollars!
I mean, or this ridiculous stuff where Apple is now claiming a patent on things that have rounded corners.
I mean, good lord.
I mean, if they ever start to charge me for my forehead, this is going to get ridiculous.
So just to get clear, this Newegg case that seems to be the latest battleground, or success story rather, in the arena of intellectual property, Newegg crushed the shopping cart patent, but what was the challenge there?
Why was someone able to say that this concept of a shopping cart in the first place has some exclusivity in terms of who can use it?
Tucker?
Well, these patents, you know, are very old, more than 10 years old, and they were kept being passed around, you know, they're like mortgage-backed securities, you know, flowing from one company to the other, and eventually landed in the hands of this company called Sovereign, you know, which was just, you know, a desk with a couple of employees, and all they did was sue people, and all they did was own these patents, which they had acquired, you know, through purchasing them, and they were entirely bogus patents, really.
But the thing is that They kept going after these companies like JCPanny and J.Crew and Victoria's Secret and Amazon and extracting these many million dollar settlements, you know, time after time.
And everybody settles with these guys.
Patent trolls arrive and they go, you owe us money for your shopping cart software.
And these companies, they make this decision where, look, this is a pain in the neck.
They go for deep pockets, of course.
It's too much trouble to challenge these guys through litigation.
Let's just pay them off so they can go away.
And this is kind of the sellout of the American capitalist class, in a way.
You know, this is what happens.
The American court system, I mean, you know, it's a shakedown, but it's totally legal.
And, you know, everybody knows it goes on.
This trolling has been the driving force behind the patent bubble over the last five years, which has become preposterous.
Got this suit.
You know, they got one of these notes from this company, this troll, and they said, you know what?
Screw you.
We're not going to do this.
This is just stupid.
So they went through a court battle.
They were ordered to pay, you know, a fraction of what Sovereign was asking for.
But then they challenged the suit based on some passing remarks of the judge.
And then a new jury said, yeah, this is idiotic, actually.
You know, this is not even legitimate.
And slammed the troll down.
And it's really devastating because it's the first big loss for a patent troll, really, since the age of software began.
So, I mean, I have an article coming out tomorrow predicting that this is going to pop the patent bubble.
I sure as hell hope so.
Well, would somebody like to explain what is a patent troll?
I can do that.
I mean, a friend of mine actually works in this field.
A patent troll is somebody who buys or creates a patent not with the goal of producing something but with the goal of shaking down other people who might have similar items.
And so you can say, well, the garbage can on the desktop of a computer is my idea.
And you just throw a patent in and then you then go to people who haven't patented it because they're not insane or evil.
And you say to them, listen, you have a garbage can and so now you need to pay me to use this garbage can idea.
And they sit on this stuff and they buy and sell this stuff and they have no intention whatsoever of entering into the creative fray.
And what it does, of course, is in a weird kind of way, it is good for big companies because it keeps smaller companies out of the mix.
So there are lots of companies who just won't develop for, say, the iOS system because there are a bunch of patent trolls out there who will hammer them hard to the point where they can lose their house simply for developing some minuscule 99-cent app.
And, of course, people think that when the government has a law that it's somehow going to produce justice, which, of course, it never does.
What it does is it ends up being a tool for people to rip other people off and shake them down.
And for larger companies who can afford legal departments to, in a sense, not directly but indirectly, keep smaller companies out of the field because the threat of patent trawling is so high.
So the big companies are a magnet for the patent trawls because they have money.
But it also does keep smaller developers from coming in.
Because smaller developers simply cannot afford this ridiculous multi-million dollar multi-year lawsuits that have very uncertain outcomes as we can see.
I mean this was ruled against Newegg, ruled against them I think two or three times and then finally on appeal after they'd spent Lord knows how many millions of dollars on this.
Smaller companies simply can't do it and large companies they quite like The last thing I'll say is, to the credit of Microsoft and Apple, they actually didn't really get involved in patent trawling until they got patent trawled.
Jeffrey was asking if you could steal your idea, and I said no, that's metaphysically impossible.
Well, with a spoon, yes.
You can steal my rusty spoon that I'm going to use to steal your kidney, but you can't steal my...
No, he can come in and steal the part of me that comes up with ideas with a spoon.
It just won't do him much good sitting in a jar.
Right.
Okay, so Josh, you see the obvious consequences with this sort of large-scale stuff.
The company Sovereign, as a patent troll, wanted to try to say that they owned the concept of...
The shopping cart.
And there are thousands, if not millions, of websites and companies that use the idea of calling their checkout system a shopping cart.
And that's really what it boiled down to, what they were trying to limit.
Do you not feel that if there is that large-scale consequence for ownership of an idea, that even on the small, specific, limited scale that you're advocating, there would then be At least small, specific, limited, negative consequences of the intellectual property that you're advocating?
I don't really believe that that is a true form of intellectual property.
See, property, a fruit of one's labor.
I believe that if they designed the shopping cart software that the other company was using, they could say something.
But they didn't.
Just because they're using the word shopping cart, they're getting sued.
And I think it's just a silly word game at that point.
I think that one should have a right to the intellectual property that is a fruit of their labor, not a fruit of their idea.
If someone else does the work, it's a fruit of their labor, not your labor.
So, Mr.
Tucker, does this suggest a possible legitimate form of intellectual property if it can be directly traced to the origin of the labor that produced it?
So I don't really have a problem with, like, even what Stefan Molyneux said, that, you know, if you do something like credit for it, you know, this is not an issue.
You know, to me, it's a matter of whether or not these, whatever emerges in a market economy, in the absence of coercion, In the absence of, you know, patent and copyright depend fundamentally on coercion.
I don't have a problem with any form of contract in the free market.
So long as, and this is the critical thing, parties that are not part of the contractual arrangement aren't stopped from creative endeavors.
Well, so are you suggesting that what Josh is advocating is coercion?
No, no, I wouldn't say that.
And, you know, ultimately, I think that, you know...
Look, here's an example.
In the video game industry, this is a really good example.
Lots of people are involved in creating video games.
and you work for a company, and you work in kind of an isolated secrecy for up to a year in creating a game with a whole crew, and everybody's really busy and everybody's really excited, they keep it absolutely secret and internal to themselves.
That's really important in this culture.
It's not even so much a matter of a contract.
Essentially, if you're working for a gaming company, and you go out and spill the beans and tell everybody what you're working on, I mean, you are shunned.
You're probably fired.
You'll never be hired again.
You'll never be hired again.
I mean, it's a catastrophe.
So there's this culture that's developed this kind of secrecy.
And then when the game comes out, then they release it.
And, of course, the game has to be spectacular.
It has to appeal to consumers.
And, of course, immediately the pirates are going after it, you know.
But it's not a problem if you have a good marketing plan.
So, in other words, you can get the right mix of openness, of sharing, of marketability and secrecy through the voluntary sector of society without taking recourse to these extreme measures that essentially grant State-protected monopolies and coerce third parties.
That, to me, is the real critical issue.
Why do you want to call it...
Well, hold on, hold on.
Just to get back to what Josh is advocating, if someone writes the software for a shopping cart and it's publicly available then on the website because people can see it, people can access that, at least...
The software, but they can't see the background underlying code.
Well, that's a good point.
So hold on a second, though.
Just to clarify, Josh.
So you're saying that if you design a software code that is creating a function on a website, that you can keep that a secret and you can call that intellectual property, but the moment that you leak it or release it, you've kind of given up on that?
No, see, here'd be an example.
Because then how do you pursue it?
How are you suggesting some enforcement of that?
A whole stack of notes here.
Hit it, Josh.
You're jumping to the end of one of my notes.
I'll go ahead and jump if you want, or should I start at the beginning?
Hit it.
All right.
Starting at the beginning.
Stefan, you made a point in the very beginning talking about physical property, your kidney, and so forth, and then moving all the way towards intellectual property and talking about where you draw a line.
It's kind of funny.
Lines can be moved slightly throughout arguing And nudged a little bit one way or another.
I think that's a bad way of arguing the fact.
I think that you should talk more about whether or not intellectual property ideas can be fought over contractually.
Can they be owned in the first place?
Yeah, I don't...
I don't believe that.
If you sell something to someone, can you sell it to them via a contract?
I will sell you this as long as you agree that XYZ. Like, as long as you agree not to share a copy of it with anyone, as long as you agree not to, you know...
Well, you guys also, everyone here supports contracts, and even in a free and open market there would be contracts, and there would be a free society way of handling people violating contracts.
Yeah, that's right.
But the question is, what do you do when somebody reverse engineers your program?
You know, I mean, it seems to me if you've created software that you can so easily reverse engineer, you can't somehow enforce your intellectual property just because somebody was able to replicate it.
I mean, you've got to be a better programmer than that, essentially.
I mean, Google has been able to maintain its secrecy around its search algorithms all of these years without any problem.
Speaking of Google, I've got a, you know, skipping way ahead of my notes, I've got a question.
You were talking about how Google released Android.
And they allow other developers to develop apps, but they provide the service.
What if they spent five years and hundreds of millions of dollars employing thousands and thousands of people to build up and get ready for this service?
And just as they were leasing it, one of the employees grabbed all the code and snuck out.
What if it was the janitor?
No, but that would be in violation of an employment contract.
You wouldn't need any IP for that.
You would simply sign an employment contract where you say, because companies do this all the time, and this would be perfectly valid in a free society where if I go and work for you, And I go and develop some code, then whoever is paying me for the code owns the code.
I don't get to go and walk out because I'm selling it to that one person as an employee in an exclusive purchasing environment.
So you're saying they can own the code.
You said they own the code.
So if he walks out and sells it, the person that bought it didn't sign any employment contract.
If they start undercutting Google now, not only do they go out of business, the thousands of people that worked on it are out of a job.
Well, but what a wonderful boon to the consumer, right?
And what a wonderful boon to the economy as a whole.
Because what happens is that if somebody else could undercut iOS's app distribution model or the Google distribution model on Android...
How fantastic!
It means that instead of paying 30% to Google or whatever it is to iOS, to Apple, you'd be paying a few percentage points and all the people who would be sitting there having this monopoly privilege to release applications would actually go off and do other things like develop new applications or find cures for cancer or whatever.
So I think that would be wonderful.
No, but the reality is that if it were possible for other people to undercut this monopoly infrastructure, it never would be built that way to begin with.
Right?
So, as a business person, if you want to invest millions and millions of dollars, you have to show how you're going to be able to maintain control over the profitability of it.
And so, that's not a scenario that would happen in a free society, and it would all be to the benefit of the consumer and to the economy as a whole.
Stephan, I mean you said that they would have to keep control of their software and you said, Adam, if it was a janitor and you said that he signed a contractual agreement, we all can see that the janitor stole the property and you're saying that would be a benefit to society.
What's the difference between that and stealing a car and selling it to someone a lot cheaper than they'd buy it from a dealership?
That's a benefit to the person who bought it.
They got it a lot cheaper.
Well, no, no, no.
Wait, wait, wait.
No.
Okay, look.
Stealing somebody's work is different from intellectual property.
These two are not the same at all, right?
So one would be covered by an employment contract, and also, like, you are not authorized to access this computer.
You can't copy stuff to a USB drive and take it out.
Like, that would all be part of a contract that you would sign as part of coming onto the company, if that's what they wanted to do.
But intellectual property is very different from that.
Is he calling the car the work or the code the work?
Both.
Well, there's a lot of mixed up terms and ideas here.
But I think Stefan's right, that ultimately reverse engineering code and distributing it broadly throughout society and improving somebody else's product is a benefit to society and it's not like stealing a car because we're talking about infinitely reproducible goods here.
The other thing is that Current patent copyright laws, you know what it does?
It tempts us all to think in terms of zero-sum.
It's like, this is my thing, if you get my thing, then I'm sunk, you win, I lose.
That's not really the way it works in a free market.
And you know this just by going to the drugstore, where every name-brand product has the same product right next to it with a store label, CVS, Walgreens, or whatever, selling for much less.
Both companies You know, hold on.
I gotta stop you right there, Jeffrey, because there's something about that that totally boggles my mind that really needs to be explained to understand this.
Why the hell do people still buy the brand name drugs when the exact same thing right there is available for cheaper with a different label on it?
It's not the exact same thing.
Okay, well, when it is.
Now, Josh, there are cases.
They use different dyes, cheaper dyes and stuff.
Bayer aspirin versus CVS aspirin.
It's the same damn thing.
Not always, not always.
In some of them, they use a different, a cheaper dye.
Okay, well, you're just as likely to be allergic to the off-brand as the name brand.
And that doesn't explain the broader, that might be a thing around the margin there, Josh.
Oh, no, no, look, look.
Adam, it's the same reason why people would rather go and see the Rolling Stones than the Drolling Bones, the Rolling Stones cover band, right?
I mean, they're seeing the original, they're dealing with the original, and then they're dealing with the cover or the ripoff.
And people will pay extra for that quality.
I mean, there are tons, there are millions of bar bands who do covers all over the world.
And they do covers that if you close your eyes are kind of indistinguishable.
We're talking about over-the-counter drugs where the difference is indistinguishable.
Well, maybe people, that's just it.
I mean, what seems indistinguishable to you and me, Adam, doesn't seem to, apparently, to a lot of consumers.
None of the consumer, look, no, the consumer knows when they go with Bayer, they're getting a whole rack of quality controls.
They do not know The degree to which other companies or generic companies have the same quality controls.
And when it comes to medicines you're putting in your body, most people will pay a buck more for that kind of quality.
Because Bayer is obviously charging more and therefore they're invested in having the extra whatever it is that they're putting in there, the quality controls or using the finest quality ingredients or making them hypoallergenic.
So when people are putting stuff into their body, they're willing to pay a little extra because they don't want to research this other company and find out whether they have the same level of quality or whatever.
Okay, now my rationale, like I go to Target.
If I go to Target and my allergies are bugging me and I want to get some Sudafed, I go to Target and I see there's the Up and Up brand and there's the Sudafed brand.
I understand your point there, Stefan, but I've already thought my way through that because I assume that, yes, Sudafed has invested in advertising and they have a national brand that they have an interest in maintaining the integrity of and that is their market incentive for For maintaining an adequate level of quality control.
You see the up-and-up brand, you go, well, that's Target.
I'm going to assume that they also have enough of a similar incentive that the quality control might be the difference between, you know,.00001% and.00002%, you know, contamination rate, and I'm going to save a buck and I'm going to buy the store brand.
Well, that's because you're a young man.
And young men, and I remember this, it's not too distant in the midst of time, maybe a medium distant, but you're a young man who doesn't have children.
And so, for me, it's like, okay, well, I could roll the dice with this medicine I've never tried before with this company that I don't really know much about.
And that I can go home and if I have some negative reaction, I can at least say to my wife and my daughter, sorry, I'm not available for two days, but here's a dollar that I saved, right?
When you get older, time becomes much more precious and money becomes less precious.
But I know more about Target as a company than I do about – is Procter& Gamble – I don't even know who makes Sudafed.
When I buy the store brand, I know who's making it.
It's like – Stefan, I understand your point and maybe that's it.
Maybe there's enough irrational parents out there.
You can't.
You can't argue against the market.
The market is the market.
I mean, you can't argue against the market.
This is the decisions that people want to make about what it is they want to buy.
It may not make sense to you, but clearly it makes sense to enough people that there's a market for it.
And I think Jeff's point, which is to say that there's people who have the original, there's people who have the copy, and they can both coexist and obviously be profitable, which is great.
Mr.
Tucker.
That's exactly the point I wanted to make.
This is just, it's weird to us to even be talking about this.
Like, why are there two products that are very similar, with different names?
It's called the free market, and it's called competition, and everybody can win at this game, and that's what we need to get used to in the post-IP world, which I think is probably already here.
We have to get used to kind of duplicated efforts and people outsmarting each other and emulating each other, copying each other's ideas.
Lord knows, I mean, people are copying Stefan Molyneux every day and challenging him to get better all the time.
And same with you, Adam.
I mean, you're all subject to this.
But it's mostly my dance moves that they copy, and that's the tragedy.
It just means you have to get better.
And it's the same thing in the world of industry and in software and pharmaceuticals and in films and music and everything else.
Everybody can win in a competitive game.
It's hard to explain, I think.
You know, the first human intuition is to say, wait a minute, you know, only one party can win at this whole competition.
Profitability gain.
You know, your profits come at the expense of somebody else's.
It's not really true.
I think copyright and patent laws actually tempt us to believe that.
And they disable the market system for coming up with more innovative, competitive means of producing better, more spectacular things.
Protecting them when they need to be, releasing them in the open when they need to be, producing software that have codes so that people can't just infinitely reproduce it even though it is infinitely reproducible.
These kind of market mechanisms of distribution are part of the innovative process of the market itself that are disabled when you have the state intervening with these kind of ridiculous...
Which I think is one of the tragedies, actually, of patents and copyrights, is that they've slowed down the market's response to the digital age to come up with better ways of For example, releasing books, you know, that are not, you know, instantly copyable, for example, or that have a different funding source like advertising in books or, you know, movies.
I mean, the software industry has really essentially overcome the problem, you know, more or less of piracy, if you want to call it a problem.
Through market means, even though they still hold copyright, by, you know, complicated coding things or providing service for software that you purchase and denying service to those people who just download it for free.
So this is kind of market.
If you want to call it intellectual property, that's fine.
I don't care what you call it.
Right, as long as it's non-coercive.
Now, Mr.
Tucker, we have a tweet here from Joshua A. Behrens who writes, in answer to the question, no, property arises from scarcity.
Ideas aren't scarce and therefore cannot be made into property.
Now, whether or not you agree with this cannot statement, that they are not scarce, because it seems like what we're talking about in the kind of intellectual property that Josh is advocating, That it's a voluntary scarcity or scarcity that is created by contractual obligation or some limited access that is contractually based, not government or coercive.
And regardless of whether you agree with that concept, the idea that ideas are becoming less and less scarce because of the transaction costs being reduced to zero by the internet We are seeing a much greater difficulty, or I should say, a much greater ease, rather, in making ideas less scarce, much greater difficulty in keeping ideas scarce.
And if anything, that is being taken out more and more from the market as a whole, the sum of nonviolent interactions.
And there really is a new mentality developing.
I just want to underscore this, that you started on, Jeffrey, because I think citizens of the internet have this idea kind of taken for granted and built in that they are part of the hive mind.
That if their brain produces something that has contributed to the pile, the vast pile of human knowledge that is out there that now everyone on the planet has access to, that's it.
They produce it, they contribute it, it's over.
There's no, I'm gonna chase people around who are using this idea, I'm gonna track them down, I'm gonna not let anybody copy it.
And a new world is emerging regardless of what your concept of intellectual property is.
I agree with that.
Thank you.
Josh, you had another question?
Yeah.
I'd like to ask basically both of them to answer in their own way a certain scenario.
Let's say that in my basement I come up with the dream for a new invention.
And I take out a loan, not from a bank, because we've done away with banks.
And let's say there is no state.
I never really have understood the market will sort it out with contracts.
So hopefully in your answer, you guys can cover that.
Sorry, why would there be no banks in a stateless society?
I mean no fiat currency banks.
No counterfeit houses, right.
Three years worth of work.
And I build this machine that if you walk through, it cures you of any illness.
And it takes a lot of software to run it, plus a lot of new inventive hardware.
And three years later, people come and I have them sign a piece of paper to use it.
And it says, if you use this, you can't, you know, if you do figure out how it works, you can't share it with anybody.
I need to charge for it.
Otherwise, I'm not going to be able to pay back my loan and I'll lose my home or whatever.
And if I can't pay back my loan, I can't make payments on the rest of, you know, the things I owe money on.
And let's say that someone does steal it anyways.
They give, they sell the idea or give the idea to someone else and then they die.
So the person that signed the contract with you isn't even alive.
But they sold the idea to someone else, and that someone else rebuilds the machine dirt cheap and is able to undercut you.
Now, I'm not overcharging the public.
I'm not, you know, holding the secret to life here and trying to rip people off.
I'm just trying to recover the money from my three-year loan at a reasonable rate.
How do you go after the person who...
Can you go after the person that basically stole the fruit of your labor and is undercutting you?
That's a lot of little things in that scenario.
Stefan, go ahead first.
I know what it is, but you guys are talking about intellectual property and code, so I want to talk about hardware a little bit.
Just bring that up there, because that's still the fruit of your labor.
Stefan?
Okay, well, obviously, you wouldn't build something that complex in your basement.
You would need to get venture capital, and the venture capital would be provided to you.
And, of course, a venture capitalist would love to invest in the cure-everything walkthrough scanner.
I mean, that would be fantastic.
And what a great boon to humanity you would have provided.
So a venture capitalist would say, okay, well, obviously, we're going to have some problems with copying stuff, so we'll try and build in some safeguards or some fail-safes about that.
but there's no shortage of sick people, and sick people don't usually want to cut corners on their cure, which is why there is generic and non-generic medicines.
So obviously there's no shortage of sick people who are going to want to pay for the original, which has gone through all the battery of testing, has got all the third-party verifications and validations that it's not going to turn your children into nine-headed monsters or whatever it is.
So this is going to be all certified, all squeaky clean, all as safe as can possibly be by whatever third-party agencies will be validating these things in a free society, and so people are going to pay for that.
You know, if you've got stage 4 cancer, you walk through this machine, you're cured.
It really doesn't matter how much money you pay for it because you can't take it with you if you die.
And so if somebody does make some knockoff copy of it, then that copy, I mean, it's either going to work or it's not.
If it doesn't work, then people will sue whoever makes it and that product will vanish very quickly.
If it does work, Then it won't have gone through all the testing and therefore it will be cheaper, right?
So instead of it being $50,000 or $40,000 to go through the special A's tested machine, maybe it's only 500 bucks to go through the B machine.
Now the reality is, the people who can only afford 500 bucks, they're not going to be buying your $50,000 cure anyway, so the fact that they go through this knockoff machine isn't taking any business from you, but what has happened is, People have gotten cured without costing you any money.
I mean, what a fantastic win-win situation.
So you're saying it forces the producer, in this case, to be more competitive, to drive your own price down to better...
No, no, no, no.
I'm not saying that at all.
Let's say to have a really safe cure-everything machine means you have to charge everyone who goes through it $50,000.
So maybe that's a 3% or 6% profit or whatever it is.
Maybe that's the lowest you can go.
So if somebody can afford that, they'll pay for that.
But what I'm just saying is that if you're charging that much...
And you're creating an opportunity for somebody to undercut you.
It challenges you to provide a greater spectrum of services where you'll have an advantage.
So you would offer the $50,000 version and the $5,000 version in order to maintain your market advantage.
So it provides that competition that says you have to better serve the consumer or you're going to have this Adam, what do you mean you would also offer $5,000?
You'd only partly cure them?
Well, no.
If you're saying you've got the $50,000 that has all of these advantages that Stefan has mentioned of all the certification and everything else, it means that you have to offer a $5,000 version before someone can rip off your idea and And create the $5,000 version.
So maybe you can create the $6,000 version now and accelerate that process.
And again, this competition, this more open system of competition leads to greater service for the consumer one way or another.
The person who came up with the original product, bringing it to market, has to minimize their first to market advantage to make it so that someone else doesn't come up and compete with them in the next business cycle, if you will.
And they have to reduce their costs as much as possible to prevent themselves from being undercut and make the decision from the consumer be, well, I can wait a few months for the cheaper version to get here or I can get it now from the original source.
At the lowest price that they can come up with.
And again, you have another mechanism that creates better service for the consumer.
He said $50,500.
I feel, from my experience as a software engineer and selling stuff out there and seeing some of it copied, it seems like people more or less actually play the price is right game where they just undercut you by a buck or two.
And so savvy shoppers go to the other location And you're not making any sales, and you drop your price a little bit.
Sorry, but let's remember that only one of them has been certified as completely safe, right?
And the other one has not been certified as because it's a copy, because it's not the same as the original.
100 people go through your competitions machine and walk out perfectly fine.
Now they're both certified completely safe.
No, I personally would not feel comfortable with that because you don't know what the long-term effects could be of a machine that has not been tested for long-term safety.
There could be some radiation thing that gives you a tumor in six months or six years.
So, I mean, just for most people, they'll pay the extra.
Even if they have to borrow it, they will pay the extra.
We know this because people pay extra for safety features in cars and there are cars that are 50 bucks and there are cars that are half a million dollars.
So some people will pay more for the safety but the people who can't afford the quote safe version are not taking any business away from you but what's happened is a whole bunch of poor people have gotten cured because of the work that you did and haven't cost you a dime.
I mean that just seems like a wonderful outcome.
Mr.
Tugger?
It's not just safety.
There's also a first-mover advantage that always exists in markets and always has been.
The first people to come to market with any good, whether it's a new cool shoe or a new medicine or a new handbag or a new style, and Lord knows the fashion industry knows this, the first mover in the market that comes up with the cool thing that everybody wants It maintains that advantage for a very long time, even long after intellectual property has expired.
We can see this even in the case of Coke or Kleenex.
The K-Cup patent just expired last year, and everybody thought the market prices of K-Cups were going to collapse.
They didn't.
They maintain.
They're just the same as they were.
And partly it's just because of the first mover advantage.
People really dig it when a company comes out with the first cool thing.
And then this is the way the market works.
It's available as a luxury good for the few.
And then the knockoffs come.
People emulate and copy and find ways to reduce costs, make it more cheaply, slightly improve it or whatever.
It starts to You know, be distributed to the masses of people.
That's what we've seen in the world of cell phones and in computers and in every other area.
This is just what, in some ways, your scenario is ridiculously unrealistic.
On the other hand, it's kind of a description of economic development.
Well, I had to come up with something that couldn't be immediately shot down.
I want to say something before any, you know, in case I don't get a chance to, if Adam says goodbye to you guys, I want to say one thing.
I'm here to continue to be enlightened.
I'm here to learn, and I'm here to stay as open-minded as I have been thus far, listening to Adam vs.
the Man as a guest many other nights.
I just haven't been entirely convinced.
That's why I still have these questions and this stance, but I'm not trying to be stubborn or hard-headed.
I did come up with that question involving a sci-fi film, scenario simply because we can't seem to come to agreement with intellectual property when it's just ones and zeros, so I came up with a little bit of also hardware involved.
Well, hold on.
We only have a few minutes left here, and I want to bring it back to the big picture for the last bit of this, and I want to share a couple of tweets that we've got during this conversation.
First from tourniquet1984.
Wasn't that a great Twitter handle?
Do you want to get into the metaphor of the tourniquet that is squeezing off the lifeblood of liberty from society?
Tourniquet 1984 writes, name brand over-the-counter drugs of great marketing to win consumer trust.
Most people simply don't know the difference between Tylenol and acetaminophen.
And that sounds like the point being they're taking advantage of people's ignorance.
Like, you should trust us because we have a lot of money to spend on advertising.
But I just want to share that and move on to one last tweet, and I think this will help us wrap this conversation up.
This is from Electro Pig.
And as you all know, if someone called Electro Pig comes to you on the street and says, I'm Electro Pig, whatever they say next, you're going to believe outright without questioning.
Electro Pig says, at Adam Kokesh, it is a valid form of property only when you have specifically created it And where retaining full control does not harm others.
And I hear a lot of language going back and forth in how we've been talking about this.
And I've tried to take a rather hard line in my own way of dealing with the issue of saying intellectual property itself as a concept is invalid.
And that's really...
An easy position to take.
And it's hard when you say, well, this is a product of my labor, and it's such a convenient metaphor for these times when you do have legitimate reasons to either sequester information or lay unique claim to information and ask that your creative role in that I think we're good to
go.
And on that note, this has kind of broadened my concept of this issue as a whole.
So would you say, Stefan, and I'll give you guys each a chance now, just a few minutes, to wrap up and give your final thoughts here, as we all seem to be...
And we didn't even get into the Justins.
We were going to talk about how this intellectual property has given us these monstrosities of celebrities.
through intellectual property rights for movies and music in ways it is concentrated power in the hands of so many and and it seems that we're all in agreement about the lack of validity in preventing sharing when information is out there and no contractual agreements are are involved if you're exercising your own property rights to download a song and to enjoy it for yourself things like that Does this present a concept of what,
even for an anarchist, Stefan, you would say is a valid form of intellectual property, if you limit it to that, if you word it right, if you say just under those circumstances?
No, again, I mean, whatever people want to contractually enforce and whatever the majority of society is willing to countenance and enforce is what's going to happen in a free society.
But I sort of think about the replica kidney ray gun, right?
Let's say I'm walking down the street and someone shines a ray gun at me.
That replicates my kidney.
I don't even know it's happened.
I'm just walking down the street.
I still have my kidneys.
I don't have to pee into a cup.
I don't have to go to hospital.
I still have both my kidneys.
I haven't lost anything.
They just have one extra kidney, and I think that's a good thing.
Sticking out of your gut?
Yeah, there's nothing bad that's happened.
The other thing, too, just to very briefly mention, IP tends to degrade quality, I think, considerably.
If you look at some of the bloatware of the IP-protected companies, it's ratchet.
And also, IP makes movies pretty crappy, for the most part.
I mean, so one of the reasons that movie-making studios can afford these multi-hundred-million-dollar movies is because of IP. And because of that, they don't have to take on the unions.
That get their monopoly wages through state protection.
But because the movies are so expensive, they have to appeal to the lowest and broadest common denominator, which is why it's all CGI and empty-headed, vacuous plots.
And so it really bugs me the number of hours that I've spent watching crappy movies as a result of government involvement, both in keeping the unions very expensive and in keeping IP, which pays for it.
And I'd like that time back.
And that's a very, very important part of my drive in this area.
Mr.
Tucker, your last thoughts?
Yeah, I would just say that I would like to get rid of the phrase intellectual property altogether, just like I don't like the idea of people as property and slavery.
Throughout human history, people confuse this issue of property so substantially.
I agree with the Twitter A guy who said, things have to be fundamentally scarce in order to be property.
If it's not scarce, we need to come up with a different word for it.
In 1995, the internet was privatized and unleashed on the world, the world's greatest copying machine.
That's what the internet is.
We've seen a vast migration from the physical world to the digital world.
We've got to unleash, we've got to use all the powers of this amazing copy machine, which I believe is going to save humanity.
And intellectual property in the form of copyright and patent pose a fundamental threat to this thing because it has empowered the state and given the state a great excuse to violate our human rights.
And our liberty.
And to me that's the strongest reason to oppose it and to violate it and get around it and to shred it and celebrate its death as soon as possible.
Well then before we give Josh the last word here, would there be a better term for what we seem to be talking about tonight as a form of Intellectual property.
And again, hating to use that term for the kind of information, proprietariness, some sequestering being valid and legitimate that we can put on this as a term that says, you know, we don't believe in intellectual property, but we believe in what?
Abstract gun monopoly shakedown.
I think it's just a contract.
But Jeffrey, that doesn't address the...
We would need a term then to refer to those pieces of information that people call intellectual property to at least address the way that...
Because even for me...
Well, I'm pretty slow.
It was a long process to wrap my brain around the concept of intellectual property because we have been conditioned and propagandized our entire lives to think intellectual property and physical property are in the same category.
We need a term that addresses that thing and distinctly puts it in a different category from physical property.
I think it's a problem to even come up with a term for it because I don't believe it even exists.
It's either a label contract or it's a purchase contract.
I've used this example yesterday in a podcast I did, but if you went into the store and somebody was selling you a potato and they said, well, these potatoes don't sell.
The only thing about them is that when you get them home, you can only mash them.
And if you slice them, That's a big problem for us, and that's a violation of contract.
And we're going to come after you, okay?
So I suppose that that contract might work.
I'm not entirely sure, and that's okay.
But if somebody right next to them, the store next to them, is telling multi-use potatoes, I might be more inclined to go that direction.
So, you have in the market a kind of competition for contracts, too.
And I'm just making a market prediction that the more liberal the contract, the more likely it is to succeed in the market.
Like, you know, potatoes that you can only mash and not slice are just not going to go very far.
So, Stefan, any thoughts on the terminology here?
I mean, I certainly understand the question.
It's stuff you make.
I mean, I call my stuff podcasts, but there's no property in that.
It's just I created a podcast which is now available, and I choose to publish it in a medium that can be copied.
I could choose to carve it in stone tablets, which would be a little harder to copy, but I choose to put it out there in the great infinite photocopy Xerox planet of the internet.
And so it's a podcast, or it's a book you've written, or whatever it is.
It's just something that you have done, or something that you've created.
And once you put it into the giant photocopier, well, you've just photocopied it for eternity and infinity.
And what you get out of that is you get a huge audience that otherwise you wouldn't have.
You get a kind of immortality in that you've now flushed your intellectual content out into the mainstream, out into the internet where it's going to be there forever somewhere.
So you gain a huge amount out of that.
And isn't it great to get a revenue stream without all of this overhead of the state and of copyright?
And that's all possible.
Let's just try and get rid of as much overhead as we can and get these people onto doing something productive rather than chasing people around who are productive.
Yes, very, very well said.
All right, we'll give the final thoughts here to our guest co-host, Mr.
Lee.
Yeah.
Adam just had said a few moments ago that you really do need to be able to separate out physical property and intellectual property.
I still would disagree that a physical property could be the fruit of one's labor as a carpentry can make a beautiful chair or a beautiful table.
Someone like Stephen Hawking, who doesn't have the ability to use his arms and legs to build something, could use his mind to create something.
Some mathematical functions are simple.
Find me the diameter of a circle.
2000 years ago or so, somebody figured out you make a function, call it diameter pass in radius.
Return radius squared times pi.
It's that simple.
Some of the mathematical functions I deal with at work are 8000 lines long.
And when they have a bug in them, it doesn't necessarily mean they crash or they don't run.
They return the result.
The value's just wrong.
And I have to close my eyes and see the numbers flow and see where the variable becomes to have the wrong value.
Long, brunette, redhead, like in The Matrix, right?
You have to know the code that well.
Eventually I realized that, oh, that's where the value turned wrong.
And it's very difficult and very hard and very long day's work.
And I create it from scratch.
It's a cross between algebra, calculus, and trig.
When I'm done, I have created something that no one's ever written before from scratch.
I feel truly like it is a product of my labor.
Now, regardless of whether or not it can be copied easily or it's difficult to copy.
A chair is difficult to copy.
A snapshot of code and a file is very easy to copy.
But it's still a product of my labor.
Now, when I asked you guys the question about how do you go after the person, you guys talked about the product and how people would use the product.
You never mentioned or answered the question that I asked addressing the fact that someone violated a contract.
If I only give people my copy of my property based on them signing a contract with me and they violate that contract but then give it to other people, people still now have a copy of something I did not give to them.
And I did not just leave it out there to be copied.
Can I ask you a specific question though?
Absolutely.
Do you own that code or does your company own it?
Do I own it or does my company own it?
Well, in the past I've always owned my companies.
Right now I do work for another company though.
But the company would still own it, not you personally.
Stefan just said something and I didn't hear him.
Sorry, but even if you own the company, having been a co-owner myself, even if you own the company, the code that you write, if you're paid by the company, accrues to that company in that it's bought and sold by the company, so it accrues to the corporation, I would assume, especially if you have investors.
But yeah, it depends.
Most coders work for companies.
They don't own their code.
No, I understand that.
To own what you create is basically bullshit.
It's not true.
I mean, that's the great lie.
You don't own what you create.
So you don't own a table?
A carpenter doesn't own a table?
No, not if he's working for a carpentry company.
And if he makes it in his basement?
If he owns the wood, he can burn it.
He can make a table.
So what if I write software in my home office?
You can't burn software, Josh.
Sorry, as much as you try.
Ah, so even though it's a fruit of my labor because...
You can't burn your code.
The fruit of your labor stuff...
And by the way, it is actually stored physically.
It isn't a thought anymore.
Once it leaves my fingers, it's stored on a physical hard drive.
It used to be magnetically as positively and negatively charged as pieces of tape.
Well, that's where this conversation actually gets easy.
And the standard answers about property rights apply...
And that's all the time we have for this conversation tonight.
Gentlemen, I really appreciate it.
It's been a blast.
Stefan, I have to say, if you were to ever carve some quotes of yours into stone tablets, and I could get a stone tablet hand-carved by Stefan Molyneux just for the novelty of that, I would probably buy one.
Thou shalt not donate less than $2 to Freedom Radio.
So please support these things.
Please support these intellectual property producers.
Freedomainradio.com.
They accept donations there.
Laissez-faire books.
Jeffrey Tucker, thank you so much for joining us.
LFB.org.
Josh, it's been great to have you on this conversation.
Gentlemen, it's been great.
Really appreciate this.
And I think this has advanced the conversation about intellectual property.
It's one that we're going to be keeping up with.
And making sure that our audience at least stays up to date as this becomes more of an issue, as we see the terrain changing, and as we see, I would like to call it, the paradigm of intellectual property completely melting away.
No, I believe it's coming.
And becoming irrelevant.
Eventually be able to tell a computer, write me a program that does XYZ and it'll do it.
Then I become obsolete.
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