This article was published in the Summer 1997 issue of Formulations
by the Free Nation Foundation
Ideas As Property
by Roy Halliday

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In Formulations Vol. III, No. 1 (Autumn 1995), Roderick Long describes the illegitimate birth of patents and copyrights and then offers an ethical argument against honoring these forms of intellectual property [*1]. In his ethical argument, he contends that, "To enforce copyright laws and the like is to prevent people from making peaceful use of the information they possess." He also argues that we don't need property rights to ration the control of ideas and information, because multiple people can use the same ideas and information simultaneously without interfering with each other and without preventing anyone else from using the same ideas and information.

In Formulations Vol. III, No. 2 (Winter 1995–96), Richard Hammer offers a defense of intellectual property rights implemented through contracts [*2]. He argues that contract enforcement will be relatively inexpensive in a free nation and that this will make the contractual approach to intellectual property viable.

I cannot defend the existing body of intellectual property law in its entirety, but I agree with Richard Hammer that intellectual property can be protected to some extent in a free nation through morally legitimate means.


The Ethical Argument

The right to one's own mind gives each individual the right to the products of his mind—ideas, inventions, plans, and so forth. The individual therefore, has the right to use his ideas, inventions, and plans in any noncriminal way. For example, suppose farmer Demeter invents a way to increase his crops a thousandfold for the same cost. He would have the right to use this invention, peacefully, for his own benefit and not tell anyone else about his discovery. He could offer to sell his crops at lower prices than all the neighboring farmers. It is most likely that people would prefer to pay less for farm produce, even if it means that other neighboring farmers lose business. This would annoy the farmers who lose business, and it would make many people envious of farmer Demeter. It would also please farmer Demeter's customers who get what they have chosen—less expensive food. Some people who previously couldn't afford to buy as much food as they wanted may now be able to. Farmer Demeter could, legitimately, end up with a monopoly of the local farming industry.

It is not possible to know whether the total happiness or welfare of society would be increased by Demeter's exclusive use of his invention. Utilitarianism is useless, because we cannot measure envy, inconvenience, and annoyance, and we cannot compare these disadvantages with the advantages of abundant food. Fortunately, it doesn't matter that we can't do interpersonal utilitarian calculations, because they have no bearing on the moral issues involved. All we need to know to justify farmer Demeter's decision is that he acted within his rights, committed no crimes, and is entitled to his property.

Suppose Demeter did not care about increasing his own wealth or the wealth of his family and was more interested in seeing that everyone could have inexpensive food. He could publicize his invention so that all farmers could use it. This would please consumers of farm products, but it would probably mean that fewer farmers are needed. The excess farmers would be unhappy, because they would have to find other ways to make their livings. Again, it is impossible to say whether the unhappiness of the excess farmers is less than or greater than the happiness of the food-buying public. Again, it doesn't matter. All we need to know is that farmer Demeter had the right to publicize his invention and that by doing so he gave everyone the right to use it.

Demeter has the right to keep his idea (invention or discovery) to himself and to use it in secret. He also has the right to publicize and give his idea to the world. He has another legitimate option. He can conditionally divulge his idea to selected individuals for a price. Some of the conditions that he could stipulate by contract with any second party (B) are: (1) that B not divulge the idea to anyone, (2) that if anyone learns the idea from B, then B forfeits all his wealth to Demeter, (3) that Demeter will not reveal his idea to anyone except by a contract that includes the same provisions as this contract. In this way, Demeter could use private contracts to derive income from sharing his idea with others. This could result in more abundant crops, lower prices for crops, profits for those who implement Demeter's idea, and happier consumers. It could also result in financial failure for farmers who are not privy to Demeter's idea. Again, I see no way to determine whether this is the choice that maximizes happiness overall. Again, it is irrelevant to Demeter's right to make this choice.

The legitimate options available to Demeter are also available to anyone who makes a discovery or has a bright idea. Private contracts, or licenses, like the one outlined for Demeter and B could provide some of the same benefits that are now aimed at by patent laws. The biggest difference between free-market contract law and current patent law is that, in the free market, anyone who comes up with an invention independently would have the right to use it, sell it, or give it away just as the original inventor had the right to do.

Protection of intellectual property rights similar to what is now provided by copyright laws could also be provided legitimately. If someone writes a book, story, play, poem, song, computer program, or other reproducible creation, he can keep it to himself, he can give it away, he can publish it himself and sell copies of it, or he can make a contract with someone else to publish it. Depending on the contract between the author and publisher, the author's creation can be sold to retailers or customers under terms and conditions that include a requirement to obtain written permission from the author or publisher before making copies of substantial parts of it. Because of well-established conventions, it is not necessary to have a formal, written and signed contract with each person who obtains a copy of the author's creation. It is enough to simply display the copyright symbol or the word copyright on each published copy of the work. Virtually all literate people understand the word copyright and the copyright symbol. Courts can certainly assume that anyone who is in the business of publishing the creations of authors would understand the word copyright and its symbol. So, unless the work is so small and simple that it could be composed independently without being copied, anyone who publishes copies of a work that is copyrighted without getting permission cannot be innocent of intent to violate the author's rights. Violation of a copyright, like counterfeiting and fraud, is implicit theft.

In a free-market society, intellectual property law would be subsumed under the law of contracts. Patent laws, which prohibit even independent discoverers from using their own ideas, would be scrapped. Instead of patents, inventors who want to protect their ideas from unlawful expropriation would mark them with copyright symbols and only distribute them to those who sign license agreements or contracts that stipulate the allowed terms and conditions of their use. Unlike under current law, intellectual property would not have an arbitrary expiration date, unless a date is stipulated in the license agreement or contract, and the right to intellectual property could be traded and inherited in the same way as other private property.1 D

Roy Halliday has recently decided that he must be a descendant of Tom Halliday who was William Wallace's (Braveheart's) nephew.

1  For a good description of intellectual property law in the free market, see Murray Rothbard, Man, Economy and State, pp. 652–660.

[Web Editors' Notes:
*1 "The Libertarian Case Against Intellectual Property Rights"

*2 "Intellectual Property Rights Viewed as Contracts" ]

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