Politico recently released a pro-State propaganda piece lauding the virtues of a new law that creates a First-To-File type patent system in the US. The article claims:
The America Invents Act is designed to help the U.S. Patent and Trademark Office cut through its massive backlog of patent applications, which administration officials argue will enable businesses to get innovations out to the marketplace faster and increase hiring.
When enacted, the bill will shift the U.S. patent system from a first-to-invent to a first-to-file nation. It also sets up a new regime to review patents and gives the USPTO more flexibility to set and spend fees paid for by inventors and businesses to get patents and register trademarks.
For those of you who are unfamiliar with the differences between a first-to-file and a first-to-invent type systems, see this wiki article on the subject.
It should be noted that the bill had the support of many major corporate interests – including, Apple, Microsoft, Facebook, Cisco, Dell and Google.
A study by McGill University explains why those corporate titans support the legislation:
A switch to a first-to-file patent regime from its first-to-invent system has become imminent for the U.S. To learn about probable effects of such a policy change, we examine a similar switch that occurred in Canada in 1989. We find that the switch failed to stimulate Canadian R&D efforts. Nor did it have any effects on overall patenting. However, the reforms had a small adverse effect on domestic-oriented industries and skewed the ownership structure of patented inventions towards large corporations, away from independent inventors and small businesses. These findings challenge the merits of adopting a first-to-file patent regime.
The ultimate truth of the matter is that ideas are not property. Patents were agitated for exclusively by businesses, and are nothing more than grants of monopoly privilege. Business have sold the public on a great lie, that monopolies of production can ultimately lead to better outcomes for consumers.
Of course, even a ten-year old knows that monopolies lead to higher prices, poorer quality, and less innovative products. When the government grants a patent, they are effectively granting a monopoly privilege of production for an arbitrary set amount of time. Clearly ideas must not truly be property by that standard, otherwise one would have to ask why patents shouldn’t last forever? Why should there be an arbitrary time limit on them if ideas are truly the property of their creators?
Of course, since ideas can be infinitely replicated without any party losing material resources in the process, they are clearly not property. In fact, when business are free to copy each other’s ideas, fierce competition emerges in the markets and innovation is drastically increased as each producer builds on the ideas of his competitors. This notion that innovation would be stifled if patents were eliminated is utterly preposterous. New innovations almost always develop from a successive chain of previous ideas. The R&D costs born by the private sector can be greatly reduced by the elimination of patents.
It is not recouping R&D costs that the mega-corporations fear, it is the stiff market competition that would arise should patents be eliminated that they fear. That is the REAL reason why most businesses support patent laws. All businesses hate the free market and the fierce competition that comes about when people are free to build and innovate without licenses, permits, patents, and copyrights.
Patent Attorney Stephan Kinsella lectures on the pitfalls of intellectual property:
The Mises Institute’s Jeffrey Tucker provides an additional EXCELLENT lecture on intellectual property here.