I received an impressive inquiry from a high school senior: “I am contacting you to ask if I can interview you for my senior project paper, which is a persuasive paper about why copyrights are invalid and impractical. I will have between 5-10 questions regarding intellectual property for you to answer.” I said sure; and she sent on her questions, which were:
1. What would you say is the most powerful argument against copyrights and patents?
2. What would you respond with to someone who argues that resources do not have to be finite or scarce in order to be allocated as property?
3. How would you respond to Lysander Spooner’s argument that property is wealth that is owned, and wealth includes ideas since they can be manifested into tangible wealth?
4. What about the argument that people own their minds, so they own the mental products?
5. Some anti-IP people believe in a right to first sell. Would you say that the original creators should have a right to sell the creation first? Why or why not?
6. What would you respond to someone who claims that if there were copies all around, the original inventor wouldn’t get as much profit as he should have?
My replies are below.Question 1. What would you say is the most powerful argument against copyrights and patents?
As I elaborate in In Defense of Napster and Against the Second Homesteading Rule and Against Intellectual Property (both available here), humans need to use scarce or “rivalrous” resources — for example, tangible things like land or food or clothing — to survive. The nature of these things is that only one person can use or control the resource. Thus, there is a possibility of conflict over the use of these things. For people to live peacefully and productively in the world, we need to be able to find ways to use scarce resources without fighting over them. This means that each scarce good–each thing that might be the subject of conflict–is assigned one unique owner, someone with the exclusive right to control that resource. The rules for determining who is the owner have to be objective, fair, and just, in order to be generally accepted and serve the function of reducing conflict. It is for this reason that ownership is thus assigned to the person with the best claim to the thing in question–the most objective “link” to it. This is the libertarian-Lockean idea of “first use”–whoever first possesses or uses a thing–that is, establishes objective property “borders” with respect to the resource–is the owner. Any other rule is non-objective or arbitrary. For example, if the first user did not have the best claim to the resource, then whatever rule you use to assign property rights, property is not secure because some latecomer could just take it from the current owner. So any property assignment rule at all presupposes the first-user idea–the idea that an earlier user, ceteris paribus, has a better claim than any other user. Which implies the first user — the homesteader — has the best claim of all. Any other rule in effect violates the notion that latecomers have an inferior claim to earlier users. For example, a thief who steals property is in effect a latecomer. And mere verbal decree is not sufficient either, for one or two reasons: first, because (with respect to unowned resources), it’s not an objective use of the thing; it does not establish any visible link; and any number of people could make such a claim, in contradistinction to first possession, which can only be done by one person, and which is objective and visible; and second, because (with respect to already owned resources) this amounts to theft, or a latecomer ethic.
Now, given this understanding, we can see that any just and peaceful and prosperous society requires the assignment of ownership rights in scarce resources in accordance with the libertarian homesteading or “first use” principle. Now ideas — creative works protected by copyright or inventive designs or recipes or processes of patent law — are not scarce resources. Any number of people can have a copy of a song; or can use the same method or design, with their own bodies and property. To assign rights in such things–called “ideal objects”–means setting up enforceable claims in these intangible things–but force is a tangible, real thing that can only be applied to other real (scarce) things. In other words, because ideas are scarce, assigning rights in ideas necessarily is accomplished by assigning ownership rights in scarce resources. So, for example, the holder of a copyright to a novel has a partial ownership right over the bodies and tangible property of everyone else in the jurisdiction, because he can stop them from using their bodies or property in a certain way. The owner of the patent for a mousetrap can stop you from using your own body and wood and metal to make a mousetrap having a similar design to his patented design. But as we have seen above, recognizing such rights contradicts the only just and objective property assignment rule, since it overrides the ownership rights already established in already-owned things. I homestead property, and own it; then someone else acquires some rights to control my property merely by a decree of the state, in effect, merely by their thinking of a way to use their own property, which is not “first use” of the resources they now claim ownership of.
So, in short, the problem with patent and copyright is that it amounts to theft of rights to scarce resources.
Question 2. What would you respond with to someone who argues that resources do not have to be finite or scarce in order to be allocated as property?
Assigning rights to non-scarce things necessarily infringes on rights to scarce things, since IP rights are enforced with force, real force, in the real world, against real things. For example, the copyright holder can force the “infringer” to pay money to him; or can get an injunction forcing him to stop using his body and (scarce) property in a certain way. Assigning rights to non-scarce things acts much like inflation of the money supply does: the more you do it, the more you dilute and reduce the value of real property (money).
Question 3. How would you respond to Lysander Spooner’s argument that property is wealth that is owned, and wealth includes ideas since they can be manifested into tangible wealth?
Wealth is too nebulous a term to be used here and is unnecessary. It appears to mean value; but as Hoppe and Rothbard show, value is not ownable or owned. The owner of property has no property right in the object’s value, since its value lies in how others’ appraise it. (Hoppe argues this in his TSC, as I note in my Against IP article, at text at note 79.) See also Rothbard’s explanation for why there are no rights to one’s reputation–because a reputation is what others believe about you, and you don’t own their minds or opinions. (I think this is in Ethics of Liberty.)
Question 4. What about the argument that people own their minds, so they own the mental products?
This line of reasoning is based on the confusing notion that creation is an independent source of property rights. This error is similar to the confused idea that we own things we mix our labor with because we “own” our labor. We own — have the right to control — various scarce resources, such as our bodies and other scarce resources we homestead or acquire from previous homesteaders. We do not own “labor”; labor is just an action, an activity of the body. To be sure, when one first uses unowned property, and thereby homesteads it, he is engaging in a type of “labor”; but we do not need to rely on the confusing metaphor that we “own” our labor. By working to emborder or possess an unowned resource, one thereby establishes a visible link with the property, thus establishing a better claim than any latecomer, i.e. ownership. This chain of reasoning does not imply or rest on the idea that we “own” our labor.
As for creation, it is often maintained that one can acquire ownership of things by either finding (homesteading), contract (acquiring it from a previous owner), or by creating the thing. But this is confused: creation is not an independent source of ownership. In fact, a bit of reflection shows that it is neither necessary nor sufficient. If you own a resource and re-shape it into some new, more useful, more valuable configuration (say, you “create” a mousetrap using your wood and metal; or you “create” a statue by carving up your hunk of marble), then you own the resulting “creation” simply because you were already the owner of the material that constitutes it. So it is not necessary to think of creation as a “source” of ownership rights. Likewise, if you carve a statue into someone else’s property, then you do not own the resulting statue; rather, the owner of the marble is entitled to have his marble back, and perhaps damages for trespass. So creation is not sufficient for ownership either.
In fact, the only legitimate ways of acquiring title to a given scarce resource is to either homestead it from its unowned state, or to contractually acquire it from someone who already owns it and who can trace his title back to an original act of homesteading. This fully exhausts all ways of coming to own scarce things. This is because matter cannot be created by man, but only rearranged.
Now let me note one other thing. Rothbard explains in Ethics of Liberty why there is not really an independent right to free speech; there are only property rights. There is no “right” to free speech that gives you the right to speak on others’ property–you must have the consent of the owner. And if you own property, you can do whatever you want on it, including speak–not because you have a “right to free speech” but because you can do whatever you want with your own property so long as you do not invade others’ property rights.
So back to your question: we do not own the mental products of our mind for several reasons. First, owning one’s body, just as owning property gives you in effect a (derivative) right to speak on it, allows you to use it to do useful things, such as come up with ideas, or even sell your services, or labor. There is no need to engage in the confusing fiction or metaphor that you “own” your labor, or you “own” the “products” of your mind. Second, “products of the mind” is far too vague of a concept. It is so broad that if property rights were granted in them, they would swamp and override all real rights in real things. And finally, if the products of your mind are scarce, you presumably own them because they result from reworking material you already owned (if not, as in the stolen marble example, you do not own it at all, but someone else does). And if they are not scarce, they are not the subject of property, since granting property in them is impossible, and can only be accomplished by eroding property rights in others’ things.
Question 5. Some anti-IP people believe in a right to first sell. Would you say that the original creators should have a right to sell the creation first? Why or why not?
I believe you may be referring to the doctrine of common law copyright. As a practical matter, if you have an idea or manuscript, you can use this to leverage payment to reveal it. But if you are foolish enough to let the information become public, it is too late to do this. As Benjamin Tucker noted: “You want your invention to yourself? Then keep it to yourself.” (see on this Wendy McElroy, Copyright and Patent in Liberty).
Question 6. What would you respond to someone who claims that if there were copies all around, the original inventor wouldn’t get as much profit as he should have?
Austrian economics teaches us that values are subjective, and that the only way to determine an objective price is on the market. See on this Rothbard’s Utility and Welfare Economics, e.g. The only way to know how much profit someone “should” make is to see what people are willing to pay them for. Part of the market is the need to incur costs of exclusion. If you don’t put a lock on your business, people will steal it. If drive in movie theaters didn’t incur the cost of putting little speakers for each car, then people would free ride by watching it from outside. To decide whether a given endeavor is worthwhile, one must take all costs into account, including costs of exclusion. The more creative find ways to exclude that have a low enough cost and that exclude a sufficient number of free riders so that the business can be profitable. For those entrepreneurial plans that have too high a cost, they should not be engaged in. So we see people finding ways to profit from their ideas, given the free rider problem–so rock bands give away their music for free (it plays on the radio, e.g.) so they develop fans who will pay to see them play live in concert (but even here, there are costs of exclusion–the ticket selling and enforcement mechanism, say). Or television shows are broadcast for free and paid for by advertisting. And so on.
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Good questions Ron.
Ron: “Your premise is that ideas cannot be owned because they’re simply copies of other peoples’ ideas, and that nothing that is not produced from wholly-owned “ingredients” cannot be owned; therefore, contracting against any human activity or creation is illegitimate.”
Ideas are more like recipes and not physical “ingredients”. But even the development and sale of recipes can occur in a free market with no prohibitions against copying and improving upon recipes.
Ideas are at least IN PART bundled copies of other peoples’ ideas. But ideas are not necessarily static. Advancement and progress certainly occur in the arts and sciences.
Ron: “Logically, then, ownership of anything is invalid, and nothing un-owned can rightfully be sold or otherwise transferred. There are no property rights, and no individual has any claim to the fruits of his or her labor. By this reasoning all goods are “public goods”. In fact, we are not even the owners of our bodies or lives, as our birth was brought about by our parents’ act of copying the idea of intercourse.”
No, just the ideas element cannot be owned or validly contracted because that portion of creative production cannot be exclusively delineated. Human bodies are exclusively delineated. Two people cannot occupy the exact same space at the exact same time. Property can be exclusively delineated. And because humans act, they own their actions (they can choose to not act in specific manners), they own themselves. But just any old acting is copying any old acting by someone else. Only claims of IP ownership can trespass on the actions and real physical property of others by preventing actions from being copied, which would be preventing others from existing. Thus, ideas alone do not constitute valid property claims.
Ron: “My question to you, then, is at what point, if ever, does ownership become legitimate? What is an individual’s labor worth if he or she must simply render up whatever has been created on the premise of incomplete originality?”
An individual’s labor is worth whatever someone else will voluntarily trade for the performance of that labor, or what that person themself subjectively values the output obtained from mixing their labor with their property. When you solely trade real physical tangible objects you don’t bundle the real physical tangible objects owned by others in the trade. Since ideas cannot ever be entirely exclusively created and owned, they cannot be owned. But labor and materials can certainly be exclusively used, shaped, and produced. Division of labor trade increases net wealth of society. And unlimited copying of ideas also increases net wealth of society. That’s why common public domain languages are created and evolve. Everybody benefits from this. It’s not a “sad” thing. The fruits of labor are massively increased exactly by copying ideas created by others. Market signals are sent precisely by this method. All DEMAND signals a wanted copying of SUPPLY. A marginal unit of supply is a copy of another marginal unit of supply. A “gold rush” is a whole bunch of people copying each other in the mining of gold. This can occur with simultaneous respect for persons and property, even though two people cannot both possess the exact same marginal unit of gold. There are no marginal units of ideas. They are omnipresent and unlimited wherever they are thought. And there’s no a priori prohibition against voluntary compensation either in advance or after the production of creative works. There are innumerable compensation models for all creative work, from subscriptions to fame to private performance to advertising subsidized to voluntary patronage. A mises.org site or wikipedia could evolve to compete with and undercut every private pharmaceutical company research and development budget.
And if physical material goods and scarce labor could theoretically be copied as easily as ideas, preventing that from occurring would be actively causing a net poorer society to exist. If copying was not justified only one single person could rightfully exist, as all others would be copying that person on some fundamental level. Ideas are just incidental information without boundaries or limits, no more remarkable than that charity and scholarships can exist in a free market. Attempting to assign ownership boundaries on ideas is just infringing and trespassing on the real property and real right to act of other persons. For society to exist, copying must occur. But copying alone is not sufficient for society to exist. There must also be voluntary exchange, and by definition of voluntary exchange, exclusively owned property and persons. That’s the only way somebody can occupy an exclusive Point A and non-violent (not resulting in a Hobbesian war of all against all) movement to and fro from different points can occur.
Isn’t it silly to declare if you invent and say a word, such as “pwn”, nobody can hear, see, comprehend or repeat that word? It can’t be controlled, except haphazardly by violence alone. In sum, ideas themselves are just not applicable to the process of ownership.
Thanks for the well thought out responses, rtr.
rtr: “No, just the ideas element cannot be owned or validly contracted because that portion of creative production cannot be exclusively delineated.”
Okay, I can accept that…I think. I’ll have to chew on it a little more to solidify my stance on it, but for now we’ll take it as true and move on.
You alluded earlier to the media itself…the CD:
rtr: “You can certainly sell whatever music you make that is represented on actual physical property.”
If an artist has mixed his or her labor with something intangible (music notation, blues chords, language, et. al.) and used it to create something tangible, i.e. a CD, then sells that CD to a consumer, does the artist have a right to dictate the use of the CD itself? Can the creator and consumer validly enter into a voluntary agreement which restricts the consumer’s ability to use the CD in a particular manner, specifically, to prohibit the consumer from accessing the CD with software that copies the information onto some other media?
You’re absolutely right that you can’t prevent someone within earshot from hearing music that’s being played loudly, though there has been legislation proposed in some states to do just that. (See: This report for an example of how patently ludicrous this has become. Pay particular attention to the reference to “The Sonny Bono Act” on page 3). However, the owner of a concert venue can restrict patrons from using recording devices inside the venue to copy the performance.
The point is that there are property rights, beside those that are arbitrarily created by government on ideas, that can serve to protect the interests of the creator. I don’t disagree with you that most artists are egotistical and have no grasp of others’ contributions to their own work. I also don’t necessarily believe that reproducing someone else’s ideas constitutes a violation of that person’s rights. I’m just wondering if the fact that you can’t claim exclusive ownership of an idea is even relevant to the IP discussion.
And yeah…I know all that stuff about labor, subjective value, free exchange, etc., and the benefits they provide. This is primarily an exercise meant to challenge my own assumptions and logically solidify my position on the subject. Sometimes playing the devil’s advocate is the best way to go about doing that.
Ron: “If an artist has mixed his or her labor with something intangible (music notation, blues chords, language, et. al.) and used it to create something tangible, i.e. a CD, then sells that CD to a consumer, does the artist have a right to dictate the use of the CD itself?”
No, a “sale” is a trade, which implies ownership of A has been exchanged for ownership of B. But suppose the artist “rents” the use of the cd. Then I suppose so (depending upon the restrictions), but that would be rather pointless, because the artist doesn’t have the right to dictate the use of all property that is not the CD itself (even if somebody originally agrees to this they can change their mind at any time), and only so long as the artist remains the owner of the cd.
Ron: “Can the creator and consumer validly enter into a voluntary agreement which restricts the consumer’s ability to use the CD in a particular manner, specifically, to prohibit the consumer from accessing the CD with software that copies the information onto some other media?”
Yes they can. Or no they cannot. Those are the only two possible answers. And that’s completely dependent on continuing present tense agreement to the terms of the contract. But the agreement cannot be enforced beyond what has been exchanged at the moment of the agreement, because agreements can be canceled at any time for whatever reason, just like divorce. So I think my preliminary answer has to be “no”. There’s no such thing as a binding contract, in so far as “contract” refers specifically to future action. The artist would have to require that a penalty be deposited in advance, which would just effectively be raising the price of the cd by the penalty amount, which would just be effectively paying for the right to violate the terms of the contract. Either way, a cd with restrictions is likely to be less valuable to the purchaser of the cd than that cd without restrictions, so the artist is only doing himself a disservice by lacing his product with restrictions. Trade is still only going to occur if that which is received is valued more than that which is given away in exchange. And I’d imagine giving away your rights to act as a complete person and giving away your rights to fully use your other property would be pretty expensive (which is why artists and creative content distributors seek government subsidies in the form of mandated ex post civil forfeiture penalties for “copyright infringement”).
But the really interesting economic demonstrations proceeding from the “intellectual property” debate are going to be the epistemological ramifications it has on contract theory, which at the moment, is a cesspool of CONTRAdiCTions. It might be the whole idea of contracts exists *only* because of
government force (in that case complete trades would occur much more often in a free market in the absence of pretend contract), and that contracts are often causing poverty in the future
tense for some party of the contract (think Katrina home insurance), as future subjective
valuations change (as opposed to present tense trade always increasing mutual profit), and massively skewing prices for goods that are connected with contracts, such as houses and cars.
It’s something I have to think about. There’s absolutely no government force needed for any voluntary trade whatsoever, because that which is received is valued more than that which is given away in exchange. Thus, it seems contradictory that third party force and regulation should be required in the realm of voluntary contracts. But I have to think about how and if such things as insurance (and there’ *still* risk insurance companies can fail) and derivative contracts would evolve in a free market from solely present tense trade events, and not from regulatory force ensuring compliance from past terms into the future. There are free market institutions that suggest contracts aren’t natural free market occurrences, such as margin requirements, banks holding title to property purchased with loans until the loan is repaid, default insurance, deposits, credit ratings, etc. I’ve already found plenty of big fundamental errors in the field of economics, so it wouldn’t surprise me to find many many more. But that would be a *big* add to my demonstration collection, showing contract evolving from something such as government justification to conscript mercenaries and serfs into continued service.
It seems to me if contracts were declared universally unenforceable alternate replacement mechanisms would evolve to hedge risk, and high risk activities, such as building expensive homes on California hillsides at risk of fire, would be far less subsidized. Well, that’s a completely different topic …
rtr: “No, a “sale” is a trade, which implies ownership of A has been exchanged for ownership of B.”
Well, yeah, that’s what I meant. Suppose, though, that the ability to copy the CD was part of what the consumer traded for the CD, in addition to whatever other remunerations were rendered. The consumer still has to decide if those things combined were of greater subjective value than the CD itself. If he/she feels that $12 + “don’t copy the CD” is worth less than the CD, then there is a trade, otherwise there is not.
Let’s suppose for a second that the RIAA suddenly pulls its head out of its arse and decides to quit fighting this frivolous battle, and as a result the price of non-copyrighted CDs jumps to $30. This puts a more tangible “price” on the hassle-free ability to copy the CD. I wonder how the market would respond.
This has got me thinking about other goods, and about how the issue of copying only applies to things that are easily copied. Copying a piece of handmade furniture requires nearly as much effort as creating the item itself, so it’s really a non-issue. Even when a piece made by a well-known artisan is copied, the copy itself often sells for much less than the original, even though the copy may be of the same quality, so there are natural market mechanisms that generally grant higher value to “originals”. I wonder if the same would hold true of CDs and software without IP laws.
This reinforces my viewpoint that IP laws are a method of legitimizing activities that would otherwise not be nearly so profitable.
Ron: “Suppose, though, that the ability to copy the CD was part of what the consumer traded for the CD, in addition to whatever other remunerations were rendered. The consumer still has to decide if those things combined were of greater subjective value than the CD itself. If he/she feels that $12 + “don’t copy the CD” is worth less than the CD, then there is a trade, otherwise there is not.”
Absolutely correct. That is why the trade occurs. But that which is received being valued more than that which is given away in exchange only definitively applies to the present tense moment in which the exchange occurs. It is an epistemological impossibility though for it to be known what uses or actions create value in the future.
But promises, contracts, just like “IP”, are intangible non-goods. That doesn’t mean they can’t have positive subjective value. Observe fiat currency being willingly picked up from the ground. Contractual restrictions applying to future actions are not market optimal transactions in the future, and they only exist to the extent they do because of government thug interference in the market place, threatening and executing violence if necessary to enforce past terms that may not be creating mutual positive value in the future tense. Just perusing the “contract” entry on wikipedia shows that “contract” is no where on par a free market institution the way private property is. Contract is always an erosion of private property, a limitation upon full ownership of property. It’s full of examples of compulsion, which by definition is not willingly occurring nor creating mutual positive wealth the way trade does.
Ron: “This has got me thinking about other goods, and about how the issue of copying only applies to things that are easily copied. Copying a piece of handmade furniture requires nearly as much effort as creating the item itself, so it’s really a non-issue. Even when a piece made by a well-known artisan is copied, the copy itself often sells for much less than the original, even though the copy may be of the same quality, so there are natural market mechanisms that generally grant higher value to “originals”.”
Very true. Fame, reputation, and brand name recognition certainly have vastly varying positive subjective value. But it’s not quite a “non-issue” as it effects scarcity and substitute goods, such as artificially labeled “knock off” or “counterfeit” goods.
Ron: “I wonder if the same would hold true of CDs and software without IP laws.”
It already does to an extent. There’s lots of memorabilia that sells for big money, such as the hand written lyrics of John Lennon’s “Imagine” some guy keeps in his safe. Artists can certainly supplement their incomes by giving their bigger fans more value in limited edition exclusives. And concert tickets have different price tiers, the closer or further way from stage the seats are located. IP just permits people to be lazy, to profit from creating artificial scarcity. But such do socialists prefer everyone to have an equal slice of the pie even if that equal slice is much smaller than what the smallest slice would be in a free market pie. But ironically IP is being used to create unequal slices of pie that are much smaller than what the what the equal slices of pie would be in a free market society with respect to ideas (there’s absolutely no physical scarcity).
Ron: “This reinforces my viewpoint that IP laws are a method of legitimizing activities that would otherwise not be nearly so profitable.”
Compulsion is not voluntary nor legitimizing. It’s merely restricting trade and causing society to be net poorer, less efficient, and more technologically stunted than it otherwise would be. Property, mine, yours, his, hers, is a mutual copied understanding. Without copying there can be no supply and demand, no trade, no action. Copying is absolutely necessary for society and a free market to exist. Copying is precisely the method by which wealth is mass created in a free market, as the very word “marginal” implies “exact copy”. But new subjective value is also created by differentiation, and famous creative artists have vast advantages (by definition being very limited famous supplies of creative artist individuals) to create extra subjective value from applying those advantages to otherwise bland marginal unit commodities, with appearances, dedications, and autographs for instance. Thus, all creative artists will be maximizing profit precisely by maximizing fame (increasing and maximizing demand), and they will be maximizing fame precisely by diminishing arbitrary artificial barriers to the spreading of their fame, such as IP.
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