Intellectual Property and the Great “Debate”

I come to the battlefield after the fires have extinguished and the embers cooled, but having fully intended to write something on the subject when it was hot, I feel the central topic is timeless and the particular affair in question momentous enough to warrant some comments, even if they arrive weeks after. Stephan Kinsella and Robert Wenzel, two notables in the libertarian community, faced off over the question of intellectual property. It was, regrettably though not surprisingly, somewhat less dignified and intellectual than the Lincoln/Douglas debates. Kinsella weathered much abuse, but managed to begin a few arguments that might have led somewhere interesting in a calmer setting. He gave the impression of someone who is on top of the issue and knows it well, and though he committed a slip or two of the sort one always must expect in an extemporaneous exchange, he acquitted himself quite well. Robert Wenzel pooped his pants.

This debate, if we are to call it that, might later be seen as the last stand for the pro-IP side, not because Robert Wenzel, a vociferous supporter of IP and an increasingly recognizable Austrian, took aim at the standard bearer of the anti-IP movement but instead shot off his own pecker, but rather because in those moments when he did take some initial steps to assemble an argument, he gave us a glimpse at just how misguided the other side is. If this is the best they can do – and I’ve heard no better from any other source – then I believe we can consider the topic settled and get back to arguing about abortion.

In short and simple terms, property rights provide the benefit of avoiding conflict. If I live alone on an unknown island, there is no question of property rights. I may, with perfect justice, do what I wish with whatever I find and if the iguanas don’t like it, they can sue me as soon as they evolve the intelligence to create a legal system. However, as soon as another person finds his way to the island, there is a potential for conflict. Now we must turn to property rights so that our relations can be harmonious and productive. If I wish to dispose of resources in a certain way, and the newcomer has a different idea, we need a way to determine whose wishes will hold sway without resorting to violence. As Kinsella pointed out, this is not a point on which he and Wenzel disagree, given that they are both Austrian libertarians.

Notice that the potential for conflict is created by the rivalry of the resources, meaning that one person’s use of them diminishes the ability of the other to use them. There will be no conflicts over sunlight on this island, nor over oxygen. Any freshwater streams, provided they are used merely to provide drinking water, will be similarly non-rivalrous. There may, however, be a specific plot of ground that is desired by both of us, or perhaps a tree. A certain spear might be straighter and stronger than the others we have made, and both of us might desire to use it at the same time. These latter goods are rivalrous and therefore a point of potential dispute.

In the Kinsella/Wenzel debate, much time was wasted on scarcity and superabundance, when in fact the important factor is rivalry. When Kinsella finally managed to get Wenzel to talk about this, Mr. Economic Policy Journal demonstrated his ignorance on the topic. An economist does not use the term rivalry as a layperson does. Ohio State and Michigan have a rivalry, yes, but this is a different idea coincidentally expressed by the same permutation of syllables. When Robert Wenzel says that another store would be his rival if they started making money off his ideas, he has not demonstrated that ideas are rivalrous in the economic sense of the term, and it is the economic sense of the term which necessitates property rights. An idea is manifestly not rivalrous, because an idea is not a physical thing. An idea is a pattern of neurons, a pulse of electricity inside the skull, a particular arrangement or perhaps emanation of the brain. The brain itself is, of course, rivalrous, but the brain is already claimed property, which takes us to the inherent incompatibility of real property rights and IP.

Barring restitution in a tort, the only way I can lose property rights in something is to voluntarily give them away, either in an exchange, as a gift or as a simple renunciation of my claim to the property. IP requires easements on all of the potential property in the universe simply because someone wrote a poem. Under an IP regime, I may have ink and parchment, but as soon as you draw a picture you may prevent me from doing certain things with my ink and parchment. You can also prevent me from chiseling your picture on a rock, or tracing it in the sand and snapping a photo. You would have easements on the property of beings in other galaxies you don’t even know exist. It is obvious, or should be for the libertarian, that Intellectual Property rights and real property rights are subject to a sort of Pauli Exclusion Principle, in that both of them cannot exist at the same time and in the same place.

When Wenzel was confronted with this, there followed an awkward twenty seconds of silence, and then he declared that he did not wish to discuss such matters. We, however, are at liberty to discuss them in as much depth as we want, unless Mr. Wenzel copyrights the ideas from the debate with Stephan. We can do it in the charming language of English, until such a time as it is deemed someone else’s property, which it really ought to be if we are to be consistent supporters of IP. Given this exclusion principle, this quantum mechanics of property, we are left with a choice between supporting rights in physical goods, which are rivalrous, or in ideas, which are not. Either we can mitigate the inevitable scarcity of things and stuff through the Free Market, or we can bring an artificial scarcity to ideas, which in nature suffer no such yoke.

The most productive thing Wenzel did during the entirety of the debate, after having several times insisted he had Stephan’s testicles in his clenched fist, was attempt to sketch a way in which copyrights and patents could be reproduced on the Free Market. In doing so, he did nothing so much as prove the error of his own position. Through contracts, both implied and explicit, one could attain easements over other property. For instance, any person who purchases a CD, by the very act of purchasing it, might be said to have consented to certain easements, thus mimicking intellectual property rights.

So insisted Wenzel, and he is correct. But this is not a property right, this is a contract. Of course you can enter into contracts with people and cast easements about and switch titles to anything the parties agree to. Third parties not consenting to the contract would not be bound by it, of course, but to a limited extent one could imitate IP in this fashion. But this is mimicry, not the actual thing itself. If intellectual property were truly a matter of rights, I wouldn’t need a contract at all. When I settle down on a plot of unowned land, build a house on it and sow some seeds, it becomes mine. I don’t need your permission for that; I require no signature on a piece of paper except by procedural necessity. The land becomes mine when I homestead it. Indeed, no contract would ever be possible without property rights already established.

The very fact that Wenzel resorts to contracts to bring about his IP in the Free Market is proof that he himself, at some level, recognizes the untenability of his own position. The debate, then, was nothing more than an unpleasant argument between two people who agree that only by consent can someone lose property rights in an object. One of them accepts this fact, while the other has yet to come completely to terms with it.

*The preceding was from a speech I gave at the Federal Reserve. Actually, I gave it to a friend, but we were at the Federal Reserve. Well, not precisely at the Federal Reserve, but we were in Pittsburgh, which is in the next state over. On second thought, we were in Columbus, but that is close to Pittsburgh which itself is practically the home of the Federal Reserve. Whatever.