The Attraction of “Strong IP”

This was originally written as a response to the question of “why [do] people think it’s such a horrible thing to want to get stuff for free, and yet our society rewards people who pay their employees a few cents an hour”?

More generally, it’s my attempt to play the Devil’s Advocate, and shed some light on why draconian intellectual-property legislation has been such a winner in the U.S.

I think the answer is staring you in the face: as a nation, the U.S. imports a lot of physical goods, but exports a lot of intellectual property. Therefore, we reward companies who chisel their foreign suppliers into squeezing their employees, because this results in cheap imports here in the States. Likewise, we punish IP ‘theft,’ because IP is one of the last things that we seem to be able to produce and sell.

Now, I’m no fan of the DMCA, because I think it causes more damage and economic loss, here in the U.S., than it can or will ever possibly create in new IP-export revenue. But the logic driving it, when you separate it from the implementation, isn’t that hard to understand, at least from a certain point of view. Allow me to illustrate how I think many people see the problem:

When we set aside irrational feelings of American exceptionalism — those warm feelings that politicians always play to, when they talk about the “American worker” being the “best in the world” as if it was self-evident — it is not immediately clear exactly how our previous success over the past century, 1 necessarily translates into continued success in the future. In short, although everyone likes to say reassuring things like “Americans have always been at the forefront of innovation!”, those words ring pretty hollow — it’s not clear why we would continue to be. We’re not smarter than everyone else, our education system basically sucks, and we have a culture that’s increasingly anti-intellectual and in some cases bordering on non-secular.

What this boils down to is: in a fully globalized economy, it’s not clear what areas the U.S. will have a comparative advantage in. We’ll probably always be able to export some agricultural products, but agricultural products do not a first-world civilization pay for. Same with natural resources like coal and timber but we’ll need them here eventually, so we’d just be selling ourselves down the river. So what do you have left, when you’ve outsourced everything that can be outsourced to lower-cost second- and third-world areas? I think Neal Stephenson was onto something: music, movies, microcode, and pizza delivery.

‘Pizza delivery’ is the remaining service-sector crap that can’t be outsourced. Music and movies are ‘cultural exports,’ things that for whatever reason, have a certain cachet in the rest of the world, and so don’t really fall victim to direct price competition with foreign competitors. And microcode 2 — even if we’re not the best at that, either, we’ll use our monopoly to milk the rest of the world pretty good for as long as we can. But we can only do that if we can get them to buy into the legal framework which lets you sell IP as if it were physical goods. Hence, the DMCA and other ‘strong IP’ laws.

All of this is just my rather long-winded way of trying to explain why so many people (people in government in particular) are hooked on strong IP law (including the DMCA, DRM, and anti-circumvention), and proprietary software: they see it as a way to ensure that the U.S. can still make money doing the only thing that we seem to be good at. It may not seem at first glance to make a whole lot of sense, particularly to non-Americans, but I’ve met a lot of fairly powerful people who are very, very nervous about where the New/Global Economy is headed, and how the U.S. is going to maintain its standard of living 3 in the future. If you’re looking for a near-magic solution, which you are if you’re a politician, grabbing onto intellectual property as the salvation of high-cost Western society probably isn’t the stupidest thing you’ll do all day.

Errata

Redistribution Info:
I was asked about redistribution rights — you may consider it licensed under the GFDL, although I would appreciate attribution via a link to this page or the original comment if possible.

Much of which is attributable to having had the good luck not to involved in any home-turf land wars (like Europe, which got flattened, some of it twice) and getting on board the capitalism bus early (unlike Asia, which is just coming around to this whole market-economy business). ↩
I’m using “microcode” here to represent basically all IP-derived exports, which includes most pharmaceuticals, since they’re more of an information product than a physical good, even if they’re generally distributed only in a ‘compiled’ form (pills). ↩
To say nothing of its political dominance (which is driven by economic dominance) and which a fair number of conservative people see as essential to keep the world from being overrun by Communists/Islamists/Huns/whatever. ↩