My former colleague Dan Griswold has a typically lucid article over at The American on iPods and the trade deficit:
As I was admiring the cool design and user-friendly functions on my boys’ new Nanos, I noticed an inscription on the back: “Designed by Apple in California. Assembled in China.” That’s a more clever label–and a more accurate depiction of economic trends–than the “Made in China” we see stamped on so many imported shirts, shoes, toys, and consumer electronics.
To those obsessed with the trade balance as a zero-sum scorecard, another imported, $200 Nano merely adds to our growing bilateral trade deficit with China and knocks a few more Americans out of jobs. Wouldn’t we be better off, they ask, if the whole thing were made and assembled at home by American workers?
The answer is a definite no.
As with other high-tech devices, iPods are assembled in China, but the real guts of the device–the brand name, the design, the engineering, the most sophisticated components–come from the United States and other countries outside of China. Like trade in general, importing iPods from China creates a win-win scenario for people in both countries. Assembling the devices is relatively high-paying work in China, so the Chinese workers and their economy do benefit to some extent. But Americans benefit even more from the deal–even, in the long run, the tattooed and pierced erstwhile clerks from Tower.
Quite so. “The trade deficit” is little more than an accounting abstraction. It could be symptomatic of problems with the American economy, such as a large budget deficit or anemic growth in our export industries. But the fact that American consumers are getting a lot of affordable goods overseas isn’t inherently troubling–especially when a substantial amount of the value in those “imports” was actually produced by American workers.
Matt Yglesias has a sensible post about space exploration. He quotes President Kennedy, who said:
But why, some say, the moon? Why choose this as our goal? And they may well ask why climb the highest mountain. Why, 35 years ago, fly the Atlantic? Why does Rice play Texas?
Matt responds:
Continue reading →
Every week, I look at a software patent that’s been in the news. You can see previous installments in the series here. This week, Mike at Techdirt has done my job for me:
There’s been quite a trend lately of companies who had otherwise completely failed in the marketplace to suddenly reinvent themselves as “patent licensing firms” and then go and sue everyone who actually was able to successfully innovate in the market. The latest entrant is Intertainer, a company that was fairly well known for a few bubble years, but was unable to find a real market for their online video distribution system. They blamed the movie industry for colluding against them (a lawsuit on that issue never went very far, nor did the antitrust investigation it helped trigger), but are taking it out on the tech industry. The company, which has long since been out of business, is back from the dead suing Google, Apple and Napster, claiming they all violate a patent the company holds on digital downloads. Go ahead and read through the patent and help us all understand what is new or non-obvious in the patent. The patent was filed (provisionally) in March of 2001, by which point it’s hard to believe that the idea of distributing content electronically wasn’t well known. I worked for a company in 1998 and 1999 that did many of the things described in the patent, and we were far from cutting edge at the time. The best comment in the article, though, goes to Eric Goldman, an expert in high tech law, who notes: “I have the same problem with this patent as so many of the patents of the dot-com boom days: I don’t know what it means.” Intertainer missed the market. It happens. It’s a part of business. It would be nice if they could now leave those who succeeded alone to continue innovating, rather than wasting everyone’s time and money on a pointless lawsuit over a silly patent.
What he said.
Larry Lessig is frustrated by the Democratic Congress’s apparent lack of interest in serious copyright reform:
“Radical” changes in Washington always have this Charlie Brown/Lucy-like character (remember Lucy holding the football?): it doesn’t take long before you realize how little really ever changes in DC. The latest example is the Dems and IP issues as they affect the Net. Message to the Net from the newly Democratic House? Go to hell…
The Dems have looked at the potential “return” from the activists on the Net. They’ve considered the kids being sued by the industry (including the kids running MySpace, and maybe soon, YouTube), and the kids creating amazing new (but presumptively illegal) mashups and remixes, and they have compared that value to the party with the value promised by Hollywood. Result: the 20th Century continues to rule.
Dems to the Net: “Thanks for the blogs. And please continue to get outraged by MoveOn messages. But don’t think for a second we’re interested in hearing anything beyond the charming wisdom of Jack Valenti. We appreciate your support. We appreciate your money. But come on–you’re all criminals. Don’t expect your criminal ways to be taken seriously by an institution as respected as the US Congress.”
I share Lessig’s frustration, but I don’t know why he’s surprised. The Democrats have never been appreciably better than the Republicans on copyright issues. Two of the best Reps on copyright issues are Democrats–Boucher and Lofgren. But on the Republican side, Doolittle and Barton have been equally helpful. This has never been an issue that’s broken down along partisan lines.
Frankly, I think the vast majority of Democrats in Congress are only vaguely aware that the “activists on the Net” even exist, and they have no idea what they want and why. There are a few Reps who understand our arguments and support them and a few others who have considered our arguments but side with Hollywood. But my sense is that the vast majority have sided with Hollywood without giving the subject a second thought. After all, everyone’s in favor of artists, right?
Instead of getting angry at the Democrats for not doing the right thing, we should be building a movement that’s broad enough that both parties feel compelled to take our concerns seriously. Lucy’s not going to stop pulling the football away until Charlie Brown develops the political clout to clobber her for it.
Prof. Vaidhyanathan has left a gracious comment in response to my post last week about his MSNBC article. He rightly takes issue with my characterization of his position as “knee-jerk leftist and old fogeyism.”
As I point out in a subsequent comment, think his article illustrates a couple of interesting ideological divides. One divide is that Prof. Vaidhyanathan is more concerned than I am about the impact of corporate control over the means of communications. But the more interesting divide, in my estimation, is an individualist/communalist divide. Prof. Vaidhyanathan seems to feel that it’s only a revolution if people are able to “forge collective consciousnesses” and tackle big social problems. I’m more inclined to think that individual, incremental, spontaneous social organizations are at least as important.
What’s most fascinating about this is that it doesn’t seem to have any correlation with the traditional left-right divide. Vaidhyanathan clearly hails from the left-hand side of the political spectrum, as does Seth Finkelstein, but you can see similar sentiments from Nick Carr, who I’ve never thought of as a left-winger, and from our friends at the libertarian-leaning Progress and Freedom Foundation.
And of course, there’s yet another axis concerning copyright and patent law, in which Seth, Prof. Vaidhyanathan, and I would generally find ourselves on the same side, with PFF and most of the Washington establishment on the other side.
This is one of the things that makes writing about tech policy so interesting. On most issues, there is a distinctively “conservative” position and a distinctively “liberal” one, with libertarians usually lining up squarely with one side or the other, depending on the particular issue. But in tech policy, the battle lines seem to be more fluid.
The Technology Liberation Front is the tech policy blog dedicated to keeping politicians' hands off the 'net and everything else related to technology.