Posts Tagged: intellectual property

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The Case for Abolishing Patents (Yes, All of Them)

… Eliminating patents altogether, Boldrin and Levine say, would also have fewer negative consequences than most of us assume. Most industries, they argue, only resort to patent litigation once their pace of innovation has slowed. As long as they still cranked out out new, popular products, companies like Apple would continue to profit by being the first to market, which often confers a long-term advantage.  …

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The Crypto-Anarchist Manifesto

Just as the technology of printing altered and reduced the power of medieval guilds and the social power structure, so too will cryptologic methods fundamentally alter the nature of corporations and of government interference in economic transactions. Combined with emerging information markets, crypto anarchy will create a liquid market for any and all material which can be put into words and pictures. And just as a seemingly minor invention like barbed wire made possible the fencing-off of vast ranches and farms, thus altering forever the concepts of land and property rights in the frontier West, so too will the seemingly minor discovery out of an arcane branch of mathematics come to be the wire clippers which dismantle the barbed wire around intellectual property.

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Rob Reiner, in a recent interview with Chris Matthews, showed that while he may have moved on to directing and producing, he’s still a comedic actor at heart. Reiner, best known as Archie’s son-in-law “Meathead” on “All in the Family,” told Matthews — with a straight face — that “the Hollywood community is the only donor base … that has no quid pro quo. … We don’t … support a candidate because … he might be able to do something for us.” Oh, Rob — you’ve still got it!

But on the off chance that this was really intended as a serious factual claim, rather than a liberal version of Stephen Colbert’s shtik, I’d like to point out a few things: Digital Millennium Copyright Act. SOPA. ACTA. The FBI seizing dozens upon dozens of torrent download sites and issuing press releases from Disney headquarters. There, that should do it.

See, my first impression must have been correct: Only a comedian would claim Hollywood wants nothing in return for its campaign contributions.

Draconian digital copyright law and Gestapo-like enforcement of same, so beloved of Vice President Biden and former Senator Chris Dodd, are central to the business model of the big movie corporations.

When you think about it, Hollywood’s special affinity for the Democratic Party makes perfect sense. So-called “cognitive capitalism” (or “progressive” or “green capitalism”), which Progressives see as a paradigm for reindustrializing America, is utterly dependent on “intellectual property” for its business model. It’s basically the same as what economist Paul Romer calls “new growth theory”: A model of economic growth based on enclosing ideas as a source of profit.

If you want to see this model in action, just compare the retail price of a pair of trademarked Nike sneakers to the $5 a job shop in Asia got paid to produce them. Or look at Tom Peters’ Minolta camera — nine-tenths of whose value, he gushed, was “intellect” rather than actual parts and labor. Or the 2000% markup over production cost on patented drugs. Or a $200 CD of Microsoft Office that cost $5 to burn.

When you see the likes of Bill Gates, Bono, Sting and Warren Buffet jet-setting around the world, it may look like they’re talking about something like AIDS in Africa. But it’s this business model they’re really promoting. Their progressive/cognitive/green capitalist business model is just as caught up with the Democratic wing of the corporate ruling class as the business model of Rockefeller, Morgan and Gould was with the Republican wing a century ago.

We live in a world where the cost of physical means of production is imploding. A desktop computer can do work once requring a million-dollar press or music studio, and a garage shop with a few thousand dollars worth of machine tools can replace a million dollar factory. Making a big profit by controlling the physical means of production — and actually producing stuff — is pretty much obsolete.

Penny ante wealth — the fortunes of a few million dollars examined by Thomas Stanley in “The Millionaire Next Door” — comes from making things. Giant fortunes, in the billions of dollars, come from controlling the terms on which other people are allowed to make things.

Actual manufacturing, for the most part, takes place in independent job shops and sweatshops that produce on contract for transnational corporations. The actual sneakers are produced in these shops for almost nothing. Nike slaps a Swoosh on them and marks them up 4000% for retail sale. Nike, a typical global corporation, doesn’t actually produce anything. It makes its money erecting toll gates between the people who produce and the people who consume.

Thorstein Veblen called this “capitalized disserviceability”: Obtaining wealth not by producing things, but by charging rent for not obstructing production by other people. Henry George, Jr. described it as making money by controlling access to natural opportunities.

The central role of the state, at a time when technologies of abundance threaten to destroy all the scarcities and rents on which the wealth of the privileged depends, is to protect the rentier classes from the threat of abundance. At a time when the means of production themselves are cheap and there’s no reason why people can’t produce for themselves and each other without a middleman, the state makes these technologies artificially scarce by giving the rentier classes legal control over the terms on which they can be used.

So when Meathead says Hollywood doesn’t expect anything in return for its contributions, he’s just making a funny. Hollywood expects something, all right. And it gets its money’s worth.