[Chapter 8, live blog]

All popular business histories are replete with lies. Or to be more charitable, they are filled with untruths based on a stupid version of cause and effect: inventions happen because people take out a patent on them. This assumption is hardly ever questioned in the mainline literature. Writers look through patent records and assume that they are a record of technological advance.

The truth is far messier. The patent records are a snap shot of those who filed a patent, and nothing more.

Gold-price history charts denominated in US dollars show a flat line at $35 that runs through most of the 20th century. Thirty-five dollars was, after all, the official gold price as set by the United States Treasury from 1934 on. Prior to 1934, the gold price had been fixed at $20.67 for almost a century, before President Franklin Roosevelt confiscated Americans’ gold and revalued the price to $35 that year.

Zeroing in on a topic like “intellectual property” offers a chance to clarify fundamental notions in economics generally. You think you understand something like property rights or the nature of competition--you have studied the ideas for years!--and then a challenge comes along that blows everything up. It’s an opportunity. Time to think and think again.

Is there really property in ideas and, if so, what rules should govern it? Is it really necessary that such property be protected in order that competition be kept fair and just and efficient?

Students at Eastern Carolina University took advantage of a rare opportunity on 20 January. The campus received an uncharacteristically large amount of snowfall and the University was forced to cancel Tuesday’s classes. Students elected to head outdoors and recapture their early childhood by engaging in an old fashioned snowball fight. Reports indicated that around 200-250 students joined in the festivities.

The Bailout Rap:

It’s easy to find examples of patent abuse but its not often to find a company that uses patents that stifle a whole industry. Such may be the case with the Apple iPhone.

In Apple May Use ‘Nuclear Arsenal’ to Delay Palm’s IPhone Rival, Bloombert reports: “Apple Inc., usually on the defensive when it comes to intellectual-property lawsuits, is threatening to use its hoard of patents to quash iPhone competitors.” This follows up from Veksler’s post on the same issue.

Writes Morgan Reynolds: “We no longer hear the Wall Street cliché “Don’t fight the Fed,” which suggests a new song to me for the Obama-Biden administration to warble next year to the music of “I Fought the Law” by the Bobby Fuller Four. Note that “Robbin’ people with a … SIX gun” is the original line–no change needed.”

WE FOUGHT THE MARKET
The Barack Obama Four
(Barack, Bair, Bennie, and Timmy G.)

[Marxism Unmasked: From Delusion to Destruction. By Ludwig von Mises. Introduction by Richard M. Ebeling. Foundation for Economic Education, 2006. Xvii + 110 pages.]