“Special 301 Watchlist” Threatens Open-Source Software

by on February 26, 2010 · 45 comments

Reihan Salam of National Review Online has a great piece on the US Trade Representative’s Special 301 Watchlist today.  Salam points out that this list, which is supposed to identify nations that are a threat to intellectual property, may include Brazil, India, and Indonesia not because of any piracy occurring there, but because of their use of open-source software.

That inclusion is being pushed for by the International Intellectual Property Alliance, a group which includes the MPAA and RIAA.  This is, of course, a brazen move by US corporations to force these developing nations to use their expensive proprietary software instead of the cheaper open-source alternatives.

This is exactly the kind of thing libertarians should abhor—government being co-opted by corporations so that policies can be made in order to defend their interests, instead of our rights.

Thanks to Salam for recognizing me and Tim Lee in the form of a link to a recent blog post on Tim’s site, Bottom Up.

For more on the USTR’s Special 301 watchlist, check out this post by Mike Masnick at TechDirt.

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  • mwendy

    I don't have a problem with FOSS – to the extent that the ideas / IP hasn't been misappropriated. And, I think that's what the 301 is about essentially – who's stealing stuff, and where. As you well know, IP plays a huge role in our and the developing world's economies. It deserves protecting, and vigorously.

  • http://srynas.blogspot.com/ Steve R.

    Excellent post. The free-market, if it is to be viable, must recognize the “free” model. If a business can't compete with “free”, to bad.

    I find it quite disappointing that there is a subset of people who profess to be free-market advocates, but at the the same time claim that everything (and I do mean everything) has to be somehow monetized. So how do they react to this “threat” by finding ways to criminalize it. By implication only proprietary products would be “legitimate”. If a group of people come together and seek to make something freely available (donate) to the public-at-large, such as Linux or Wikipedia, it is their free-will and would not be inconsistent with the principles of the free-market economy.

    Think of it this way, if you can legitimately obtain something that helps your business for free, that makes your business more productive and that much more profitable!

  • mwendy

    Steve, the key is “legitimately obtain” – and therein lies the problem. Stealing is not legitimately obtaining. This is not to say that all FOSS / open source does that, but where ideas are stolen, then that should not be promoted. It hurts the ecosystem of ideas, and the incentive to create. Protection of private property does make the world a better place. Stealing – well, it doesn't. And that's what the 301 report is about.

  • q-jimmy

    I agree mwendy, especially when it comes to violating software copyrights, and pirating software.

    I can't help but think that you're trying to insinuate that FLOSS software somehow violates software copyright more often. In fact, the converse is true, as open source makes plagiarism easy to detect, and as SCO found out.

    You are also insinuating that FLOSS software somehow violates patents more often. I doubt this is true. It is true that FLOSS developers don't cross license as much as the M.A.D. world of proprietary software.

    But the fundamental point there is that the vast majority of software patents are absolutely invalid rent-seeking monopolies for obvious ideas. If it did turn out that FLOSS software violated software patents a lot, this would be further argument for the invalidity of those patents. If you can't make a program that does a basic task without infringing dozens of patents, this tends to demonstrate that those patents themselves should never have been granted. You can patent efficiency, or math, or algorithms, or obvious ideas, yet this is what most software patents do.

    Software patents are a net drain on innovation–software copyright is not. In fact, software patents are just another of the rent-seeking tactics used by the large software houses to keep competition out.

  • http://www.cordblomquist.com cordblomquist

    Theft of copyrighted material as a part of FOSS (which rarely happens as it would be quickly found out) had nothing to do with the IIPA's push for these countries to be included. Here's an excerpt from the IIPA recommendation for Indonesia:

    “The Indonesian government’s policy… simply weakens the software industry and undermines its long-term competitiveness by creating an artificial preference for companies offering open source software and related services, even as it denies many legitimate companies access to the government market.

    “Rather than fostering a system that will allow users to benefit from the best solution available in the market, irrespective of the development model, it encourages a mindset that does not give due consideration to the value to intellectual creations.

    “As such, it fails to build respect for intellectual property rights and also limits the ability of government or public-sector customers (e.g., State-owned enterprise) to choose the best solutions.”

    This sort of statement is absurd. Governments, just like corporations, should be able to set preferences for open-source or proprietary software. Just because Indonesia's government would rather use Linux and Google Apps than Windows 7 and Office doesn't mean that they have no respect of intellectual property.

  • http://srynas.blogspot.com/ Steve R.

    Why this constant need to degenerate products/services that are donated to the public domain? Ideas cannot be stolen. You are entitled to a patent and/or copyright for something you actually create. But don't forget that the current patent/copyright regime is actually a humongous LAND-GRAB on the public domain.

    Also take a look at who is suing whom. Most of the lawsuits are between private companies who each claim that they are the original creator of the so-called intellectual property. The preponderance of these suites point to the fact that we do NOT have clear property lines. The inability to clearly define property lines points to an overly complex broken intellectual property system. Example: Acacia Technologies. Electronic Frontier Foundation called it a: “Laughably broad patent would cover everything from online distribution of home movies to scanned documents and MP3s” So if the super big bully proprietary companies are having am underhanded bloody ballroom fight calling each other “thief”, why all this concern over a little bit of so-called “theft” by small companies?

    For a real laugh, take a look at what one Mr. Lohr wrote in the New York Times: “The dilemma for such firms is the “free rider” problem. Companies like Microsoft and Intel have paid Intellectual Ventures many millions of dollars for the insurance that the patents the firm holds will not be used against them in patent-infringement suits. But rival technology companies benefit as well, without paying license fees to Intellectual Ventures, unless there is a mechanism to sometimes sue the companies that hold out.” This quote boils down to: “Pay us insurance money or get sued.”. Patent hoarding as an extortion racket.

  • MikeRT

    My perspective as a consultant is radically different from mwendy's. The fact is that most proprietary software is significantly more expensive than what its buyers actually need in many cases. I've worked on many projects where Oracle was used instead of PostgreSQL, despite the fact that the agreed upon configuration of and use of Oracle was such that it offered literally no benefits over PostgreSQL. A single instance of Oracle Standard Edition costs $17,500 per processor, and I think that might even cover each CPU core in multicore systems.

    FOSS allows people like me to deliver cheaper services. Many FOSS products may not be as good as their proprietary counterparts, but then the delta between the two is rarely sufficient to justify the latter except to make sure some manager covered their ass.

  • mwendy

    The ideas expressed by IIPA aren't all that far off the mark. Sure, a country is free to choose free. But then, in that preference, which looks with myopic gaze at the chosen source code, it denies others that may be better suited for the task at hand.

    Moreover, the statement it sends to the development community – i.e., FOSS or nothing; give it away, or nothing – how can that help the indigenous marketplace? Certainly, sales into that government by local, proprietary programers will be less as a result. And to what end – to make a “Lessig statement”; to reduce costs (i.e., like the present U.S. Healthcare proposals); to be more secure; to “free the code / language / ideas”? This is all marketing spin by a couple of big American companies seeking to exploit anti-American feelings, gaming the legislative system to their parochial ends.

  • mwendy

    The patent system ain't perfect – until you look at all the other options. Whatever balance that emerges in these next couple of years (certainly not this Congress), at a minimum, private property and the immense risk associated with those discoveries, must be protected against people, companies, countries that steal this stuff outright.

  • mwendy

    I reiterate – i don't have a problem with FOSS. There's plenty good stuff on the market for people / companies/ countries to choose from. I do have a problem, however, with people stealing ideas, and free-riding off that risk. Now this can occur on an FOSS environment, just as easily as it can occur in a proprietary environment – no single development has an advantage in that regard. But, as the 301 Report admonishes, stealing ain't the way.

  • MikeRT

    “Stealing ideas” is relative. Microsoft basically stole the majority of Java's syntax to make C# by the reckoning of many people. We're better off for it because .NET was the competitor that Java needed to make Sun have to invest serious work into improving the quality of the JVM.

    The economy benefits greatly when companies can compete more on the quality of the implementation than simply being the one that had the bright idea.

  • http://www.timothyblee.com/ Tim Lee

    I don't think you understand how the software industry works.

  • http://srynas.blogspot.com/ Steve R.

    What are the “other options” that make the current patent regime the least evil option and should therefore be maintained?

    Additionally, how can one steal an “idea”? How do you deal with multiple people/firms developing the same concept independently? None of them are “stealing” nor should one be entitled (to the exclusion of others) to monopoly control, just because they filed a piece of paper.

    mwendy, you are also making a logical mistake in that what is good for one entity is somehow good for the entire society. True if John Doe has a patent on “X” he makes more money and he could reinvest that money in other research. Now if there is no patent on “X”, everyone in society can make/buy products at a lower costs. These cost savings would allow others to invest in further research also thereby making the society more robust.

    PS: patents do NOT foster creativity, “X” will be invented irrespective of the existence of a patent system. Innovation has occurred through-out human history because of man's inquisitive nature, not patents. Patents are a relatively recent legal construct.

  • mwendy

    Tell me, Tim, how does it work? I gather that programmers, and the people that fund them, are immune from economic signals – especially where government procurements of software are involved. I gather they don't care about IPR – even GPL-built software, which relies on copyright / copyleft (IPR) to enforce author / donor rights downstream.

    My point above is about government preference laws / rules – which have, thankfully, been beaten back most everywhere they've been introduced. They're a jip all the way around when they limit choice – they jip administrators, taxpayers, and the industry creating the stuff we desire.

  • mwendy

    Patents are ways of protecting the incentives to create. No one claims the system is perfect. But the fundamental idea still holds true. That balance is being worked out in Congress, the PTO, the EPO, etc. The question remains – how do you promote people to create very complex things, with very complex ideas, at great cost? IPR.

    When I can wall someone off of my idea / innovation (patent), or expression (copyright), it's going to bring me to the table. “Section 8″ software (like Section 8 housing) could likely result if no IPR existed. Who's want to take the risk without some assurance of ROI – only saints and software good Samaritans.

    If I have a good idea, I do not want society telling me I am compelled, for its interest, to cough up the goods. That's involuntary servitude, and we know where that leads.

  • http://www.timothyblee.com/ Tim Lee

    I don't want to get into a long argument about this, but just ask yourself this question: how does Red Hat turn a profit? And given that Red Hat makes a profit, might there be indigenous software firms in developing countries that could pursue the same strategy?

  • http://www.cordblomquist.com cordblomquist

    FOSS isn't somehow divorced from the economy, it's just a different approach to making money by producing software. Matt Mullenweg, who created WordPress, the software that runs TLF, is a millionaire thanks to giving away his code. Several companies have been built around Drupal and contribute code to the project frequently. Larry Page and Sergey Brin have been giving away high quality searches for years and have become billionaires as a result.

    Your claim that software is only given away to make a statement or foster anti-American sentiments betrays the fact that you don't understand how giving software away can be the basis for a money-making enterprise.

    It's also rather obvious why countries in the developing world would have a preference for open-source software, namely because they can't afford the alternatives. U.S. companies trying to foist their high-priced software upon these countries is deplorable. The added cost to those countries, which could likely be in the hundreds of millions or even billions of dollars, represents an opportunity cost–meaning that the government of that nation now has less money for education, hunger-relief, housing, etc.

  • http://srynas.blogspot.com/ Steve R.

    You did not answer the questions posed to you.

    The free market is not about “protection”, if you risk and win, good. If you risk and loose, too bad.

    Moreover, how can you possibly advocate supporting government sponsored “protection” when you say: “I do not want society telling me I am compelled, for its interest, to cough up the goods. That's involuntary servitude, and we know where that leads.”?

  • mwendy

    I don't disagree with the ability of companies like Red Hat to profit. They provide great services. They should make money. Doubtless, other similar companies in far away lands profit, too, from a FOSS business model. I think that's good (of course, this present discussion is not about the 301 Report, which makes no judgment on the viability or preference of any certain business model. That “Special report” is about stealing – who, where, how. BRIC nations, plus Canada, among others, from last year's report).

    The end-goal should be – “what is the best, most cost-effective software / IT to provide government services to citizens?” Indigenous firms can do whatever they want to meet that goal – FOSS, proprietary, hybrid. A full range of options. But, government software preferences short-circuit that goal, placing the “wisdom” of regulators over the marketplace.

    Now, we gripe here when government spending hits 25% of GDP – a big chunk, in an OECD nation at that. $70 billion gets spent on federal IT procurement this year. In developing nations, the percentage of government spending to GDP is generally far higher. And, that's a powerful signal, because for many such markets, the government is the only game in town. So, when a preference – de jure, especially – gets put in place, depending on which side of the puzzle you sit, well, you can be SOL if you don't follow that model / preference.

    I know all the arguments on why “x” software is better than others. Who cares. They're nonsense. My preference is we let the marketplace sort this out with as few distortions as possible from clairvoyant government officials.

  • http://www.timothyblee.com/ Tim Lee

    Man, that's some serious cognitive dissonance. Remember, we're talking about government purchases of software. That's not something we can “let the marketplace sort out” by definition.

    To be clear, I'm not necessarily in favor of government-wide procurement rules. But the point is that there's no issue of libertarian principle here, and the US government has no business telling other countries what kinds of software they're allowed to buy.

  • mwendy

    Look. That's not what 301 is about. It doesn't say “x” model is better than any other. It's about stealing IP.

    Of course, as Tim Lee points out, FOSS can drive success in the marketplace, though no model guarantees it. Look at Red Hat, Sun, Oracle, IBM, Apple, even Microsoft. They recognize and exploit the model to their shareholder's interests, as well as society's interest.

    I also understand the loss-leader approach to many of these sub-models (companies noted above). I use WordPress. It's a great, “free” product. You know, I just experienced how they monetize that otherwise free offering. I just had to upgrade space so I could put this song on my blog page: http://polisonic.wordpress.com/2010/02/28/redis…. That cost about $18 bucks for the year / 5 gigs. And it's worth every penny.

    Any country is free to choose what they want. Though software costs are generally less than 10% of the TCO, for countries working to mandate free, well they get about a 10% bump, and then freedom, of course.

  • mwendy

    Believe me, Tim, with Big Blue's (and others') “help” / lobbying in writing the Special 301 Report, it does not say “Country “x”, don't acquire FOSS.” It does say, however, don't steal IP.

  • mwendy

    The free market is built on the rule of law, which provides certainty to market participants. It does not guarantee outcomes, but rather provides the standard by which individual conduct may be measured and directed. The rest is up to the market participants themselves.

  • http://www.cordblomquist.com cordblomquist

    mwendy, I know that 301 is about theft, the point of my post is that the IIPA is pushing to add preferences for open-source software to the list of reasons a country can be added to the list. I'm anti-piracy and pro-open-source at the same time. The US Trade Representative should recognize that a country can also hold these two positions and should therefore deny the IIPA's request that open-source preferences become a factor in 301.

  • mwendy

    Some policy makers get the idea that what they do in a procurement sense affects the marketplace – akin to monopsony. They are part of the marketplace, albeit a very large and growing part; they do not produce goods and services on their own. This is why the software preference debate (or the muni-provided telecom networks debate) is so important. Governments play a role in, and inform (potentially distort), the marketplace. The government's procurement girth has real, significant effect.

  • mwendy

    I've been in that very office, and they do recognize it. That said, IIPA's underlying reasoning remains sound – it's the “ask” (i.e, if a country “prefers” FOSS, they should go on the Special 301) that's not sound. Of course, that's jack. A government preference (for any type of software) is just a bad policy choice, not a reason to get perp-walked on the 301.

  • http://srynas.blogspot.com/ Steve R.

    The law is being subverted to grant patent holders and copyright holders so-called “rights” that they should not even possess. The consequence is patent/copyright holders are using legal fiction to claim theft, when they are the ones “stealing”.

  • MikeRT

    If that's the way you feel about it, then why keep bringing up the issue of theft as though to obliquely imply that open source vendors are stealing? Clearly, the IIPA is trying to make FOSS out to be something extremely dangerous and bad here.

  • MikeRT

    You have a skewed view of the government's role in the marketplace. The federal government is simply the largest “enterprise” in the United States. Its procurement rules are really no more capable of being “anti-market” than a private company's procurement rules. The worse case scenario is that the burden of contracting with them becomes sufficiently burdensome to make companies not want to deal with them. Of course, $70B is a big pie to divide, so many vendors don't mind.

    You also assume, incorrectly, that enterprise vendors are going to be competitive with FOSS in many poorer countries. Your average Latin American country doesn't have the funds to throw around Windows Server licenses like the federal government, let alone Oracle database licenses. For that reason alone, it makes sense for them to set a standard that mandates FOSS while allowing government managers to apply for waivers on a case-by-case basis.

  • tsydnor

    Cord, you say, “Governments, just like corporations, should be able to set preferences for open-source or proprietary software.” What about speech? Should they have “be able to set preferences” there, too? And, really, Cord, shouldn’t governments “be able to set” prices too?

    But, fine, Cord, let's play this your way. Even then, your argument is an exercise in self-contradiction. As you, (claim), to see it, any government should be able to “set” a “preference” for or against proprietary software. OK. But if the U.S has a “preference” for proprietary software, then only a hypocrite would whine and wail because the U.S. might dare to promote its own “preference” by using its trading power to disfavor other nations that disagree with the U.S. “preference.”

    Is that what you had in mind? Or did you just fail to think how absurd it is for any “libertarian” to start praising foreign governments for picking and choosing among software development methods? Indeed, we all know what would happen if the U.S. government adopted a proprietary-software “preference” analogous to the sort of FOSS-preference that you praise foreign governments for adopting: You, Tim, and the rest of your market-challenged buddies would throw a raving hissy fit—and justifiably so.

    Fortunately, you need not worry. Last I checked, the U.S. government—unlike the top-down, we-know-best governments that you and Tim Lee idolize—has rejected such a paternalistic approach to software development. Rather, when I was working on these matters, the U.S. position was quite clear: governments should not pick and choose among software development methods.

    Seriously, Cord. If, tomorrow, the U.S. government declared a governmental “preference” for Zune audio-player technology, you and many others would throw a well-deserved tantrum. But here you are, ranting about how unfair it is for the U.S. government to discourage foreign governments from declaring a “preference” for FOSS. Pardon me if I note the gangrene stench of hypocrisy oozing from your post.

    –Tom

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  • http://enigmafoundry.wordpress.com eee_eff

    Or why someone has suddenly offered more than 2X the stock price to buy Novell.

    Yes, Foss is disruptive to some existing business models, but that is the nature of innovation.

  • http://enigmafoundry.wordpress.com eee_eff

    “(of course, this present discussion is not about the 301 Report, which makes no judgment on the viability or preference of any certain business model. That “Special report” is about stealing – who, where, how. BRIC nations, plus Canada, among others, from last year's report).”

    No, Wendy it is exactly about the 301 report, because someone is trying to equate a different business model with theft.

    This attempt illuminates to me why I am so very opposed to the ACTA–it would be used by market incumbents to fight innovative companies.

  • http://enigmafoundry.wordpress.com eee_eff

    I have no problem with raising the issue of stealing IP. But that's not the context–if it were so, than FOSS business model would not have been singled out, instead “stealing” would have been.

  • http://enigmafoundry.wordpress.com eee_eff

    “but where ideas are stolen, then that should not”

    OK Wendy here is the very heart of the problem: ideas actually CANNOT be stolen, only the expression of those ideas when you speak of copyright.

    Perhaps you do mean Patent, in which case there are also very particular limits to which an idea alone can be protected.

    Let's Remember Thomas Jefferson's wonderful letter of August 13, 1813 to Isaac McPherson:

    “It would be curious then, if an idea, the fugitive fermentation of an individual brain, could, of natural right, be claimed in exclusive and stable property. If nature has made any one thing less susceptible than all others of exclusive property, it is the action of the thinking power called an idea, which an individual may exclusively possess as long as he keeps it to himself; but the moment it is divulged, it forces itself into the possession of every one, and the receiver cannot dispossess himself of it. Its peculiar character, too, is that no one possesses the less, because every other possesses the whole of it. He who receives an idea from me, receives instruction himself without lessening mine; as he who lights his taper at mine, receives light without darkening me. That ideas should freely spread from one to another over the globe, for the moral and mutual instruction of man, and improvement of his condition, seems to have been peculiarly and benevolently designed by nature, when she made them, like fire, expansible over all space, without lessening their density in any point, and like the air in which we breathe, move, and have our physical being, incapable of confinement or exclusive appropriation. Inventions then cannot, in nature, be a subject of property. Society may give an exclusive right to the profits arising from them, as an encouragement to men to pursue ideas which may produce utility, but this may or may not be done, according to the will and convenience of the society, without claim or complaint from anybody.

  • http://enigmafoundry.wordpress.com eee_eff

    “Patents are ways of protecting the incentives to create. No one claims the system is perfect. But the fundamental idea still holds true. That balance is being worked out in Congress, the PTO, the EPO, etc. The question remains – how do you promote people to create very complex things, with very complex ideas, at great cost? IPR.”

    Yes, Wendy, Patents are ONE way to protect creations. Copyright is another. Trademark is another. It is not automatic how certain classes of creations should be protected. As an Architect, my experience has been that nearly all of what I design should be protected by copyright, occasionally, and very rarely, Patents are appropriate.

    What is appropriate for software? Some believe copyright, other Patents. Branding those who come to one conclusion as “criminals” is simply not correct, and unnecessarily polarizes the debate about this important issue.

  • http://enigmafoundry.wordpress.com eee_eff

    Steve:
    Exactly right. Property begins and ends with the law, and has no separate existence outside the law. What exactly that law is, and what the extent of the protection that should be offered is a matter of debate, a social negotiation. Branding those who disagree about the social utility of certain laws as “thieves” or “Pirates” is ploy by those advocate certain ideas of coloring the debate by using false metaphors. This is William Patry's central thesis in his book “Moral Panics and the Copyright Wars”

  • http://enigmafoundry.wordpress.com eee_eff

    Tsydnor:

    You owe Tim Lee an apology. I have had many exchanges with Tim, and we agree on some things disagree on others. But the quote “we-know-best governments that you and Tim Lee idolize” does NOT represent Tim Lee's views in any respect.

    Secondly, if a government, as a purchaser of software, wants to have a preference that is perfectly fine, as long as that preference is consistent with that governmental unit's goals, and is cost effective.

    But what we are talking about here is the US government being urged to equate use of certain software with “theft” That is not right, and that is not consistent with the actual purpose of the Section 301 list. (see: http://www.ustr.gov/sites/default/files/asset_u…)

    The “Special 301” Report is an annual review of the global state of intellectual property rights (IPR) protection and enforcement, conducted by the Office of the United States Trade Representative (USTR) pursuant to Special 301 provisions of the Trade Act of 1974 (Trade Act). The 2008 Special 301 review process examined IPR protection and enforcement in 78 countries. Following extensive research and analysis, USTR designates 46 countries in this year’s Special 301 Report in the categories of Priority Watch List, Watch List, and/or Section 306 Monitoring status.

  • http://enigmafoundry.wordpress.com eee_eff

    Tsydnor:

    Do you find it ironic that you are criticizing others for not being “libertarians” when you are defending the US governments intervention in markets, by using the 301 watch list?

  • tsydnor

    Dear eee_eff:

    This is Tom Sydnor. Thank you for your responses. For three reasons, I find them wholly nonresponsive.

    First, I owe Tim Lee no apology—none. Where FOSS is concerned, Tim, like Cord, favors government-knows-best paternalism blended with the heaping helping of hypocrisy required to praise foreign governments for using their sovereign powers to express their “preference” for FOSS while condemning the U.S. government for using its sovereign powers to express its “preference” for letting private parties—not governments—decide which software-development methods produce the best software. Their world-view is thus both anti-libertarian and anti-American. Fortunately, I also suspect that it is also too hypocritical and result-driven to do much harm.

    Nor is this incident isolated: Tim has repeatedly documented his willingness to throw real-world markets out the window to indulge the incoherence of his fetish for FOSS, his irrational contempt for non-FOSS copyrights and his affectation for the socialism of Ebin Moglin. Here, for example, is what happened to blogger-boy Matthew Yglesias after he made the fatal error of deriving his “views” about copyrights from those of Tim Lee:

    http://blog.pff.org/archives/2010/02/copyrights

    As for the root causes of this ugly Yglesias “fail,” here is a prime example of Lee, at his new blog, “thinking” about the economics of authorship:

    “The obvious point is that the marginal cost of ‘producing’ and distributing a new copy of an eBook is very close to zero. So assuming a competitive market, we should expect prices to be pushed down to zero.”

    Contemplate, eee_eff, the sheer reality-defying inanity of Lee’s claim. It cannot be rationalized by any known form of market economics. Nor does Lee himself believe it: if he did, he would have to oppose the GPL as just one more barrier to the “competitive” solution in which the work of authors, performers, directors and programmers attains its “true” economic value—$0. And note that in his haste to denigrate copyrights and authors, young Master Lee happily decreed every known market for every known high-tech product or service to be “noncompetitive”: according to Lee, a “competitive” market prices products at their marginal cost of production. That means that any profit-making tech company is operating in a non-competitive market. If Lee actually believes this, then he will surely call Christine
    Varney at the Antitrust Division at DOJ to alert her to this massive, tech-industry-wide market failure….

    So, seriously, eee_eff, if you want to know what “owing someone an apology” actually looks like, here is a link that will illuminate the concept:

    http://blog.pff.org/archives/2009/08/copyright-

    I’m still waiting for my apology, but I’m not holding my breath.

    Second, let me get this straight, eee_eff: You honestly believe that IIPA, whose members include BSA, (and thus IBM), filed a document with the U.S. government that equated IBM’s use of FOSS with “theft”? That… makes sense to you? Really?

    Third, eee_eff, have you noticed that your comments add nothing substantive? You ask, “Do you find it ironic that you are criticizing others for not being ‘libertarians’ when you are defending the US governments intervention in markets, by using the 301 watch list?” Here is my answer: “No, but I do find it ironic that your response just regurgitated the same fallacy that prompted my critique of Cord.” You merely restated Cord’s its-a-“preference”-when-Brazil-does-it-but-“intervention”-when-America-does-it fallacy. I caught that fallacy the first time: what made you think that I would overlook its repetition?

    Governments can use trade policy to—as you put it—“intervene[e] in markets” in ways that encourage or discourage the development of free markets and private ordering. Indeed, every government probably uses trade policy to do both simultaneously. A given government’s international-trade priorities will likely focus on areas in which its citizens are very competitive, (in which case, its trade policy is likely to strongly favor market-based solutions), and on areas in which its citizens would otherwise be utterly uncompetitive (in which case, the same trade policy is likely to be as protectionist, paternalistic, and statist as Soviet central planning).

    Fortunately for me, in the context of expression, the phrase “very competitive” understates the reality of American success. We are the world’s leading producers and net exporters of a vast array of copyrighted expressive works. Consequently, American copyright-related trade policies tend to be extremely market-friendly: At least when I was explaining those policies to our trading partners, America merely wants government to define copyrights appropriately, to ensure that they can be enforced effectively in practice, and to let private preferences dictate outcomes so that our creators can compete in foreign markets against locals who enjoy many inherent financial and cultural advantages. And you would be surprised, eee_eff, how often foreign officials would actually blurt out replies along the lines of, “But if we did that, you Americans could be TOO successful in our country….”

    Hence the banal fallacy to which you and Cord must resort. You pretend that when a foreign government uses its sovereign power to decree its “preference” for dealing with American software developers who use FOSS, (or proprietary) methods, why that government is just acting as a normal market participant, no different, really, from me, you, or Cindy Lou Who, who was no more than two…. But if the U.S. uses its sovereign power to enforce a “preference” for letting truly private, nongovernmental actors decide whether FOSS or proprietary methods work best, well—oh, the humanity—that horribly illiberal America is engaging in evil governmental “intervention in markets.”

    If you really think that, eee_eff,—if you really want to draw that distinction—may I gently suggest that you first spend the next few years digesting a slim little tome entitled The Federal Acquisition Regulation (FAR). No words of mine could convey to you—certainly not in such numbing, dumbfounding detail—the all-too-obvious truth that governments that have acquired multi-billion-dollar leverage against even the largest private entities by exercising coercive powers of taxation, nationalization, and law-making are not REALLY normal market participants like me, you, and Cindy Lou Who….

    In short, foreign-government “preferences” for or against FOSS or proprietary software ARE a form of governmental “intervention in markets.” To the extent that the U.S. counters them by using the Special 301 process, FTAs, or other aspects of U.S. trade policy to discourage such governmental interventions in markets, then U.S. trade policy, is, at least for now and in this respect, luminously libertarian in its objectives. I thus remain proud to support our government’s efforts to ensure that software development methods are dictated by actual people and actual markets—not by politics, bureaucrats, and governments.

    In closing, I note that my own views on FOSS are precisely what the above would suggest: FOSS is not a secular religion; it is one of several methods of developing software. Laws should favor neither developers who believe in FOSS, nor those who believe in proprietary methods. Well-designed property rights should protect a wide array of business models, including proprietary models, cross-subsidized models, FOSS, and Creative Commons. Copyrights do just that.

    –Tom Sydnor.

  • tsydnor

    Dear eee_eff:

    This is Tom Sydnor. Thank you for your responses. For three reasons, I find them wholly nonresponsive.

    First, I owe Tim Lee no apology—none. Where FOSS is concerned, Tim, like Cord, favors government-knows-best paternalism blended with the heaping helping of hypocrisy required to praise foreign governments for using their sovereign powers to express their “preference” for FOSS while condemning the U.S. government for using its sovereign powers to express its “preference” for letting private parties—not governments—decide which software-development methods produce the best software. Their world-view is thus both anti-libertarian and anti-American. Fortunately, I also suspect that it is also too hypocritical and result-driven to do much harm.

    Nor is this incident isolated: Tim has repeatedly documented his willingness to throw real-world markets out the window to indulge the incoherence of his fetish for FOSS, his irrational contempt for non-FOSS copyrights and his affectation for the socialism of Ebin Moglin. Here, for example, is what happened to blogger-boy Matthew Yglesias after he made the fatal error of deriving his “views” about copyrights from those of Tim Lee:

    http://blog.pff.org/archives/2010/02/copyrights

    As for the root causes of this ugly Yglesias “fail,” here is a prime example of Lee, at his new blog, “thinking” about the economics of authorship:

    “The obvious point is that the marginal cost of ‘producing’ and distributing a new copy of an eBook is very close to zero. So assuming a competitive market, we should expect prices to be pushed down to zero.”

    Contemplate, eee_eff, the sheer reality-defying inanity of Lee’s claim. It cannot be rationalized by any known form of market economics. Nor does Lee himself believe it: if he did, he would have to oppose the GPL as just one more barrier to the “competitive” solution in which the work of authors, performers, directors and programmers attains its “true” economic value—$0. And note that in his haste to denigrate copyrights and authors, young Master Lee happily decreed every known market for every known high-tech product or service to be “noncompetitive”: according to Lee, a “competitive” market prices products at their marginal cost of production. That means that any profit-making tech company is operating in a non-competitive market. If Lee actually believes this, then he will surely call Christine
    Varney at the Antitrust Division at DOJ to alert her to this massive, tech-industry-wide market failure….

    So, seriously, eee_eff, if you want to know what “owing someone an apology” actually looks like, here is a link that will illuminate the concept:

    http://blog.pff.org/archives/2009/08/copyright-

    I’m still waiting for my apology, but I’m not holding my breath.

    Second, let me get this straight, eee_eff: You honestly believe that IIPA, whose members include BSA, (and thus IBM), filed a document with the U.S. government that equated IBM’s use of FOSS with “theft”? That… makes sense to you? Really?

    Third, eee_eff, have you noticed that your comments add nothing substantive? You ask, “Do you find it ironic that you are criticizing others for not being ‘libertarians’ when you are defending the US governments intervention in markets, by using the 301 watch list?” Here is my answer: “No, but I do find it ironic that your response just regurgitated the same fallacy that prompted my critique of Cord.” You merely restated Cord’s its-a-“preference”-when-Brazil-does-it-but-“intervention”-when-America-does-it fallacy. I caught that fallacy the first time: what made you think that I would overlook its repetition?

    Governments can use trade policy to—as you put it—“intervene[e] in markets” in ways that encourage or discourage the development of free markets and private ordering. Indeed, every government probably uses trade policy to do both simultaneously. A given government’s international-trade priorities will likely focus on areas in which its citizens are very competitive, (in which case, its trade policy is likely to strongly favor market-based solutions), and on areas in which its citizens would otherwise be utterly uncompetitive (in which case, the same trade policy is likely to be as protectionist, paternalistic, and statist as Soviet central planning).

    Fortunately for me, in the context of expression, the phrase “very competitive” understates the reality of American success. We are the world’s leading producers and net exporters of a vast array of copyrighted expressive works. Consequently, American copyright-related trade policies tend to be extremely market-friendly: At least when I was explaining those policies to our trading partners, America merely wants government to define copyrights appropriately, to ensure that they can be enforced effectively in practice, and to let private preferences dictate outcomes so that our creators can compete in foreign markets against locals who enjoy many inherent financial and cultural advantages. And you would be surprised, eee_eff, how often foreign officials would actually blurt out replies along the lines of, “But if we did that, you Americans could be TOO successful in our country….”

    Hence the banal fallacy to which you and Cord must resort. You pretend that when a foreign government uses its sovereign power to decree its “preference” for dealing with American software developers who use FOSS, (or proprietary) methods, why that government is just acting as a normal market participant, no different, really, from me, you, or Cindy Lou Who, who was no more than two…. But if the U.S. uses its sovereign power to enforce a “preference” for letting truly private, nongovernmental actors decide whether FOSS or proprietary methods work best, well—oh, the humanity—that horribly illiberal America is engaging in evil governmental “intervention in markets.”

    If you really think that, eee_eff,—if you really want to draw that distinction—may I gently suggest that you first spend the next few years digesting a slim little tome entitled The Federal Acquisition Regulation (FAR). No words of mine could convey to you—certainly not in such numbing, dumbfounding detail—the all-too-obvious truth that governments that have acquired multi-billion-dollar leverage against even the largest private entities by exercising coercive powers of taxation, nationalization, and law-making are not REALLY normal market participants like me, you, and Cindy Lou Who….

    In short, foreign-government “preferences” for or against FOSS or proprietary software ARE a form of governmental “intervention in markets.” To the extent that the U.S. counters them by using the Special 301 process, FTAs, or other aspects of U.S. trade policy to discourage such governmental interventions in markets, then U.S. trade policy, is, at least for now and in this respect, luminously libertarian in its objectives. I thus remain proud to support our government’s efforts to ensure that software development methods are dictated by actual people and actual markets—not by politics, bureaucrats, and governments.

    In closing, I note that my own views on FOSS are precisely what the above would suggest: FOSS is not a secular religion; it is one of several methods of developing software. Laws should favor neither developers who believe in FOSS, nor those who believe in proprietary methods. Well-designed property rights should protect a wide array of business models, including proprietary models, cross-subsidized models, FOSS, and Creative Commons. Copyrights do just that.

    –Tom Sydnor.

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