The problem here is really very simple and straightforward, and that is, how do we incentivize and more justly treat innovators – people who create intellectual property? It’s beyond debate that people who create the tangible goods and services, the things, that flow from ideas have all the same problems in terms of just compensation as do innovators: they owe debts to others for prior art, they have licensing and branding issues, and on and on. Still, nobody with myleinated axons in their brain is going to argue that because that system is messy, inconsistent. and far from completely just, it should be scrapped. Arguments like that don’t get made because it is apparent, from evidence-based experience, that the whole system of commerce collapses when you remove the incentive and the reward.

Yes, there really are important differences, on average, between the kinds of people and their motivations who produce IP, versus those who produce implementations of IP. It is far more likely that the innovator is going to be less concerned with ‘getting rich’ personally. But, to some extent, that’s an illusion, or a misconception, because it fails to take into account that the innovator is almost always, on average, vastly more avaricious and greedy than anyone else! What he often wants is MONEY, and lots of it, to pursue more innovation, or whatever else interests him – and brother, that’s about the most expensive and luxurious hunger in the universe.

People look at the ‘nerd’ or the scientist, and because he isn’t interested in behaving like Elvis or the Kardashians, they say, “Oh, what wonderfully selfless people – they want nothing for themselves but to advance the state of knowledge and human well being – they just want a little place with heat and 3 squares a day, where they can be left undisturbed to think great thoughts – and make the world a better place! LOL! Scientists are viciously competitive for money and related resources! While they could care less about having an Armani suit or Dolce and Gabana casual wear (on average), they would cheerfully kill for a TOKAMAK, a space telescope, or a space program. Von Braun stepped over the bodies of beaten and starving workers at Dora-Mittelerk, not because he was a Nazi, but because he wanted to go to the moon and Mars in his lifetime.

Today, there are scientists, very good ones, doing very clever and valuable things, with lots and lots of money provided by DARPA. And DARPA’s objectives are to make war more efficient and less lethal to the soldier (the US’s). It’s all the same, with the enviable difference that today’s scientists don’t have to actually step over their victims, literally, instead, they only see them TV (which they can turn of with the infrared remote control); men who have been mutilated by war (and would formerly have been dead), but who now survive because of advanced protective technologies and advanced medical rescue technologies. These scientists even get to feel good about it, because they can truthfully say, “If it weren’t for my armor, my plasma expander, my tiny ventilator…those guys would be dead! Of course, what they may not realize is that absent those specific enabling technologies, their nation-state would not have dared to prosecute such wars – because the populace would not tolerate the heavy losses in DEAD, rather than injured soldiers!

Innovators are just as ‘greedy’ in the sense of being desirous of having the resources to pursue THEIR goals and interests, and maybe more so. But, and this is a big but, it is vastly better (or more powerful) for civilization when they get their way, than when anyone else does! This is so because the leverage and the durability and the wealth generating capacity of ideas is always greater than is any particular instantiation of them, and, without exception, the longer the timescale the research or intellectual activity operates in, the more powerful and profitable are the returns over the long haul. But, that another kettle of ideas altogether, for another time and place.

Bottom line, it may be the Devil and it may be the Lord, but you gotta PAY somebody, to paraphrase Dylan. If you want the most bang for your buck you’re gonna pay the guy who is fooling with the fundamental questions of how the world operates, because in the long run, he’s going to give you radio, AC power, nuclear and solar energy, and even things like quantum computing and practical immortality. How you pay is less important than THAT you pay him. And believe me when I say that, on average, he won’t use the money to cover himself (and much of his chattels) with rhinestones, or buy solid gold taps for his bathtub. – Mike Darwin

Equal shares for everyone noted on the patent application? Or divided according to how much of a contribution each person made? Would only the living people get checks or would there be a check to Einstein’s estate if he had something to do with it? And I assume there would be lawsuits from anyone left off the application who believed he was entitled to a piece of the pie. Sounds like a full employment act for lawyers which would discourage anyone from inventing anything, with all due respect.

OK, suppose I see an original recipe for a chocolate cake in a library book, memorize it, and then go home and make the cake. Should the author of the book be able to force me to pay for the idea? Should I send her a small donation? After all, once the book is paid for by the library, she gets no further royalties even if 1,000 people check out the book and make the cake. Are lending libraries immoral since you can pick up a lot of good ideas for nothing? Suppose I get no monetary benefit from an idea but just enjoy it? Is the originator still entitled to monetary compensation?

And yes, you are absolutely right that every innovator owes a debt to every other innovator! Newton summed it up beautifully when he said (in an uncharacteristic moment of ‘modesty’), “If I have seen further than other men, it is because I have stood on the shoulders of giants.” And if you look at any patent, particularly a good patent by a good mind, you will find a long list of intellectual antecedents which the inventor must credit. It is a requirement of patent law that he do so. Do these people deserve some compensation to the extent they contributed to the new insight? You bet. Will that be easy to do? Well, yes and no. In fact, it was not even possible to do until the advent of contemporary computing. I just went to another window and Googled “Isaac Newton,” the summary of the result: “About 4,770,000 results in (0.13 seconds).” There you have it – the IP value tracking equivalent of double entry bookkeeping, in the form of unbelievably powerful computing and hyperlinking. While 4,770,000 results were returned in just over a tenth of second, who knows how many records, references and cross references were checked, and intelligently evaluated in that same instant of time? A lot more, for sure! If Quantum computing is developed, it will make even the best foreseeable performance of this kind look like 1+1=2 done with a stick in the sand.

When I mentioned double entry bookkeeping being invented, I wasn’t just throwing that our as some generic exemplary achievement, but rather I was trying to point out that before double entry bookkeeping was invented, the whole system of business as we currently understand it, could not have existed! The same is true for the zero, which the Roman’s didn’t have. The moral implications of these two inventions are profound, almost beyond reckoning, because they made commerce and human interaction more just. Not just more efficient, but more just. Ditto systems of accurate and consistent weights and measures.

On the edge of he British 1 pound coin is engraved Newton’s quote: “If I have seen further than other men, it is because I have stood on the shoulders of giants.” This is so deeply and profoundly appropriate, it is hard to put into words how it makes me feel. Coin clipping is the process of shaving off a small bits of precious metal from the edges of coins (back in the day when coins were made of things like gold, silver, or even copper). It was a hanging offense – but it was very difficult to prosecute. It played havoc with economies, and it was deeply unfair to everyone, because it debased the worth of the currency. It was Newton who, as Master of the Royal Mint, invented the use of serrated lines along the edge of coinage to defeat coin clipping (http://books.google.com/books?id=4XWH_SqAkHMC&pg=PA46#v=onepage&q&f=false). While Newton was not the first to find a technological strategy to defeat this injustice, his was by far the best and the most economical (others before had used quotes or words near the margin of the coin). In so doing, he invented not just a foil to those who would debase the currency, but also a technology that made the world more just and fair. My point here is that morality and justice are heavily a function of the available technology. Just consider the Birth Control Pill, if you doubt that this is so. -Mike Darwin

Another point is that one cannot know how valuable an idea is until someone has implemented it. If you have an idea for a better computer chip, it is WORTHLESS until Intel makes it and successfully sells the product. And most ideas are worthless. For example, any drug company executive will tell you stories of millions spent on developing drugs that did not work or were harmful. 20 ideas for good drugs may result in one actual good drug.

Film is not much better. Those “red box” kiosks that you see in Fred Meyer and Walmart has cut the total revenue to Hollywood by nearly 50% in the past 5 years and may cut revenue by another 50%. Forbes magazine describes “red box” as the perfect cannibal business model.

Professional athletics has trouble on the long-term horizon. Demographic changes in both the make up of NFL teams as well as the fan base makes it likely that NFL will decline to NBA level of popularity in another 10 years or so. Half of the NBA franchises (teams) are consistently loosing money and could disappear within 10 years (our team, the Trailblazzers, nearly disappeared a couple of years ago). Major League Baseball has never recovered from the steroid and other scandals during the late 90′s to early 00′s. Baseball’s fan bases is very traditional and does not tolerate the antics common to the NBA and increasingly so to the NFL.

On government parasitism it is the case that the government share of spending has grown from about 6% in the mid 19th C (a historic low) to officially just over 50% in Britain today. A further point is that the economists’ rule of thumb is that regulation costs the regulated 20 times what it costs government to run it. Thus 200,000 “health & safety” inspectors destroy the wealth produced by 4 million workers. We may be very glad that most government employees have no economic effect either way. I have done my calculations here http://a-place-to-stand.blogspot.com/2009/03/costs-of-government-regulation_22.html of how government regulation destroys the equivalent of 100% of our actual economy & thus 50% of the potential economy we could have & subsequent research suggests this is not an underestimate. Combined that is government robbing us of 75% of our potential wealth, a figure close to the one in this article but calculated from a different direction.

One interesting counter example is Japan where, after spectacular growth, we have had 2 decades of zero growth. This is probably partly because government reorganised the economy to make keeping the banks solvent the prime objective so partly government parasitism; partly because they have an aging population; but I suspect partly because they had reached the top of the world technological tree at the time and had nowhere to go.

On that basis I would suggest that space development is the obvious “place to go”. I also think that the way to stimulate innovation, both in that field and others, is X-Prizes. Probably simplifying & enforcing patents laws so that inventors get more money than patent lawyers & the regulators who regulate new products out of existence would also help. I have proposed putting 2% of GNP into assorted X-prizes as something that would provide real technological progress & grow everybody’s economy by at least 2% annually (let alone 2% overall). This is something positive government could actually do which would improve on the free market which normally is the default best route.