An Incredibly Bold Conservative Copyright Reform Proposal, and Why Its Authors immediately Disavowed It

Commentary about business and finance.
Nov. 19 2012 2:23 PM

The Case of the Vanishing Policy Memo

An influential conservative group released a copyright reform memo that was so smart it had to immediately disavow it.

Republican Study Committee staffer Derek Satya Khanna.
Republican Study Committee staffer Derek Khanna

Courtesy of Derek Khanna/Facebook.

A Friday afternoon policy memo is not normally the sort of thing that gets one’s heart racing, but “Three Myths About Copyright Law and Where To Start To Fix It” was an exception. It offered a bracing attack on the conventional wisdom about intellectual property that’s dominated Congress for decades mounted a vibrant defense of competition, and advocated regulation aimed at consumers rather than incumbent copyright owners. Even more amazing was the source. The memo went out on the letterhead of the Republican Study Committee—an organization of House Republicans who think the House Republican caucus isn’t insanely conservative enough—under the names of Rep. Jim Jordan and executive director Paul Teller.

It was an exciting moment for copyright reformers, who were surprised and delighted to find these new conservative allies. But a moment was all it was. By Saturday, Teller had already retracted the memo, claiming it “was published without adequate review” and needed to be “approached with all facts and viewpoints in hand.”

Common sense suggests there were other reasons for the retraction. Derek Khanna, a tech-savvy young Republican staffer who came to Washington with Sen. Scott Brown before shifting to the RSC to work primarily on cybersecurity and government oversight issues, is clearly well-versed on the subject. He simply lacked the authority to enact a change in position on a topic dominated by powerful interest groups with a ton of money. Khanna’s supervisors seem to have paid too much attention to the merits of the memo and not enough to the larger politics when vetting it. According to Mike Masnick at TechDirt, when news of the memo filtered out to the Motion Picture Association of America and Recording Industry Association of America, those organizations “went ballistic and hit the phones hard, demanding that the RSC take down the report.” They won.

And of course they did. Big shifts in policy simply don’t happen by trying to sneak memos past lobbyists. But Khanna’s gambit did succeed in making news on a subject where the gap between Capitol Hill and knowledgeable people in the tech and economics worlds is enormous.

Khanna’s three myths are, in order, that “the purpose of copyright is to compensate the creator of content,” that “copyright is free market capitalism at work,” and that “the current copyright legal regime leads to the greatest innovation and productivity.”

The first myth is the most easily devastated. Congress’ power to enact intellectual property laws is spelled out in the U.S. Constitution, which empowers it “to promote the progress of science and useful arts, by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries.” As Khanna writes, this constitutional rationale has practically nothing to do with the actual modern congressional discussion of the purpose of copyright. Today’s debate tends to focus not on promoting the progress of science and art but rather on “what the content creators ‘deserve’ or are ‘entitled to’ by virtue of their creation.”

Khanna’s third myth—that our copyright system promotes the most innovation and productivity--is the most important one. I’ve made the case previously that fully preventing online intellectual property piracy would be a social and economic disaster. A certain amount of unauthorized copying is actually a good way to minimize deadweight loss and increase welfare.

Khanna focuses on the length of copyrights. Longer-duration copyrights theoretically create larger financial incentives for creators to innovate and develop great characters and great stories. On the other hand, shorter-duration copyrights reduce the cost of artistic production and innovation. Because the basic stories of Hamlet, Snow White, and Robin Rood are in the public domain, they can be easily and cheaply treated and retreated by artists in a variety of media. Spider-Man, by contrast, is enmeshed in a web of legal obligations that stifle creativity. Sony Pictures and Sony Pictures alone may make Spider-Man films, and unless they release them very frequently, they’ll lose this lucrative monopoly and the rights will revert back to Marvel. Decisions about which stories get told are driven by intellectual property considerations rather than dramatic ones. Peter Parker can’t appear in an Avengers film, and Iron Man can’t appear in a Spider-Man movie because the rights belong to different studios.

America’s original copyright statute provided 14 years worth of protection, renewable for 14 more years if the author was still alive. Current law gives individuals monopoly rights for the lifetime of the author plus 70 years. Corporate authors’ rights extend to 95 years after publication. But even that’s an undercount. Congress has retroactively extended copyright terms to prevent Mickey Mouse from losing copyright protection—preventing hundreds of other works from entering the public domain.

Khanna also makes an intriguing case that we shouldn’t consider strong intellectual property rights as a form of free-market capitalism but rather as a form of big government monopoly creation. Khanna, essentially, is proposing conservatives make a bold political gambit. Rather than moving “to the center” on issues that are in the public eye, Republicans could perhaps garner support from younger voters and the tech community by repositioning on a subject that’s currently the subject of bipartisan consensus. The memo doesn’t delve into this kind of cynical gamesmanship, but it’s hard not to notice that right now the Democratic Party raises a lot of money from both Hollywood and Silicon Valley, even though those two industries tend to line up on opposite sides of the copyright issue. Elevating the salience of copyright reform would be an excellent way for the GOP to wreak a little havoc with the Democrats’ financial model.

The pushes both for and against last fall’s thankfully doomed Stop Online Piracy Act were basically bipartisan, but bipartisanship rarely lasts forever. If major reform occurs, one party or the other will likely take the lead and earn the gratitude of a rising geek lobby. Khanna’s suggestion that Republicans should view copyright less as a kind of “property” and more as a kind of regulation is a fascinating move on the coalitional chessboard. For now it seems too hot for the Republican Party. But if they’re smart, they’ll think twice. 

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