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Friday, March 10, 2006

The New Mercantilism

Michele Boldrin and David K. Levine's book, Against Intellectual Monopoly, is still in the draft stage, but it has the potential to be highly influential. These two self-described "conservative economists" believe in property rights, but blast "intellectual property" right out of the water. Neither the moral nor the utilitarian case survive. The historical insights are priceless in showing that patents and copyrights are not necessary for innovation and creativity. Quite the contrary.

Chapter one contains a particularly important point, namely, that globalization as it is today being implemented, rather than meaning real free trade, is a device to impose American patents and copyrights on the developing world. Given the expansiveness of IP protectionism today, this means that the developing world will have scant opportunity to progress economically without paying tribute to American firms for ideas, something which cannot be owned. The parallel with mercantilism is inescapable. They write:
Now that the intellectual and political battle over free trade of physical goods seems won, and an increasing number of less advanced countries are joining the progressive ranks of free-trading nations, pressure for making intellectual property protection stronger is mounting in those very same countries that advocate free trade. This is not a coincidence.

Most physical goods already are and, in the decades to come, will increasingly be, produced in the less developed countries. Most innovations and creations are taking place in the advanced world, and the IT and bio-engineering revolutions suggest this will continue for a while at least. It is not surprising then, that a new version of the eternal parasite of economic progress -- mercantilism -- is emerging in the rich countries of North America, Europe and Asia....

The contemporary variation of this economic pest is one in which our collective interest is best served if we buy goods cheap and sell ideas dear. In the mind of those preaching this new version of the mercantilist credo, the World Trade Organization should enforce as much free trade as possible, so we can buy "their" products at a low price. It should also protect our "intellectual property" as much as possible, so we can sell "our" movies, software, and medicines at a high price.
They go on to say that just as the anti-free-trade fallacies had to be smashed to defeat the original mercantilism, now the IP fallacies have to be smashed to defeat the new mercantilism. "Our goal here is to demolish that glass house."

"Globalization" based on U.S.-led IP protectionism and the heavy-handed corporate state is not worth fighting for. It is rank injustice. But globalization based on real free trade is worth fighting for. As long as the first prevails, the anti-free-trade anti-globalists will have the moral high ground. But that high ground rightfully belongs to the voluntarists. Let's make sure we occupy it.

4 comments:

Anonymous said...

Proudhon's famous quip that "property is theft" should have been "intellectual property is theft."

Sheldon Richman said...

Several thinkers have properly distinguished between natural property and legal property. I'm not sure if Proudhon was one of those. But it is a good point.

Anonymous said...

I read in The Nation recently that certain central American entrepreneurs specializing in "informal entertainment oriented media" were among the loudest protesters of CAFTA, which would indeed put the squeeze on their livelihood. Nice way to rally the indigenous merchant class to free trade!

-Dain

Sheldon Richman said...

Thank you, anon. I would like to gather more details such as this for an article against the "free trade" agreements.