My response to Jonathan Zittrain's response, to the effect that substituting taxation for copyright is not a better way:

-Substituting tax for copyright gets rid of the main mechanism, market prices, by which consumers communicate their needs to producers. No good substitute for this mechanism has been found. (If surveys and sampling work so well, why don't we run the entire economy that way?).

-Switching the complexity to the tax system and a bureau to dole out the proceeds to make it less visible to consumers is not a good thing. Those best able to navigate bureaucracies will continue to benefit disproportionately, and hardly anyone will care. But we will all pay.

-With the copyright system, true, the government sets the ground rules (as usual with statutes) and the courts step in as arbiters in the case of disputes. But the government is not present in the vast majority of exchanges involving copyright, which are not disputed. But with a tax system, government is present as a middleman in every single exchange. On balance, concerns about free speech tip me in favor of copyright. (If one is wavering on this point, consider how a tax scheme would go over with the publishers of books!).

-By doing away with market prices, it makes consumers less sensitive to prices, which in turn reduces the incentive of producers to innovate to lower their costs.

-It would end competition and innovation in business models for delivering content. If there is something beyond P2P or disks, we will never know.

posted by Solveig Singleton @ 11:34 AM | Comments from Readers, Tax-Funded IP

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