As is typical of me these days, I engaged in a political debate over the bar top a few nights ago, which prompted me to elaborate a response in writing. Argumentation had failed, and, remaining unpersuaded, I didn't care in that moment to keep trying. I was working after all, producing something for my ideological opponent to steal, and this wasn't necessarily my debate anyway. I had walked in mid-way, while an argument was proceeding between a libertarian friend of mine, who's a regular patron of the bar, and a known, self-proclaimed "democratic-socialist."
The thought of writing on this problem highlighted in our short exchange sounded more appealing than continuing attempts to reason. Besides, it might be more effective to just go write an article and refer them to it these days. Making these points in person can be hopeless, but nonetheless inspire one to write on it.
Less than I cared to discuss the matters, it was more that I couldn't resist but to interject after overhearing the typical rebuttals of our allegations against statism, that: "taxation is voluntary", it turns out; "you use the roads, though"; or, a favorite of mine, that "if you don't like it you can just leave." I couldn't leave a fellow libertarian alone, I thought.
Perhaps I got a little too heated, honestly. I should have made my point and walked away. It's frustrating attempting to convey a proper understanding of liberty to these people sometimes, but I know it's essential to spread the message, so I do. I try to remain calm, but to have someone who is telling you right to your face that they believe in sending men with guns to rob you, and to not accept this as a threat because: "democracy", and then for them to tell you that you have to be one who leaves, can be quite infuriating of how indoctrinated the masses have become. They do the job of maintaining the State's legitimacy without it ever lifting a finger.
The debate: The socialist's intellectual property problem
I was trying to make the point that patents are monopoly privileges from the government, and that that's how, along with other protections, corporations can come to dominate the market. He stopped me there:
"Wait, you don't believe in patents?"
I replied,
"No, I do not. Nor copyrights or trademarks."
The turning point, for me, which opened up the chance to attack his position, was when he said of the hiking of prices allowed through reduced competition, that:
"That's you guys' system!"
Government is the libertarian way! Right.
Of course, it's not "our system." It's theirs. We're living with government, i.e., with socialism; not without (anarchism), i.e., capitalism. We must remember, socialists hold the false premise that America is capitalist; that capitalism and statism are compatible and co-existing. Interestingly, they say "we can't have a free-market", but then when something goes wrong with government they don't like it's blamed instantly on the non-existent free-market. Somehow, I guess, just because big businessmen are special interests of government that this is "capitalism" when they do these things.
What are they saying, then?
What they [socialists] are saying, by supporting patents to protect the costly development of drugs, that they should be able to obtain monopoly prices. They're the ones who think it's unfair, or lacks incentive, should someone invest in a drug and not be able to fully reap the reward by themselves, i.e., by receiving a monopoly, however limited in time, on the production of the good in question.
So, they're the ones who want to protect profits, and not us anarchists/capitalists. Libertarians wish for everyone to be free to seek and find a profit in the market, without being hampered by the government in doing so. He mentioned too, validating this suspected sentiment of indeed being for protecting profits, that:
"It takes X years and X dollars to bring a drug to the market..."
How ironic the socialist preaches the necessity of "intellectual property", a concept which the libertarian rejects, but then uses this violation of property rights to turn around and call it "capitalism."
As usual, what they say of capitalism is only true of their own system. So long as they can't see that statism (what we have in America, and around the world) isn't capitalist, then they'll never be able to identify the solutions to our problems, what is indeed capitalism; a free, competitive market in all goods and services absent of government monopolies.
The regulated are the regulators
Without going into much detail here in this one, of how regulations are used by industry to provide themselves with protection, it should be simple for anyone to see what happens: The businesses that are imagined to be in need of regulation, to tame their supposed desire to hike prices absent of government control, are the ones appealing to the government (rent-seeking is the term) for protection. They come to run the regulatory agencies, dubbed rightfully "regulatory capture." The majority of people remain holding the view that it's government which is doing things to protect the people. Sadly, this isn't a laughable thought yet among the masses.
It isn't just IP—patents, copyrights, trademarks, trade secrets—that is the cause for less competition, though, but the government's regulations themselves which cause hurdles, or, "barriers to entry", into the market. Murray Rothbard explains of the use of licensing and regulations to restrict competition, using medicine as his example here:
"The current government intervention in the medical field in the
United States has created most of the problems that now exist.
By creating licensing requirements—state regulations restricting the
number of doctors and medical schools—the government creates a
medical monopoly and increases the cost of medicine.
The same happens in banking, with the Federal Reserve; or food, with the Department of Agriculture; Pharmaceuticals, with the FDA; the airlines, with the FAA; etc. These people, as socialists recognize, are the corporations that own the government. The anarchists solution is of course to deny them the political power to do these things.
As with EpiPen, made by Mylan, where they have a patent on the injector that no one else may produce, they have obtained an effective monopoly. To me, it's sad that this even needs to be explained that the lack of EpiPen competitors is the FDA's fault, but someone how this is still pinned on capitalism just because it's big businesses that are attaining such positions. Apparently big businesses and tall buildings are synonymous with "capitalism."
He of course mentioned Martin Shkreli, too, to paint him as some capitalist that is ripping off consumers in the free-market, not seeing that government drives up pharmaceutical prices, not markets.
The goal of these companies is to shorten the supply relative to demand, so that prices and profits will rise; so that they can raise the price without inviting new competition under the lure of a new profit opportunity. Ironically, this is a contention of what will happen in the market: a giant firm will come around, buy out all the competition, cut production and raise prices. This is of course the way "the system" works now, with government.
The cognitive dissonance of the socialist is hard when caught in this IP/anti-capitalist trap here. On one hand, speaking of the need to violate property rights by protecting the made-up rights in non-scarce ideas, like IP, yet thinking this is caused by a system of private property rights (capitalism); and on the other not agreeing with the prices they've obtained through protectionism but supporting the means of acquiring such protection.
What is government?
The State, itself, is a monopoly. Everyone essentially understands this, saying that "the government is needed to be the sole provider of X [anything and everything]", implying that competition cannot be allowed.
They have taken a monopoly on: defense, law, money, roads, schools, etc, and controlling everything else in some sort of way. There are hardly remnants of a free market; government rules the landscape. It's no wonder why these things aren't running efficiently. Everything everyone complains about is a crumbling socialist disaster, whether literally the infrastructure, or the brutality of the police.
It is of course, then, a contradiction to admit that "monopoly is bad", but that "the State is good." If substituting monopoly for competition is bad in the production of general consumer-goods, like: food, clothing, housing, etc., then we must conclude that it isn't needed either in the areas in which the State has taken unto itself: law, defense, justice, education, transportation, etc.
But it is through the political means of this system that it's possible to turn around and grant privileges (monopolist in nature, if not outright so) to favored clients of the government. There are single companies with "no-bid contracts", where they're the sole provider of X; there are the ones in the top of the regulatory agencies; those receiving special licenses, permits; and so forth.
Murray Rothbard had called for a return of the original definition of monopoly (understood this way for centuries) in his Man, Economy, and State of being special privileges granted by the government. Not simply, what is used today, as just meaning "big business", or a large market share for a given good.
The powers that be do not want a free-market, as is supposed by socialists who hold the myth of the free-market monopoly. Again, Rothbard:
"It then became clear to these big-business interests that the only
way to establish a cartelized economy, an economy that would ensure
their continued economic dominance and high profits, would be to
use the powers of government to establish and maintain cartels by
coercion. In other words, to transform the economy from roughly
laissez-faire to centralized and coordinated statism.
He asks, further
"But how could the American people, steeped in a long tradition
of fierce opposition to government-imposed monopoly, go along with
this program? How could the public’s consent to the New Order be
engineered?
And answers
"Fortunately for the cartelists, a solution to this vexing problem lay at
hand. Monopoly could be put over in the name of opposition to monopoly!"
What about anti-trust?
In a neat little book The Concise Guide to Economics, Jim Cox explains of the reality of antitrust laws versus the conventional wisdom that they're used to prevent monopolies:
"The origins of the antitrust laws lie in politically influential businesses
getting a national law passed to preempt state laws, to use the power
of the state against their business rivals, and from a political vendetta
by the bill’s author against the head of a major firm. In truth, the laws
have not served the consumer but have done the exact opposite, harming
productive, cost and price-cutting businesses to the detriment of consumers.
There might be one way, however, that using "the law" could be considered moral, and that's a great point Stephan Kinsella makes on the use of government to deal with them:
"Since patents are government-granted monopolies, it is not
unjust to use an anti-monopoly law to limit the ability of a patent
owner to extend this monopoly beyond the bounds intended by the
patent statute. The problem with antitrust laws is in their application
to normal, peaceful business dealings, not to limit real—i.e., government
-granted—monopolies.
So, why no IP?
To put briefly, libertarianism holds that only, and all, scarce goods are subjected to private ownership by way of original appropriation; and therefore, thoughts and ideas, being non-scarce, cannot be "owned." It's a clear absurdity to try and imagine the need to prevent someone from having the same thought as you.
Legally, to enact these "ideas" as a "right"—preventing anyone from crafting their own property however they wish, by violating a patent; playing in a cover-band at a bar; calling your business something; or building something in which ever way, shape, or form you desire; etc.—requires that one violates genuine private property rights—those of scarce resources. That is, to say someone may not craft materials into some specific way and sell them, trade them, or use them for himself, is to say that it would be just and moral to invade his private property to prevent him from doing this among his voluntary trading partners.
Again, Kinsella:
"Let us recall that IP rights give to pattern-creators partial
rights of control—ownership—over the tangible property
of everyone else. The pattern-creator has partial ownership
of others’ property, by virtue of his IP right, because
he can prohibit them from performing certain actions with
their own property. Author X, for example, can prohibit a third
party, Y, from inscribing a certain pattern of words on Y’s
own blank pages with Y’s own ink."
Having armed police kick down your door to prevent you from doing something with your own resources in the name of enforcing these made-up "rights" to ideas—to "intellectual property" is clearly anti-liberty. To grant the privilege of sole production, say, to not allow anyone else to make an identical product as the protected producer, i.e., excluding anyone else from the competition, is against the libertarian idea of rights as a negative concept. We're squarely against intellectual property.
One final note is that economically, too, we would deny as well that protecting producers would "promote progress" and be beneficial to the economy; simply, for reasons that competition is always preferable to monopoly. Allowing a greater supply of a given good, which competition will do, will lower the price of the good upon this greater availability for consumers. IP law seeks to restrict the supply as to prevent prices from falling below a profitable amount for the producer they wish to reward
The socialists and rights
Unfortunately, the non-libertarians idea of "positive rights", which means that you control another's property, essentially, is embodied in the United Nation's Universal Declaration of human rights. As pertains to this discussion, it makes mention of intellectual property, saying
"Everyone has the right to the protection of the moral and material
interests resulting from any scientific, literary or artistic production
of which he is the author."
While contradicting this anyway, with "everyone has the right to freedom of peaceful assembly and association" (this can't be true if such associations are found to be in violation of another's "rights" to his intellectual creations), they go on to list other alleged "rights"
"Everyone has the right to education. Education shall be free...shall be compulsory."
The word "compulsory" on a list of rights. Let that sink in.
"Everyone, without any discrimination, has the right to equal pay for equal work."
They laughably continue of the right to
"food, clothing, housing and medical care and necessary social
services, and the right to security in the event of unemployment."
Even anarchists, who are very good otherwise often failed on economic or property rights issues, stating here the support for the idea of intellectual property as being no different than tangible property rights, Lysander Spooner says that
"...a man has a natural and absolute right...of property, in the ideas,
of which he is the discoverer or creator; that his right of property, in ideas,
is intrinsically the same as, and stands on identically the same grounds with,
his right of property in material things; that no distinction, of principle, exists
between the two cases."
Ayn Rand, too, thought intellectual property and private property were equals. The first sentence in her chapter on patents and copyrights of Capitalism: The Unknown Ideal is that they [patents and copyrights]
"are the legal implementation of the base of all property rights: a man’s right to the product of his mind.”
So she takes the view that the must be protected just as much as ordinary property rights.
They are who they say they're against
Again, and to summarize our point, it's funny they're the one's who think the necessity of IP is to "allow owners of intellectual property to benefit from the property they have created, providing a financial incentive for the creation of an investment", in which they mean by higher prices than would exist with competition, and then turn around and say it's us anarchist-capitalists who are the one's at fault for such a system, despite the plain fact that we've never had it our way and the government-way reigns. We're the ones for *competition, not monopoly.
They are caught in a dilemma they can't get out of: to support protected monopolies, and be an anti-"capitalist" (in the sense they believe this is being against monopolies, profits, a free price-system, etc); or to realize government and intellectual property law assists in supporting monopolies, and to stop being socialists (and to support property rights).
To conclude, it's the socialists in truth who are the monopolists. Not only for giving us the State, but for also supporting the rewarding of special privileges conferred through the "regulatory" agencies, an inevitability of the special-interest-ridden incentives inherent within government.
It is the system of government that is the system of monopoly, not a capitalist private property order.