Administration Bangs The Drum In Support Of Needless Protectionism On World IP Day

Politics

from the you're-doing-it-wrong dept

Well, today was “World Intellectual Property Day,” and I had hoped to just ignore the whole thing, but, as was expected on such a day, the politicians were out in force, talking up the importance of “protecting intellectual property,” with none of them really discussing the key issues: whether or not that sort of protectionism really is good for the economy, or the growing body of economic research that shows it is not. At all. Instead, we just get the same statements based on the old myths of intellectual property. Outgoing Commerce Secretary Gary Locke gave a mildly bland statement on the “critical importance” of such protectionist policies. But the really bizarre statement came from James Cole, our recently appointed Deputy Attorney General, who really takes the cake for ill-informed rhetoric concerning innovation and intellectual property.

This country has a deep and rich history of developing innovative products and groundbreaking inventions that have helped to shape our world. Intellectual property is one of America’s greatest assets and protection of these assets is vital to our economy, our health, and our legacy.

Thing is… the first sentence and the second sentence have little to do with one another. Our deep and rich history is not because of our intellectual property laws. In fact, much of our history involved very weak IP laws (some of which allowed us to industrialize faster). Recent studies, such as those by Eric von Hippel at MIT, have shown that the vast majority of productive innovation is done for reasons that have nothing to do with intellectual property laws. So why would Cole make such a statement?

Today, as we recognize the 11th Annual World Intellectual Property Day, we celebrate the creativity and innovation of American music, literature, film, art and the inventive spirit that have set this country apart. The growth of new technologies, increased broadband access to the Internet and global manufacturing distribution channels provide increasing opportunities to market American products and creative content around the world.

Yes, and much of that had nothing whatsoever to do with intellectual property laws. In fact, much of it happened in spite of intellectual property laws. The whole film business was launched on the basis of trying to hide from Thomas Edison’s patents.

Yet, on this day we must also recognize that there are those who exploit these same technological advances to profit illegally from the hard work of American authors, artists and inventors through criminal copyright infringement, trademark counterfeiting, trade secret theft, economic espionage, and other intellectual property (IP) offenses.

Like the founders of Hollywood? Like Disney, exploiting our cultural heritage and then locking up those works?

Unfortunately, criminals rely upon American consumers to buy their counterfeit goods. According to recent research from the National Crime Prevention Council, most Americans do not fully understand the scope or consequences of intellectual property crime and are susceptible to being swayed by the lure of a bargain, especially in these tough economic times.

Actually, multiple studies have shown that counterfeiting isn’t really that big of a problem. It’s not that American’s don’t understand the scope. It’s that industries who benefit from excess gov’t protectionism have massively inflated the actual problem and most consumers recognize that these concerns are bogus. They know when they’re buying a fake purse, and no harm is being done to them or the original brand. The purchase is often aspirational in that they buy the counterfeit when they can afford it, knowing that when they get enough money, they’ll buy the real version. In fact, studies have shown that massive numbers of counterfeit purchasers go on to buy the real thing within just a few years. You would think this info would be relevant. Why does Cole ignore it?

As chair of the Department’s Task Force on Intellectual Property that Attorney General Eric Holder established last year, I know we must continue to work to change the perception that IP crime is risk-free and victimless through aggressive criminal enforcement of laws designed to protect the American public and ensure the quality of products reaching consumers. Intellectual property crime contributes to the loss of hundreds of thousands of jobs, costs our economy billions of dollars annually and exposes Americans to potentially dangerous products, affecting public health and safety and national security.

Almost nothing in this paragraph is accurate. The “loss” numbers, in both jobs and dollars has been widely debunked. The studies mentioned earlier point out that in many, many cases it is a victimless issue. And, at most, this should be a civil issue between a rightsholder and an infringer. The government has no place in this.

The task force has sought to strengthen IP protections through an increased focus on domestic and international enforcement and better coordination with our state and local law enforcement partners. We’ve made significant strides to obtain convictions of online distributors of counterfeit pharmaceuticals; large-scale producers and smugglers of counterfeit goods ranging from luxury items to military-grade computer system hardware; distributors of pirated digital movies and music; and those who have misappropriated highly-valued trade secret information from American corporations.

Note the conflation of very, very different types of issues. Also note the ignoring of the massive due process and First Amendment violations that happened in the process of seizing domains from those falsely accused. Gee… I wonder why.

No, actually, it’s not. There are a few specific cases where there is a risk: genuinely fake medicines (not grey market imports) and counterfeit military & safety equipment. But those are very, very small issues. And yet they’re used to give Cole’s Justice Department a wide berth in stomping on people’s basic rights, turning civil, non-commercial issues into bogus criminal indictments, and taking questionable steps that appear to contradict basic free speech and due process principles.

Though we have accomplished a great deal, we recognize that we cannot rest on what has been done. The attorney general and I are committed to continuing to do more and with your help, we will hold accountable these criminals, protect the American public and safeguard one of America’s greatest assets.

Please, don’t. You’re making things worse, not better. You’re encouraging innovation to avoid the US and go elsewhere. You’re making the US the laughingstock of the world by seizing domains and censoring the internet while pretending to be in favor of free speech. Innovation does not work by “protecting” anything. It’s about enabling. And the DOJ is doing the opposite of that.

Filed Under: intellectual property, james cole, obama administration, protectionism