“IP” or Intellectual Properties. Do you feel that they are an integral
component to personal freedoms or a detriment? And what place does
Intellectual Property have in public and academic settings?
That’s a very interesting question. It has an interesting history. The
World Trade Organization, the Uruguay round that set up the World Trade
Organization imposed, it’s called a “free trade agreement”. It’s in fact a
highly protectionist agreement. The US is strongly opposed to free trade,
just as business leaders are, just as they’re opposed to a market economy.
A crucial part of the Uruguay round, WTO, NAFTA, and the rest of them, is
very strong (what are called) intellectual property rights. What it
actually means is rights that guarantee monopoly pricing power to private
So take, say, a drug corporation. Most of the serious research and
development, the hard part of it, is funded by the public. In fact most of
the economy comes out of public expenditures through the state system, which
is the source of most innovation and development. I mean computers, the
internet. Just go through the range, it’s all coming out of the state
system primarily. There is research and development in the corporate
system, some, but it’s mostly at the marketing end. And the same is true of
Once the corporations gain the benefit of the public paying the costs and
taking the risks, they want to monopolize the profit. And the intellectual
property rights, they’re not for small inventors. In fact the people doing
the work in the corporations, they don’t get anything out of it, like a
dollar if they invent something. It’s the corporate tyrannies that are
making the profits, and they want to guarantee them.
The World Trade Organization proposed new, enhanced intellectual property
rights, patent rights, which means monopoly pricing rights, far beyond
anything that existed in the past. In fact they are not only designed to
maximize monopoly pricing, and profit, but also to prevent development.
That’s rather crucial. WTO rules introduced product patents. Used to be
you could patent a process, but not the product. Which means if some smart
guy could figure out a better way of doing it, he could do it. They want to
block that. It’s important to block development and progress, in order to
ensure monopoly rights. So they now have product patents.
Well if you take a look at, say, US history. Suppose the colonies after
independence had been forced to accept that regime. Do you know what we’d
be doing now? Well first of all there’d be very few of us here. But those
of us who would be here would be pursuing our comparative advantage and
exporting fish and fur. That’s what economists tell you is right. Pursue
your comparative advantage. That was our comparative advantage. We
certainly wouldn’t have had a textile industry. British textiles were way
cheaper and better. Actually British textiles were cheaper and better
because Britain had crushed Irish and Indian superior textile manufacturers
and stolen their techniques. So they were now the preeminent textile
manufacturer, by force of course.
The US would never have had a textile industry. It grew up around
Massachusetts, but the only way it could develop was extremely high tariffs
which protected unviable US industries. So the textile industry developed,
and that has a spin off into other industries. And so it continues.
The US would never have had a steel industry. Again same reason. British
steel was way superior. One of the reasons is because they were stealing
Indian techniques. British engineers were going to India to learn about
steel-making well into the 19th century. Britain ran the country by force,
so they could take what they knew. And they develop a steel industry. And
the US imposed extremely high tariffs, also massive government involvement,
through the military system as usual. And the US developed a steel
industry. And so it continues. Right up to the present.
Furthermore that’s true of every single developed society. That’s one of
the best known truths of economic history. The only countries that
developed are the ones that pursued these techniques. The ones that weren’t
able… There were countries that were forced to adopt “free trade” and
“liberalization”: the colonies, and they got destroyed. And the divide
between the first and the third world is really since the 18th century. It
wasn’t very much in the 18th century, and it’s very sharply along these
Well, that’s what the intellectual property rights are for. In fact there’s
a name for it in economic history. Friedrich List, famous German political
economist in the 19th century, who was actually borrowing from Andrew
Hamilton, called it “kicking away the ladder”. First you use state power
and violence to develop, then you kick away those procedures so that other
people can’t do it.
Intellectual property rights has very little to do with individual
initiative. I mean, Einstein didn’t have any intellectual property rights
on relativity theory. Science and innovation is carried out by people that
are interested in it. That’s the way science works. There’s an effort in
very recent years to commercialize it, like they commercialize everything
else. So you don’t do it because it’s exciting and challenging, and you
want to find out something new, and you want the world to benefit from it.
You do it because maybe you can make some money out of it. I mean that’s
a… you can make your own judgment about the moral value. I think it’s
extremely cheapening, but, also destructive of initiative and development.
And the profits don’t go back to individual inventors. It’s a very well
studied topic. Take one that’s really well studied, MIT’s involved:
computer controlled machine tools, a very fundamental component of the
economy. Well, there’s a very good study of this by David Nobel, a leading
political economist. What he pointed out and discovered is the techniques
were invented by some small guy, you know working in his garage somewhere
in, I think, Michigan. Actually when the MIT mechanical engineering
department learned about it they picked them up and they developed them and
extended them and so on. And then the corporations came in and picked them
up from them, and finally it became a core part of US industry. Well, what
happened to the guy who invented it? He’s still probably working in his
garage in Michigan, or wherever it is. And that’s very typical.
I just don’t think it has much to do with innovation or independence. It
has to do with protecting major concentrations of power, which mostly got
their power as a public gift, and making sure that they can maintain and
expand their power. And these are highly protectionist devices and I don’t
think… You really have to ram them down people’s throats. They don’t
make any economic sense or any other sense.
…So what role though do you think they should play in academic and public
Well I don’t think they should play any role. (Applause) But, since 1981
there was an amendment which gave universities the right to patent
inventions that came out of their own research. Actually that’s kind of a
gag. I mean nothing comes out of the university’s own research. It comes
out of public funding. That’s how the university can function. That’s how
their research projects work. The whole thing is set up to socialize cost
and risk to the general public, and then within that context, yeah in your
biology lab you can invent something. But I don’t think universities should
patent it. They should be working for the public good. (Applause) And that
means it should be available to the public. So…