Coolthin.gs

Thoughts and commentary from a young brash economist/philosopher.

Patent Law and Smart Phones

I love smartphones. Every time I use my Motorola Droid in the back of my mind I still marvel at the technology and how portable it is. I have preferences in mobile OS operating systems. and manufacturers but I won't be discussing them here. Today I'd like to talk about one area where I have yet to fully form a concise opinion on but never the less I have many ideas about, the patent system.

My interest in discussing the subject of the patent system comes from reading a recent article from the Wall Street Journal talking about the fact that NTP Inc. (a patent holding company) has recently filed a suit against Apple, Google, HTC Corp, LG Electronics Inc, Microsoft Corp. and Motorola Inc  over patents held by NTP over the wireless delivery of email. If you look again at that list you'll notice that it includes pretty much every manufacturer of smartphone though RIM, and HP/Palm are noticeably absent because it's already brought suits against them. There is also a pending suit against AT&T, Sprint Nextel, T-Mobile, and Verizon Wireless from 2007.

My issue with patents is that unlike physical property which they are often compared to, patents are ideas. The may be used  to create a physical product but they are not a product themselves just as ideas are not. How do you own ideas? How can you expect others to pay for an idea which is the way firms like NTP work. Patents are bestowed to companies and individuals for their ideas by governments which means the state has positive rights view over the right to thought, that I find to be incredibly dangerous and constitutes a violation of our natural rights. If I were to come up with a way to send email to my phone I don't have a right to that idea because NTP already has it. If you think that patents are about specific ways you doing things then I don't think you understand just how vague patents can be.

Here is where I run into one of my disagreements with a person who is one of the largest influences on my ideas Ayn Rand. She for all of her greatness she contradicts many of her own ideas with a surprisingly pro positive rights and anti free market position on on patents.....

"As an objection to the patent laws, some people cite the fact that two inventors may work independently for years on the same invention, but one will beat the other to the patent office by an hour or a day and will acquire an exclusive monopoly, while the loser's work will then be totally wasted. This type of objection is based on the error of equating the potential with the actual. The fact that a man might have been first, does not alter the fact that he wasn't. Since the issue is one of commercial rights, the loser in a case of that kind has to accept the fact that in seeking to trade with others he must face the possibility of a competitor winning the race, which is true of all types of competition." - From Ayn Rand, Capitalism: The Unknown Ideal (New York: New American Library, 1967), p. 133.

My problem with this statement is that patents are through their design, anti-competitive. Patents are government given monopolies for an idea and represent of intervention by the government in the markets, changing the nature of competition. It is often said that patents exist to entice inventors to create because they make the inventor stand to benefit more from their creation. However does that necessitate positive rights theory? The idea that the government creates rights and that conversely gives it the right to say what rights you do or do not have. 

What I'm basically hitting upon is the time honored debate of government being a necessary evil. Does patent law represent a necessary evil, even to those who support a free market? I'm still in the process of deciding my opinion on it, but I am always skeptical of evil being able to do good but even for those who believe it can then they usually believe it should be restrained. The belief in restraining government was held reverently by the founders of the United States but over two hundred years of history hove shown that it is no longer a common belief and the lack of it I fear will bring untold misery.

The Fed Vs. The State of Arizona

My first thought about the news that the Department of Justice is officially challenging the now infamous Arizona immigration law sb1070 in not that whether or not they have a legitimate argument but rather how this is an example of the guilty looking to find faults in others. While faults may be determined to exist in sb1070 it pales in comparison to the federal response the illegal immigration crisis in not only Arizona but the whole of the United States.The entire federal government is responsible for this debacle: the Democrats have no real policy on immigration, and the Republicans fright over theirs, with some wanting all the immigrants out and some trying to maintain and fight for the idea that they can be the representatives of some future Hispanic voting block. Both have failed on this issue but it is the DoJ and the Obama administration that has decided a distraction from their faults is in order. Arizona Representative Ann Krikpatrick (Dem) I think states this best, “A court battle between the federal government and Arizona will not move us closer to securing the border or fixing America’s broken immigration system....” and “The legal fights and boycotts are drawing focus and attention away from what has to be a policy-driven, substantive debate.” Her statement can be found here.

As I understand it the federal government's challenge to the law is on preemption grounds. They state that Federal law governing immigration preempts any single state’s on the topic. This idea is derived from the Constituiton’s supremacy clause, which basically states that on any given topic, federal law trumps state law. Temple Law professor Peter Spiro speeking to the Wall Street Journal about this part of the DoJ challenge said this "I think the Arizona lawmakers were pretty careful to grasp the law and avoid obvious conflict with federal law. But even if there’s no conflict, the government can still win under a theory called “field preemption.” The feds are likely to argue that regardless of the law’s specifics, Arizona has no business in this “field,” it simply has no business regulating immigration in any way. Another key case is a 1941 case called Hines v. Davidowitz, in which the Supreme Court struck down a Pennsylvania law on preemption grounds despite the fact that the law didn’t conflict with federal law at all." In the rest of the interview he goes on to say that he thinks the final decision can go either way. The full article is here.

We can be rest assured though that regardless of lower court decisions that this will eventually be argued in front of the Supreme Court unless the cost to Arizona to fight it gets higher then they can stomach. That's the main issue from me here. Local representatives and governors are far easily removed by the political process when their constituents are worried about money while the Federal Government is virtually immune to that power. This has been a long standing federal practice with laws, challenges and regulations that it can defend with far more money then states and individuals. But let us also remember that it is ultimately individual tax payers that foot the bill for all of this. To quote the tag line from the first Alien Vs. Predator movie, "Whoever wins we lose."