Today, the Obama administration announced 5 executive actions it is taking and 7 legislative proposals it is making to address the problem of patent trolls. While these are incremental steps in the right direction, they are still pretty weak sauce. The reforms could alleviate some of the litigation pressure on Silicon Valley firms, but there’s a long way to go if we want to have a patent system that maximized innovation.

The proposals aim to reduce anonymity in patent litigation, improve review at the USPTO, give more protection to downstream users, and improve standards at the International Trade Commission, a venue which has been gamed by patent plaintiffs. These are all steps worth taking. But they’re not enough. The White House’s press release quotes the president as saying that “our efforts at patent reform [i.e. the America Invents Act, passed in 2011] only went about halfway to where we need to go.” Presumably the White House believes these steps will take us the rest of the way there.

But the problem with computer-enabled patents isn’t merely that they result in a lot of opportunistic litigation, though they do. The problem is that almost every new idea is actually pretty obvious, in the sense that it is “invented” at the same time by lots of companies that are innovating in the same space. Granting patents in a field where everyone is innovating in the same way at the same time is a recipe for slowing down, not speeding up, innovation. Instead of just getting on with the process of building great new products, companies have to file for patents, assemble patent portfolios, license patents from competitors who “invented” certain software techniques a few months earlier, deal with litigation, and so on. A device like a smartphone requires thousands of patents to be filed, licensed, or litigated.

If we really want to speed up innovation, we need to take bolder steps. New Zealand recently abolished software patents by declaring that software is not an invention at all. It would be terrific if the White House would get behind that kind of bold thinking. In the meantime, we’ll have to watch closely as the Obama administration’s executive actions are implemented and its legislative recommendations move through Congress. I hope for the best, but for now I’m not too impressed.

I just finished Ken Auletta’s latest book, Googled: The End of the World As We Know It, and I highly recommend it. Auletta is an amazingly gifted journalist and knows how put together a hell of good story.  It helps in this case that he was granted unprecedented access to the Google team and their day-to-day workings at the Googleplex. I’m really shocked by the level of access he was granted to important meetings and officials–over 150 interviews with Googlers, including 11 with CEO Eric Schmidt and several with founders Sergey Brin and Larry Page.  That’s impressive.

The book shares much in common with Randall Stross’s excellent Planet Google: One Company’s Audacious Plan to Organize Everything We Know, which I reviewed here earlier this year.  Both books recount the history of Google from its early origins to present. And both survey a great deal of ground in terms of the challenges that Google faces as it matures and the policy issues that are relevant to the company (privacy, free speech, copyright law, etc).

What makes Auletta’s book unique is the way we taps his extensive “old media” world contacts and integrates such a diverse cast of characters into the narrative — Mel Karmazin (former Viacom, now Sirius XM), Bob Iger (Disney), Howard Stringer (Sony), Martin Sorrrell (WPP), Irwin Gotlieb (Group M), and even the Internet’s “inventor”–Al Gore!   Auletta interviews them or recounts stories about their interactions with Google to show the growing tensions being created by this disruptive company and its highly disruptive technologies.  There are some terrifically entertaining anecdotes in the book, but the bottom line is clear: Google has made a lot of enemies in a very short time.

Indeed, the book is as much about the decline of old media as it is about Google’s ascendancy.  What Auletta has done so brilliantly here is to tell their stories together and ask how much old media’s recent woes can be blamed on Google and digital disintermediation in general. “If Google is destroying or weakening old business models,” Auletta argues, “it is because the Internet inevitably destroys old ways of doing things, spurs ‘creative destruction.’ This does not mean that Google is not ambitious to grow, and will not grow at the expense of others. But the rewards, and the pain, are unavoidable,” he concludes. Google is essentially just the tip of a giant wave of digital disintermediation that is tearing through the media landscape, Auletta argues. But because it is the biggest and most visible part of this wave, it invites greater scrutiny and scorn.  And then there are more profound questions about Google and the digital disintermediators: “What we don’t know is whether the new digital distribution systems will generate sufficient revenue to adequately pay content providers.”  Auletta isn’t just talking about old media giants, but about content creators in general. It’s the “digital sharecropper” concern that Nick Carr has articulated in his book about cloud computing, The Big Switch. [reviewed here]  In the relentless pursuit of greater efficiencies, do digital disintermediators destroy the cross-subsidization methods that have traditionally funded the creation of news, information, and entertainment? If so, are we better off because older, “less efficient” ways of doing business are replaced with better ones. Or are we instead left with less high-quality journalism and entertainment because of funding streams are drying up or being siphoned off by the new digital disintermediators?

Those are heated question frequently debated by Internet optimists and pessimists. It’s a great debate, and one that will no doubt continue to rage for many years to come. The problem for Google — as the interviews Auletta conducts with others in the book makes clear — is that it will increasingly become the scapegoat for every problem under the digital sun. “To blame Google is to prescribe a cure from the wrong illness,” Auletta notes.  Nonetheless, as the biggest and most visible of the digital disruptors, it’s clear the company will have a target on its back for many years to come.

Worse yet for Google, Aulleta states, is that the company is “waking the government bear,” not just because of its growing size but also because of the sheer amount of information it collects and puts at the world’s disposal.  Privacy, child safety, defamation, and copyright are just a few of the concerns raised by Google’s mission “to organize the world’s information and make it universally accessible and useful.”  Google has gone to great pains to address these concerns, but it’s unlikely to ever be enough to satisfy government officials, who will be fielding increasing complaints from disgruntled competitors and activist groups at the same time.

These concerns could play into the hands of those who think antitrust action against Google is needed. Indeed, I fear that’s on the way given the myopia of Washington. As I pointed out in my lengthy review of Gary Reback’s ode to antitrust regulation, Free the Market: Why Only Government Can Keep the Marketplace Competitive, the static competition, fixed-pie mindset that rules Washington leads many to support antitrust crusades against the tech giants of the day.  In the 70s it was IBM. In the 90s it was Microsoft.  In the next decade it will likely be Google.

“Today, Google appears impregnable,” Auletta notes, “But a decade ago so did AOL, and so did the combination of AOL Time Warner.”  Indeed, I have written extensively about that deal and many others that critics predicted would bring on a techno-apocalypse.  Of course, we know how the story ended in those cases. Markets and technologies evolved while the old giants rested on their laurels. Dynamic competition and innovation are the rule; the static mindset crowd that pretends today’s giants are the end of the story just don’t have history on their side.

But that doesn’t mean Google will be able to avoid a massive regulatory onslaught. In fact, I have pending bets going right now with several friends that, before the Obama Administration leaves office, it will launch the biggest, most costly antitrust jihad in U.S. history against Google.  I can’t tell you how much I am hoping to lose those bets.

P.S. I have enjoyed many of Auletta’s earlier articles and books, especially Backstory: Inside the Business of News (2003),  but I highly recommend that you check out the latest essay he posted on his blog about “Media Maxims.”  Outstanding insights.

A number of conservative blogs have picked up on reports that the Obama administration is looking to data mine users on social networking sites. Reports CNS News:

Anyone who posts comments on the White House’s Facebook, MySpace, YouTube and Twitter pages will have their statements captured and permanently archived by the federal government, according to a plan that the White House is now seeking a contractor to carry out.

Whenever government is collecting information about private citizens, we should be concerned. But this controversy smells a lot like privacy fear-mongering, even though it involves government. If you post a comment to an “official” Obama administration page on a social networking site, it seems only natural that it’s fair game for data mining. The same goes if you post a video response on a publicly accessible site.

If you’re posting controversial statements online under your real name for the public to see, what do you expect will happen? Anybody in the world who has an Internet connection can log your postings, so why shouldn’t government officials be able to do the same? Until government starts pressuring Facebook or Myspace to hand over data that’s being collected on an involuntary basis, I don’t see a whole lot here to worry about.

This controversy, and the flap over flag@whitehouse.gov from a few weeks back, raise another interesting question: should Congress reexamine the Presidential Records Act (PRA) of 1978? This is the law that governs Presidential record-keeping. According to some commentators, if the administration solicits data on its critics, it is obligated under the PRA to retain that data indefinitely. I haven’t read the law, but at first glance it appears that it may have some serious deficiencies. This is is hardly surprising, of course, given that the Internet — let alone social networks — didn’t even exist when the PRA was enacted in 1978.

I was very pleased to read in Federal Computer Week this morning that the Office of Management and Budget will begin tracking earmark requests next year for the fiscal 2011 budget cycle.

OMB makes available some years’ approved earmarks, but not the earmark requests put forward by members of Congress. Tracking and publishing requests will shed light on the whole ecosystem of congressional earmarks—the favor factory, if you will.

OMB’s move follows a project WashingtonWatch.com has conducted this summer: asking the public to plug earmark disclosures into a database. The site now maps over 20,000 earmarks. (Well, technically, that much data breaks the mapping tool, but you can see state-by-state earmark maps.)

Earlier this year, the House and Senate Appropriations Committees required their members to disclose earmark requests. These disclosures—published as Web pages and PDF documents—were not useful, but public interest in this area is strong, and the public made them useful by entering them into WashingtonWatch.com’s database.

The project isn’t over, by the way, and the current focus is collecting earmarks requested by Appropriations Committee members.

It’s great news that next year the Obama Administration will track and disclose earmarks, from request all the way through to enactment. Given his struggle in the area lately, this is a chance to score some transparency points. President Obama campaigned against earmarks, promising reform, and this is an important step toward delivering on that promise.

More restraint is in order when it comes to the Obama administrations intent to escalate “antitrust” enforcement against business and enterprise in America.

A skeptical interpretation of antitrust’s realities—up to and including recent campaigns targeting Intel, Google, XM-Sirius; and earlier campaigns against Microsoft and the AOL Time Warner merger, as well as rejected mergers like Echostar/DirecTV—is that antitrust often advances the well being of various species of political predators rather than consumers.

Antitrust is a form of economic regulation. And like all economic regulation, it transfers wealth from somebody to somebody else, often in response to special-interest urging. Partly in recognition of such shortcomings, many economic sectors like transportation and telecommunications were (partly) deregulated and liberalized during the last quarter of the 20th century. But antitrust regulation typically gets a pass. Even in the “new economy,” this century-old smokestack era concept is used to justify constraints and conditions imposed on vigorously competitive modern companies. Antitrust is wrongly seen as being in the public interest, as having a superior role to play in policing markets relative to the alternatives.

In antitrust cases, targeted companies’ rivals have a direct financial interest in the outcome. Appeals to antitrust as a public interest law do not change the fact that private motives of rivals, and even ambitious enforcers, are not simply lurking in the background, but running the show. The idea that antitrust helps consumers and that it has a role to play in the new economy deserves reexamination and challenge.

Under antitrust law, a laundry list of business practices (tying, bundling, discrimination, exclusive deals, and so on) are regarded suspiciously, some outlawed altogether. But business transactions are fundamentally voluntary, non-coercive dealings—unlike the forced antitrust interventions that rivals often seek. From this fresh perspective, one finds that even the most “despised” business behaviors—even collusion and mega-mergers—can be pro-competitive and pro-consumer. To the extent that antitrust regulation strikes down practices that have misunderstood or ignored efficiency justifications, especially in an information-based economy, individuals and society are made unnecessarily poorer.

The list of vilified business practices is long, but needn’t be, and we often try to explain why. If anyone cares about economic recovery and jobs, today’s aim should be to “deregulate to stimulate,” so a list of vilified trustbuster practices would be far more advantageous to consumers.

According to the Threat Level blog, the Obama Administration has declared the text of a proposed Anti-Counterfeiting Trade Agreement a national security secret.

Thing is . . . it can’t be. And that would also be contrary to Obama administration policy.

. . . or does he?

Friday afternoon, the White House blog announced that the American Recovery and Reinvestment Act of 2009 was posted online for public comment. This is good evidence that the President intends to honor his campaign promise to post legislation online and take public comment for five days before signing it.

But it’s not great evidence of that.

The Whitehouse.gov post went up at 2:05 pm, but the House didn’t vote until 2:24 pm and the Senate voted at 05:29 pm. (Click on the “votes” to see how your representatives did.) As of Saturday afternoon, the Thomas legislative tracking system doesn’t indicate that the bill has been presented to the President yet. And news reports indicate that the President will sign the bill on Monday, three days after it was “pre-“posted.

Regular order, Mr. President. When a bill is presented to you, post it online (at a consistent place on your Web site, not just at ad hoc URLs as you’ve done up to now). Then wait five days, reviewing the comments of the public as you promised to do when you asked the public to elect you.

The steps the White House has taken toward implementing the President’s promise are good steps. (In this Cato daily podcast, I characterized the President’s record on transparency so far as “mixed.”) But the promise is not fulfilled until bills receive five days online airing after they have been presented.

Presentment is a distinct, constitutional step in the legislative process. Until every non-emergency bill is posted online for five days after presentment and before signing, President Obama will look like he’s being driven by events and maneuvered by his elders in Congress.

I’ve been following President Obama’s early moves on government transparency here on Tech Liberation and on the Cato@Liberty blog.

Last week, Obama’s first broken campaign promise was the pledge to post legislation online for five days before signing it.

Well, the White House is working to address that, but it appears to be doing so with a half-measure that comes up short. On Sunday, the White House blog announced that the SCHIP legislation pending in the Senate was up for public comment. And it is, of course, but it hasn’t passed the Senate yet.

It was implicit in the promise to post bills online for five days prior to signing that the bill posted would be the one passed by the House and Senate and presented to the President.

If the White House were to implement the promised practice of leaving bills sitting out there, unsigned, after they pass Congress, that would have significant effects. The practice would threaten to reveal excesses in parochial amendments and earmarks which could bring down otherwise good bills. President Obama’s promised five-day cooling off period would force the House and Senate to act with more circumspection.

Taking comments on a bill as it makes its way through the House and Senate does not have the same salutary effect. If the White House is trying to start the five-day clock on the SCHIP bill with the posting of a comment page on Sunday, that is not consistent with President Obama’s promise.

The Washington Post reports that the Obama administration is delaying the Bush Administration plan to require federal contractors to use the E-Verify worker background check system.

Criticizing the move, Lamar Smith (R-TX), ranking minority member on the House Judiciary Committee says, “It is ironic that at the same time President Obama was pushing for passage of the stimulus package to help the unemployed, his Administration delayed implementation of a rule designed to protect jobs for U.S. citizens and legal workers.”

E-Verify may well have been designed or intended to protect jobs for citizens and legal workers, but that’s not at all what it would do. I wrote about it in a Cato Policy Analysis titled “Electronic Employment Eligibility Verification: Franz Kafka’s Solution to Illegal Immigration” (a ten-year follow-on to Stephen Moore’s “A National Id System: Big Brother’s Solution to Illegal Immigration“):

A mandatory national EEV system would have substantial costs yet still fail to prevent illegal immigration. It would deny a sizable percentage of law-abiding American citizens the ability to work legally. Deemed ineligible by a database, millions each year would go pleading to the Department of Homeland Security and the Social Security Administration for the right to work.

Even if E-Verify were workable, mission creep would lead to its use for direct federal control of many aspects of American citizens’ lives. Though it should be scrapped, the longer E-Verify is delayed the better.

In at least two recent stories, the mainstream press are highlighting Obama administration slow-walking on transparency.

Bloomberg recently filed suit against the Fed under the Freedom of Information Act to force disclosure of securities the central bank is taking as collateral for $1.5 trillion of loans to banks.

“The American taxpayer is entitled to know the risks, costs and methodology associated with the unprecedented government bailout of the U.S. financial industry,” said Matthew Winkler, the editor-in-chief of Bloomberg News, a unit of New York-based Bloomberg LP . . . .

And here’s what President Obama said in his day-one memorandum on FOIA:

The Freedom of Information Act should be administered with a clear presumption: In the face of doubt, openness prevails. The Government should not keep information confidential merely because public officials might be embarrassed by disclosure, because errors and failures might be revealed, or because of speculative or abstract fears. Nondisclosure should never be based on an effort to protect the personal interests of Government officials at the expense of those they are supposed to serve. In responding to requests under the FOIA, executive branch agencies (agencies) should act promptly and in a spirit of cooperation, recognizing that such agencies are servants of the public.

Politico notes that the Obama team has failed to make financial disclosure information available in electronic form, detailing the cumbersome process of getting access to these public documents from the Office of Government Ethics. It starts with already potentially long delays for legal review and “certification”:

Even then, in order to actually obtain the disclosures, requestors have to print and fill out a form posted on the office’s website. It asks which disclosures are being requested and the requestor’s name, address, phone number, occupation and signature – information the form says can be passed along to law enforcement, congressional offices or private contractors working for the federal government. Completed forms then have to be faxed to the office. They can’t be e-mailed. And requests for disclosures of officials whose last names begin with “A” through “L” go to one employee, while requests for disclosures of officials whose last names begin with “M” through “Z” go to another. . . . They’re not scanned or recorded electronically, though, so requestors have to make arrangements to have the forms mailed or picked up at the agency’s office, where a receptionist dispenses the disclosures after yet another signature – this one on a carbon-paper copy of the original form. And, to get other technically public disclosure documents such as appointees’ ethics agreements and waivers, requestors have to use different forms and may have to deal with other agencies and their request procedures.

At least the Office of Government Ethics lists the administration officials about whom copies of documents can be ordered on its Web site. That’s a start!

These are run-of-the-mill bureaucratic impediments to transparency, so I don’t count them as Obama administration “steps away from transparency.” But these impediments exist in part because they maintain the obscurity of government bureaucracies and officials, and the freedom of action of these agencies and people vis à vis voters.

The Obama administration will have to root them out and fight them aggressively, or else the early talk of transparency will be mere words.

My post yesterday wondering aloud whether the Obama administration was walking away from its transparency commitments was slightly premature. Memoranda were being issued/reported on as I wrote, and this morning’s Washington Post describes some of the technical glitches that befuddled White House staff on day one. The texts of the executive orders President Obama signed yesterday are now online, but his memoranda on transparency aren’t yet. Helpfully, they’ve been posted by the Sunlight Foundation.

But I think my post was sound in the main, because I was looking for actual pro-transparency deeds from the new administration, and they haven’t materialized. I appreciate the sentiments voiced in these documents, but don’t find myself wholly impressed with the actual transparency measures the White House has taken.

What I’m hearing is the transparency dog that didn’t bark: The Obama team set a great precedent in the transition with the Seat at the Table program, but there’s no sign that such a thing will be implemented in the White House. Why not?

We can expect an “Open Government Directive” within 120 days and new guidelines for the Freedom of Information Act, but I would have appreciated seeing President Obama’s commitment to openness illustrated the best way possible: through the direct and immediate commitment of his own White House operation.

The White House will not be run as openly as the transition was. The agencies, already predisposed against transparency, will see this as a sign of weak commitment and will whittle away even more fiercely at the good sentiments President Obama’s expressed in his transparency memoranda.

(“Thanks for inviting me!” said the skunk at the garden party.)

The new Whitehouse.gov went live shortly after Barack Obama became president yesterday. It has much of the look and feel of his transition Web site, Change.gov.

Among the featured items on the homepage today (they will change regularly, of course) is the site itself and the new administration’s commitment to transparency. However, the actual terms of that commitment come up pretty anemic.

In a post on the White House blog, Director of New Media Macon Phillips says:

President Obama has committed to making his administration the most open and transparent in history, and WhiteHouse.gov will play a major role in delivering on that promise. The President’s executive orders and proclamations will be published for everyone to review, and that’s just the beginning of our efforts to provide a window for all Americans into the business of the government. You can also learn about some of the senior leadership in the new administration and about the President’s policy priorities.

Executive orders and proclamations? Information about senior leadership and the President’s priorities? That’s not breaking any new ground on transparency.

The transition’s “Seat at the Table” program required “any documents from official meetings with outside organizations [to] be posted on our website for people to review and comment on.”

The decision to port this practice over to the White House has either not been made, or has been decided against. Given that meetings are already happening, it will be a tough policy to implement if it is not implemented right away.

There is an “Office of Public Liaison” (and intergovernmental affairs) on the Whitehouse.gov site, but it’s nothing more than an email submission form at this point. “More ways for you to interact” are promised.

Words aren’t deeds, and it’s already too late to demonstrate a day-one commitment to transparency. Let’s hope the first steps of the new administration are not steps away from the important transparency precedents set by the transition.

Update: As I wrote this post, news stories were coming out about new executive orders coming out dealing with ethics and transparency. Though I haven’t been able to find them yet – hint hint, Whitehouse.gov – the change to the interpretation of FOIA sound like a welcome, if modest, step in the right direction.

The memo from John Podesta articulating the transition’s “‘Seat at the Table’ Transparency Policy” is redacted. Redactions are kind of a red flag to transparency fiends, but they’re probably appropriate (a name, an email address).

The overall “Seat at the Table” program is a decent step forward. You can get a look at the documents submitted to the transition, search them (somewhat clumsily – and not more often than once every 15 seconds), and comment on them.

So carry on transparently, Change.gov!

Jesse Walker has a terrific feature story looking “Beyond the Fairness Doctrine” in this month’s issue of Reason magazine. I highly recommend it. It’s an in-depth exploration of what an Obama Administration means for the future of tech and media policy. Walker rightly opens the piece by noting that “The fairness doctrine is still dead, and it probably will stay dead even if Barack Obama becomes president.” The danger, however, is that an Obama FCC will still pursue a variety of onerous regulatory objectives that could do a great deal of damage to markets and free speech.

Walker touches upon the various issues that will likely be a priority for an Obama Administration and the Left-leaning media reformistas like Free Press, Media Access Project, Public Knowledge, and New America Foundation. Those policy issues include: net neutrality, “localism” mandates and increased “community oversight” regulations, media ownership rules, minority ownership requirements, increased merger meddling, spectrum policy, and other new “public interest” obligations.

Of course, as Walker also correctly points out, it is difficult to see how things could get much worse than they have been under Bush Administration’s FCC and the leadership of Chairman Kevin Martin.  Walker was kind enough to quote my thoughts on this point: “Martin is the most regulatory Republican FCC Chairman in decades,” I told him. “He wants to control speech and will use whatever tools he has to get there.”

I stand by those words, but I am also aware that things could get worse — much worse — under a Democratic FCC influenced by radical Leftist activists like Free Press.  Indeed, in our new book A Manifesto for Media Freedom, Brian Anderson and I inventory the many looming threats to media and technology freedom that exist today and show how most of them arise from the Left.  As Walker notes in his article, however, it is unlikely that a re-empowered Democratic FCC would come right out of the gates with the same sort of command-and-control approaches they’ve employed in the past.  And we’ll still have to worry about some right-of-center lawmakers and regulatory joining some of these misguided campaigns. “The real danger,” Walker concludes in his piece, “is more subtle and more mundane.  It’s a bipartisan bureaucracy slowly, steadily increasing its power.”    Make sure to read Jesse’s entire piece.  Great stuff.