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Refuting Intellectual Nonsense About Intellectual Property

by Theresa Fritz Camoriano (8-27-01)

Of course, we know that socialists are opposed to all forms of private property and believe society would be better off if government owned everything.  But it has been very surprising lately to read several articles by some modern theorists, who claim to support property rights, and yet who say that society would be better off if patents, copyrights, and other forms of intellectual property did not exist.  Since ideas have consequences, and I know from personal experience that we would all be much worse off without patents, trademarks, and copyrights, I would like to make a stab here at explaining why these theorists are wrong.

These theorists who oppose intellectual property rights say there are two foundations that serve as a basis for establishing property rights.  First, the thing that becomes property must be scarce. Second, in order to establish something as property, there must be some effort involved, such as the effort required in homesteading land.   The argument goes like this: Since it is virtually cost-free and effortless to reproduce sound recordings and books and distribute them worldwide through the Internet, there is no scarcity in these products, so there should be no property rights in them.  Similarly, it is cost-free to distribute inventive ideas, so again there is no scarcity and should be no property rights.  Also, since one person's use of another's creative concept does not prevent the creative person from using his own concept, there should be no property rights in the creative concept.

But this kind of analysis misses the entire point.  The scarcity is not in the copies but in the creation of the originals.  If property rights are not protected in the original intellectual works, so as to prevent others from using them without permission, then there will be little incentive to create the works in the first place.  Would you invest years of your life writing a novel if you would not have the right to prevent others from reproducing it and selling it without your permission?  Would you invest thousands or millions of dollars to develop an invention, if your competitor could simply copy it without undertaking all the research and development costs?  Usually not.  If the creators of these intellectual works are not granted property rights to prevent others from using the works without permission, we will have fewer and fewer works of art, musical compositions, inventions, and so forth, which will impoverish us all. 

Certainly, without the availability of patent rights, drug companies would have no incentive to invest millions of dollars in developing new cures or treatments, which would result in many lives being lost that could have been saved.  Certainly, Bill Clinton would not have been able to obtain a $10 million advance for his memoirs if others could promptly make copies of his book and distribute them without having to pay him or his publisher for that right.  And, if that were the case, the memoirs probably would never be written in the first place, depriving us of all their entertainment value.  If a songwriter or performer cannot profit from his effort, he might prefer to go into another field, where he can make some money, such as becoming a university professor who cooks up screwy theories about property rights!

We generally understand by now that things of value should belong to somebody in order for someone to be able to protect them, use them to their highest value, and so forth.  For example, when a person owns a piece of land, he has an incentive to take care of it.  He tends not to overgraze it, tends to plant trees for future generations to enjoy, and so forth, because that enhances the value of the property to him.  By owning the property as an asset, not only does he have the use of the property, but he also can mortgage it to obtain cash, can lease it, and so forth.  When things are owned by no-one (like air) or by everyone (like land in communist countries or in our national forests), we encounter the “tragedy of the commons”.  Land that is not owned by someone tends to be overgrazed or over-logged, air is overpolluted, and so forth.  Things of value that are not owned by someone tend to be wasted, spoiled, and certainly not used to their maximum benefit.  Also, the other benefits of property ownership, such as the ability to borrow money against the asset, to sell the asset, and so forth are not available.  The same issues arise with intellectual property.  If an author or inventor does not have property rights in his creation, then nobody will own it, and it will tend to be wasted and not to be used to the greatest advantage, thereby making us all worse off.

Furthermore, there is the moral question.  If there is a value in the intellectual creation, who else should be able to control it but the person who created it?  If people want copies of the piece of music or the artwork, or if they want to take advantage of an invention, then they are saying that it is of value to them.  Why should they be able to make those copies and obtain that value without paying for it, if there is a practical mechanism such as copyright or patent laws to provide for such payment?  While some newer musical groups are happy for people to make free copies of their works through Napster, because it provides them with free advertising, others, who already have established a reputation for quality music, do not want people to be able to make copies of their creation for free.  Shouldn't the creator of the work be the one to have the right to make those decisions?

Intellectual property rights are not like a tax, taking away something that one person earned or created and giving it to someone else.  Instead, they simply secure to the creator the rights to control his own creation.  The U.S. Patent Office is run entirely by user fees.  In fact, the U.S. general fund regularly steals user fees from the Patent Office, so not only do inventors entirely fund the Patent Office, but they are also unfairly taxed to support the general functions of government as well.

Some forms of intellectual property have been respected by the common law for many hundreds of years. For example, people’s reputations have been protected under common law libel and slander laws, under common law trademarks, unfair competition, and so forth. For example, if I could adopt the name Tiger Woods and use that name to endorse a particular brand of golf club, I could have a devastating effect on the original Tiger Woods’ ability to sell product endorsements.  Or, if I could sell a cola beverage under the name Coca-cola without permission from the original Coca-cola company, I would greatly diminish the value of their brand name.  The newer statutory laws, such as copyright, similarly protect an author’s ability to control the copying of his work.

Of course, not everything that is created and that is of value can be protected by law as a practical matter.  But patent, trademark, and copyright laws have established a practical way to protect many of these things of value.  Patent laws provide very strict requirements that must be met before an inventor can acquire legal rights to prevent others from copying his invention.  The original U.S. Constitution in Article I, Section 8 provides for Congress to protect the works of authors and inventors, and the first U.S. Patent statute dates back to April 10, 1790.  Fortunately, our founders did not share the theories of today’s theorists.  They understood the practical and moral value of providing property rights to inventors and authors. 

Not only do patents provide all the advantages described above, but they also create an incentive for inventors to make detailed information about their inventions available to the public so it can inspire further developments by others, rather than trying to protect it by keeping it hidden and secret.  In order to patent an invention, it must be new, useful, and unobvious in view of the prior art.  The invention must be described in enough detail in a patent application that a person skilled in the art would understand how to make and use the invention.  The subject matter over which the inventor makes a claim must be clearly defined by written claims, which provide guidance to others who wish to avoid infringing the patent.  Only after an inventor meets all these tests can he obtain a patent, giving him a temporary property right to prevent others from making, using or selling the invention he created and patented.  Frequently, once the invention has been disclosed, others are able to leapfrog over the patented invention to develop improved inventions that do not infringe the original.

By giving the inventor control over a thing of value that he has created, a patent provides a boost to the economy in many ways.  First, it encourages future innovation that otherwise might not take place.  Second, it creates a property right that can be the basis for making investments in the invention, which is frequently needed in order to bring the invention into the market for everyone’s benefit.  Third, it provides information to the public that helps other inventors make further developments in the field.

Owning a patent or a copyright does not mean you will make any money on the invention or other creative work.  Most inventions never earn a dime, and the risks of bringing a new invention to market are frequently very great.  Similarly, most artworks do not make their creators rich.  Ownership of a creation only means that, if there is value in the thing a person creates, that value will accrue to the benefit of the person who created it.  Of course, the value of the creation (if it has any value at all) will also eventually accrue to others who wish to take advantage of it by buying prints of artworks or copies of music, or devices or products resulting from inventions, just as the use of other types of property eventually benefits consumers.  If others do not wish to take advantage of the creation, it costs them nothing. 

I am very pleased to have been able to make a career in the intellectual property field, helping inventors acquire property rights in their inventions and watching many of them prosper as they bring their inventions to market for the benefit of their customers.  Just as property rights in land, buildings and equipment are essential in helping us prosper, so are property rights in intellectual creations.  In fact, there can be little question that the creativity of people is one of the greatest assets in the world today, and protecting people’s rights to their creative works is an important step in ensuring continued and growing prosperity.