By Harley Austin | United States
In our modern age, the average person is all too familiar with the concept of intellectual property From copyrighted music and movies to the “®️”, “©️”, and “™️” symbols on our favorite brands, intellectual property is a common aspect of everyday life. However, most do not realize the origin of the current system: the government. Intellectual “property” is really just an artificial monopoly on an idea. In effect, it cripples the free market and stifles innovation.
This may come as a massive shock to many, even the most hardcore laissez-faire capitalists. A common misconception is that critiques of intellectual property are an attack on capitalism and property itself, which is not true. It is from the support of a free market and property rights that one comes to recognize intellectual property as invalid. It is nothing more than a creation of the greatest market impediment in history: government. To analyze this further, simply look at what property is.
The Nature of Intellectual Property
Property, in the most basic sense, is control over a scarce object, usually capital goods or land. This usually occurs on an individual basis. The right to property guarantees that the owner has full ability to voluntarily exchange it. The purpose of property is to maintain just ownership of a scarce resource/good.
Non-scarce resources, on the other hand, such as sunlight and air, are more difficult to control. As they are (relatively) infinite, they do not operate under the same laws of demand as scarce goods. With infinite supply, market actors cannot control them. This means that things that are either infinite or uncontrollable cannot be property because they are not scarce or controllable. Note that raw intangible resources are different from the harnessing of intangible things. Solar power and purified air, for example, are scarce harnessings of non-scarce resources.
Because of this, the claiming of ideas as property, or intellectual property, is absurd. Ideas are both infinite and uncontrollable. A person cannot claim absolute control over an idea after its creation and declaration. Once someone declares an idea, it the exists infinitely in the minds of others. As nobody can externally control this, it thus cannot be property. However, the physical manifestations of these ideas, as tangible and scarce goods, are different.
The Patent System
This critique does not mean that all copyrighted or trademarked goods and services should be free to copy at will. The main target of criticism, instead, is the patent system. Essentially, when someone obtains a patent for an idea, the state is granting them a false monopoly on it. Since ownership of ideas is not a justified form of property, it requires the same thing as all other unjust forms of property: the use of force. And as is typical, the force ultimately comes from the state.
Patents, by definition, are as follows:
A government authority or license conferring a right or title for a set period, especially the sole right to exclude others from making, using, or selling an invention.”
This kind of government monopoly is a violation of property rights and the free market. Through this system of coercion, entrepreneurs use the government to take away their competition. In no sense are the ideas subject to the refining and modifying of the free market. Of course, this is not an endorsement of the stealing of any entrepreneur’s ideas. However, the current patent system is another crony capitalist example of using government power to stifle competition.
Government Control and Power
The power to control this “intellectual property” is one that the government can easily abuse. The most recent example of this is the European Union’s Directive on Copyright, which many people claim is an obvious attempt to restrict free speech. The most controversial components of this are the infamous Article 13, which requires websites to automatically remove copyrighted content, and Article 11, which taxes people for linking to news articles or including segments of them online.
This use of the copyright system is an obvious pretext for censorship and abuse of state power. Giving government control over ideas and images has resulted and will continue to result in censorship and restrictions like Article 13.
A Free Market Method of Copyrights
Fortunately, there is a free-market solution to protecting inventions: copyrights. However, unlike our current system, the free-market solution is based on actual, physical property instead of a coercive and fabricated intellectual “property”. This is called the contract theory of copyright.
In a free-market exchange, actors exchange complete ownership of one item for another, usually a currency. However, in a free market, if the sold item has a copyright, the owner sells it on the condition that the buyer does not reproduce and distribute it themselves. If the buyer reproduces it anyway, then they would have violated the terms of the exchange. The seller, thus, can sue the buyer and take him or her to court. This way, an inventor or author could still prevent the direct copying of their invention while still allowing free-market competition.
Contractual Copyright for Patents
Murray Rothbard, Austrian-School economist and political writer, describes how a contractual copyright system would work for patents in his book, Man, Economy, and State, stating:
Part of the patent protection now obtained by an inventor could be achieved on the free market by a type of “copyright” protection. Thus, inventors must now mark their machines as being patented. The mark puts the buyers on notice that the invention is patented and that they cannot sell that article. But the same could be done to extend the copyright system, and without patent. In the purely free market, the inventor could mark his machine copyright, and then anyone who buys the machine buys it on the condition that he will not reproduce and sell such a machine for profit. Any violation of this contract would constitute implicit theft and be prosecuted accordingly on the free market.”
This means that if a person were to directly copy an invention, then they would face legal penalties. However, if a person were to independently invent a similar creation, without purchasing (or even knowing about) the original, they would face no penalty. The prevention of independent invention of a previously-invented item is what makes patents coercive and unjust.
Patents vs Copyrights
Rothbard further describes patents and copyrights as follows:
The patent is incompatible with the free market precisely to the extent that it goes beyond the copyright. The man who has not bought a machine and who arrives at the same invention independently, will, on the free market, be perfectly able to use and sell his invention. Patents prevent a man from using his invention even though all the property is his and he has not stolen the invention, either explicitly or implicitly, from the first inventor. Patents, therefore, are grants of exclusive monopoly privilege by the State and are invasive of property rights on the market.
The crucial distinction between patents and copyrights, then, is not that one is mechanical and the other literary. The fact that they have been applied that way is an historical accident and does not reveal the critical difference between them. The crucial difference is that copyright is a logical attribute of property right on the free market, while patent is a monopoly invasion of that right.
The unjust, coercive, and monopolistic system of intellectual property must come to an end in order to obtain a truly free market. Those who advocate for laissez-faire capitalism and voluntary exchange cannot defend the government violations of property rights and free competition through the patent system.
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