Monday, February 03, 2014

Strong IP Protection Leads to Economic Growth and Innovation, Just as Our Founding Fathers Said – Part II

As I discussed in my last blog in this series, the Global Intellectual Property Center of the Chamber of Commerce held a conference last week to celebrate the launch of its Second Annual International IP Index, Charting the Course. The proposals included in the Index and in the presentations by conference panelists delivered the same unified message: Strong IP protection systems lead to economic growth and innovation.
Senator Orrin Hatch delivered a keynote presentation at the event. He focused on the importance of strong intellectual property protections like other panelists, but he was the only presenter to focus on the constitutional basis for intellectual property protection. Senator Hatch recognized that the strong IP system in the U.S., which leads the world in the latest Index, is firmly rooted in the beliefs of our Founding Fathers and is “woven throughout the fabric of our nation”:
Our Founding Fathers believed intellectual property to be so fundamental to America’s future prosperity that they explicitly granted Congress the constitutional authority to protect it … The fact is, strong intellectual property rights [are] a tool of economic growth, not an impediment. It is a simple truth – countries that strengthen their intellectual property rights regimes enjoy economic benefits. They attract more investment, more technology transfers, increased innovation, and, ultimately, more prosperity for their citizens. Yet, despite these fundamental truths, intellectual property protections around the globe are continually at risk.
Our Founding Fathers recognized the role that intellectual property protection would play in our future and they have been proven right. As our innovators continue to advance and compete globally, now, more than ever, the United States must heed the wisdom of our Founders and bring this lesson to the forefront of our trade policies. It is through strong protection of innovation that we developed as a nation, and it is through the protection of innovation that our nation will continue to thrive in the international arena.
While the value of strong IP protections may be gaining support in the U.S., there is still strong anti-IP sentiment both at home and abroad. Here in the U.S., some argue for weaker IP protections, and point to disruptive technologies which challenge traditional notions of content ownership and patentable innovation. These developments have indeed strained the existing IP framework, and action may be required to form a better IP framework for the digital age. The Index recognizes that the U.S. struggles in these areas, identifying issues like inconsistent applications of limitations and exceptions to copyrights and related rights and ambiguity concerning ISP obligation to respond to trademark holder notice of infringement as “key areas of weakness.”
Anti-IP sentiment is particularly strong abroad in many of the countries that ranked low on the GIPC’s Index. Those countries, like India and China, advocate for the free sharing of copyrightable or patentable works by arguing that doing so is for the “public good.” In fact, the opposite is true — IP protections create incentives for creation and innovation, which serve the public good. Elaine Wu, Attorney-Advisor at the U.S. Patent and Trademark Office and Michael Schlesinger, Counsel at the International Intellectual Property Alliance, particularly focused on the problem of anti-property rights rhetoric abroad. They recognized that government officials perpetuate this backwards perspective, because the voices of authors and inventors are not heard.
Anti-IP advocates should heed the message of Senator Hatch and recognize that strong IP rights established by the Founding Fathers have produced economic growth and innovation. Further, as FSF scholars have observed in Perspectives and blogs, James Madison’s theory that “the public good fully coincides … with the claims of individuals” should provide the foundation for IP protection frameworks. This statement from Federalist No. 43 expresses the idea that an IP system can serve the public good by meeting the public’s demand for information access, content sharing, and use of new inventions or products while also providing strong protection for authors’ and inventors’ rights.
In order to help other countries around the world improve their economies and the lives of their citizens, it is helpful to present facts and figures that demonstrate the positive effects of strong IP protection. And it is also important to recognize the constitutional roots of intellectual property protection. The Founding Fathers intended that one of the government’s primary purposes be to protect property rights. This protection for the works of authors and inventors has produced the positive economic impact discussed in the GIPC’s Index and by GIPC panelists.
As Senator Hatch urged, heeding the wisdom of our Founding Fathers by retaining a strong IP system will provide incentives for creation of all kinds of valuable works – ranging from literary works and music on the one hand to practical new products and services on the other. This, in turn, will fuel further innovation and economic development for generations to come.