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Source link: http://archive.mises.org/6066/re-patents-and-utilitarian-thinking-redux-stiglitz-on-using-prizes-to-stimulate-innovation/

Re: Patents and Utilitarian Thinking Redux: Stiglitz on using Prizes to Stimulate Innovation

December 28, 2006 by

In a previous post, I noted that Nobel-prize winning economist Joseph Stiglitz had advocated replacing the patent system with a system for “awarding prizes”–presumably taxpayer funded–for innovations and inventions. In Scrooge and intellectual property rights, Stiglitz endorses a “medical prize fund” that “would give large rewards for cures or vaccines for diseases,” which “prizes could be funded by governments in advanced industrial countries.” Two cheers for capitalism! Or is that the other one?

{ 52 comments }

Don Lloyd December 28, 2006 at 5:36 am

‘Previous post’ has no link.

Regards, Don

Sasha Radeta December 28, 2006 at 9:48 am

It just shows that all socialist are united in their opposition to anything that resembles private property rights (although these rights are currently crippled by state intervention and even hard to recognize when it comes to copyright).

The only difference is that some leftist extremists here propose free and unrestricted violation of contracts that prohibit commercial use of someone’s invention – based on society’s “needs”… While others like Stiglitz advocate the complete prohibition of any contracts that specify or restrict someone else’s use of your product – and they offer taxpayers money as a substitute for this legalized trespass.

scineram December 28, 2006 at 3:23 pm

What you said does not make any sense, Sasha.

Sasha Radeta December 28, 2006 at 4:14 pm

Scineram,

It certainly makes sense, but perhaps you need more clarification than an average person? Or you are just trying to be malicious?

I just tried to point out how very different socialists are united over their hatred for private contracts, including those that would protect terms of use known as copyright.
- Leftist activists on this blog are advocating that people should freely violate their free-market contracts (upon which the property rights are based) if their “need” dictates them to do so…
- Stiglitz, on the other hand, is advocating the same thing, but he also proposes some socialist incentive (from taxpayer’s money) in order to keep the inventors from dying out (he is at least aware of what communism in commercial use of someone else’s products would do to producers’ incentives).

David C December 28, 2006 at 10:26 pm

Sasha said,

“It just shows that all socialist are united in their opposition to anything that resembles private property rights (although these rights are currently crippled by state intervention and even hard to recognize when it comes to copyright).”

Yeah, of course they’re hard to recognize with copyright. That’s because copyright isn’t a property right. Even you, when pressed, call it a contract right, so why do you keep calling it a “property” unless you are trying to mis-represent the truth. BTW, socialists also love to control information and how people use ideas.

“The only difference is that some leftist extremists here propose free and unrestricted violation of contracts that prohibit commercial use of someone’s invention – based on society’s “needs”… While others like Stiglitz advocate the complete prohibition of any contracts that specify or restrict someone else’s use of your product – and they offer taxpayers money as a substitute for this legalized trespass.”

Well, contract rights inherently have the following characteristics:

  1. Contract rights are two way binding agreements – which means that if I send you a letter in mail that says “by opening this, you agree to pay me 100 bucks” – that contract is invalid. So clearly the act of declaring or having a work copyrighted has no binding.
  2. Contract rights are non binding to 3rd parties, this is obvious, but clearly if you choose to sue a 3rd party for tort when it is the first one that broke the contract. Then you are binding a 3rd party to a contract.
  3. Contract rights can not deny “free will”. This is why you can not sign a contract that says, I will believe this religion, or I will be a slave, or if I fail the terms you have a right to revoke my free speech and shoot me in the head. Well what about you have a right to control how I disseminate information at my disposal? Copyright
    is the “right” to control where people get their information from once the cat gets out of the bag.

  4. Contracts must be proportional, that is if I agree to wash your dishes than the maximum damages must be the cost of damages caused to you by the failure to wash. This is more utilitarian because if someone sues in the courts for damages, that’s the most they’re likely to get no matter what was agreed. But there is still an element of justice to it, we don’t give people the death penalty for stealing a 5 cent sheet of paper either.
  5. Contract rights are the right of free people to make voluntary agreements, and while they can be commoditized, they are not an equivalency to property right.

Any one of the tests is enough to make a contract invalid, but copyrights fail 3 of these tests conclusively and arguably fail all 5. I think anyone who looks it from a neutral point of view intuitively knows that copyrights are not contract rights. And I think it was already shown quite clearly that they are not property rights, so what are they? A socialist regulation that controls how people use ideas, information, and where they get it from.

David C December 29, 2006 at 1:30 am

One more thing,

When I was a physics student (a long time ago), we would propose a theory, test it in the lab, and if the test results didn’t do what was predicted then that theory was called invalid and it was back to the drawing board. Perhaps you’ve herd of this, it’s called scientific method. The only problem is that if I do that today with economics, then I’m called a “utilitarian” and my arguments are written off as not applicable to the situation. Nonsense, either freedom is rationally connected to the real world, or it’s not, in which case why care at all?

Well, copyrights and patents are a theory that says that not forcing a monopoly on distribution of information or ideas (via whatever means) will harm creativity and incentive. The most amazing thing is, however, almost the entire Renaissance happened without a copyright. And the half the industrial revolution in the US happened while we ignored overseas patents. So copyrights and patents wern’t matching up to theory before they were even implemented.

Was there a desperate shortage of writing that needed to be addressed, was there a desperate shortage of invention? Well, no. They had more writing and invention than in the last 1000 years before. A better theory would be: some politician wanted to earn money for himself so he got some publishers and industrialists to pay him for the placement of Private monopolies in the constitution under the guise of an incentive. At least that theory isn’t shot down before it even starts. But the most ironic thing of all: there is no foundation in law, or in the constitution, or in common law that even pretends to treat copyrights and patents like a contract right or a property right. Nope, just a government backed monopoly. In fact, the first copyrights were granted to publishers in return for not publishing bad things about the monarchy. Then they were eventually just granted to publishers. Then the system became so abused that they were outlawed, but after petitioning over and over, the publishers finally got their monopoly back so long as it was attributed to authors. Well fine, that doesn’t prove that they are not rights, but it sure doesn’t smell like the glorious fight for the freedom and liberty of the creative either.

Which brings me to another point. They are clearly not property, they are clearly are not the source of incentive, they clearly are not the source of creativity and innovation, which begs the question. If there is such a great justification for them, then why the extraordinary effort at pushing such lies. Why should we want to have anything like them? Well, I digress.

How about this for a theory: patents lead to genocide. Like millions of people in Africa needlessly dying because they were restricted from treating AIDS. Prove that I’m wrong. So far, no argument has even come close to being as compelling as the case against copyright and patent.

Sasha Radeta December 29, 2006 at 3:33 am

David C,

It is easy to argue against me, when you impute some statement I never gave – and than pretend like you are rebutting them. If you used my real arguments, you would have much harder time. For example, I never said that copyrights are property! I said that these are contracts that create negative obligations against unauthorized commercial use (trespass).

Now that aside,

I don’t think it’s not a coincidence that all communists and many socialists are united around copyright-hatred. They want to find a good way to show “market imperfections” and how some voluntary market contracts would create a collapse of authorship (which would happen in many cases, if unrestricted reproduction drives prices toward zero).

Let’s just see how I pass a typical socialist “test”

1. “Contract rights are two way binding agreements.” Copyrights are indeed two-way binding agreements between a buyer and a seller.

2. “Contract rights are non binding to 3rd parties”. Copyright contract would never be binding to a third party. The owner of a rented property would never sue a “third party” for his tenant’s breach of contract and owed damages. He would insist that his tenant respects his contractual obligations. The owner does care who sues some “third party” and on what grounds. The tort issue by definition (which David C did not know) is not a contractual concern.
* THIRD PARTY WOULD NEVER BE RESPONSIBLE FOR COPYRIGHT VIOLATION! Whether that third party would be responsible for injuries to someone who happens to be in a contract has nothing to do with the contract’s validity.
* By the way, there are no contracts in which a “third party” can be used as an excuse for contract violation. Parties must satisfy their obligations – and third parties are of no concern to any contract, including copyright.

3. “Contract rights can not deny “free will”"
For real? Like a free will to commit a theft or trespass? You say that if I have a free will, you cannot control where I get my information… Does that include your living room, your bedroom, your PC? Well, of course that you can place negative obligations on other individuals, because property rights are based on that. If you restrict your tenant’s behavior, you are not committing any aggression – you are simply exercising your property right. The same goes for restricting what someone can do with your product – in a voluntary, free market contract. Someone who uses your product cannot just give himself a free “upgrade” or a price discount.

4. “Contracts must be proportional, that is if I agree to wash your dishes than the maximum damages must be the cost of damages caused to you by the failure to wash.”
Copyright specify damages that are equal to the amount of violation. Proportional…
But seriously, copyright has nothing to do with this nonsensical condition. Copyright damages are not based on failure to perform some service. They are specified in terms of exchange. In order to obtain personal use of some product you state what price you are going to pay in money and what you will owe in damages if they occur. Giving your own discounts against these conditions would be a theft – even more so if we know that property title over these damages is transferred to the owner.

5. “Contract rights are the right of free people to make voluntary agreements, and while they can be commoditized, they are not an equivalency to property right.”
Nonsense. Valid contracts are clear expressions of exchanges of property titles – which are an exercise of property rights. This is also the case with copyright.

——

You made me laugh with your “scientific method.” Using your logic, Dark Ages were a prosperous era without any copyrights – while modern age with their industrial revolutions is horrible. Oh, I see that you remembered Industrial Revolution in your second message, so tell me this: which great American invention was made without any authorship protection? Not even denim! By the way, first instances of modern copyrights date back to Renaissance in Republic of Venice – while “patents” based on similar protection of authorship even date back to ancient Greece (their city-states).

Why than copyright didn’t emerge until the Renaissance period, while protection for inventions (now labeled as “patents”) have such deep roots? The answer is well-known: before printing press and wide-spread literacy, there was no need for such contracts. en during a period of a prospering book trade, during the Roman Empire, the occurrence of piracy was unlikely. This is because books were, typically, copied by expensive and high maintenance literate slaves. Because of this fact, any pirate would have had to pay much the same expense as the original publisher, effectively destroying any economic incentive for piracy.

Again, I never claimed that “copyright is property.” By repeating this assertion, you only demonstrate your ignorance (like many times before… remember the definition of “tort” : ). Copyright is simply the protection against unauthorized use of your product. The fact that the government granted these protections is only the evidence that government held the monopoly in printing activities, which is a well-known fact (the power of printing press is best evidenced by the quick spread of Reformation/Protestantism and the way Martin Luther distributed his word).

As far as your example with Africa goes, can you please get me a violin? You choose a wrong website to sell such demagogy. It was explained to you many times before: AIDS deaths are not caused by patents, but mostly by viruses, irresponsible actions, and self-inflicted poverty. Horrible suffering of some Starvin’ Marvin in Ethiopia cannot serve as a justification for property rights violations of someone in the USA. Africans, who, unlike European firms, pay for only personal use of some medications, cannot just “upgrade” their terms of use on their own. They need to ask nicely for such a favor, which could flood the world with generics, reducing prices and completely destroying profit incentive of pharmaceutical industry to finance a real cure for AIDS (which does not exist and will not exist, since AIDS theory is probably wrong, but that’s a separate issue).

So stop your nonsense about “genocide” in Africa (unless you start referring to warlords and tyrants who brought these conditions upon their own people) – and start educating yourself. You mentioned that there is no mention of copyrights and patents in the Constitution. For you my poor friend, a little quote from Article I, Section 8, Clause 8 (which I hope will be amended and replaced by free-market forces), which states one of the duties of the US Congress:
“To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries.”

David C December 29, 2006 at 10:58 am

Sasha,

Well technically you never said that copyrights are a property right, but in practice you are used the word “property” all over the place. Your verbal inconsistincies are matching your logical inconsistencies as well.

“I don’t think it’s not a coincidence that all communists and many socialists are united around copyright-hatred….”

The ones I know don’t. Hmmmmm, how come you know what socialists think so well? Hmmmmm.

“…They want to find a good way to show “market imperfections” and how some voluntary market contracts would create a collapse of authorship (which would happen in many cases, if unrestricted reproduction drives prices toward zero).”

Yeah, I could truly see that they’re trying to demonstrate a market imperfection with copyrights, because copyrights are anti-free market. And your notion that authorship would collapse is nonsense. Once again, just the opposite happens in free to copy environments. Your theory doesn’t match up to the real world …. think scientific method … think scientific method…..

1) Sasha, you say that copyrights are a binding agreement between a buyer and a seller. But not to 3rd parties, are they? Not to people who didn’t sign anything, is it?

2) That’s just a technicality. By implying that the (natural act) of copying by a 3rd party is injurious, you are still binding a 3rd party. The enquirer is injurious too when they bust into your house and take dirty photos, but doesn’t mean that the people who buy, share, and copy the Enquirer are subject to “tort”.

3) So what are you saying, that it *IS* alright to to enter a contract that says “by doing this, I have the right to pop a bullet in your head”? You also said, “Someone who uses your product cannot just give himself a free “upgrade” or a price discount.” – they can if they’re a 3rd party. :)

4) Uhh, theft isn’t defined by what one gains, but by what one looses. In this case they loose a private monopoly on distribution, not a property. The liabilities are not proportional.

5) Yeah, technically you are correct, but in practice there is a reason why we call a contract a contract and a property a property. Perhaps you should figure that reason out.

——————————————

FYI, the “first” copyrights in Venice wern’t practiced widely, and were pretty much dead for 300 years after that. The Renaissance happened without copyrights. Also, patents were originally used as a monopoly grant for anything and everything, but their abuse got so bad that they decided to just limit it to new invention. Well, it amazes me that people can see why private government granted monopolies are bad everywhere else, but not here.

“It was explained to you many times before: AIDS deaths are not caused by patents, but mostly by viruses, irresponsible actions, and self-inflicted poverty.”

And it was explained to you that you are forbidding these people from helping themselves and calling it a contract (property) right. If Europe is dumb enough to dupe themselves into accepting a fraudulent contract (property) right, that is their problem, not Africas. Sorry charlie, a murder called a “contract?” right is still a murder. (did you gleam my example of the pulley in the previous IP article?)

David C December 29, 2006 at 11:44 am

I think the problem here is that in a perfect imaginary world it is easy to imagine these perfect fences and perfect boundaries that perfectly control all ideas and information to the satisfaction of their creators without being coerced upon anyone else. But like most statist utopian ideals, when put to practice in the real world it all goes to hell.

Here it all goes to hell because the very nature of ideas and information goes contrary to these imaginary boundaries and fences. Just as nature tells you that gravity exists by the way things drop to the ground, this is natural laws way of telling you that patents and copyrights are intellectual sewage.

Roy W. Wright December 29, 2006 at 12:33 pm

How many thousands of posts are required before everyone realizes that Sasha is not going to be swayed by the consistent libertarian position (ie Kinsella’s)? Not that I care how you all spend your time; and after all I am taking a moment to comment on it myself.

We have seen time and again that his arguments are empty and largely consist of redefining basic ideas to fit his biases. At other times he resorts to such arguments as “you superficially agree with the Communists on one issue and are therefore wrong,” to paraphrase. Now, you can of course continue the back-and-forth with him if you find it fruitful, but to me it’s just mildly amusing wordplay with a confused statist.

Sasha Radeta December 29, 2006 at 1:46 pm

Roy W. Wright,

By “libertarian” position you probably refer to anarcho-communists who call themselves “libertarian”…

The position against contract enforcement that is based on some demagogue’s cries about “AIDS genocide in Africa” is not a libertarian position. A collectivist claim that you can freely use someone else’s product based on your needs has nothing to do with libertarianism. Now David C imagines a wold in which our property rights “fences” will be easy to cross… That is a communist position, and you are correct – I’m not going to be persuaded by this horrible ideology.

—–

David,

First of all – you were unable to prove that I ever claimed that copyright is property. So one more time: you lied… I never claimed copyright is not a property – because it’s a contractual restriction in terms of use that comes from our property rights over some piece of property.

Your ’5 point test” was a joke. Now you can only lick you wounds, tell that my responses were correct but just “technicalities” – and you try to switch the subject to assisted suicides – as if they have anything to do with issue of terms of exchange. When you arrange your terms of exchange, you may think that you were stupid and that you overpaid your personal use of some product. But you cannot change those terms on your own and allow yourself a discount or an “upgrade” against the owner’s consent.

* Some “third party” will never be a concern of a contract – and as anyone who ever signed a contract knows – you cannot use that “third party” as an excuse for contract violation. The seller does not care if you later sue someone outside of contract for tort – and that is not a part of the contract law (I mean dude, now you know that “tort” refers to injury other than breach of contract).…

You tried to invent a completely new history and I had to correct so many of your inaccuracies and ignorant assertions – and now the only defense you have is (allow me to paraphrase you):

“Yes I said that nonsense about world being more prosperous in (dark) ages without copyrights and patents, I still owe you a list of great American inventions that are not patented, I lied about the Constitution – but now all I have to say is: copyright was not practice widely – and forget about my patents claims”…

WOW! So you discovered that printing (and hence copyright) was not massive until the industrial revolution and capabilities for reproduction. I’m so impressed.

PS
By the way, African poverty is self-inflicted, as well as many cases of AIDS (which is a common name for immune-deficiency which does not have to correlate with the presence of HIV).

Sasha Radeta December 29, 2006 at 1:47 pm

Roy W. Wright,

By “libertarian” position you probably refer to anarcho-communists who call themselves “libertarian”…

The position against contract enforcement that is based on some demagogue’s cries about “AIDS genocide in Africa” is not a libertarian position. A collectivist claim that you can freely use someone else’s product based on your needs has nothing to do with libertarianism. Now David C imagines a wold in which our property rights “fences” will be easy to cross… That is a communist position, and you are correct – I’m not going to be persuaded by this horrible ideology.

—–

David,

First of all – you were unable to prove that I ever claimed that copyright is property. So one more time: you lied… I never claimed copyright is not a property – because it’s a contractual restriction in terms of use that comes from our property rights over some piece of property.

Your ’5 point test” was a joke. Now you can only lick you wounds, tell that my responses were correct but just “technicalities” – and you try to switch the subject to assisted suicides – as if they have anything to do with issue of terms of exchange. When you arrange your terms of exchange, you may think that you were stupid and that you overpaid your personal use of some product. But you cannot change those terms on your own and allow yourself a discount or an “upgrade” against the owner’s consent.

* Some “third party” will never be a concern of a contract – and as anyone who ever signed a contract knows – you cannot use that “third party” as an excuse for contract violation. The seller does not care if you later sue someone outside of contract for tort – and that is not a part of the contract law (I mean dude, now you know that “tort” refers to injury other than breach of contract).…

You tried to invent a completely new history and I had to correct so many of your inaccuracies and ignorant assertions – and now the only defense you have is (allow me to paraphrase you):

“Yes I said that nonsense about world being more prosperous in (dark) ages without copyrights and patents, I still owe you a list of great American inventions that are not patented, I lied about the Constitution – but now all I have to say is: copyright was not practice widely – and forget about my patents claims”…

WOW! So you discovered that printing (and hence copyright) was not massive until the industrial revolution and capabilities for reproduction. I’m so impressed.

PS
By the way, African poverty is self-inflicted, as well as many cases of AIDS (which is a common name for immune-deficiency which does not have to correlate with the presence of HIV).

Sasha Radeta December 29, 2006 at 1:47 pm

Roy W. Wright,

By “libertarian” position you probably refer to anarcho-communists who call themselves “libertarian”…

The position against contract enforcement that is based on some demagogue’s cries about “AIDS genocide in Africa” is not a libertarian position. A collectivist claim that you can freely use someone else’s product based on your needs has nothing to do with libertarianism. Now David C imagines a wold in which our property rights “fences” will be easy to cross… That is a communist position, and you are correct – I’m not going to be persuaded by this horrible ideology.

—–

David,

First of all – you were unable to prove that I ever claimed that copyright is property. So one more time: you lied… I never claimed copyright is not a property – because it’s a contractual restriction in terms of use that comes from our property rights over some piece of property.

Your ’5 point test” was a joke. Now you can only lick you wounds, tell that my responses were correct but just “technicalities” – and you try to switch the subject to assisted suicides – as if they have anything to do with issue of terms of exchange. When you arrange your terms of exchange, you may think that you were stupid and that you overpaid your personal use of some product. But you cannot change those terms on your own and allow yourself a discount or an “upgrade” against the owner’s consent.

* Some “third party” will never be a concern of a contract – and as anyone who ever signed a contract knows – you cannot use that “third party” as an excuse for contract violation. The seller does not care if you later sue someone outside of contract for tort – and that is not a part of the contract law (I mean dude, now you know that “tort” refers to injury other than breach of contract).…

You tried to invent a completely new history and I had to correct so many of your inaccuracies and ignorant assertions – and now the only defense you have is (allow me to paraphrase you):

“Yes I said that nonsense about world being more prosperous in (dark) ages without copyrights and patents, I still owe you a list of great American inventions that are not patented, I lied about the Constitution – but now all I have to say is: copyright was not practice widely – and forget about my patents claims”…

WOW! So you discovered that printing (and hence copyright) was not massive until the industrial revolution and capabilities for reproduction. I’m so impressed.

PS
By the way, African poverty is self-inflicted, as well as many cases of AIDS (which is a common name for immune-deficiency which does not have to correlate with the presence of HIV).

Sasha Radeta December 29, 2006 at 1:49 pm

My browser was messing me up… I am sorry about messages.

David C December 29, 2006 at 4:52 pm

Sasha,

“The position against contract enforcement that is based on some demagogue’s cries about “AIDS genocide in Africa” is not a libertarian position.”

Yes it is. It has always been a libertarian position that taking away peoples liberties causes great harm and death. You took away their liberty to copy and use medicine for AIDS. You keep saying that they’re violating a contract, or a property, or the soup of the day, but still fail to make a compelling case.

——————–

“…you were unable to prove that I ever claimed that copyright is property. So one more time: you lied… I never claimed copyright is not a property…”

So you never claim to call copyright a property, then you never claim to say it’s not a property, then you call it a contract, but call a contract a property that you never claim copyright to be. Well your problem is that copyrights are not a contract right nor a property right because they are not a right at all – switching terms around a bunch isn’t going to help you.

The technicalities in the 5 point test were technicalities in your wording and semantics, not technicalities in the nature of what’s valid to make a contract. Like hint, 3rd parties, 2way binding… I’m waiting….

It is you that doesn’t seem to understand that “tort” refers to injury other than breach of contract. You’re the one claiming damage relating to a broken contract that the public mob never broke.

Dude, copyrights didn’t exist thru much of the Renaissance, and patents were monopolies granted on everything even salt mining, go back to your history books, that’s just the way it was.

And about the constitution. My quote was “…
there is no foundation in law, or in the constitution, or in common law that even pretends to treat copyrights and patents like a contract right or a property right…” notice how I didn’t say it wasn’t in the constitution – I only said that it wasn’t treated like a property right or a contract right, but a government granted monopoly. That’s because it is.

Finally, the correlation between the industrial revolution and patents and copyrights is no different that the correlation between the industrial revolution and the rise of communism. Your point clearly displays the kind of invalid logic that copyrights and patents must rely on for their sustenance. It certainly can’t rely on the facts.

Brian Macker December 29, 2006 at 5:27 pm

“In fact, the first copyrights were granted to publishers in return for not publishing bad things about the monarchy. … Well fine, that doesn’t prove that they are not rights, but it sure doesn’t smell like the glorious fight for the freedom and liberty of the creative either.”

You know the first time I heard this argument it was from Roderick T. Long. I don’t remember the paper precisely but as I recall he didn’t balance this with other important information. My first thought on reading it was a totally specious argument as you have admitted.

My second thought was that it was a little deceptive not to also bring up the fact that during the middle ages property title was also held as a grant from the King. If this counts against copyrights it also counts against land titles. Oops.

Most of the arguments against copyrights and patents are specious like this. There are proper concerns about patents and they were addressed by Rothbard. He was on the right track and certainly not someone who would have advocated intrusive government monopolies.

All these arguments about how better we would be off without copyrights are specious. We might be “better off” if we allowed women to be doped and unconciously raped. That doesn’t mean we have the right to do so.

Please drop the specious arguments when they have been shown to be so. Stop bringing them back up.

I’m tired of hearing how fast technology would move forward without patents and copyright. Especially when they use the example of the software industry. I work in that industry and let me tell you that besides government funded projects most software firms were very dependent on the copyright laws.

I absolutely would not have been able to make a paycheck at the startup I was working at back in 1981 if copyrights did not apply to software. Believe me I wasn’t about to work for free. I never would have went into software. If I had I probably would have had to seek employment at some government funded institution.

I wish people would just stop making stuff up.

David C December 29, 2006 at 8:11 pm

Brian Macker,

It goes both ways. Correlating copyrights to land title can be considered deceptive too, and we are “better off” if we permit or allow copyrights and patent monopolies – is the argument that I always hear. Those arguments are just as specious.

Being in the software industry, sometimes I have benefited from copyright, sometimes I haven’t. But I’m not going to let that stop me from telling the truth as I see it. One time I was at a software conference and it was asked how many developers work in-house, vs how many developers work on a commercial product. About 75% worked in-house – and that statistic matches my personal experience in the industry, and other polls I’ve seen as well. The influence and success of free software is not made up. The information age is doing for services what the industrial revolution did for production. When people try to monetize the content value of a product instead of the service value, they do not have any idea of the freight train they are standing in front of.

Sasha Radeta December 29, 2006 at 11:33 pm

David C,

I know this hard for you to understand, but try it anyway:

“Copyright” is not a name of a piece of property. It is a name of “restrictive terms of use of someone’s product”.

I did not claim anything else. If you are not capable to understand my point, that’s not my problem… But you should jump to your conclusions based on your misunderstanding and ignorance.

After you tried to invent your own test for validity of contracts, now you try something even more absurd. You said:

“You’re the one claiming damage relating to a broken contract that the public mob never broke.”

HOLD ON! You still don’t understand what is tort. Tort is the injury that is committed by the third party to my buyer. There is no contractual relationship between the buyer and this third party.

You don’t understand that third party did not commit a breach of contract against the buyer – and this by definition makes it a tort case. This party committed the property injury by the act of trespass! That is why this is the tort. Third party is not bound by any contract and that is not a “technicality” as you call it.

David C said: “Finally, the correlation between the industrial revolution and patents and copyrights is no different that the correlation between the industrial revolution and the rise of communism.”

WAIT A MOMENT! Rise of the communism where? In the 18th and 19th century United Kingdom and United States… or in almost feudal Russia in the 20th century? Nevermind, whatever… you showed enough of your historical “knowledge” and critical thinking… Still – it was you who started with these absurd correlations in order to prove that Dark Ages and era without patents was more prosperous than the era in which copyright and patents existed. I did not concern myself with utilitarian arguments, since anyone who understands the law of demand and supply knows what would happen if you could freely violate copyright contracts and have unrestricted use of someone else’s property (communism).

By the way – the fact that the US Constitution provides government’s protection of copyrights – does not deny that copyrights are still the protection of someone’s property from unwanted use. By the same token, the fact that the same article of the Constitution allows Congress to regulate interstate commerce- does not make such commerce something evil and non-libertarian. Again, learn more about history and you will understand the power of printing and why governments monopolized copyright protection and enforcement, and why the historical records show patents so early and copyright later in history of mankind.

Sasha Radeta December 30, 2006 at 9:38 am

To prevent some further misunderstanding about “third-party” involvement in copyright (or any other) contract:

In tort, you can sue for loss of earnings (consequence of broken labor contract) caused by the third party negligent trespass. For example, if I park my truck on your property, blocking your car and preventing you from going to work and earning your money (and you tried everything to show up at work and you were unsuccessful) – I cannot defend myself by claiming I have nothing with your injury, because I am not a party to your labor contract. That is not a “technicality” – it is a tort.

Wild Pegasus December 30, 2006 at 12:25 pm

Saying that patents and copyrights are “monopolies” is true but uninteresting. All property rights are monopolies. The question is which ones are justified.

For all the anti-IP talk here, I’ve never seen a good reason to change my view that using what I’ve created without my permission is anything but theft, whether ethereal or physical.

As for socialism, socialists say that the workers ought to own the means of production. What does that have to do with patents?

- Josh

Sasha Radeta December 30, 2006 at 1:13 pm

“As for socialism, socialists say that the workers ought to own the means of production. What does that have to do with patents?”

—-

They actually prefer “common ownership.” Patented and copyrighted products are means of production… That’s where their agenda is coming from. They are trying to get unrestricted access to someone else’s property rights over their products, and they are trying to rewrite legal theory in order to prevent these creators from making contracts which would allow someone’s personal use, while restricting other types of use… Once they create a precedent of free unauthorized use of someone’s property (communism) they will be one step closer to their goal of total abolishment of private ownership of means of production.

Stephan Kinsella December 30, 2006 at 4:49 pm

Sasha:

HOLD ON! You still don’t understand what is tort. Tort is the injury that is committed by the third party to my buyer. There is no contractual relationship between the buyer and this third party.

You don’t understand that third party did not commit a breach of contract against the buyer – and this by definition makes it a tort case. This party committed the property injury by the act of trespass! That is why this is the tort. …
To prevent some further misunderstanding about “third-party” involvement in copyright (or any other) contract:

In tort, you can sue for loss of earnings (consequence of broken labor contract) caused by the third party negligent trespass. For example, if I park my truck on your property, blocking your car and preventing you from going to work and earning your money (and you tried everything to show up at work and you were unsuccessful) – I cannot defend myself by claiming I have nothing with your injury, because I am not a party to your labor contract. That is not a “technicality” – it is a tort.

Sasha is either not honest or perspicacious enough to realize that he is question-begging here. When he says the third party commits a tort because he is trespassing, this is question-begging since it is assuming what is to be proved. Is it a trespass if I go out right now and make a movie called “The New Adventures of Han Solo,” based on a script I write, which is based on the Han Solo character? This is the question. If Sasha just asserts I’m trespassing then it’s dishonest question-begging. If not, then there is no third party copyright to speak of, it dissipates.

David C December 30, 2006 at 9:33 pm

Wild Pegasus,

“Saying that patents and copyrights are “monopolies” is true but uninteresting. All property rights are monopolies. The question is which ones are justified.”

The answer to that is easy. Someone must have control or a say when it comes to physical property, because it is exclusive. That makes the monopoly natural and justified. The other ones, are simply rationalizations of people coercing people.

“For all the anti-IP talk here, I’ve never seen a good reason to change my view that using what I’ve created without my permission is anything but theft, whether ethereal or physical.”

I’m glad you mentioned that. Those who wish to impose IP are the ones who want to put massive restrictions and controls on what people can copy even though there is no natural justification inherent in the nature of the creation. The onus to make a compelling argument is on those who wish to impose it.

David C December 30, 2006 at 10:07 pm

Steve said,

“Sasha is either not honest or perspicacious enough to realize that he is question-begging here. When he says the third party commits a tort because he is trespassing, this is question-begging since it is assuming what is to be proved. ….”

His argument is even more flawed that that. Even if I bust into his house, and take his private manuscript at gun point, and post it all over the Internet. Well fine – he would then have the leeway to sue me and lock me in the slammer. As for all the other people who downloaded, printed, and continue to sell copies of that manuscript. Well, tough shit, they have done no crime and have no liability. To do so, he would need to presume that people don’t have an inherent right copy and disseminate and profit from information that comes their way freely.

This is like arguing against free speech by presuming that people don’t have a right to free speech to begin with. Like if a reporter got a story at gunpoint, there may be leeway to prosecute the reporter. But once the story is out, there exists no right to control peoples free speech to keep it under wraps no matter how unethical the reporters actions were. His inability to differentiate between his right not to have his privacy and contracts violated, and the right of the public to use information that comes their way freely is clearly a boundaries problem typical in socialists. For example, they not only presume on faith that their utopia is perfect, but then presume the right to kill anybody who doesn’t approve of it as well.

Sasha Radeta December 30, 2006 at 10:07 pm

Stephan,

Thanks for repeating my wonderful posting.

No sir, I did not say that third party committed a tort “because he is trespassing.” I said that in my scenario, the third party commits a tort while trespassing. You know – stealing my buyer’s book and than causing him liabilities by creating unauthorized copies (for which I hold my buyer liable, based on a contract). That’s a typical tort issue and I did not involve this third party into my contract.

Anyway – I’ll go back to your interesting example. In a perfectly free market, Del Rey, the writer of The Han Solo Adventures, will have to prove that he had an agreement with you (like copyright disclosure on his book) that restricted your use of his characters. If he did not have such agreement, the courts would have to decide if the contractual copyright covered the name of the character. I think they would rule that you didn’t create this character on your own – and that you violated copyright with the use of sentence “The Adventures of Han Solo.” You might be successful at your defense, thought. You’re the lawyer.

Regards.

—–

David C,

When I forbid people from passing through my property is that coercion? When I forbid someone from using my property in a certain way – how is that coercion? Copyright is exactly that – contractual negative obligation of someone who wants to use my property. That is a perfect exercise of private property rights.

Sasha Radeta December 30, 2006 at 10:16 pm

David C,

You jump to conclusions again. Stephan is a lawyer who is not very fon of me. There’s no chance in the world that he’s missing the fact that my argument is “more flawed than that” what you pointed out.

If you break into my house and take my book away – you will not be responsible only for the immediate property damage (like $10). You will also be responsible for any other property injury caused by your action. If you post that book all over the Internet and that ends up costing me $10 million (based on my copyright contract with the author) – guess what – I will hold you responsible for that injury.

Again, go back to my parking example. Even if you don’t make any property damage, but you end up costing me some lost wages – you will be responsible for tort. I hope you now understand that tort cases for loss of earnings do not imply that this “third party” is forcefully included in labor contract. Despite your haughtiness, I believe you understand these fundamental issues and that we’re making some progress here.

Regards.

Stephan Kinsella December 30, 2006 at 10:24 pm

Sashinator,

Thanks for repeating my wonderful posting.

the only sense it was wonderful was in “wonderfully illustratrative of a confused, scientistic, amateur mindset”.

No sir, I did not say that third party committed a tort “because he is trespassing.” I said that in my scenario, the third party commits a tort while trespassing. You know – stealing my buyer’s book and than causing him liabilities

See, “causing liabilities” is your question-begging. Get it?

by creating unauthorized copies (for which I hold my buyer liable, based on a contract). That’s a typical tort issue and I did not involve this third party into my contract.

by “typical tort issue” are you saying that the idea of “tortious interference w/ contract” is consistent with libertarianism? Let’s see the theory. And let’s see your demonstration that this dubious doctrine would cover *every* third party.

Anyway – I’ll go back to your interesting example. In a perfectly free market, Del Rey, the writer of The Han Solo Adventures, will have to prove that he had an agreement with you (like copyright disclosure on his book) that restricted your use of his characters. If he did not have such agreement, the courts would have to decide if the contractual copyright covered the name of the character.

well, how convenient–just ask whether contractual copyright covers it? ! Wow, what miraculous question begging!

I think they would rule that you didn’t create this character on your own – and that you violated copyright with the use of sentence “The Adventures of Han Solo.”

What is amazing here is your stupidity or dishonesty in not realizing that you are begging the question here, by assuming the validity of copyright, while ostensible denying it elsewhere.

David C December 30, 2006 at 10:26 pm

Sasha said,

“If you break into my house and take my book away – you will not be responsible only for the immediate property damage (like $10). You will also be responsible for any other property injury caused by your action. If you post that book all over the Internet and that ends up costing me $10 million (based on my copyright contract with the author) – guess what – I will hold you responsible for that injury.”

Well Sasha, that’s a lot more compelling, but also explains why your philosophy never works out in the real world. Because, some homeless druggie will buy your book at the book store, sign the contract, post it all over the Internet, for his $20 fix. Fine – he now caused you 20 million in damages. Go sue him – if you can find him, if he didn’t sell it thru an anonymizer.

Sasha Radeta December 30, 2006 at 11:27 pm

Stephan,

So you actually managed to write all that and still said nothing. Keep those insults to yourself, please. Look at the mirror.

If your trespass causes someone a $10 million dollar liability (injury) you claim that this is not a tort? Do you think that suing someone for loss of earnings is “bounding” this third party to a labor contract? Are you joking now…? Maybe that’s your lawyer humor I don’t get.

—-

David C,

A druggie can kill someone for a $20 fix. It does not mean that we have to legalize homicide. The same goes for contract violations.

David C December 30, 2006 at 11:44 pm

Sasha said,

“A druggie can kill someone for a $20 fix. It does not mean that we have to legalize homicide. The same goes for contract violations.”

Well then contract law is already well defined and perfectly capable of serving that purpose now. So do you advocate setting the term of copyright to zero today and letting things ride from here on out?

Sasha Radeta December 30, 2006 at 11:59 pm

David C,

Just like state is not necessary to find and punish murderers – it could be bypassed in contracts violations. I advocate the abolishment of current state (because we’re moving toward socialism and we’re maybe too far away on our road to serfdom) and letting things ride from there on out, hoping we’ll end up in Hoppe’s libertarian monarchy.

greg December 31, 2006 at 12:18 am

SR> Patented and copyrighted products are means of production…

There is not a single item produced that does not have ideas behind it, whether those ideas are patented or copyrighted, or not. That’s why the whole precept of copyrights and patents applying to third parties is incoherent nonsense.

NSK> See, “causing liabilities” is your question-begging. Get it?

Fat chance.

Sasha Radeta December 31, 2006 at 12:25 am

(Hopefully drunk) Greg,

No one here claimed that “a single item produced that does not have ideas behind it” – so I don’t know what you hallucinate about.

Copyright is about the owner’s property rights to allow certain uses of his product, while restricting others. I never claimed that this contract applies to some third party, although Stephan would want me to say something like that (than he would finally have a counter-argument, instead of his childish attempts to insult me). If third party causes a tort to my buyer – that is not bounding him to any contract. Look at the common law “loss of earnings” example – is it “libertarian” to let someone cause it without any consequences.

Sober-up.

greg December 31, 2006 at 12:47 am

SR> No one here claimed that “a single item produced that does not have ideas behind it”

Gosh gee golly. No one here claimed that you claimed so. The point was that you have a propensity for making meaningless statements. And you wonder why few take you seriously enough to engage at anything beyond the trivial level.

Sasha Radeta December 31, 2006 at 1:40 am

Gosh gee golly!

If no one here claimed that “a single item produced that does not have ideas behind it” – why are “replying” to such ridiculous claim????

You’re basically telling us that you are so challenged that you have to make-up some fake arguments that nobody here even mentioned – just so you can “refute” them. That’s why I said: I hope you’re drunk and not permanently like that.

Well, at least you’re aware that you have capabilities of providing counter-argument to something I really said. Speaking of “trivial level…”

: )

Sasha Radeta December 31, 2006 at 2:09 am

Gosh gee golly!

If no one here claimed that “a single item produced that does not have ideas behind it” – why are you “replying” to such ridiculous claim (while responding to my completely different statement)????

You’re basically telling us that you are so challenged that you have to make-up some fake arguments that nobody here even mentioned – just so you can “refute” them. That’s why I said: I hope you’re drunk and not permanently like that.

Well, at least you’re aware that you have no capabilities of providing counter-argument to something I really said. Speaking of “trivial level…”

: )

Stephan Kinsella December 31, 2006 at 9:20 am

Sasha:

If your trespass causes someone a $10 million dollar liability (injury) you claim that this is not a tort? Do you think that suing someone for loss of earnings is “bounding” this third party to a labor contract? … I never claimed that this contract applies to some third party, although Stephan would want me to say something like that (than he would finally have a counter-argument, instead of his childish attempts to insult me). If third party causes a tort to my buyer – that is not bounding him to any contract.

Sasha you keep assuming it’s a trespass when a third party uses an idea. You seem to think that if two parties enter into a contract whereby one of them is liable to the other in the event that some third party get the idea, then the third party is causing harm in an actionable sense. This is bad reasoning, and it may result from an amateur understanding of law, tort, and libertarian rights theory.

Suppose I agree with Dave that I’ll pay him a million bucks if Sasha goes jogging tomorrow. Now, when you do go jogging, you “cause” me to have contractual liability to Dave. But you are not commmitting a tort. I am just stupid for having agreed to such a contract.

Likewise, as a buyer of a book, I would never agree to unlimited liability in the event I lose the book or fail to have every guest in my house sign an NDA before entering. And even if I did, third parties who gain access to information from the licensed book copy i have, are not committing a tort at all.

What you do not understand is that contract binds only the parties. This is why it is referred to sometimes as the law of the contract or the law of the parties–it’s like a private set of law among the participants (see, e.g., for further discussion, p. 47 of my book International Investment, Political Risk, and Dispute Resolution). Your clumsy attempt to get around this by saying outsiders are not parties to the contract but merely trespassers liable in tort is disingenuous; the label does not really matter. The point is that the set of contractual rules internal to the parties to the agreement do not bind or affect outsiders, no matter what you call it.

Sasha Radeta December 31, 2006 at 12:11 pm

STEPHAN SAYS: “Sasha you keep assuming it’s a trespass when a third party uses an idea”

======

That’s not true Mr. Kinsella. You are also imputing some ridiculous statements that no one here ever claimed. But if that’s the only way you argue with me, I’ll take it as a compliment.

I never assumed “it’s a trespass when a third party uses an idea.”

I said: If a third party steals my book from the buyer and his trespass causes him some huge financial injury – that’s a tort! There can be no dispute about it. When third party takes my book without any authorization – that’s a trespass! In our book theft example, this “third party” commits a clear trespass, and since injury caused by his actions is far greater than the price of that book – he will get sued for a total injury (liability of poor buyer).

If some third party never steals my book from the buyer, but his causes violations of copyright, the buyer is solely responsible for the violation of contract and all the damages. I will assume that the third party acted on buyer’s behalf – or that the buyer was negligent.

ON THE OTHER HAND…

In your irrelevant example, we have a gambling contract in which I never committed any trespass. Therefore, you cannot argue that my nonexistent trespass caused you any liability – but your own stupidity. I recently lost some money on Orlando Magic, but that does not mean that I can sue Washington Wizards who beat them by a point. But Wizards cannot be compared to someone whose clear and undisputable theft causes my financial injury. And this does not “bound” any third party to any contract- just like suing someone for “loss of earnings” is not bounding anyone to a labor contract (it’s all tort).

greg January 1, 2007 at 7:22 pm

SR> If no one here claimed that “a single item produced that does not have ideas behind it” – why are [you] “replying” to such ridiculous claim????

Your comment did not distinguish “right-based ideas” from “non-right based ideas” as ideas are related to means of production. That made it a meaningless statement for the purpose of your argument. Until you can establish the rudiment — that a process is “owned” (an idea is owned) then there is no way of even saying there are two distinct methods of process.

SR> You’re basically telling us that you are so challenged that you have to make-up some fake arguments that nobody here even mentioned – just so you can “refute” them.

You sure are wordy. Why not say “strawman?” There is no “argument” against meaningless statements.

Sasha Radeta January 1, 2007 at 8:48 pm

Oh, we have a pseudo-philosopher here!

How nice.

Anyway, why would I want to distinguish >>”right-based ideas” from “non-right based ideas” as ideas are related to means of production.<

Serious question: Are you out of your mind? There is no reason for me to argue that a process is “owned,” or that idea (per se) is owned. I explained that at the beginning of my discussion with Stephan Kinsella.

I argued that when someone’s product (physical creation) is owned:
a) the owner has the right to sell only the limited use of that product, which would restrict any unauthorized replication of it
b) if someone steals this person’s creation – trespassers will have to pay for their unauthorized use and tort they cause (such as loss of earnings in the amount of unauthorized copies that otherwise/legally would have been purchased from the author, etc.)

You see that there is an argument against your meaningless statements. It’s a matter of simple demonstration which shows that you lied about my position – and that you still have to make-up some fake arguments that nobody here even mentioned – just so you can “refute” them.

Regards.

Sasha Radeta January 1, 2007 at 8:50 pm

Oh, we have a pseudo-philosopher here!

How nice.

Anyway, why would I want to distinguish >>”right-based ideas” from “non-right based ideas” as ideas are related to means of production.<

Serious question: Are you well? There is no reason for me to argue that a process is “owned,” or that idea (per se) is owned. I explained that at the beginning of my discussion with Stephan Kinsella.

I argued that when someone’s product (physical creation) is owned:
a) the owner has the right to sell only the limited use of that product, which would restrict any unauthorized replication of it
b) if someone steals this person’s creation – trespassers will have to pay for their unauthorized use and tort they cause (such as loss of earnings in the amount of unauthorized copies that otherwise/legally would have been purchased from the author, etc.)

You see that there is an argument against your meaningless statements. It’s a matter of simple demonstration which shows that you lied about my position – and that you still have to make-up some fake arguments that nobody here even mentioned – just so you can “refute” them.

Regards.

Sasha Radeta January 1, 2007 at 8:51 pm

There is no reason for me to argue that a process is “owned,” or that idea (per se) is owned. I explained that at the beginning of my discussion with Stephan Kinsella.

I argued that when someone’s product (physical creation) is owned:
a) the owner has the right to sell only the limited use of that product, which would restrict any unauthorized replication of it
b) if someone steals this person’s creation – trespassers will have to pay for their unauthorized use and tort they cause (such as loss of earnings in the amount of unauthorized copies that otherwise/legally would have been purchased from the author, etc.)

You see that there is an argument against your meaningless statements. It’s a matter of simple demonstration which shows that you lied about my position – and that you still have to make-up some fake arguments that nobody here even mentioned – just so you can “refute” them.

Regards.

scineram January 2, 2007 at 6:55 am

“restrict any unauthorized replication of it”

Only by the buyer. If a third party gets to know about it, he can produce a similar product.

Sasha Radeta January 2, 2007 at 11:50 am

“Only by the buyer. If a third party gets to know about it, he can produce a similar product.”

——-

I responded to this many times before.

Something that can be produced “similarly,” when someone only “gets to know about it” (without actually handling the product) – is not a reproduction and cannot be called copyright violation. That is all part of independent discovery and not unauthorized use of someone’s product.

On the other hand – if third party does, beyond reasonable doubt, reproduce my distinctive product (such as my book) I will then hold my buyer accountable according to our contract that prevents “any unauthorized use.” Contracts don’t ever excuse you for allowing some third party to cause your violation of terms; otherwise, there would be no private property rights (third parties would have a license to trespass). You cannot accept a limited use of my product – and than offer your son (third party) the unlimited use of it.

If the third party obtained my product by theft from the buyer – it’s a tort issue (someone’s unauthorized use of my product caused financial injury) – not a breach of contract.

Peter January 3, 2007 at 8:16 pm

Again, Sasha, which buyer? If you publish a book that is bought by 40 million people, and then someone starts producing unauthorized copies, who are you going to sue? Can you answer that?

Sasha Radeta January 3, 2007 at 10:22 pm

No, I can’t. You really got me there.

: )

Of course not, I’m just kidding.

What kind of silly question is that?

If I have a supermarket chain that is annually visited by millions of people, and then someone starts shoplifting, who am I going to sue?
Who is sued now, for any tort, in this country?

You think that with 40 million copies sold I will not have an incentive and resources to invest into protection of my vast property? Think again. If copyright was completely privatized, you would have much more efficient and competitive market in firms that would provide better investigations and enforcement.

Nothing that humans do is perfect – and our current government’s copyright business is just like any other government’s business. Nevertheless, anarcho-communism that anti-IP clowns advocate (freedom to commit tort and breaches of contracts based on personal “needs”) is not an option.

Stephan Kinsella January 3, 2007 at 10:50 pm

Peter: Sasha is one of the most dense or dishonest opponents I’ve encountered. Or unjustifiably full of himself for some reason. But your question is a good one. Sasha has no idea whatsoever about the 40 million buyers, and has no idea whatsoever he is talking about. He evidently has no clue about the nature of real patent and copyright law, and why it simply cannot be duplicated by some “contractual-copyright” notion.

Sasha says:

If I have a supermarket chain that is annually visited by millions of people, and then someone starts shoplifting, who am I going to sue?
Who is sued now, for any tort, in this country?

Sasha is utterly clueless. S/he does not realize the distinction between scarce and non-scarce things. Sasha does not or cannot see that s/he is begging the question.

Sasha Radeta January 3, 2007 at 11:56 pm

WOW Dr. Kinsella!

Another posting entirely dedicated to my persona (as you see it), with some disturbing fantasies about my sex that say more about you that anyone cared to know – but you haven’t said a single thing that would contradict me.

You also have no clue about 40 million sold items in terms of revenue and power (if market for law enforcement was privatized). Plus, there is no reason why would privatized copyright be less efficient than government’s monopoly.

Plus, before Dr. Kinsella can talk about “the distinction between scarce and non-scarce things,” he should first start considering the economic definition of scarcity, where it comes from and how it is applied. http://blog.mises.org/archives/006035.asp#comments

Anyway, everyone here knows that copyright pertains to terms of use of real, ownable goods and not something “non-scarce” as you maliciously state.

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