Why Is Consumers' Research Pushing For Anti-Consumer Trade Deals, And Bad Intellectual Property Laws?

from the doesn't-seem-to-fit...-at-all dept

This is kind of bizarre. When you normally think of an organization like Consumers’ Research, you think that it should be looking out for the consumer’s best interests, and pushing back against corporations that are looking to make life worse for consumers. But apparently that’s not how it is. Consumers’ Research — importantly — is not to be confused with Consumers Union, which puts out Consumer Reports (and owns Consumerist). Consumers Union actually was created back in 1936 after a bunch of staffers revolted from Consumers’ Research and set up their own thing. And while Consumers Union took off, Consumers’ Research languished, such that many have probably never even heard of it. Somehow, however, it got a bizarre opinion piece published in the Hill all about strengthening the US’s intellectual property laws and supporting trade agreements (like TPP and TTIP) that do so (the article is actually from a few months ago, but a reader just sent it to me). The piece is written by Joe Colangelo, who is the executive director of the organization — though, from his LinkedIn profile, it appears he only graduated college (with a political science degree) in 2007, and then was in the Navy until 2011. After that he was a sales manager for some company and a consultant at Booz Allen (the giant government contractor) before becoming exec director of Consumers’ Research. It’s not clear what (if any) “consumer” background he has, other than (I assume) buying stuff every so often.

The opinion piece is a mess from the beginning:

With both sides of the aisle focusing on bettering the middle class this new Legislative session, Congress should consider determining how to better protect the intellectual property of innovative Americans. America?s knowledge-based economy requires international treaties and enforcement of current laws to keep American IP safe and to encourage innovation.

Wait, why? There’s a ton of research showing that greater enforcement of IP and stricter IP laws have actually done plenty to discourage innovation. It’s why most of Silicon Valley is pushing for new laws to fix the patent system, not strengthen it. And, it’s why plenty in Silicon Valley are worried about agreements like the TPP for not including important features like fair use, a lack of which will stifle innovation.

IP-intensive industries create more high paying U.S. jobs than any other sector. A 2010 report by the U.S. Department of Commerce and the Patent and Trademark Office found that direct employment in IP-intensive industries in the U.S. accounted for 27.1 million jobs, and indirect activities associated with those industries provided an additional 12.9 million jobs for a total of 40 million jobs. Jobs related to IP industries comprise a staggering 27.7 percent of all jobs in the U.S. economy.

Oh gosh. Not this report again. It’s been debunked so many times even bringing it up tends to be a sign of someone who is obviously ignorant of the facts. Once again, the report assumes — incorrectly — that if an industry gets a lot of copyright/patents/trademarks every bit of that industry only exists because of existing copyright/patent/trademark laws. It doesn’t take into account that much of the economic activity may have nothing to do with those laws. Nor does it consider if there would be even greater economic activity if those laws were different — either weaker or stronger. All you have to do to understand how messed up the report is, is to recognize that the leading “employer” cited in the report… is grocery stores. Anyone who thinks that grocery stores exist because of IP laws is clearly delusional or ignorant.

Yet, Colangelo not only accepts the study’s questionable methodology, but falsely assumes it means more or stronger IP must mean more such jobs — even though the report makes no such claim at all. Colangelo makes a random reference to a meaningless Apple patent, and some nonsense about “21st Century policies” and then starts ranting about piracy:

Illegally downloading content is not a legitimate option. Just as in the physical world, online, freedom does not mean lawlessness. Users must be aware of the consequences of internet piracy. Pirating a movie is just as illegal as slipping a DVD into your pocket and stealing it at a discount store. A truly free Internet, like any truly free community, is one where people can engage in legitimate activities safely and where bad actors are held accountable.

Remember, folks, this is a guy supposedly supporting consumers’ interests, and he’s pushing the laughably misleading line (that even most of Hollywood has given up on) that a download of a movie is the same as stealing the DVD. Does he think “a truly free internet” is one in which legitimate news websites are shut down just because the entertainment industry (wrongly) asserts that there is some infringing music on the site?

Next up, we get a supposed “consumer advocate” repeating the Chamber of Commerce’s talking points:

Unfortunately, too many foreign governments treat IP theft as a victimless crime and look the other way, ignoring the economic and societal benefits that innovative economies offer. The lure of access to the U.S. market should be used as an incentive to convince trading partners that they should adequately protect IP rights, and to this end, the Global Intellectual Property Center recently published its third annual International IP Index. The Index serves as a tool for both government leaders and industry to evaluate the IP environments in 30 diverse economies around the globe. Effective IP protections are critical to trade agreement negotiations to protect software developers, artists, creators, innovators, and industry.

The Global Intellectual Property Center is a front group for the Chamber of Commerce. The Chamber of Commerce has a long history of opposing basically any and all consumer rights. I’m beginning to get the feeling that “Consumers’ Research” is not, in fact, a consumer group any longer, but a mouthpiece for the Chamber of Commerce, and a faux consumer group. These talking points do seem an awful lot like the old SOPA talking points, whose campaign was led by the Chamber of Commerce.

Protecting IP is more than just a policy imperative ? it?s enshrined by our Founding Fathers in the U.S. Constitution in Article 1, Section 8: ?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.?

This clause, articulated by the Founders, is rooted in the notion that the best way to encourage creation and dissemination of new innovations and creative works to the benefit of both the public good and individual liberty is to recognize one?s right to the fruit of their intellectual labor through intellectual property rights.

Actually, that clause is rooted in the notion that Congress is supposed to actually “promote the progress” for the public, like you would think a consumer advocate would support — and that means that it can use such powers if and only if they benefit the public. The Constitution does not require Congress to expand copyright and patent laws. It just gives it the option to do so if those laws benefit the public.

It appears that, as the fight for TPP heats up, you can expect all sorts of ridiculous bloviating from astroturfers and front groups. This particular article certainly suggests that “Consumers’ Research” and Joe Colangelo are much more aligned with the interests of the Chamber of Commerce and its anti-consumer sentiment than anything that resembles a “consumer advocacy” group — no matter the organization’s historical legacy.

Filed Under: , , , , , ,
Companies: consumers research

Rate this comment as insightful
Rate this comment as funny
You have rated this comment as insightful
You have rated this comment as funny
Flag this comment as abusive/trolling/spam
You have flagged this comment
The first word has already been claimed
The last word has already been claimed
Insightful Lightbulb icon Funny Laughing icon Abusive/trolling/spam Flag icon Insightful badge Lightbulb icon Funny badge Laughing icon Comments icon

Comments on “Why Is Consumers' Research Pushing For Anti-Consumer Trade Deals, And Bad Intellectual Property Laws?”

Subscribe: RSS Leave a comment
50 Comments
Ninja (profile) says:

Consumers’ Research — importantly — is not to be confused with Consumers Union, which puts out Consumer Reports (and owns Consumerist). Consumers Union actually was created back in 1936 after a bunch of staffers revolted from Consumers’ Research and set up their own thing.

I’d guess the reason for the revolt is still the same after more than 50 years and also the cause of Caonsumers’ Research being largely unknown.

Anonymous Coward says:

Re: Re: Re:

Im with you, but according to keyes,

Price is related to scarcity (supply and demand), and value is related to price (cost). value = quality/cost.

But, I am still kind of with you because, the problem is the ‘rights-holding-middlemen’ are trying to create an artificially lowered supply and, unfortunatly, somethings are easier to pirate than they are to buy. In some cases, purchasing is not even possible.

If a label or studio put all of their works online for a reasonable price (even online rental), I think they would make a bit a bank. Some pirates pirate to pirate. Perhaps many pirate because there is not other option.

And don’t but, netflix, amazon, itunes, whatever. The labels and studios have purposely limited the selection. There are some artists, etc.. that you just can’t by for personal consumption.

James Burkhardt (profile) says:

Re: Re: Re: Re:

I’m with you, but according to keyes,

Price is related to scarcity (supply and demand), and value is related to price (cost). value = quality/cost.

And as is discussed here on techdirt, traditional economic analysis goes out the window when scarcity isn’t a factor. So quoting 1930s economic theory to try to suggest that value = scarcity is still a thing is a bit problematical. In fact Mason’s statement seems to decry Keynesian economics being the only model considered.
While you are potentially correct that in this case that the price someone is willing to pay becomes their cost in the value equation, I still can’t understand what you are arguing in the rest of your statement. It seems you are arguing that Artificial Scarcity is a bad thing, but that really contradicts your earlier quoting of Keyes.

Anonymous Coward says:

Re: Re: Re:2 Re:

But scarcity is a factor,and artificial scarcity is Bad.

IMO, keyes says if the supply and demand curves move naturally, the market is at good place. Supply and demand meet at the most effective point for the market.

However, if the suppliers are artficially shifting the supply curve, this is not good. The intersection of supply and demand is not the most efficient for the buyers and the sellers.

Not sure what the problem is here.

James Burkhardt (profile) says:

Re: Re: Re:4 Re:

I assumed you would be able to follow the implications of my statement, but as stated I may have committed a roundabout logical fallacy, but let me rephrase. Quoting an economic theory from an environment where all goods have inherent scarcity to prove that scarcity = value in an environment where there is no scarcity is problematical.

I think you have employed “The Fallacy fallacy” as well as a strawman in that comment.

James Burkhardt (profile) says:

Re: Re: Re:3 Re:

If you are trying to agree that value can come from somewhere other then scarcity, quoting keynes is a problem, as Keynesian economics is based on the assumption that scarcity raises prices (which raises value).

If on the other hand you are, despite agreeing with Mason, arguing that Scarcity = Value, the establishment of artificial scarcity is important, because without scarcity, prices drop to zero, and so does value (as per your simplified Keynes equations. This would be what Mason is arguing against, so therefore, your problem is you should be disagreeing with him.

If you are just arguing that artificial scarcity is bad, then the quotes about Keynes hold no value to your argument. So why were they included?

Mainly, I am trying to figure out why you quote keynes, and then advocate a position that disagrees with him.

Anonymous Coward says:

Re: Re: Re:4 Re:

You are only seeing one side. The market clearing price is the intersection of supply and demand. One really can be considered without the other.

Firstly, value and scarcity, IMO -> by the business/mathematical definitions there is no obvioius correlation on a macro scale.

If the demand is constant, and supply is artificially shifted left (less supply), then the market clearing price is not the most efficient. (this is my main point why artificially manupilation of the supply is not good -> because the markets don’t operate at peak efficiency for the buyers AND the sellers combined.

So thats the macro economics.

On a micro scale, and this could be were the rub is, cause I am not sure, but if the price goes up (and for this case, assumed the parts of the cost that are not the price remain constant), then if I was considering purchasing at the elevated price, in reality, the value went down (for me, the buyers perspective). because value = qual/cost. Cost goes up (the price part) and value goes down. Same product so quality is constant.

Well, now i just argued the other side -> scarcity lowers value because the supply curve shifts and the intersection with demand moves up.

But hey, what ever you guys want, just make it up. Remember, only you can determine value.

James Burkhardt (profile) says:

Re: Re: Re:5 Re:

Firstly, value and scarcity, IMO -> by the business/mathematical definitions there is no obvioius correlation on a macro scale.

But before you said

Price is related to scarcity (supply and demand), and value is related to price (cost). value = quality/cost.

So if there’s no obvious correlation, how can you so easily state they are related in just over 100 characters?

Additionally you have no concept that the terms price and cost normally mean different things in economics do you? Let me clarify, when discussing a good, cost is normally the cost of production, and Price is normal the cost of sale.

But thats not really my point, you have finally explained why Keynesian economics might suggest that scarcity (but only artifical scarcity) lowers value. but you fail to explore what happens under the same economic theory when there is no artificial scarcity, and therefore no scarcity of a digital good, because there is no practical limit to your ability to replicate that good. And what it does is break the Keynesian model. Supply curves are meaningless, because there is infinite supply at 0 cost to the producer. Demand curves argue the optimal price is near zero. And we haven’t yet factored in concerns of establishing the value of freely distributed products.

If you are stuck in the Keynesian economic model where the only way to determine value is via monetary price and the only way to determine price is the interaction of supply and demand curves, you aren’t going to get a good image of the economics of free and digital distribution.

Also, I never claimed that value was subjective, that was someone else. Your Human Condition article did though. You argue against me when responding to others as well. You might want to figure out that ‘people are individuals’ thing.

Value only has one meaning. the rest is just marketing.

http://www.merriam-webster.com/dictionary/value disagrees with you. How about what you meant to say, which is that in economics value has only one meaning. But there are many economic theories of value, such as the labor theory, in which given an equal value of labor, the good with more labor input has more value. That one doesn’t effectively fit into your formula, but its a valid measure for some industries.

I still find the way you responded to Mason’s comment about value=scarcity (that it wasn’t true) to be odd:

Im with you, but according to keyes,

that suggests keynes disagrees with him. And so all my argumentation was based on that premise. Hence why I thought you were using Keynes to argue that value=scarcity, and really, its based in the idea of scarcity, which is not true in a digital environment.

Anonymous Coward says:

Re: Re: Re:6 Re:

Ah grasshopper, you will fail if you believe,

“Supply curves are meaningless, because there is infinite supply at 0 cost to the producer. Demand curves argue the optimal price is near zero. And we haven’t yet factored in concerns of establishing the value of freely distributed products.”

Also, You “never claimed that value was subjective, that was someone else.”

So are you claiming that value is not subjective?

I believe you have failed at a meaningful retort.

also, I never said value=scarcity, you should clear that from your the air in head.

OldMugwump (profile) says:

Re: Re: Re: "Value"

The word “value” has two relevant meanings here.

1 – “That car is a great value!”. This just means it’s perceived as cheap for what you get.

2 – “The value of the product to the buyer”. This is the relevant meaning here. And it has nothing to do with scarcity, in anybody’s model.

Value in this sense is the amount the buyer is willing to pay to get the thing.

For every product, there’s a minimum price the seller is willing to let it go at (S), and a maximum price the buyer is willing to pay for it (B).

If S > B it doesn’t make sense to trade – wealth would be lost.

If S < B it makes sense to trade; wealth would be created (in the amount B-S). This gain from trade is where ALL WEALTH COMES FROM.

Who gets how much of the created wealth is a matter of negotiation between the seller and buyer.

OldMugwump (profile) says:

Re: Re: Re:3 "Value"

You’re entitled to your own opinion, but you’re not entitled to your own facts.

From https://www.google.com/webhp?sourceid=chrome-instant&ion=1&espv=2&ie=UTF-8#q=define%20value :

val·ue
ˈvalyo͞o/Submit
noun
1.
the regard that something is held to deserve; the importance, worth, or usefulness of something.
“your support is of great value”
synonyms: worth, usefulness, advantage, benefit, gain, profit, good, help, merit, helpfulness, avail; More

John Fenderson (profile) says:

Re: Re: Re:5 "Value"

I disagree with the definition of “cost” in that essay. To (the noneconomist) me, the “cost” of something is the total burden of ownership of the thing. This includes both tangibles like how much I paid for it and how much I have to keep spending in terms of upkeep, etc., and intangibles such as how much complexity and inconvenience it brings into my life, etc.

This is how some of the things I’ve owned that I consider costly were things I obtained for free.

flyinginn says:

Re: Re: Re:2 "Value"

The discussion of value vs price assumes a stable but finite supply. It is also typically based on a cost of production. If the cost of production is zero and the supply is infinite, the value is zero. The seller attempts to control supply in order to justify a profit. This is by no means an absolute right even in anti-socialist regimes since it may be deemed a restraint of trade, public domain, an unenforceable contract, fair use or contrary to the public interest. The other extreme is where the supply is zero at any price. Clearly there is no loss of business income if there is no product, but we see endless cases where rips from vinyl over 40 years old are removed from Youtube (for example) despite the fact that the IP holder has repeatedly refused to make a commercial release available. In this case the loss of business is the supplier’s choice and copyright has not been enforceably infringed.

Anonymous Coward says:

Re: Re: Re:2 Re:

He said value. I was merely responding to the previous comment. However, while your statement about value is correct, here we are talking about the general perception of value in the market not one individual’s perception. Price is an arbitrary amount set based on the cost and the perception of market value.

Anonymous Coward says:

Re: Re: Re:4 Re:

By market value I mean the perception of how the market (ie. people interested in the product) will value it. It’s not how any one person values it. That perception can be WAY off and thus it gets priced either way too high or way too low. It’s still a perception that isn’t affected directly by any other concrete factors.

James Burkhardt (profile) says:

Re: Re:

That is clearly untrue, as I just bought something digital (so it had value to the person who sold it) and its presence on my PS3s hard drive’s increases the value I hold in that hard drive (so it holds value to me).

If you are refering to the economic discussions TechDirt raises, you are thinking that COST (of distribution) becomes zero (and even then its still not exactly zero). This has nothing do with the VALUE of the file.

So, not really sure what you were trying to say.

Teamchaos (profile) says:

Weaker IP laws are the solution?

Mike, can you provide any links re “There’s a ton of research showing that greater enforcement of IP and stricter IP laws have actually done plenty to discourage innovation.”

Or just provide the correct search terms and I’ll find it on Google. I did a search for “weak Intellectual property protection fosters innovation” and most the research on the first page of the search results seemed counter to your statement.

In the short run, if everything is free, I can see that helping the consumer, but in the long run that would seem to discourage anyone from investing in creating content.

I can also see how sharing ideas would foster innovation, but how many start-ups would get funded if there wasn’t sufficient protection of their proprietary IP?

James Burkhardt (profile) says:

Re: Weaker IP laws are the solution?

The problem is you are searching for the opposite of what he said there are studies of. Search for “strong IP stifles innovation” for instance and find:
http://cleantechnica.com/2013/03/29/do-intellectual-property-rights-on-existing-technologies-stifle-innovation/
http://www.bloomberg.com/bw/articles/2013-02-24/how-patent-laws-are-stifling-american-growth
http://www.canadianlawyermag.com/4222/Do-strong-IP-laws-stifle-innovation.html
And a couple books and papers on the subject.

In the short run, if everything is free, I can see that helping the consumer, but in the long run that would seem to discourage anyone from investing in creating content.

You are conflating ‘lesser IP protections’ with “absolutely no IP protections and giving everything away for free” And that ignores the large body of creative/innovative work that existed before copyright and patents.

Ill be back to discuss the final bit later, im out of time now.

James Burkhardt (profile) says:

Re: Re: Weaker IP laws are the solution?

As to your concerns about start up funding, You discount the value of innovation in the marketplace. there are a bunch of VCs that feel some patents are a danger to continued innovation.
https://www.techdirt.com/articles/20110607/18502014596/investors-speaking-up-about-patents-harming-innovation.shtml

The key in the patent arena isn’t, remove all patents. Its balance the benefits of patents with the benefits for the public. Independent Innovation defenses (a case for non-obviousness), fee shifting for patent trolls, rapid review to invalidate bad patents (an expansion of the existing business method patent review process), end-user protections-All these things would help rebalance the playing field so that patents aren’t being abused. And I haven’t even started in on the problems with software patents.

The software field moves so quickly, and various tasks can be completed so many ways, that proper software patents (ones that describe exactly how to accomplish the goal, not just a vague mission statement), if they were considered patentable (which they aren’t, because they are just math), would be useless, because you could think of 3 other ways to code around the method used in the patent. But thats really beside the point.

Anonymous Coward says:

Re: Weaker IP laws are the solution?

In the short run, if everything is free, I can see that helping the consumer, but in the long run that would seem to discourage anyone from investing in creating content.

People create content for many reasons, and getting paid is usually way down on the list of reasons.
Just explore the world of of podcasts, free books, free music and free videos available on the net. A few of the people producing such content can make a living at it, many more can cover the costs of bandwidth etc. from donations.
The amount of content produces and published via the gatekeepers, where earning money for the gatekeepers is the prime objective is now a very small part of the content that is being created and published.

lfroen (profile) says:

Re: Re: Weaker IP laws are the solution?

> People create content for many reasons, and getting paid is usually way down on the list of reasons.
There are all kind of “content”. Yes, people will play music just because it’s fun. And write books just to express some thoughts.
But – people simply can’t create Call-Of-Duty/WoW/etc level game just-because. It’s simply financially impossible, at least now. Same is true for movies – those of high production values are usually produced to make a profit.

Anonymous Coward says:

Re: Re: Re: Weaker IP laws are the solution?

But – people simply can’t create Call-Of-Duty/WoW/etc level game just-because. It’s simply financially impossible, at least now. Same is true for movies – those of high production values are usually produced to make a profit.

The Opensource ecosystem has shown the way to produce high value labor intensive intellectual products in a much less restrictive fashion than locking it up behind strong IP. Network capacity is now passed the point where where sharing large files for cooperative processes is difficult, and also enables the distribution. As for production values, try Star Trek New Voyages for the production values that can be achieved by a volunteer team of fans. The costs of setting up to produce videos has dropped to the level that most people can afford one or two cameras, and free software like Blender is right up there in capabilities for CGI video production.

Josh Taylor, creator of the Interracial Progress says:

I support stronger IP laws and patent litiigation

This article needs to be taken down. I am creator of a webcomic and I support stronger IP laws including patent litigation. Creators are the 99% and the IP thieves are the 1%. We Creators are struggling to make a living. I think the TPP’s IP chapter and the ISDS chapter that involves intellectual property is a good thing. If people wants to use my creativity, I should be compensated. Otherwise they should create their own work, make their own characters.

Furthermore, everyone complains that these non-existent boogeymen called Patent Trolls, would stifle consumers and businesses to infringe their patents (including software patents). Patent holders are not trolls. Patent litigation is important to eliminate and ban all imitations of patented products. Including imitations that are made from China, also known as counterfeits, which cost consumers billions of dollars.

Using someone’s creativity without compensation is stealing. In my church, my religion, The 3rd of the Ten commandments say “Thou shall not steal”. Stealing is wrong, that includes intellectual property and patent protection. Two options: you either pay compensation to use someone’s creativity or make your own.

Add Your Comment

Your email address will not be published.

Have a Techdirt Account? Sign in now. Want one? Register here

Comment Options:

Make this the or (get credits or sign in to see balance) what's this?

What's this?

Techdirt community members with Techdirt Credits can spotlight a comment as either the "First Word" or "Last Word" on a particular comment thread. Credits can be purchased at the Techdirt Insider Shop »

Follow Techdirt

Techdirt Daily Newsletter

Techdirt Deals
Techdirt Insider Discord
The latest chatter on the Techdirt Insider Discord channel...
Loading...