Introduction
Intellectual property is the presumed right of the creator of an idea to certain controls over all the physical forms in which his idea is recorded. The extent of this control may be different depending on whether the idea is considered to be copyrighted, patented, or trademarked, but the essential principle is the same in all cases.1 The creator of an idea is often seen as having a right to the idea he has created in the same way that a homesteader has a right to land that he has settled, but the analogy is false. Intellectual property is necessarily a statist doctrine.
The Nature of Property
People cannot be expected all to agree on what the world ought to be like and what each person should do, nor are they necessarily coordinated enough to arrive at a consensus through deliberation. Instead, they will tend to be apart from one another, desiring immediate action and without established procedures for coming to decisions efficiently. When people disagree and are unwilling to deliberate, it is necessary that one person’s decision should prevail without regard to other people’s desires. Whose decision prevails may be determined in two ways: physical conflict, or deferral to a system of property. With a system of property in place, it is necessary only to ask who owns a thing rather than endure the costs of communicating and arguing with one another until either agreement or physical conflict breaks out.
The world being as it is, full of people with different desires and things which may be used according to different plans, there is always value in preventing physical conflict. If this need did not exist, property rights would not be not needed either. If people were bodiless ghosts able to pass through one another without interacting, or if everyone lived in his own universe without being able to pass from one to another, all disagreements about what to do with the world are automatically resolved. Without the possibility of two people being able to control anything, defining property rights would be a mere psychological game without any consequences for human action. The prevention of physical conflict is therefore the purpose of property rights. An essential characteristic of property is exclusivity, meaning that the use of this product by one person prevents it from being used by another.2
In addition to property rights, many other kinds of rights have been proposed in political theory. However, all such rights must resolve into rights over physical things. When we speak of a right to free speech or a right to one’s labor, for example, what is really meant is a right over one’s own physical body. All rights, therefore, are ultimately property rights and the term ‘property right’ is redundant.
Ultimately, therefore, though we might speak of ownership over abstract things, it is only physical things, things that can actually be fought over, which are owned. This we must keep in mind, for it is possible to sound reasonable and humane when discussing rights in abstract terms that would sound horrific and monstrous if they were described in terms of property. Libertarians have often noted, for example, that a right to health care, a job, or a minimum income implies a property right over the people capable of providing such things, and is therefore really a form of slavery. Similarly, the right to a vote is really a joint ownership between all citizens of the people, land, and everything else within a particular territory.
Libertarians themselves are at times confused over this issue. For example, they sometimes claim in a free market broadcast industry, broadcasters would own certain frequencies in a given region, and would therefore have the right to broadcast without interference by a pirate radio station on the same frequency. However, clearly it is not the frequency that is owned because a frequency is not physical but rather an abstract property of all waves. Rather, it is the land over which that frequency is broadcast that is owned, for the purposes only of broadcasting that frequency. Ownership of a radio frequency is ultimately a property right over a region of space which allows someone to broadcast at a given frequency, but does not necessarily allow anything else to be done with it. 3
This example demonstrates that ownership is not necessarily over entire objects but rather over decisions to be made with regard to it. An object can be owned by many different people because there are many kinds of decisions that can be made about it. Since different frequencies of radio waves can pass through one another without interfering, the same volume of space can be owned separately for the purposes of broadcasting at each frequency without leading to a conflict.4
Ideas cannot be controlled with physical force, but instead must be controlled by way of other things—paper, printing presses, computers, and people. It is therefore in these that intellectual property consists. To own a patent in a given invention is to have rights over everything in the universe that might be used to replicate that invention. This ownership is limited; one only owns things to the extent of being able to prevent others from arranging them in a particular way. Similarly, to have a copyright in a song or a book, I have a property right over all paper, printing presses, computers, even over all people, everywhere, and I may prevent the copying or public performance of my work by them all. Intellectual property is, like socialism, a kind of slavery, albeit a limited kind. Unlike socialism, however, intellectual property does not limit itself to the people and property in a given town or nation, or even the entire world, but, since most matter in the universe could be used to encode an idea, intellectual property is a claim over the entire universe.
Rather than seeing it as a kind of ordinary property, people tend to see intellectual property as a separate and analogous construction, equally fundamental as ordinary property. To copy an intellectual work is therefore a form of theft analogous to burglary; however, I insist that there is no analogy. Intellectual property and physical property cannot exist side-by-side as logically independent legal constructions. Anything that gives control over physical things necessarily limits others’ control of those things, and therefore acts exactly like a property right to those things. If you have an intellectual property right to your monograph, you may prevent me from copying it, thereby limiting the property right I have in my ink, pen, and paper.
Coordination and Communication
To serve this function of preventing physical conflict, it is not enough that everything controllable should be owned; in addition, what is owned must be controllable by its owner, at least to the extent of preventing others from appropriating it for their own purposes. This does not involve only providing for some defense of his property, whether on his own or by engaging police to help, but also communicating his ownership to other people and watching his property closely enough to know if it is being misused. This is not to say of course that people can be forced to write their name on everything they own or register all their property with some central authority. People have a perfect right to conceal their ownership of something; however, in that case they really have no cause to complain if someone else should claim it for himself. If a system of property is to maintain itself, however, it is necessary that it should not be difficult to learn who owns a given thing.
If the costs of discovering who owns what are too great, then the system of property cannot persist as it is. This is not a moral point, but simply an economic fact: if the system of property rights is too complicated for anybody to figure out, then the property rights necessarily unravel. A man who claims to own a piece of land so far away that he cannot communicate with anyone around it will be unable to derive any use from his land. Even if his wish is that it should remain fallow, he cannot know if it has been stolen and used in some other way. Those near his land and wishing to use it may be perfectly willing to trade with the owner for his permission, but being unable to communicate with him, may simply steal it instead. That system of property, therefore, failed to prevent physical conflict.
An exchange may be consensual, but if the result is too confusing for people to understand, the exchange is impossible even in a libertarian society. People cannot expect to maintain their property if it is too difficult to figure out what their property is. Therefore, some kinds of rights cannot exist without a certain degree of capitalization in a society.
In a primitive society, rights will tend to come in the form of complete ownership of physical objects rather than as shared stakes in large enterprises, and of relatively few things kept close to the owner himself rather than many things dispersed over great distances. It is also difficult to own property that is far away because of the expense in communicating over distances. It is also difficult to own property collectively for the same reason: people must communicate with one another over the distance separating them, and they must deliberate on the procedures that they will use to make decisions about their shared property. A certain degree of wealth is necessary before a given organization is worthwhile; otherwise the effort to create and maintain an organization will divert people from more important activities.
The cost of communication in any society requires that there be some dispersion of authority. It cannot be that one man or organization owns everything. Instead, everyone should own something. This is not to say, of course, that property should be redistributed to those most capable of controlling it; to do so would require a giant organization that attempts to control everything, the very thing that needs to be avoided! Rather, people have the incentive to sell to those more capable of controlling their property because property will tend to be worth more to those most capable of controlling it.
As the creation of wealth progresses, coordination and communication will become easier, and thus shared and dispersed ownership will become more feasible. However, there will always be limits to the kinds of coordination and communication that are supported in any economy. This is the Hayekian problem of knowledge.5
The doctrine of intellectual property is revealed by this analysis to be extremely impractical and out-of-touch with reality. It grants people property rights which are unlimited in their distribution, rights over things shut in peoples’ homes, over their computers, paper, and whatever other materials might be used to encode an idea. The degree of communication and coordination necessary to control such a property is vast. Although as a practical matter, intellectual property holders will wish only to maintain control over people who actually have access to their idea, in most cases this now includes the entire world. Rather than establishing boundaries with other people, and separating certain things from them so that they can be more easily controlled, an intellectual property right is like a series of tendrils extending into the boundaries of everyone else. It is necessary of course to keep track of each of these tendrils in some way because any one of them can seed an unlimited number of pirate copies.
The free market is characterized by widely dispersed management rather than top-down control of everything, so there is no reason to expect that the free market will support such an enormous and invasive system of monitoring. It is known that even during the stone age, trade routes connected North Africa and China, but obviously the people on either end of the route had no knowledge of the other. The trade route was not created by any hierarchical, deliberate organization, but rather arose out of the interactions of traders along the way. Many inventions that originated in China, such as the compass and gunpowder appeared in Europe before Marco Polo made his journey to Asia. Obviously, no claim to intellectual property in such a society could be backed by anything whatsoever in these societies; such claims would truly be nothing more than ‘nonsense on stilts’.
In our society, controlling widely dispersed property is much easier, but this does not mean that intellectual property makes any more sense. Although an empire of a given size might be easier to control now, the advances in communication that made this possible have also made it far easier for a given intellectual property to expand beyond the boundaries intended for it. It is now possible to produce more information in a week than in the entire history of medieval Europe. Our superior communication industry today may make it easier to control a given widely dispersed property, but it makes an intellectual property able to grow far more quickly, and thus far more difficult to control.
The owner of intellectual property, particularly a popular one, cannot expect to retain control over his work. A work that has spread over the globe, having been enjoyed by thousands or millions of people, is simply too big. Imagine that someone were to lend out thousands of small trinkets all over the world to people he has never met, knows nothing about, and cannot keep track of. Can he by any stretch of the imagination believe that these will be returned to him? To own an intellectual property is similar to having build a fortress with a practically infinite, fractal-like boundary that cannot be defended, patrolled, or even charted. Anyone can get in or out without being observed. Can anyone expect not to be vandalized, burglarized, and overrun under such conditions? Physical property can be fenced in, guarded, defended, lent only to those deemed trustworthy enough, and forcibly retrieved if stolen. The only way to control an idea, on the other hand, is never to think of it in the first place. Once put into practice, one may try to keep an idea secret, but once it escapes, it cannot be retrieved. A piece of physical property is only in one place at a time, and one can chase after it if it is stolen, but an idea can disperse in an unlimited number of directions at once. An idea can be everywhere on the planet in a matter of minutes.
The type of infrastructure necessary to maintain such an empire is such that could never be supported on the free market. Thousands or millions of objects would have to be monitored, in peoples’ houses, on their computers, in their business affairs, and wherever the idea might be put to use. It is only by way of the state and its eagerness to employ any excuse to wield power that intellectual property might plausibly be defended.
Backed by the doctrine of intellectual property, every inventor of a useful device and popular author claims an empire on which the sun never sets. This doctrine could not survive as long as creators must bear the cost of patrolling their empires, but with the state on their side, authors are willing to cling to it straight to the logical extreme. Whereas on the free market the costs of defending a property are as relevant as anything else in the decision to own it, the doctrine of intellectual property, backed by the extravagant monopoly power of the state, encourages people to lay claims to properties that are inherently indefensible. As Boldrine and Levine say in Against Intellectual Monopoly,
“Being a monopolist” is, apparently, akin to going on drugs or joining some strange religious sect. It seems to lead to complete loss of any sense of what profitable opportunities are and of how free markets function. Monopolists, apparently, can conceive of only one way of making money, that is bullying consumers and competitors to put up and shut up. Furthermore, it also appears to mean that past mistakes have to be repeated at a larger, and ever more ridiculous, scale. 6
Unlike ordinary property, intellectual property cannot be defended on the free market because of the vastly greater resources that would be required to maintain control over it. For this reason, the doctrine of intellectual property should be seen as inherently statist. It is nothing but another trick that the ruling class employs to increase their power, and they are entirely willing to impose the degree of invasive monitoring necessary to enforce it. It is only to the extent that customers willingly obeyed the wishes of the author that there could be anything like intellectual property on the free market.
Natural Property
Though the free market may not support intellectual property, can one nonetheless make a moral argument for it? Though intellectual property may be so costly to defend that only the state might even attempt such a job, might it still be theft to violate a copyright or patent? To see how this might be possible, I will now discuss the justification of property rights in general and test the doctrine of intellectual property against the general theory.
The justification of any system of property rights must always reference an earlier state of society because it must show that the origin of the present system justly transitioned out of the prior. An argument that a system of property rights is just in and of itself, without reference to how they came to be, would be nonsensical. The material substances in the world are heterogeneous, each having their own disadvantages and advantages for any purpose. The same is true of people; all have different skills and merits. It is subjective to compare these different merits with one another, so everyone will have different ideas about what arrangement of property is the best. What sort of merits and needs might grant a person a 1st floor apartment over one on the third floor? Such questions are clearly impossible to answer meaningfully.
An attempt to justify an arrangement of property based on fairness rather than on a history of just actions requires that the problem of subjectivity must be averted somehow: This can only be done by granting some particular organization a superior opinion to all others. The opinion of an ordinary person is nothing in comparison to the official opinion of this organization. The extreme power it has is obviously unfair, so it must be somehow excluded from the question of fairness entirely. Instead, this organization, which by now the reader has certainly identified as the state, must be justified historically. An argument that property should be distributed fairly depends on the historical circumstances under which the state was created being just. If someone should attempt a redistribution of property in the name of an organization not already believed to have the right to reorganize all property, he would have no legitimacy in their eyes regardless of how fair his redistribution was.
All utilitarian arguments about how society should be structured involve some kind of historical assumption, often unstated, in the form of a preexisting state with the right to do whatever it is they propose. When people advance utilitarian arguments for the state, there is a logical gap between promoting such an organization in the abstract and identifying the actual existing state as the very monopolist to which we all must pledge our allegiance. It is entirely arbitrary that this particular organization should rule and not any other one. Even if it could be established that there should be a ruler, it does not follow that we should therefore obey the present one, whose ‘right’ arose only from having defeated the other contenders in a physical conflict.
There is a utilitarian justification of intellectual property to which these considerations apply. The proponents of intellectual property propose that creators be granted control over their works as an incentive to continue to innovate. However, like all utilitarian arguments about law, this justification presupposes our ability to shape the rules which society obeys according to our whims. To say that creators should have control over their work is one thing, but this cannot be done unless some particular king or senate actually has the right to grant such control. On the other hand, if the right to grant this control is dispersed among everybody, then it is up to them individually to grant it. If there were no state, the very idea of intellectual property rights would therefore seem absurd on the face of it.
Since any system of propriety requires a historical justification, it is necessary that the rules of any theory of justice can be taken back to the state of humanity before society, to a state before the question of justice can arise. This is why the state of nature is so important in political theory. Humans do not seem to have ever lived without society, which evolved from the societies of our hominid ancestors, but it is not necessary that the system of property we have today actually arose from people originally in the state of nature; rather the purpose of the state of nature is to consider the simplest cases of human interaction, unencumbered by history.
The state is often justified by a trick: the state of nature is defined to be a state in which people are at odds with one another without having recourse to a third party to resolve their dispute. However, such a state clearly has a history to it; why should people find themselves so close together that there is a great need for an institution of justice, without having already created one? Surely they would stop moving closer to one another before they became involved in a ‘war of all against all’. Their situation is more plausible as a society which resulted from the collapse of a prior state that had monopolized all justice.
Instead, the proper state of nature is one in which people are so far apart that they do not yet know of one another’s existence. Here there is no universal war and since people will come into contact gradually, there is no reason to expect that they will automatically start fighting. Natural law theories are those which begin with this state of nature, and natural property is the system of property that arises from the application of natural law.
This version of the state of nature constrains the possible rules of justice considerably. It is not the case that law can simply be whatever the rulers desire or what some group considers most beneficial, but rather that there are some laws which cannot be otherwise. Any system of property which cannot be explained as having been created out of natural law ultimately rests not on any real justification, but simply on the result of force.
Rules of justice cannot depend on a society having a supply of wealth already at its disposal. Natural law cannot require people to spend time and energy they do not have to coordinate themselves into a centralized decision-making body. Natural property, therefore, necessarily begins as a system of dispersed authority and individual property, without joint ownership.
In the state of nature, there is no place for intellectual property. When one creates a work or invention, one does not ‘homestead’ the idea in a manner analogous to that of the land homesteader. To claim property in an idea a certain claim over all material in the entire universe, over material of which one has no knowledge, and even over material which others have already justly homesteaded. This is never possible, even in an advanced society, and its impossibility in the state of nature demonstrates that intellectual property is not a kind of natural property.
As society progresses, people will become capable of creating more complicated rights. However, these rights are still created, and therefore not natural. They are built out of the consent of everyone involved, and do not give anyone the right to involve other people without their consent. On the free market, therefore, any kind of intellectual property must be created by the agreement of creator and consumer alike. Intellectual property, where it arises by consent, would be an arrangement beneficial to everyone, not simply to the creator alone.
Here I should bring up the attempted justification of libertarian intellectual property by Rothbard. Someone writes a book and sells rights to the book other than the right to copy it. All subsequent posessors of the book do not own the right to copy the book because this right has been continually retained by the author.7 This construction would make sense if the book had the ability to reproduce itself on command, but ordinarily copying a book does not involve any using it any differently than one would to read it. The buyer certainly must have the right to open it, and the writer certainly cannot retain the right to aim cameras or Xerox machines at its pages.
The copyright is not a natural right that the author can retain, but he might effectively reserve a copyright in his work by selling it with a contractual agreement that the buyer will not distribute copies himself and must require the same of anyone to whom he later resells the book. The initial pirater then is guilty of a breech of contract and may owe the author restitution, but the contract cannot bind third parties who obtain pirated copies. No matter how the author attempts to word the contract, the pirater need only create copies out of material that does not belong to him and the author will have no say over those copies at all. This would be the case, for example, if people created copies for themselves by downloading a file onto their computers. No property is transferred; the hard drives have simply rearranged their internal state.8
Suppose that a creator is somehow able to retain rights to his creation such that one cannot copy it without violating his property rights. Perhaps an inventor could do this by selling only the right to posess his machine and turn it on and off, but not to open it up or tamper with the inside. As long as the machine cannot be probed with X-rays, he has effectively ‘patented’ his device. However, he finds that his property in many sets of machine innards to be an extremely inconvenient thing to own. He does not know where his property is, what is being done with it, who holds it presently, and he cannot control it in any way from where he sits. His property is also difficult to alienate, for who would buy property that cannot be communicated with? Suppose, however, that buyer of the invention has no desire to act in bad faith and is interested to pay to look inside the machine, but finds that the original inventor no longer owns the inside of the machine—he may have sold it or died and passed it on to an heir. It may quickly become extremely difficult for someone who encounters the invention to figure out who owns it. Under these circumstances, the invention should simply be regarded as unowned, and anyone may look inside and claim the interior.
The conclusion is quite clear: on the free market, intellectual property can requires the consent of the consumer because attempts to retain control of all instances of a work are easily circumvented and too inconvenient to maintain. Unfortunately, in our world ‘orphaned works’ like the invention I described above are not regarded as unowned, but are simply abandoned out of fear that the owner will suddenly show up again.
Conclusion
Intellectual property violates the libertarian principles of homesteading and exchange, and it makes no sense as a right at all without the assumption of an omniscient and omnipotent organization willing to protect them. A striking feature of intellectual property is its unreality. Unlike the ordinary rights of homesteading and exchange, intellectual property is not something that anyone can reasonably expect to be able to defend and control. It therefore serves the state well to promote such a doctrine; as long as people believe that they have a right that requires a huge concentration of power to enforce, they will be most eager to rely on the state to protect it.
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See Kinsella, N. Stephan, Against Intellectual Property, Ludwig von Mises Institute, 2008 for a much fuller summary of property rights law.
- Kinsella, 2008 makes this argument in much greater detail.
- Rothbard, Murray N., Law, Property Rights, and Air Pollution, http://mises.org/story/2120, 2006.
- See Marcus, B. K., The Spectrum Should Be Private Property: The Economics, History, and Future of Wireless Technology, http://mises.org/story/1662, 2004 for an elaboration of this view.
- Boldrine, Michele and Levine, David K, Against Intellectual Monopoly, Cambridge University Press, 2008, page 98.
- Hayek, F. A., American Economic Review. XXXV, No. 4. pp. 519-30, 1945.
- Rothbard, Murray, The Ethics of Liberty, New York University Press, 1998, page 123.
- See Kinsella, 2008 for a refutation of Rothbard on similar lines in much greater detail.
Sorry, your wrong.
If I’m a farmer and I till, plant, harvest I own the produce.
If I’m and engineer and I research, prototype, test, build a new product, I’m entitled to own the new idea.
Just because you want to download and steal free music is no reason to come up with this excuse. Go to the back of the class.
Sorry, Joel, you’re wrong. You can have a property right to the produce that you tilled, planted, and harvested because of the homesteading principle – you already own the materials used to produce the product. Now, however, you are asserting that ownership / property rights can come through another means — creation alone. But this is obviously wrong; it’s easy to see why. Consider if someone chisels a statue out of marble on his neighbor’s lawn without permission, who does the statue belong to? Certainly not the “creator” of the statue – it wasn’t his in the first place. He cannot “own” it in any way because he was trespassing. The act of creation does not imbue property rights because you cannot invent more rights than that which you were originally entitled to by homesteading the original resources used.
Your property right to a scarce resource is a right to the *physical integrity* of the good. That is, others may not take it from you by force or attack it. Ideas *cannot* be made into property.
Stormin’ Norman, you might want to edit your comment; I believe, toward the end of your analogy, “He” should be “me” or “I,” respectively.
Joel: What Dan’s arguing is essentially how the real business world works. It is completely impossible to defend all claims to intellectual property. Pragmatically speaking, you cannot control an idea once it has been shared, and even modern indsutry/engineering acknowledges this; that’s why they shroud their new ideas/products in mystery during the research and development cycles. If a competitor found out about the idea, the competitor could steal it. If large engineering firms can acknowledge the simple fact of such pragmatics, I don’t know why it’s beyond such as the music industry to do so.
What about convergent evolution of ideas? Two people might have the same idea; if they have it at precisely the same moment, how do you decide which gets the IPR (intellectual property rights).
Finally, at what level of thought ‘ought IPRs be considered valid? For example, if I could somehow prove the IPR to something ubiquitous, like sliced bread, does it seem right to then require some part of the proceed of every loaf of sliced bread to be given to me?
@Robert H. :: Whoops! You’re exactly right, I used first person in the beginning when I shouldn’t have…. It has been changed accordingly!
Joel: I have already addressed your objections in the essay. There is no analogy between the homesteading of physical property and intellectual property. Intellectual property, ultimately, is made out of physical things, like paper, ink, or the configuration of the tiny magnets in a hard drive. Hence, when I claim ownership over an idea, I am really claiming partial ownership over everything in the universe that could possibly encode that idea. It is an illusion to regard matter and ideas as separate ownable things; in reality, only matter is ownable because only matter is exclusive.
Daniel is my hero.
Careful Norman. You’ll go straight to my head! Thanks man.
Haha, the other day Ian and I were discussing political theory and I said, “Well, intellectual property rights are illegitimate anyway!” and Ian responded, “Have you been talking to Daniel?”
You’re right though! I used to think there was a case to be made for intellectual property, and now after reading this and thinking about it I’ve decided there’s no such thing.