The TCS piece "Time to Play Hardball on IP" also looked at the international dimension of the IP issue:

According to the International Intellectual Property Alliance, $13.4 billion worth of books, motion pictures, records and music, and business and entertainment software were pirated last year. This doesn't include the strong arm tactics placed on pharmaceutical companies and outright theft of their patented formulas by foreign generic companies that adds billions more in losses. Most of these losses took place in developing and poor countries, with the justification being provided that people simply couldn't afford the high prices charged for some goods -- in particular for essential medicines. In fact, though, these countries often put high tariffs on foreign products which they then encourage domestic producers to pirate and sell domestically. It seems like a bargain for them, but it is really a lose-lose situation -- for their people as well as the foreign producers.

As outlined by Peruvian economist Hernando de Soto, much of the poverty of most countries can be traced to a lack of enforceable property rights. That undermines incentives and discourages effort; it also tends to encourage corruption.

That certainly seems to be the case in many of the highest nations on the IP theft list -- China, Russia and Brazil.

It's time to deliver one of them a brushback pitch. And the target should be Brazil -- with $931 million worth of theft -- up from $785 million three years ago, not including breaking of U.S. pharmaceutical patents. Brazil has not merely turned a blind eye to IP theft, it has openly abetted it in medicines.

For [Minister of Culture Gilberto] Gil, "the fundamentalists of absolute property control" - corporations and governments alike - stand in the way of the digital world's promises of cultural democracy and even economic growth. They promise instead a society where every piece of information can be locked up tight, every use of information (fair or not) must be authorized, and every consumer of information is a pay-per-use tenant farmer, begging the master's leave to so much as access his own hard drive. But Gil has no doubt that the fundamentalists will fail. "A world opened up by communications cannot remain closed up in a feudal vision of property," he says. "No country, not the US, not Europe, can stand in the way of it. It's a global trend. It's part of the very process of civilization. It's the semantic abundance of the modern world, of the postmodern world - and there's no use resisting it."

Gil laughs, as he often does when even he finds himself a little over the top. But these days it's not exactly unusual to hear this sort of thing from high-level members of the Brazilian government. The preservation and expansion of the information commons has long been a cause of hackers, academics, and the odd technoliterate librarian, but in the world's fifth-largest country it is fast becoming national doctrine. And the implications hardly end with free samba: Brazil, in its approach to drug patents, in its support for the free software movement, and in its resistance to Big Content's attempts to shape global information policy, is transforming itself into an open source nation - a proving ground for the proposition that the future of ideas doesn't have to be the program of tightly controlled digital rights now headed our way via Redmond, Hollywood, and Washington, DC.

We are not opposed to community. We love community. But the way to achieve community is through hard-headed property rights and markets, not through airy abstractions. These are the institutions that allowed civilization to transcend the dreary cycle of feudal poverty and tyranny in the great leap forward of the agricultural and industrial revolutions.

Those who want to go the other way are indeed "dot communists," in the current phrase. And their prescriptions would have the same effect on the modern economy as the prescriptions of their predecessors had on the heavy-industry-based economies of the early 20th century. As one economic historian notes:

Depending on how you count, between two-thirds and seven-eighths of the potential material production and prosperity of a country has been annihilated if it fell under Communist rule. Communism was not only a source of genocide, it was also a source of economic stagnation and decline: not one of the brighter lights on humanity's tree of good ideas.

posted by James DeLong @ 11:33 AM | International

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