IP Monopolism as “Free Enterprise”

Singapore’s Ministry of Law (Orwellian nickname “MinLaw”) announced this week that it is developing a plan to make the nation “Asia’s one-stop destination for world-class [intellectual property] services.” The release boasts that “[t]he first thrust entails … facilitating greater IP exploitation by companies,” heralding a “renewed vigor in protecting IP rights.”

Singapore has long been lionized as a free enterprise Mecca, often considered the economically freest place in the world (the conservative Heritage Foundation gives Singapore a 90 out of 100 rating on both trade freedom and property rights). But that “libertarian” connotation raises the question of what role intellectual property “rights” would play in a free society.

Today, more stringent IP law is associated with the development of poor countries and their transition into the globalized economy of the digital age. It’s taken for granted that IP is not only compatible with Western “economic freedom,” but necessary for alignment with that system.

While it’s true that intellectual property enjoys a central position in the corporate neoliberalism of the present, that system doesn’t bear even the remotest resemblance to the economic freedom that market anarchists advocate.

From a law and economics standpoint, the fundamental problems with intellectual property are manifold, its purported goals ill-matched to its actual effects. Instead of spurring new breakthroughs in technological originality, argue law professors Siva Vaidhyanathan and Lawrence Lessig, “the problem with current law is that it over-rewards incumbents and under-rewards future innovators.”

Under the present IP legal regime, the rewards are clustered around a small and powerful group of rich multinationals putting armies of lawyers to work filing at the patent office. The monopoly rights granted as “intellectual property” end up largely in the hands of big business, who prefer gluttonizing on exclusive privileges to actually competing.

If companies were denied these protections — founded in state coercion — access to the technical information necessary for novel inventions that make life easier for everyone would be far more open. The problem with genuine competition and open access, of course, is that it compromises the ability of globalization’s ruling class to exact rents on all economic activity.

Rather than out-innovating their competitors, especially those who “compete from below” on terms unsanctioned by the corporate elite, big business simply uses the legal system to prevent competition. Another law professor, Nestor Davidson, has contended that “the deadweight loss” associated with intellectual property’s allocative inefficiencies far outweighs its ostensible benefits.

Consumers are forced into a market where tired, unimaginative products and methods are safeguarded by law. Millions of dollars are tied up in protecting strategically-held patents through litigation and legislation, resources that could and should be advancing networked, “ground-up” technological development.

Market anarchists understand that the decentralization of a genuine free market is the greatest research and development “program” society could hope for. Real free markets aren’t systems of privilege for the rich, but thriving communities wherein the lack of monopoly means abundance for everyone.

That state grants of monopoly power are thought to be associated with “freedom” says a lot about the backwardness of the corporate economy that covers the world. Intellectual property and its guardian, the state, are the enemies of liberty, enemies that won’t go away unless and until we start to expose their role as the handmaids of entrenched big business.

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