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Intellectual Property — The Real Argument

Written by Darrell Anderson.

The heated debate about intellectual property fascinates me. The essence of the debate is about whether ideas — intangible resources, can be protected as property using the same concepts and social processes that protect tangible property. What fascinates me the most is how few people seem to realize what the real argument is actually about.

The concept of property arises primarily from the principle of scarcity. That is, the things humans need or want do not exist abundantly or immediately. Scarcity does not necessarily mean unavailable or nonexistent, only that supply is limited or restricted in some fashion. If something does exist that will satisfy needs or wants, people nonetheless must expend some labor and time in order to obtain those things. A fruit tree in the Garden of Eden is a scarce resource if the fruit is not immediately available within hand’s reach. Even if within hand’s reach the fruit remains scarce until harvested and consumed.

The fact that something is not abundantly or immediately available means there is competition for resources. Without expanding on the many reasons why this competition does not necessarily result in Hobbesian violence, that competition tends to create cooperative efforts to obtain title to resources.

One reason why these abstract constructs evolve is humans want to survive. Survival is accomplished by maintaining energy flows. All of life, both sentient and nonsentient, is impossible without maintaining energy flows. The reason is the Second Law of Thermodynamics teaches that there are no perfectly efficient energy conversion processes. Energy is always wasted in any process of converting energy into work. In a closed system output always is less than input.

Humans are no exception to this process. Those who want to continue living must eat and produce in order to maintain energy flows. For humans, converting energy into work is called labor. Labor is not a thing to be possessed, but a process, an activity.

A sticky point about intellectual property is whether inventors, artists, and authors should be allowed to use various political and social concepts to ensure their ideas are not duplicated or used to advantage without remunerating the originator. Proponents want protections, opponents don’t. Some proponents want only short-term protections, some want perpetual protections.

The true debate is not about the specific mechanics of providing protection for intellectual property, but is about maintaining energy flows. Humans prefer to satisfy needs and wants with as little effort as possible. The debate about intellectual property condenses to whether an individual should be granted societal protections to create virtual perpetual motion through an artificially contrived scarcity.

As any casual science student knows, perpetual motion is impossible. The Second Law of Thermodynamics explains why. No energy conversion process is perfectly efficient.

The desire to create protections for intellectual property is a desire to create virtual perpetual motion and artificial scarcity.

What must be asked is why is there such a keen desire for such protections? One clue is that humans prefer to get something for nothing, to work as little as possible to satisfy needs and wants. Natural laws of the universe prohibit perpetual motion, but humans nonetheless strive for perfect efficiency. Intellectual property rights are monopolies and a way to capture the labor of other people to maintain energy flows. Monopolies indirectly capture the labor of other people by eliminating competition.

Is there a way to end the argument about intellectual property? Yes, but the solution requires a paradigm shift in thinking.

Suppose humans could live together in a world where fundamental needs and wants were provided at almost no cost. Sounds like science fiction, but stop for a moment to realize that the cost of production for many goods has plummeted dramatically compared to what those same goods would have cost 100 years ago. Mass production, science, and technology have significantly reduced the real cost of most goods (despite currency inflation). Thus, to imagine a world where basic human needs and wants are easily and amply supplied is no pipe dream, but realistic. Additionally, many people have researched and argued that current production processes easily could supply the entire world’s population of basic needs and wants.

Some day in the future humans likely will invent intelligent machines that can build houses, plant and harvest foods, produce and provide clothing, and manufacture basic household tools and appliances. Humans will be minimally involved in those processes. Although those machines will not be perfectly efficient, with respect to the amount of human labor involved, those machines will seem like perpetual motion because humans will get something for no direct labor.

With fundamental needs and wants easily provided in such a world, where is the need thereafter for a monetary exchange system? Even if such an exchange system survived such a dramatic change in human production and consumption, the global social structure changes. Essentially the rat race ends. (Yes, there are several assumptions in this story, but they are not important to the critical point being made.)

With fundamental needs and wants easily provided, and little need for a monetary exchange system, where then is the motivation for protecting intellectual property rights? There is none, and inventors, artists, and authors all will create for the pure joy of creating because they no longer have to worry about putting beans on the table.

This is the essential problem associated with intellectual property rights. People want to put beans on the table and do so with as little effort as possible. By changing the energy flow problem of survival, inventors, artists, and authors would be concerned only with receiving appropriate recognition for their work.

Utopia? Perhaps, but hardly unrealistic. That day is not here, but understanding the root cause of the intellectual property argument is critical to understanding what is being truly debated — maintaining energy flows with little or no further input.

Presently, the various symbolic tokens used in the monetary exchange system — currency — represent future energy flows. Yes, this same desire to maintain energy flows through the monetary exchange system is at a primary root cause of many other human conflicts too.

This desire to create perpetual motion is not so much tied to the idea that humans prefer to work as little as possible, but that humans are now so divisively separated into categories of producer and consumer. This happened as a result of the Industrial Age. The Industrial Age introduced mass production, but because initially people were relatively self-sufficient within their own tight-knit communities, mass production quickly and easily outpaced consumption. As manufacturers over produced, they found themselves deep in debt because of capitalization costs. Thus, they had to produce new markets to encourage consuming those overproduced goods. Mass marketing and advertising was necessary to “teach” the remaining population how to become consumers. People had to be taught “what they needed.” As prices continued to drop because of the efficiencies of mass production and improved technology, more people preferred to buy goods rather than remain self-sufficient. The Industrial Age created a distinct wedge between producing and consuming, and created a widespread social system where humans became individually dependent upon others for survival. That wedge created a high division of labor and a subsequent high dependency upon monetary exchange systems.

That monetary exchange system is the wedge that is at the core of the intellectual property debate. Currency is the physical thing that circulates commonly as a medium of exchange to represent the concept of money. Currency is a token symbol representing debt, not wealth. Currency represents an unfinished exchange of wealth. Therefore, converting currency into wealth necessarily depends upon the future labor of other people.

There is an old adage that to determine the root cause of a conflict to “follow the money trail.” That adage is merely another way of saying look for the effort to create virtual perpetual motion through the captured labor of other people. The problem of humans wanting to get something for nothing is never going to go away. Likewise, neither will the desire to create perpetual motion despite the impossibility.

The love of money often is cited as the root of much evil, and when people realize that a monetary exchange system provides numerous opportunities to create virtual perpetual motion, they will realize that the old adage is true. Follow the money trail and you’ll discover a desire to create virtual perpetual motion. Thus, the desire to invoke protections for intellectual property is a desire to create that perpetual money trail.

The concept of intellectual property is not derived from the principle of scarcity, but instead tries to artificially create scarcity in order to sustain energy flows.

Part of the solution is to redesign the way humans exchange wealth for wealth. That solution is to eliminate common mediums of exchange and return to directly exchanging wealth for wealth — barter and trade. The technology now exists for such a global exchange system, but the transition is indeed a paradigm shift in thinking.

Finis.

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