KOL502 | Abolish Intellectual Property? Stephan Kinsella on Objectively Speaking: Scarcity, Negative Servitudes, IP, Objectivism, AI Copyright, and Bitcoin Ownership

by Stephan Kinsella on October 13, 2026

Kinsella on Liberty Podcast: Episode 502.

This is my conversation on Liquid Zulu’s Twitter Space (@PunishedZulu), recorded Oct. 12, 2026. Topics discussed include why property rights require scarcity, the case against IP as non-consensual negative servitudes, critiques of Locke, Rand, and utilitarian arguments, Objectivism and Atlas Shrugged, AI training and copyright liability, international IP treaties, and whether Bitcoin can be owned.

The Problem with Intellectual Property. Stephan Kinsella, Papinian Press Occasional Paper, No. 2 (Houston, Texas: Papinian Press, May 15, 2025) [v.1.1]. ISBN Ebook 979-8-9890306-8-2. — Kinsella’s most recent and comprehensive short presentation of the case against patents and copyrights, covering scarcity, negative servitudes, and why IP is incompatible with libertarian property rights.
Intellectual Property Rights as Negative Servitudes. Stephan Kinsella, C4SIF Blog (June 2011). — Explains the core argument from the episode that IP grants are non-consensual negative servitudes restricting the use of others’ already-owned scarce resources.
The Mountain of IP Legislation. Stephan Kinsella, C4SIF Blog (November 2010). — Documents the extensive and growing body of IP statutes, illustrating the arbitrary, legislated nature of patent and copyright terms discussed in the episode.
Against Intellectual Property. N. Stephan Kinsella, Journal of Libertarian Studies 15, no. 2 (Spring 2001): 1–53; later issued as a monograph by the Ludwig von Mises Institute (2008) and Laissez Faire Books (2012). — The classic systematic libertarian case against IP, including critiques of natural-rights and utilitarian justifications.
Against Intellectual Property After Twenty Years: Looking Back and Looking Forward. Stephan Kinsella, chapter 15 of Legal Foundations of a Free Society (Houston, Texas: Papinian Press, 2023); also available at C4SIF. — Reflects on the original AIP arguments, updates them, and discusses the shift in libertarian opinion against IP over two decades.
Law and Intellectual Property in a Stateless Society. Stephan Kinsella, Libertarian Papers 5, no. 1 (2013): 1–44; updated version appears as chapter 14 of Legal Foundations of a Free Society (Houston, Texas: Papinian Press, 2023). — Comprehensive treatment of why IP cannot exist in a free, private-law order based on self-ownership, homesteading, and contract.
The Case Against IP: A Concise Guide. Stephan Kinsella, Mises Daily (September 4, 2009). — Short, accessible overview of the main arguments against IP, including the failure of both deontological and utilitarian defenses.
The Overwhelming Empirical Case Against Patent and Copyright. Stephan Kinsella, C4SIF Blog (October 23, 2012); also chapter 31 of The Anti-IP Reader (Papinian Press, 2023). — Collects studies (including Machlup and others) showing no clear evidence that patents or copyrights produce net gains in innovation, relevant to the utilitarian discussion.
Intellectual Property and Libertarianism. Stephan Kinsella, Mises Daily (November 17, 2009); earlier version in Liberty 23, no. 11 (December 2009). — Explains the tension between IP and core libertarian principles of property and the non-aggression principle, with discussion of Randian and other creationist views.
Nobody Owns Bitcoin. Stephan Kinsella, StephanKinsella.com (April 21, 2021). — Article version of the argument that Bitcoin ledger entries are not ownable scarce resources; control via private keys is distinct from property rights, matching the episode discussion.
KOL274 | Nobody Owns Bitcoin (PFS 2019). Stephan Kinsella, Kinsella on Liberty Podcast, Episode 274 (Property and Freedom Society, 2019). — Full talk elaborating why Bitcoin cannot be the subject of property rights under a scarcity-based theory of ownership.
Key IP Resources and Publications. Center for the Study of Innovative Freedom (C4SIF). — Curated collection of Kinsella’s major books, articles, and speeches on IP, including links to Legal Foundations of a Free Society and related works.
IP Chapters of Legal Foundations of a Free Society. Stephan Kinsella, C4SIF Blog (September 23, 2023), discussing Legal Foundations of a Free Society (Houston, Texas: Papinian Press, 2023). — Overview of the several chapters in Kinsella’s 2023 book that develop the property-rights foundations and case against IP in greater depth.
A Succinct Case Against IP: Libertarians Have No Excuse Anymore. Stephan Kinsella, C4SIF Blog (May 31, 2025). — Recent short statement reinforcing that IP is a non-consensual negative easement and that libertarians have no remaining principled basis for defending it.
Yet Another Randian Recants on IP. Stephan Kinsella, C4SIF Blog (February 2012). — Discusses Objectivist responses to anti-IP arguments and examples of Randians who have come to reject intellectual property.
The Intellectual Property Quagmire, or, The Perils of Libertarian Creationism. Stephan Kinsella, speech/article (2008/2010); available at C4SIF. — Critiques the “creationist” view (common in some Randian and Lockean arguments) that creation is a source of property rights.
Libertarian Answer Man: Bitcoin and Fraud. Stephan Kinsella, StephanKinsella.com (March 14, 2024). — Addresses practical implications of the view that Bitcoin is not ownable, including fraud, trespass, and remedies when private keys are misused.
Introduction to the Laissez Faire Books Edition of Against Intellectual Property. Stephan Kinsella, C4SIF Blog (June 22, 2012). — Foreword-style overview of the core thesis of AIP and its place in the broader libertarian debate over IP.

Grok shownotes:

In this episode of Objectively Speaking, hosts Liquid Zulu, Su, and Edardo Yanes interview libertarian patent attorney Stephan Kinsella on intellectual property. Kinsella explains his shift from initially accepting Ayn Rand’s defense of IP to concluding that patents and copyrights are incompatible with property rights. He argues that all human action requires scarce physical resources guided by knowledge, and that rights arise only to resolve conflicts over those resources through self-ownership, homesteading, and contractual transfer.

Kinsella contends that IP is not ownership of ideas but a non-consensual negative servitude that restricts how others may use their already-owned factories, printing presses, or other resources. He rejects both natural-rights arguments (including Locke’s labor theory of property and Randian “creationism”) and utilitarian market-failure claims. He notes that finite patent and copyright terms are arbitrary, that empirical evidence does not support net gains in innovation, and that pharmaceuticals are among the worst cases for IP because monopoly pricing and FDA barriers restrict access to life-saving goods.

The discussion turns to Objectivism. Zulu, an Objectivist who opposes IP, argues that Rand’s non-fiction treated law as secondary to politics and presupposed a state, while her fiction (especially Atlas Shrugged) is more consistent with a scarcity-based view of property. Kinsella adds that Rand’s emphasis on physical force as the sole means of rights violation undercuts her support for patent rights as “the heart and core” of property.

Later segments address AI training and copyright liability, the rise of potential copyright trolls, international IP treaties and “IP imperialism,” and open-source licenses. Kinsella also addresses Bitcoin, maintaining that one controls entries on a ledger via private keys but does not own Bitcoin as property in the same sense as scarce physical resources. The episode closes with Kinsella’s assessment that principled libertarian opinion has shifted strongly against IP over the past two decades.

Key sections include

Introduction and Setup (0:02)
Defining the Problem (6:06)
Property and Scarcity / The Case Against IP (8:06–14:19)
Negative Servitudes (20:57)
Critiquing IP Arguments (25:52)
Utilitarian Fallacies (33:05)
Value and Ownership (47:35)
Objectivism and Law (1:08:46)
Atlas Shrugged and IP (1:15:35)
AI and Copyright (1:22:26)
Arbitrary IP Laws (1:34:05)
Global IP Enforcement (1:47:20)
Bitcoin and Ownership (1:54:51)
Trespass and Fraud (2:04:35)
Closing Thoughts (2:15:33)

Transcript below.

Transcript (Grok cleanup)

Objectively Speaking: Stephan Kinsella on Intellectual Property

Cleaned transcript of the interview with Stephan Kinsella, hosted by Liquid Zulu, Su, and Edardo Yanes. Recorded as a Twitter Space / YouTube live stream. YouTube: https://www.youtube.com/watch?v=9xMQzSt9EP0

Introduction and Setup

0:02

Zulu: Hello. Hello. Hello. How’s everyone doing on this fine day?

Su: Yeah. So, today I’m echoing. Why the hell would I be echoing? I don’t think I’m echoing. Yeah. So anyway, today it’s another Objectively Speaking, that is the other Twitter Spaces show that I co-host on Twitter of course. This week with Stephan Kinsella talking about IP and why it’s not very good. Pardon me.

Zulu: Switch to this one. That way you guys are on screen. Had it on the other one cuz I use my OBS for scan cap. But I got to have it on this. That way it doesn’t have this useless extra gobbins on the screen which is not important for that.

[music]

Zulu: I’m going to go over here.

[music]

Zulu: Louder now.

Su: Hello. Hello. Hello. Can you hear me? Yes. Um, can you micell?

Zulu: Yes. Just did it.

Su: Yeah. I read, I went through his Against Intellectual Property earlier and got some questions. Hopefully something to like, you know, spur a conversation rather than just like what what the IP, nothing too boring. Yeah. Yeah, that makes sense.

Zulu: Hello Edardo. Can you hear us?

Edardo: Adora, can you hear us? Yes, I can. Are you guys?

Zulu: Hey, there’s just some waiting stuff in here. Yeah. You hear me?

Edardo: Yeah. Yeah, I can. Can you hear us? Yeah. Yeah. Yes, bro. I I can hear you.

Zulu: Wait a minute. What the I hear some echoing.

Edardo: Right. For me, do I sound good now?

Zulu: Gador, you just became a listener. Yeah, I mean, it sounds fine to me. Maybe he’s got the stream open twice or something. I don’t know. Do I sound good to you, Zulu?

Edardo: Yeah, it sounds fine. Are you guys able to hear?

Zulu: Yes, dude. The audio kept like looping. Like I kept asking, I kept hearing you ask me, “Can you hear us? Can you hear like” No, I maybe it’s because I asked it for several times. Is it that? No, but then I heard myself like my own voice start replaying. Like I I heard myself answering you and saying, “Yeah, I can hear you.” Like the [expletive] is wrong with Twitter’s faces, bro?

Su: How angry will he get at the if I ask him if I read out some of the things Rand said against IP and what he thinks about those.

Zulu: Oh yeah, it seems fine. Like he’s got arguments against Rand in the book. Yeah, that’s true.

Su: Pardon me. Got a frog in my throat this evening.

Zulu: Drink some tea. I’m drinking beer. That’s much better.

Su: What the hell? I’ve never heard beer being good for your throat.

Zulu: Everyone, we just um waiting for Kinsella here. Oh, here he is. I’m just gonna accept him as speaker. Hello. Can you hear us?

Kinsella: Hello. Hello. Hey guys. Hey, can you hear us?

Zulu: Right. Perfect. I think we can get this started now. Zulu. All right. Hey everyone. Um welcome to Objectively Speaking.

Defining the Problem

6:06

Su: My name is Su and I’m co-hosting this episode of Objectively Speaking with Zulu and Edardo Yanes. Here you can find me on Twitter at the sisu and the Liquid Zulu. He has a new Twitter account now at Punished Zulu. So if you’re watching this on YouTube, make sure to give him a follow and I’m followed by Edardo. You can find him at Adorian on TikTok and Twitter as well. Um today we have a very special guest joining us, Stephan Kinsella. I’m pretty sure most of our guests already know him. He’s a libertarian writer and kind of one of the leading thinkers in libertarian legal theory particularly known for his work on property rights and IP. He’s the author of Against Intellectual Property and Legal Foundations of a Free Society and he spends some time exploring the philosophical and legal foundations of liberty. So Stefan, it’s a pleasure to have you here with us today. Welcome to our Objectively Speaking episode.

Kinsella: Thanks. Glad to be here. Yeah, absolutely.

Su: So, yeah, I was reading the book earlier today actually. It’s a very short audiobook. You can get it on YouTube which specifically Against Intellectual Property. Um everybody should go listen to that, read it. It’s not a very long book, you know, but you can read it in an afternoon easily. Um, so I suppose a good way to open this up would be what is like sort of the basic case that you make on why property is requiring scarcity cuz that’s not necessarily obvious to people. It’s not common to all sorts of property theories, right?

Kinsella: Yeah. I um Okay. The best way to approach this um I think the case against intellectual property is pretty easy to see once you just explain it. It took me a while to figure it out. Um, you know, originally I was interested in libertarianism and Objectivism based on Ayn Rand’s um, you know, her kind of common sense and very principled view that the only way to violate rights is by physical force and she says that explicitly. Um, so to me there’s always been a sort of a logic or a symmetry and the logic of what we used to view as the non-aggression axiom or the non-aggression principle. Um, but the more I thought about it over the years, um, and I had to think about it to untangle the question of intellectual property because when I started learning about intellectual property rights, you know, at first I thought they made sense because Ayn Rand said they did and they seem to stem from the intellect um, and they’re useful and they’re valuable and ideas are valuable and all that stuff. Um but the fact that patents and copyrights have an arbitrary finite term uh gave me some pause um uh unlike other rights which last potentially forever. I mean if you live forever then your body rights last forever and if you own a car or a watch or a piece of land you don’t lose ownership of it at a certain point in time but you do with patented copyright. So I thought there was something wrong with it. So I turned my attention to trying to understand what was a better what’s a good argument for intellectual property because Ayn Rand’s wasn’t very fleshed out and the more I studied it the more I kept realizing that um and also understanding praxeology later like Mises’s understanding of the way to view what human action is which he used in economic analysis right. So that led me to understand that all human action right and this is not incompatible with Objectivism. I believe all individual all human action is the movement of your body in this physical world right by your will by your decisions about how to move your body and you interact with that world and with physical resources in it that can cause something to happen if you use it like tools. Um that means they’re causally efficacious. So these are what economists call the scarce means of action, right? Or resources. Um but knowledge is a second equally important ingredient of action. All action involves the use of resources or means of action, right? To cause something to happen to change the future as it were but guided by your knowledge of the way the world is and the way the causal laws of the world are. So action involves knowledge which you consult and which guides your action and the use of scarce resources. Um now these scarce resources the reason Rand said that the only way to violate someone’s rights is by the initiation of physical force right. So she recognized that that’s the only way to invade someone’s body or to take someone’s resources from them. So that sort of recognizes there’s an implicit aspect of force there. But force is actually a physical thing that can only be applied to objects and that is what we do when we use resources. We manipulate them. We grab them physically with our hands and these things have a physical effect on the world and they achieve our ends. And if you use the laws of if you exploit the laws of causation and causality properly that is our understanding of the laws of cause and effect um then you get a successful result that means if your knowledge is correct. So when you recognize this you realize that in the world with Robinson Crusoe by himself alone on an island he acts but he doesn’t live in a moral world or he doesn’t live in a world of other people where interpersonal morals come into play. You could argue that things he does could be immoral, but that’s only because he’s not furthering his own interest. But they don’t they’re not immoral in the sense of hurting other people. So the idea is that human action needs to be viewed as the employment and possession and manipulation of scarce resources. Okay? So these are physically scarce objects in the world. Um so that’s the possession and use of those and you have to be guided by knowledge. But this general structure of human action applies to anyone. Now it applies also when other people enter the picture. So that when you have other people in the world in society, there’s always the possibility that they could choose to try to physically grab your body or your own or your resources that you’re using and that would lead to physical conflict. And property rights emerge as a practical response to this fundamental aspect of human action. So property rights are the so so human action is a purely descriptive thing. We describe the fact that humans act and that we employ resources to achieve ends guided by knowledge. This is all descriptive. But when we enter the normative realm that is talking about what is right and wrong, what people should or should not do or ought or ought not do or we have these are all normative concepts. Then what we’re doing is we’re engaging in a rational um interplay with other people trying to come up with rules that people follow could follow to minimize or totally eliminate this conflict which is a rights violation. So property rights to me is like a normative superstructure on top of possession. So you could think of ownership or property rights as the right to use something which is widely and socially recognized in a just legal order. Whereas possession is the actual ability to use a resource. So ultimately and ideally a just legal system supports your ability to use a resource. Um so once you understand that then you have to say well then what is a just legal order? And the libertarians and the Objectivists more or less agree

The Case Against IP

14:19

Kinsella: that well your property rights and this is implicit in Ayn Rand’s formulation that the only way to violate rights is by the initiation of physical force. Now the initiation of physical force is just another word for aggression. But aggression just means using someone’s resource without their permission or without their consent. So, you can’t really determine what aggression is unless you have a preceding view of what property rights there are because aggression depends upon who owns what. So, if I see someone taking a wallet from someone, I don’t know if the guy taking it is an aggressor or if he’s the owner retrieving his wallet. You have to have a property theory to determine who owns the object that people are fighting over. And the libertarian answer and the Objectivist answer is basically a more consistent version of what the private law in the West has more or less always revolved around which is that basically every person is the owner of his body. That is they’re a self-owner or they’re presumptively a self-owner. They enter the world as a self-owner. And as far as the external resources in the world, the things that we employ and use as scarce resources, as causally efficacious means of action, these things um need to be possessed and used. But for that to happen, they have to be first used. That means that someone has to be the first one to start using an unused resource in the world. Um, and therefore any just property rights system that is a normative structure on top of the natural fact of the need to use resources is going to have to specify that original appropriation or homesteading is one way that we can determine who owns a given contested resource. And then the second way is if an owner of that resource gives it by consent or by contract to someone else, they transfer those rights. Then that person is now the owner. So those very simple rules those property rights is how you determine when aggression has happened. So aggression is not primary. Aggression means the unconsented use of someone else’s owned resource. And we determine who owns it by asking well whose body is it? And it’s the actor’s own body because they’re a self-owner. And as far as other resources go that were previously unowned, they’re owned by the principles of original appropriation or homesteading and by contractual title transfer. So those are basically almost the entire set of core rights along with one other which is rectification which means you can also lose property rights in a resource if you commit an act of aggression against someone and you owe them compensation or restitution. So that can be seen as a subset of contractual title transfer. So when you commit an act of when you sell something or give it to them by contract then the new person becomes the owner or if you harm them then you owe them some compensation. So some of your resources can be transferred to them to compensate them. So those sort of four principles um are what the entire Western legal system is built around. Uh a lot of its details of course but that’s basically what our rights are. Um once you understand that you can understand that there is just no room for also saying well in addition to owning these scarce resources which we acquire by homesteading them from the state of nature when they were unowned or by contractual title transfer that also if you create something that’s useful like a useful idea that you also own that um for the same reason that as Rand said all rights can be violated only by the initiation of physical force. But that’s an idea that goes along with the physical possession and manipulation and use of a scarce resource in the world. It doesn’t make any sense to apply that concept to information or knowledge or ideas. That’s the knowledge that we learn over time about how the world works that we consult that helps guide us into what ends to pursue, what means to employ, and how to act, what recipes to use, which designs to use, which inventions to use. Um and so if you once you understand that you see that um it’s a mistake to say as some Randians do that the reason we own these resources like your body or something that you homesteaded is because you intellectually created something. You didn’t create anything. So you didn’t create your body and you didn’t create resources which were unowned in the world. You just first possessed them. When you do that, you establish a better claim to someone else because you’re the first user and that has to be permitted by a property right system so that the human race doesn’t die out. Right? So the basic thing is that so rights are not a result of creation. Um rights are result of having a better connection to a resource and having a better claim to it than someone else so that when there’s a conflict we know who the owner should be and who the winner of that conflict should be. Um, so when Objectivists say, well, if I come up with a better way to use a resource like an invention or if I pattern my book with a useful series of patterns like a novel like Atlas Shrugged, it has value. That’s true. It has value, but you haven’t created any new object in the world. You’ve just made the objects that you already own more useful. What you created was some useful knowledge, but the useful knowledge is what guides human action. So, if you were to grant a property right or try to grant a property right in something that’s intangible or immaterial like a recipe or a pattern, you know, like a book, the pattern of a book or the pattern of a song or the pattern of the way a device is arranged, which is what patents cover, then because it’s impossible to you can only use with physical force, you can only grapple with physical things in the world. That’s what human action is. And by the same token, just like Ayn Rand said, you can only you only force can be used to only it is only the initiation of physical force that can violate rights. You know, by the same token, um you cannot apply property rights to immaterial things. Property rights always are directing the use of physical force against something that physical force can be applied to. What that means is that an intellectual property right is not what it is called. It’s not really a right to an invention and it’s not really a right to the pattern of words on a book. What it is is it’s a partial property right in other people’s already owned resources.

Negative Servitudes

20:57

Kinsella: So having a patent gives me the power to use state sanctioned force, physical force to prevent someone else from using their own factory and their own resources to make products shaped in a certain way. Um, and having a copyright is the same type of right that can be used to prevent someone from printing a book that has a certain pattern of words on that book, even though I own the printing press and I own the ink and I own the paper. And in the law, what that’s called is that’s called a negative servitude. And those types of rights are perfectly legitimate um as long as they’re consented to. Just like kissing a girl doesn’t violate her rights if she consents to it. But if you kiss someone or you do something worse to someone against her consent, that’s called sexual assault or rape or battery. So it all depends on consent. Um so two people fighting in a boxing ring are not committing battery because they consent to it. But if I attack someone without their consent, I’m committing an act of battery. Um, and by the same token, when the state grants someone the right to tell someone else that they may not use their factory or their printing press in a certain way, then that is the grant of a negative servitude to the holder of that IP right, but it was not consented to by the owner. It was just given to the holder of that new IP of that new servitude by the state. So it amounts to a taking of use rights, a taking of property rights that conflict with the fundamental principles that you determine the owner of a resource like a factory or a printing press by asking simply who first homesteaded it and who got it by contract. Those questions answer the question of who is the owner of the resource. Um it doesn’t matter that you’re using information to do it because information can’t be owned because the only way to own information is to get a negative servitude over the already existing property rights of others. So that’s the fundamental problem with intellectual property. And so the reason property rights have to be in scarce resources is because the only way to cause change to happen in the world is to use physical force to interact with physical things to have to cause physical things to happen in the world. I mean as Rand said we’re not ghosts you know we are physical things uh we’re also guided by knowledge and knowledge is important but it’s got nothing to do with property rights because again the reason the property rights emerge is because of the potential for conflict between things that people need to use as resources and because there’s a possibility of conflict because of the nature of these things because only one person can use that thing at a time and because other people have free will and they have the ability to choose to try to use that resource that someone else is using. And that conflict is, you know, is not possible for both people to use it. Because of the inevitability of conflict over these types of things in the world, property rights emerge to try to reduce that conflict. But with information, information can be used and shared by any number of people at the same time. And it doesn’t lead to inevitable conflict and for the reasons I just gave. That’s why the attempt to grant property rights to those things is nonsensical and only leads to eroding the property rights people already have in scarce resources. Um just like if the state were to print more money, it doesn’t make us richer. It just dilutes the purchasing power of existing money. And just like when the state tries to add on to our negative rights, our negative rights against aggression and murder and rape and assault and theft, it tries to say, well, in addition to these rights, we have positive rights like welfare rights. In addition to those rights, you have the right to an education and you have the right to food and you have a right to a job. Those rights always come at someone else’s expense. You can’t get that for free. So this is the very problem with positive rights is that they dilute the effectiveness of negative rights. And by the same token, granting intellectual property rights takes away from existing rights in scarce resources.

Su: Yeah, I think that’s a very good explanation and I think I certainly found it very convincing. I was convinced when I first read the book and I haven’t been disabused with that notion. I’ve had several people bringing counters to me over the years since then. Um, but I do like how you go over that you kind of categorize the different counters that you could think of at the time into like two different sorts of camps, like the utilitarian sorts and the natural rights sorts. And I’m curious like how would you like vaguely rank the different arguments again? You know, you give like Rothbard’s argument, like Rand’s argument, um, Galambos, I think that’s how you pronounce it. I’m not even sure you went over his argument. It just sounded kind of I think you went like well that just sounds kind of to the extent I understand it sounds kind of crazy. Um I suppose what what’s like the strongest argument you’ve heard for it and like what’s the least strong argument you’ve heard in favor of IP that is?

Critiquing IP Arguments

25:52

Kinsella: Well, I mean there’s a lot of them. I think I pretty much counted them all by now. There you can categorize them in a couple ways. One is deontological or principled which and there’s several types of that and then there’s consequentialist or utilitarian. Um so the which is a predominant argument now utilitarian although um most Objectivists and defenders of IP slip back and forth between the practical or the pragmatic or the utilitarian argument and the natural rights type argument and they’re not always clear on the difference. Um, there’s a third argument no one ever talks about. It’s Hegel’s personality theory, but it’s so murky, no one even understands it. It’s basically the idea that um, when you create like an artwork or an invention, you’re extending your personality into that realm of the world and therefore you have some kind of property right in it. But that’s just not how you go about defining what property rights are and what the purpose of law is. Uh, it’s just a nonsensical argument. Um the the principled arguments uh I think primarily stem from a mistake made early on by John Locke which has been carried on into the entire world of political philosophy and um I call it the labor theory of property. Um and it’s I think it was a close cousin to or kind of a progenitor of the labor theory of value of the later thinker Adam Smith and then David Ricardo and then Karl Marx. And ironically, Ayn Rand a lot of her theories have make the same mistake. It’s the idea of thinking of labor as some kind of substance that has some kind of ontological if not physical reality in the world and that has value and utility which it does but therefore it’s an ontological type of thing that can be owned. So they don’t stop and think what does the word ownership apply to? Um uh and to jump out for a second, I’ve yet to hear a good argument for IP. I can tell you the one I think is the least preposterous in a second, but they’re pretty much all absurd. Um I’ve never heard a good argument for it really. Um but the problem with Locke’s view is that in his argument where he was trying to defend the right of people to acquire unowned resources in the world and to have some kind of absolute right in those against the king and the government. Uh he was trying to counter the monarchy arguments of Filmer, things like that. But he was also appealing to the population at the time which was kind of religious and they believed in this Adam and Eve story and you know which was how the Filmer and the monarchs defended their divine right is by tracing their divine right back to Adam and Eve. So Locke was saying listen God gave the earth to man in commons and if there’s unowned resources he wants us to be able to use them. So basically everything is unowned and the first person to start using something by mixing their labor with it is the owner of it which I think is a good argument but the reason is because um when you mix your labor with something you’ve put a border up around it and you establish an objective link between you and the other person and that’s enough to establish a property title that can signal to people that now I’m the claimant and the owner of this resource and then conflict can be reduced or avoided because now you have property rights but it’s not because you own your labor. Which is what Locke said. He Locke said you own yourself and therefore you own your labor and therefore you own things you mix it with. So you have this kind of series of steps which muddy his argument and which are frankly unnecessary because you don’t need to assume that you own labor to say that you have a better claim to a resource than you labored on because labor is just a type of action. There are two types of action. There’s labor and leisure. I mean no one says you own your leisure. It doesn’t make any sense but it’s another type of action. So if you own your labor, then you own your actions in general and you own your leisure, which just a nonsensical statement. Ownership is the right to use physical force to repel someone who would take from you a physical object that you possess and find useful to possess, right? You can only use physical force against something physical. Um, so that’s a fundamental mistake made by Locke and that’s permeated theory ever since then. And that’s why I started up earlier saying that um what I call libertarian or Randian creationism is this idea that creation is a source of property rights. Um creation is a source of wealth. Wealth just means having more useful things at our disposal which we get by rearranging or manipulating or transforming things that we already own. Production means doing that. Production means possessing and owning a resource like a raw material and then using your labor and your intellect and your effort to transform it into something more useful. That is that’s what production means. But when you produce something like that, you are creating you’re creating a new shape and you’re creating wealth, but you didn’t create a new thing that you own. All of a sudden, you already owned the input factors, which is why Henry Ford’s employees did not own the cars that they produced because they were using someone else’s own material. So, you determine who owns the cars Henry Ford is producing by asking who owned the raw materials and who did he sell it to? That’s the only question, right? So that’s the fundamental mistake of what I call libertarian creationism or the deontological approach justifying rights. Um the second one would be more of a consequentialist and then there’s a personality theory which I’ve already briefly mentioned. Um and that would just to me seems to be so absurd and in fact if you take it seriously then you would end up with infinite copyright terms which is what some Randians and Galambos and Jill Schulman and others who are more insane advocates of intellectual property say they say yes you’re right um it’s arbitrary to cut off the term of a copyright at 110 years and it’s arbitrary to cut off patents at 17 years so they should last forever right? Because they wouldn’t exist without your efforts. So, you know, so that’s their argument. But that would lead to a world where we would be dead because you couldn’t act because you couldn’t get enough permission from everyone around the world that has some kind of inherited claim from some distant ancestor who invented fire or how to cook food, cook food with fire, wear clothes or build a log cabin. I mean, or catch fish with a spear or with a net, you know, we just would die out as a species. Which is why the practical-minded IP advocates always limit it to some practical thing. Okay.

Utilitarian Fallacies

33:05

Kinsella: So then we get to the utilitarian argument and the utilitarian argument is basically a market failure argument. The argument is that um is that normally the free market works to give enough incentive for people to produce things, right? So you have a profit and loss incentive. You have an incentive to homestead resources and to transform them and then maybe to sell them to others. And normally that’s enough. But the argument is that with some types of goods where a predominant or overwhelming percentage of the value of the resource that you want to sell or the product or the service that you want to sell where the predominant aspect of it is a pattern or the design which is easy to copy which means easy to compete with then it’s too easy for people to compete with you. So then it’s harder for you to make a profit because you can’t as easily like start making a new I don’t know horse saddle or some product and just sell it on the free market because people can’t easily copy you know your saddles. They have to work to start competing with you to be a competing saddle competitor. But if the device if the product is a book with a pattern on it, you know, like Great Expectations or something or if it’s like a new drug a new pharmaceutical drug with a certain property that the predominant value in that thing is the way it’s arranged and it’s easy for someone to copy it and therefore compete with you by selling a lower priced alternative which is similar. In that case, the incentive to produce is not high enough. And so we would have an underproduction of intellectual goods if we didn’t prevent people from competing with you. In other words, they think that the free market fails because it’s too easy to compete with someone if the product or service they’re offering is something that’s easy to copy. Okay? You know, there’s a lot of fallacious assumptions in those scenarios, but even if they’re right, their argument basically is that in those cases, the free market fails and we would have an underproduction of these types of goods. And so the state needs to step in and grant temporary intellectual monopoly privileges, which they originally called that, um, and in the form of patents and copyrights, which gives someone breathing room from competition for a number of years. So if I come up with a new invention, I can patent it and then no one can compete with me for 17 years. Or if I come up with a new novel, no one can compete with me for 14 years. Well, that was a term originally. And then then it was 14 years times two if you wanted to renew it, but only one time. So it was 28 years in the beginning of the country uh in the US in 1790 with the first copyright act. But then over time because Mickey Mouse’s copyright was about to expire several times and you know Sonny Bono and his cronies in Congress kept being lobbied by Disney and others to keep extending it. So now we have uh the term is 70 years after the author’s death. So it’s like well over a hundred years in many cases. So the copyright lasts right but the idea is that um whoever invents or comes up with this useful intellectual pattern that could be used to improve a product or to you know make a piece of paper with ink on it more valuable with a pattern on it. Um because people can’t compete with you. You can sell it for a monopoly price. And because you can sell it for a monopoly price, you have a greater incentive to engage in that creative effort in the first place. But if you didn’t have that, you would have less of an incentive and you would have fewer intellectual works being produced. So it’s basically this utilitarian argument that these wise congressmen and bureaucrats in the patent and copyright office can determine what kind of optimal term for patents and copyrights whether 17 years or 14 times 2 or life of the author plus 70 I don’t know I mean but it’s some number that they think somehow reduces the amount of underproduction of these goods and gets us closer to this ideal utopian non-failed free market. So, so that’s the argument there. And the problem with that argument there there’s like at least five problems with that argument. Number one, um it assumes that the state ought to have the power to violate property rights, which is what the grant of a non-consensual negative servitude is. What patenting copyright are the argument is that the state should have the power to step in and fix market failures by force. Well, that’s a stupid assumption. That’s not just and libertarian. Number two, it assumes that they will do that and have the knowledge to do that, which they don’t, which is why the copyright term keeps changing and no one knows what the optimal copyright and patent term are except me, which is zero. Um, right? And number three, it assumes that uh that you can compare utility interpersonally between people and that it’s cardinal, right? So, in other words, there’s a number attached to it like a quantity. So, it’s cardinal, not ordinal. Uh and also that you can compare them interpersonally between people and also that it’s ethical to hurt one person to help another person if the if this if the net sum is positive like that’s just pure utilitarianism. I mean by that argument, you know, if there’s a cure for blindness by taking the one eyeball out of a seeing person and putting it into the head of a blind person, then it would be justified to take eyes out of seeing people and put it in blind people’s heads because, you know, the person who was victimized by this procedure is harmed, but they can still see. So, they’re not harmed that much, but the blind person goes from zero to, you know, to full sight. So the net sum is definitely positive in that case, you know, or you if you got some guys who are desperate for sex, you know, maybe they should be able to rape women because maybe maybe they benefit more than the women are harmed. I mean, when you have this type of intellectual calculus, the doors open for just a massive unprincipled violation of rights. Um I suppose the best argument for and by the way people say that the best case for patents even if you oppose them in most cases like I do they say well the best case or the hardest case is pharmaceuticals but that’s actually the opposite of the truth the best case I mean the pharmaceuticals are almost the worst case for IP for patents because pharmaceuticals save lives and when you allow pharmaceutical companies to charge monopoly prices they stop competitors from innovating and also the prices are astronomically high so they prevent people from getting access to these resources. Sorry, go ahead. Like Martin Shkreli, right? Were you interrupting?

Su: Oh, sorry. Yeah. No, like Martin Shkreli, he he like jacked up the price on that like insulin or whatever.

Kinsella: Yeah, that was a complicated case because it was already off of patent, but he used the quasi monopoly of the FDA. See, the FDA sort of extends patents by you have to get FDA approval to um uh it was Martin Shkreli. You have to get FDA approval to have a generic compete with another drug even if the patent expires. Um um but that’s like a quasi patent right too. So yeah, that’s another example. But you know the thing is patents are the worst case for for in other words the reason the patent the drugs cost so much is because the FDA imposes billions of dollars of costs to get regulatory approval. It’s not because the free market has failed. It’s because the statist state has imposed regulations and costs on this industry in the first place. Um I think I’ve come up in my head with a couple of arguments that are not the stupidest arguments. Like I suppose if you could prove that without IP rights that we would be living in a third world or if we um or we would die off as as you know because some some some IP advocates say that there would be no innovation and no creative art without IP like they say zero but that’s obviously stupid because before the modern IP system you had inventions and you had science and you had artworks so obviously it’s possible so their only argument can be that um that there’d be less. Okay. But the other thing there’s two other points to make. These guys do not take into account when they argue that uh that if you have a patent system or copyright system, you have more artistic and creative works and innovation because of these artificial monopoly grants. Um number one, there’s no empirical evidence that this is true at all. Like there’s no evidence that there’s any more innovation or artistic creativity at all. And number two, they don’t take into account the obvious cost of the system. There are huge costs of these systems. So they would have to come up with number one a sum total of all the innovations that we lost. Number two, the value of the innovations that we gained, number three, the cost of the system and see if it’s all worth it. And they don’t even try to do that. And the economists that have tried to do that since 1950s keep concluding that there’s no proof of this or that it looks like it’s a negative. So the empirical argument is weak at best and it’s on our side. So like there’s no argument that you should violate rights to generate maximum utility. That’s not a principled way to do things and there’s no argument that it does so anyway. And it defies common sense because uh we have innovation. We’ve always had innovation and in today’s world there’s rampant piracy of movies and books and songs and yet people still sell them and produce them. In fact, most people don’t make any money selling books. I mean we’re doing this podcast right now which is the recording will be protected by copyright but no one’s being paid for this. So, people do things all the time creatively without financial payment.

Su: Yeah. Um, I do have two follow-up questions on that, but for that, Hamsters uh is apparently on low battery, so Hamsters, go ahead and uh ask your questions, please.

Hamsters: Hey, try buying a charger next time, bro. Please go around with a charger.

Zulu: Can you hear us, Hamsters? Uh-oh.

Su: He’s listed for me as a listener, not a speaker. Oh yeah, he just dropped that again. Oh my god. It is not a Twitter Space without technical problems. Um, Hamsters, can you hear us?

Zulu: Hello, Hamsters, you there? Can you hear us? Damn, bro. Can you do some sort of emoji reaction if you can hear us? Okay. Well, we cannot hear you. Um, are you using AirPods? I think you are. This is your last chance, Hamsters, where you fix your technical issues. Hello. Can you hear us?

Su: And by the way, uh before we finish this conversation, I’d like to hear at some point, Zulu, I’d like to hear your as as you’re one of the Objectivists who is anti-IP, I kind of want to hear your position as to when we may have time for that. Yeah, for sure.

Zulu: Yeah. Hamsters, um please fix your mic and come back. Just come back in five minutes because I have a follow-up question to here. Um yeah, I you when you were um you know uh I noticed something you said that um Objectivists were saying like um labor is a substance that can be owned. Uh did I understand that part correctly? Yeah.

Kinsella: Yeah. I think uh Rand would disagree with that. I think Rand would deny that labor is something that can be owned. Uh she would claim that the product of the action would be owned and then she would say that would be conflating the action with its result because I think she talked about that is that um um she was just called the nor ownership as a normative relationship between a person and something and then look at the principle okay what principle determines which results of human action can legitimately be owned but she she would she absolutely denied like labor itself is the substance that could be owned. I wonder what you think about that.

Kinsella: I I agree with you. She she she would deny that and she and the Objectivists don’t say that explicitly. I’m trying to explain uh the mistake I think that they’re unintentionally making. I think Ayn Rand is of two minds on this. I think her statement of in Galt’s speech that I quoted earlier that I was uh paraphrasing earlier that you know, no man may initiate the use of force. I mean, she’s clearly talking about physical force, but physical force is she talks about we’re not just ghosts. Okay. So, I think her view there is incompatible with her view elsewhere that uh patent rights are the most fundamental. She said that somewhere that patent rights are the most fundamental type of right. And that’s where she has a commonality with Galambos. The Galambos said that there’s primary property which is your ideas and then below that is like secondary property which is like your body and physical property. And when Ayn Rand says that patent rights are the heart and core of property rights, what she’s getting at is the importance of the intellect, which I agree with. But saying that just because something is important and crucial to human life and human action doesn’t mean that there’s a property right in it. Um, so I think her statement of the only way to violate property rights is by physical force or aggression is correct, but that implies that there’s physical force involved and it has to be the type of thing that can only apply the type of thing that force can apply to that we can grapple with, which is a scarce means of action. So I I like I said earlier it when she says that the the result or as you said the product of your effort Yeah. The product of your effort is profit or is success, right? But you can call it creation if you want. But we have to be careful of these metaphors because they can tangle us up into what I think is one of the greatest errors of the modern world, which is I think a type of reification. It’s this idea that if you have a useful word or a useful concept or a legitimate concept, a concept that has a reference, right? That that means that that’s an ontological type of thing and that any quote thing unquote that exists that has quote unquote value can have an owner. But that’s jumping the gun because again the whole purpose of property rights is because there is the possibility of physical conflict between people over the use of resources. We have property rights emerge to try to reduce that. But that only makes sense when it applies to those types of things. So if you think of all the things in the universe, all the things that we have different concepts for, all the ontological types of things, if you want to call it that way, um that’s fine. If you find that it’s a useful concept, you can use a concept of love, you can use the concept of weight, you can use the concept of productivity and labor. But all these types of things only a subset of them are the types of things that can be owned because only a subset of these things are the types of things to which you can use. You can apply physical force that you can physically grapple with. Just like there’s only one way to commit aggression by the use of physical force directed against what? It’s got to be directed against a physical thing. I mean, you can’t direct physical force against someone’s spirit, right? Or their or their soul. Even if you want to use metaphorically that idea that someone has a spirit aspect or a soul aspect, even in the Randian atheist sense, I mean, yeah, someone’s person, their personality, their their memories, you know, their character is a distinct valid valuable concept, but it’s distinct from the concept of their physical body, corporeal body. That’s a thing that’s a subset of things that physical force can be used against and that’s the type of thing that there could be a rights violation against and that’s the type of thing that can be owned. So only so you have to first ask before you ask who is the owner of this thing you have to ask is it a type of thing that can have an owner. So if you say well if I like Kibbe McCann who an Objectivist scholar said well if I create a poem the poem ontologically exists and therefore the most natural owner is the one who created it but he’s assuming that it has an owner. Yeah, he’s correct that if a poem has an owner it would have to be the one that created it. But creation has never been a source of ownership. Ownership comes from physical for physical activity homesteading a resource that was unowned. It’s not creating anything. It’s first using a thing.

Value and Ownership

47:35

Su: That actually brings me to the second question I wanted to ask. This is also like this whole topic is also related to kind of justification of rights. Um I don’t know what’s your approach towards Rand’s justification rising to give one sentence summary to audience who may not know um Rand’s divorces and the right to life and that right of properties and implementation of it. So she just looks like what are the conditions necessary to sustain his life by his own effort. What do you think about that whole justification? Do you agree with it?

Kinsella: I I think in general form it makes sense, but it’s not very rigorous. Um to the extent that Hold on just a second. Hold on just a second. Yeah, I’m on the phone. Okay, good. Thanks so much. Thank you. Yeah, send me the simulator. Sorry about that, guys. Paying for an air conditioner repair. You’re good. Okay. Um um so I I so David Kelley has an argument about the necessity of government and his argument is that government is justified because of necessity in other words because we need it. Um and Rand has and I don’t think it’s a good argument and I Rand has a similar argument um uh that yeah she’s describing how humans operate in the world. Okay, we need to be productive, right? We need to be independent and productive. That’s why the virtues of independence and productivity and integrity, honesty, intelligence, you know, all matter. Um but because success is not guaranteed to us, um we need to be able to operate in the world, right? And I think and that’s why she believes in individual rights. You need to be free from physical force or force by others. Um, and so I think she’s saying that she she’s doing she’s making the same mistake um that’s made by people that think that property you have a property right in the value of a thing, but you don’t. You only have the property right in the integrity of a thing. Or people that say that um um if you work hard um you you deserve to the fruits of your labor, they sometimes call it. It’s this idea that if you work hard then you are entitled to some kind of reimbursement. And that insight comes from the observation that we’ve gained over time that by and large when you work hard and when you’re diligent and when you try hard and you and you’re intelligent you tend to succeed in life, right? Or as Mises we call it, you make a psychic profit and you profit. You have successful human action. Um, and that’s all true, but it doesn’t mean that you’re guaranteed anything. You know, if you try to start a business and it fails, even if you worked hard, you’re not entitled to a profit. And by the same token, if you work hard on a book and you sell it and people compete with you by selling copies of it, it’s not like you’re having the fruits of your labor stolen. That’s using metaphors to obscure and muddy the issue. So I think what Rand was doing is she’s saying like so we need to have um productive effort to survive in life and so we need to have a retrospective but all that means to me is you need to be able to be free of conflict from other people. In other words, you need for people not to commit aggression against you um or the property rights that you have in things that you acquired by homesteading it or by contractual transfer. Uh that’s enough to give you the ability to find a way to try to succeed in a free market by selling something to others by providing services uh or just living on your own and still you know succeeding by you know having chickens and a garden and in a solar powered hut or whatever you want to do. Um, so the fact that so and then she says that so the purpose of a moral life is to produce values. And this is another thing she does is kind of a little bit idiosyncratic is she uses the word values almost like a noun. Um like I I think that we demonstrate that we value something by or that we prefer something by action. And that’s actually compatible with Ayn Rand’s view of value. She says that uh so Mises would say that um uh you demonstrate that you value something by acting to achieve it right to by using means designed or aimed at achieving some end that you so that that’s what you value that’s demonstrated preference and Ayn Rand would say that a value is something that someone acts to gain and or keep and that’s all perfectly fine and compatible with Austrian or with Mises’s praxeology. But then she says it’s about producing values, like it’s a noun. So, she’s thinking of anything that you any result of an action or an effort that is valuable to your life as being of value. And then she’s thinking then that’s the type of thing that you created and therefore you own it. So she’s jumping to this again the same mistake that values that you create by the use of your effort or the types of things that you have a property right in without first asking is that the type of thing that you can have a property right in. I mean I value my wife but I don’t have a property right in her. You know I value my country. I don’t have a property right in that either. You know I value living in a world of people that appreciate art. I don’t have a property right in that either. We can value lots of things. So I I think one of the mistakes is not keeping in mind the distinction between value as a noun and value as a verb.

Su: All right. Um Hamsters have Thanks so much. We can’t hear you. Please go ahead.

Hamsters: Um right. So uh I might have forgotten some of the arguments you were making earlier, but I’m rather convinced by the utilitarian arguments in favor of IP. So you were talking about with um pharmaceuticals earlier. So the argument is mostly I think I think you mostly got it right. So like long-term capital bets uh really high fixed costs, low variable costs, really easy to reverse engineer it. Um and you also said like is there like evidence for your standard just like uh empirical evidence that would show innovation increasing counterfactually to uh no IP right yeah but I think the issue is that you would also have to show that as well right like the burden would also be on you unless you want to like take an agnostic position also I do think um there are there have been some like synthetic control papers and like matching studies that kind of argue that uh patents like national patents do increase innovation. So there’s a paper called Q uh it’s from 2007 and they basically um so are you familiar with like uh like matching studies? I’m not sure.

Kinsella: Yeah. So it’s um they basically like construct a model to try to see like if the United States uh had stronger patent laws versus if it had weaker patent laws, what would it look like? Um and they find that uh for educational R&D that it does increase slightly. Um so I think the empirics do lean slightly towards intellectual property increasing innovation. Um, and also the other point you made was uh on how like you can’t really trust the government to enforce good IP because they just get politically captured, which is true because uh I believe Congress right now passes intellectual property laws under title 17. Right.

Kinsella: Well, they pass the laws under the copyright under the Constitution’s copyright clause, article one, section 8.

Hamsters: Yeah. So wouldn’t that wouldn’t your like uh critique just basically be hedged if we just had like an independent board to determine copyright laws similar to how we have like an independent uh central bank right now?

Kinsella: No, no. The these the patent office and and the bureaucrats in Congress and in the bureaucrats and any any um agency that they appoint. Well, look, I think if you actually appointed an independent board to assess the term of patents, they would they would almost all say it should be lower because it’s too long. Now, I don’t know what number they would settle on, but there’s but there’s a lot of evidence about that, but they would probably tend to they would complicate it. They would say something like, well, software patent should last 5 years and pharmaceutical patents should last eight years. And so then you would have even more uncertainty about so you give more discretion to the state. But I the question I would ask you is a fundamental question. Um what do you think the purpose of of law is and justice? I mean what’s the purpose of having whether it’s a government or or any legal system what’s the purpose of having laws?

Hamsters: I I think laws are mostly there just for like welfare enhancing purposes like we have laws as social norms to promote uh like people’s welfare and wellbeing. So, like when I look at what laws I’d be in favor of, I mostly assess them on whether or not they’d be welfare enhancing.

Kinsella: No, but my question is, do you not do you not agree that in general the purpose of law is to do justice? That is to determine what people’s rights are and to try to enforce and respect and identify those rights. I mean, isn’t it in general that what the purpose of law is?

Hamsters: Yeah. But what I think I think rights are just like legal fiction created for welfare purposes is the point I’m trying to get across.

Kinsella: Well, so if there’s a law that says you’re not permitted to kill someone by hitting their body without their permission can you hear me?

Zulu: Is that Hello? What’s going on? Hamsters, can you hear Kinsella or us? Did you lose connection?

Hamsters: Can I I think I think I just I switched to my car and I think I just cut out. Okay. Can you hear us now?

Zulu: What is going on? Hamsters, can you hear us? I mean, if you’d just like to continue with your answer. Maybe he comes back. Maybe he doesn’t. We can move on.

Kinsella: Yeah. So, so, so what I was going to say is I mean it’s it’s a little bit bloodless and humanless to say that like the reason we prohibit murder is because it’s a welfare enhancing measure. I mean, that’s not what rights are. Um, and also, so if you’re imagining this this I think these studies are all they’re all nonsense. I I don’t I don’t agree with that at all. And and if you if you I have a post on my site called the uh the empirical case against IP. I mean I’ve got quotes from Fritz Machlup from 1956 and a host of legal legal theorists and um and economists ever since then even to this day and they keep saying we don’t know any more than Fritz Machlup claimed in 1956 when he said that we have no evidence that these things really do anything any good. I’m talking about the patent system. So I don’t I don’t think you’re right. I mean, uh, there’s there’s no clear study and even if you’re right, it still doesn’t it doesn’t take the cost of the system into account. Um, I mean, Milton Friedman and even Rothbard, they they it was obvious even to Milton Friedman that patent system distorts innovation because it gives reward to some types of innovations and not to others. So, at the very least, it causes some innovation to be lost or distorted. But I would say the more fundamental point is this. Um, let’s imagine that you’re right that we we have some pharmaceuticals in a pre-market that is a world without IP rights, but you don’t think it’s enough and a congressional subcommittee doesn’t think it’s enough. So, they pass a patent law um which gives you 17 years of patent term, right? So that by that logic that makes more marginal inventions that would not have been funded and developed makes them now possible. So now we go from let’s say 1.0 level of innovative activity to 1.7 let’s say. Okay. So now we have more pharmaceuticals. Now we still don’t know if the price is worth it because the cost of the system may be greater than that 7 delta. But let’s let’s let’s say that that’s zero. Okay. How do you know that that’s enough? Why don’t we have a capital punishment for infringing a patent? Maybe that would deter uh infringers and we would have even more innovation. Or maybe we have a 100-year patent term instead of instead of 17. Maybe we should make it infinite because the more patent term you add, the more innovation you stimulate. Or maybe we say that even with this draconian patent system, we’ve gone from from level one to level 1.7. But we don’t think that’s enough because the world would be better off if we had even more innovation. So now let’s start taxing everyone to pay to pay scientists and inventors to come up with more inventions. Like that’s why I ask you the question about what’s the purpose of law. To my mind, the purpose of law is to do justice by identifying people’s rights and and respecting them and enforcing them. It’s not to maximize some arbitrary uh criteria that the central planning board thinks is the most important thing to maximize right now. I mean, if you say the most important thing in the world to maximize is the production of pharmaceutical drugs, then we could enslave the entire planet and make us dedicated towards just making more drugs. But why do you arbitrarily assume that the one thing the government should gear its laws towards is maximizing the amount of innovative products at the cost of everything else? I prefer to let freedom and the free market handle how we allocate our consumption, our leisure, our production versus our consumption, and the types of products and services that people engage in and that they value on the market.

Su: Um, answers, do you have a follow-up question?

Zulu: All right. Well, I think he’s gone. He’s a goner. So, wait. Hello. Hello. Do you have a followup question? Yeah, we can.

Hamsters: Yeah. Yeah. So, to be clear, yeah, for some reason, every time I hop in my car, I my microphone just breaks or something. Um, to be clear, I don’t think anyone’s in favor of just maximizing innovation. Everyone just like the the utilitarian argument is that innovation is instrumentally useful for promoting well-being. Um, and I I agree that Machlup uh wasn’t he in favor of intellectual property? Um, I know he was like not even like he wasn’t I not what he said was what he what I’m not sure what he’s in favor of but what he said in his study was that we don’t have enough evidence to conclude one way or the other whether we should he said if we if if we if we didn’t have a patent system we don’t have enough evidence to say we should have one but we also don’t have enough evidence to say we should abolish it now that we have it. So basically he said it’s inconclusive. We don’t know.

Kinsella: Right. Right. Of course, there’s like a burden on anyone taking like a negative or affirmative on that. But what I’m saying is that, you know, Machlup is like is this is obviously like a very long time ago. I feel like we have the empirical methods to give us like at least a model that should have us favor at least one conclusion. And it seems like it does slightly favor uh a like a very limited intellectual property regime. Not for like, you know, Mickey Mouse. I don’t think we should have like 70-year patent laws for Mickey Mouse, but I think that perhaps for like COVID vaccines for example, it seems like we do need intellectual property. Um Moderna and Pfizer spent billions, right? Uh we we we spent billions on early stage and late stage development and I just can’t see that happening um in like a regime without intellectual property. Well, well, first of all, I’m not a big COVID I’m not a big COVID vaccine uh status. So, I don’t care. And number two, I I don’t care. It’s It’s irrelevant. I mean I mean I I guess you didn’t hear the point about I mean the reason it costs billions is because we have an FDA. So I guess you’re in favor of the FDA, too. I mean I look I’m happy to talk about normal things but I thought this was me trying to defend my view of I of IP against the Objectivists. You don’t seem like you’re either one. I mean, no libertarian, I think.

Hamsters: Yeah. I’m just likeian. You’re just, you know, wait. I think I’m I think I’m a libertarian. I We had like a discussion on Twitter a while ago where you said utilitarians can be libertarians.

Kinsella: They can’t be. They can’t be. I just You didn’t sound like saying I mean because you’re not valuing justice at all or rights.

Su: I think I don’t think any value right Hamsters. I think this is going too much back and forth and kind of like getting us out of the conversation.

Kinsella: No, that’s fine. That’s fine. I’ll mute.

Su: No, you’re good. You’re good. Um, so from here we’re moving on. We have Liitz here. He had several questions in the replies. And after Liitz, um, Kinsella mentioned you have want to talk about like Objectivism IP with Zulu. And after that, I actually have want to talk about AI. So that that’s the route we’re going to go. Um, hey Liitz, how are you doing today?

Liitz: I’m doing okay. I’m in sunny California, so I’m enjoying myself. Stephan, I have three interrelated questions for you. The the Ayn Rand’s view, her theory of rights is derived from her theory of ethics and her theory of ethics is derived from her epistemology. So my questions are, what are rights? Do you have a deontological view of rights? And do you think that Objectivist epistemology is compatible with Kantian epistemology?

Objectivism and Law

1:08:46

Kinsella: I mean, the last question I it’s interesting, but it seems like I don’t see how it’s possibly relevant to this topic. Um, uh, do you want me to tell you? I will. Well, I think it’s I think I think we live in a world of reality. I think Ayn Rand was right about that. And I think that there are interpretations of Kant’s uh Kant’s epistemology which are also realistic. So to that extent they’re they’re fine. I think we know enough about reality to know that we live in a world where we act and we have to use scarce resources and that there’s cause and effect and there’s there’s things we can learn about the world and that you know in this world the question is what rights do we have? And I don’t think we need to have a deep discussion of Kantian epistemology to determine these things.

Liitz: Okay, so that that answers that one. What about the other two questions? Remind me what the other two are. What are rights? And do you hold to a deontological view of rights?

Kinsella: I don’t think I hold to a deontological view. I I I’m I’m become increasingly skeptical of that way of looking at it. Uh to my mind um and I think it is difficult to define rights properly. Um you can do it in more general terms. I think you can call it a justified claim on on a resource. Uh which means that uh it’s a claim you can assert that you can back by the use of force to defend your ability to possess and use a resource. Um I think that’s what a right is. A right is the normative um protection of the ability to possess. So the I think of possession as what people do when they act and then uh rights are like a legal layer on top of that that gives you the right to use force, the socially recognized right to use force. So that’s what rights are. Now what that’s what rights are in general, but what rights we have is a different debate. I I think by and large that Objectivists and libertarians basically agree on what the rights are. The rights that we have and I agree with Rothbard whether that all rights are property rights and the reason is because you can only you can only violate rights by the use of physical force and and force can only be used against physical things. Um so uh it’s murder to choose someone’s body because that’s a physical thing but it’s not murder to you know murder their soul whatever that metaphor means. Um and to be precise when people say oh taxation is theft of your life that is a that’s a metaphorical way to describe it but technically speaking taxation is not even theft. Taxation is extortion. Taxation is the use of a threat of physical force to compel you to hand over some owned resource. Okay. So when you get precise in these things then you see what the nature of the actual act of aggression is. Um, so that’s what rights are and I think so what that’s what rights are in general. But what the rights we have are it’s a right to be the the owner of your body and the right to be the owner of a resource that you acquired by original appropriation or by contractual title transfer. That’s the rights that we have. Um, and that’s why you can’t have intellectual property. Um, and what was the first the other question?

Liitz: Okay. So, so do rights exist or are they a human artifice or a human creation? Are they something that are are real or are they just something we create?

Kinsella: I mean, I’m not a Platonist. I don’t I don’t think of things in in that in that way. I like I said, I think the biggest mistake is made is is reification. It’s the idea that if there’s a useful concept and if there’s a legitimate concept, then it refers to something that we can name with a word. And then once you have that, you can wrap your head around this solid thing that has a name and therefore it’s a thing that exists. I think the word exist is misused quite often. When people say do rights exist or they say is does evil exist, that’s another way of saying that the concept is legitimate or or useful. Um so when they say does a right exist, what I think that means is can you justify that that proposition that normative proposition or that ethical proposition that you’re making? So I would say rights can be justified or not justified, but not I don’t think they exist any more than numbers exist. They certainly don’t exist in the same sense as a physical object does. So yes, numbers are a useful concept, but I don’t think numbers exist. I don’t think a circle exists. Um, unless you’re careful about what you mean and you you you clarify that you you have a different meaning of the word exist. So to me the word exist I try to restrict it to you know the existence versus non-existence of a physical thing or a physical law something causal in the universe. Okay. Thanks a lot Steph.

Kinsella: So to me to me so to me a right is a normative or an ethical principle and they can be justified but but they don’t exist.

Liitz: Okay. Thanks Stephan. Thank you uh Su for having me on. Appreciate it.

Su: Thank you. Absolutely. Um all right. Now um uh fellow you mentioned you wanted to talk about Zulu on like Objectivism and intellectual property and about history. Would you like to go with that and then we can get into AI? You talking to me?

Kinsella: Yes. Oh yeah. Because there’s so few Objectivists that that um that they still maintain their Objectivist principles and yet they they they come to realize that not not only the state but intellectual property are incompatible with Objectivist principles. I’m curious. I’m just curious as a Zulu’s take on this. Why why you think that is? And how do you think what’s the best way to show Objectivists that their their their core principles um are applied incorrectly on IP?

Zulu: Yes. So I mean basically I think well I was an ancap first and then I became an Objectivist. So I I already kind of had it ground in my head like the more precise legal thinking and then when I saw what the Objectivists had to offer it’s you know Rand is very vague and very kind of meh when it comes to the law her legal principles it’s very much like not precise uh as I’m sure you’re aware. Um so I was already like well I mean the anarcho-capitalists they’ve already got this beautiful legal theory you know can I actually square this circle here? Can I unify this with the Objectivism? And as it turns out, I think you can. And I think it’s the natural conclusion. And I think Ayn Rand, yeah, her real big issue was that in doing her non-fiction, um, she was answering the wrong question when it came to her politics. Like she didn’t even think that law was necessarily a part of philosophy. Um, which is probably why she didn’t pay much attention to it. Um, but she thought that politics was a part of philosophy. And I think she was answering the wrong question there because her politics is like it includes a clause including the functions of government. Um so that already assumes that there is going to be a government. It already assumes anarchism out of the question. So that kind of muddied her whole thinking there and made her reject law as a part of uh philosophy. What if she truly understood what law is talking about that it’s okay it’s ethics applied to this problem that there are there’s this thing called a conflict that you can have because there is scarcity if she understood that then I think she would come to the correct conclusions basically conclusions that the capitalists have come to and I think she is more honest about this in her uh fiction than she is in her non-fiction because she says directly in in Atlas Shrugged honus who retracted his fire from the He isn’t Prometheus who went out and stamped everybody else’s fire out, right? It’s it’s not like uh you know Rearden after after he wanted to quit um that he went out and destroyed every other metal refinery. He didn’t do that. He just stopped working at his metal refinery and you know everything then collapsed. That that is the whole theme of Atlas Shrugged is that if these producers quit then everything else just kind of collapses from that. They don’t have to go out, you know, Wyatt doesn’t have to prevent anybody from uh, you know, implementing his oil refining techniques at Wyatt’s uh, hill, his torch, right? He just has to he he says, “I I give it to you as I found it, right? He doesn’t have to go out and prevent them from re-implementing his techniques. It’s just it’s just a natural consequence.” So, I think it’s just a natural although there So, yeah.

Kinsella: Yeah. Absolutely. But in Atlas, it’s interesting in Atlas, there’s a uh about uh Rearden there is a little subplot about Rearden Metal being patented and the government wanting to take the patent from him and Rand treats that as like kind of a theft by the by the bureaucracy of Rearden’s property, but she kind of wait she she she glosses over the fact that well it was granted to him by the state in the first place, you know. Um and then you have this subplot where remember Dagny and um uh was it Hank? They were looking for Galt’s I mean for uh the motor that Galt invented at 20th Century Motors and they found it. They were trying to reverse engineer it but you know if you really believe in intellectual property rights they were committing a theft of his of his property by doing that. Right. And of course Galt was quasi anarchist anyway. Uh so um I and there’s actually somewhere in her in her questions and answers somewhere someone asked a question about like what’s the right term for patents and copyrights and she she kind of hand waves and says oh that’s let the legal specialist figure that out like she just didn’t want to give it any deep thought at all like she just assumed there’s this body of experts who can sort out these little issues. Yeah, it’s it’s I actually um I believe it was the first time I met um my co-host here Su was I had this debate with uh with a Randoid where I brought this this point up to him where I was like okay he he like made this whole like declaration in the middle like oh and here’s the burden of proof and Zulu has to poke some hole in my theory that I brought forth yada yada yada and I was like okay let’s start poking some holes then guy and I basically said like okay well what if two people file at the same time and he’s like okay well then it would be the person who discovered okay what if they discover at the same time what it and he like I just kept going down this uh route with him and it’s like yeah it’s arbitrary you don’t know how to handle two people coming up with an idea at the same time and you just had to basically like well this is actually not a part of philosophy this is only a part of it’s some implementation detail doesn’t matter it’s like well it actually does matter it matters very much right that’s the point yeah it’s an implementation detail to her but it’s not Yeah,

Su: I want to add something to that. Um, yeah, that was a video that kind of before that I was also like a defender of IP. That video was a thing that got me. I was like, “Oh, oh.” But um I noticed something uh even before that, even though I would uh philosophically debate IP and use like have a justification for it, I I still keep kept pirating things like I would still go to websites to pirate movies and you know uh like photocopy books, college books from library so I wouldn’t have to pay for them which are all these are technically still violations of IP at least in Turkey where I grew up in. And um and uh everyone that I knew who were defending IP they still pirated and uh like did all these things that with copyrights and it made me realize that uh it was not even something and that any problem obviously this is not like a philosophical justification it’s just an observation of how people take failed to take this serious they violated IP on their day-to-day lives. They didn’t even care about it.

Kinsella: Well, it’s an indication that it’s it’s impractical. It’s not as it’s not as practical as they think it is because even they can’t they can’t abide by it.

Su: Yeah. It doesn’t really it doesn’t really fit actually. Um like you know as objective as we look at the requirements for human life and what makes us to live better and flourish and we have this thing that is completely impractical that kind of serves the opposite purpose. And this actually came up in my um video I was doing on AI art because there’s a lot of artists who are making IP arguments against AI art because it’s like, oh, these AIs, they scrape the internet for a bunch of artist pictures and then they’re stealing those pictures, right? Um but the artists themselves, first of all, they aren’t protected by IP. Understand this cuz if if you commission an artist, some small small potatoes artist, they’re going to watermark your their work, if they’re sending you like a copy like, “Hey, is this good to go?” And they’re only going to give you the full quality unwatermarked version if you pay them money. So they cuz they understand that they they are not they they can’t afford to go through the process of DMCAing you if you take their art, right? So there’s there’s that. And also there’s this thing called fan art which is also a violation of IP. There’s this whole subset of the artist community who all they do is violate IP and they just don’t care about that. They understand that this is a not something that protects them and b not something that they’re even going to follow. And yet they they still want to use as like a cudgel against uh you know the unbelievers, people who don’t accept what they believe in.

AI and Copyright

1:22:26

Su: I think this uh brings us to AI, which I really want to talk about also. Um Stephan, I know you’re a retired attorney, but uh I don’t know how much knowledge you have with um Anthropic. Have Have you had a chance to check the like the lawsuits going on with Anthropic and um OpenAI right now?

Kinsella: Yeah, a little bit.

Su: So, first of all, I was kind of wondering um do you have, you know, like I work in AI. I work for an AI company and I work in the Silicon Valley and uh the topic of copyright infringement is like something that comes a lot like there’s a lot of negativity uh towards especially usage of AI through like from the artist community but first of all like one kind of wants to learn what you think about like how would would copyright infringement like as the law it is written in US since you are an attorney who worked in that field how would that apply to AI who uses it as warning for platform like is there a law against that based on no current copyright laws in the US?

Kinsella: Okay. So I mean what happens? So if you remember until about 1995 when the internet started no one thought about copyright very much because it was like this law between big companies publishers and all that. But now we have self-publishing and then we started having MP3 you know music streaming and digital digital music and all that. And so everyone started calling people that copy things pirates and then other people started saying no it’s a violation of my rights. So you had this growing awareness of a conflict between one legal regime and a growing social practice right and uh so it became more apparent that copyright uh violates liberty and then the people defending it started getting on the defensive. So you have these debates and now you have a second version of that happening and by the way it’s starting it could happen too with 3D printing someday because I think copyright has largely uh the internet has largely undermined copyright um not completely but largely um and I think that um 3D printing in the future theoretically could undermine patents because if you have a robotic AI guided you know fabrication 3D printing kind of system in your basement or in your neighborhood basement that can make a new iPhone by using a downloaded pirated copy of the design. No one can stop it. Like these laws will be unenforceable. So my that’s my hope for the future. But in the meantime, we see this happening. So AI um um I think AI clearly violates copyright and that’s the problem with it. So people are people try to make arguments that well it’s fair use but then you have all these arbitrary and ambiguous for fair use factors in the US and they’re similar in other countries and you have to weigh these things left and right and decide whether something they’re fair use and usually a commercial use of something when you make a a monetary profit because I guess it’s evil to make monetary profit as long as you don’t do something for money it’s fine uh but um if if you make a monetary profit then it’s a problem so that’s a factor that against you and these these are for-profit companies by and large. Um and yeah, so when they copy these uh books and versions of pictures and books that they see traces of on the internet from billions and billions and billions of scrapings, it’s inevitable that they’re going to be making temporary and not so temporary copies of these things. I mean, I’ve tried with the AI engines um to get them to admit and they they will admit it if you ask them like, you know, I’ll give it a copy of a PDF copy of a book and I’ll say, “Give me tell me what pages three through seven say and it won’t it says I can’t do that. It’s copyrighted.” Uh, and that’s a guardrail that the designers are putting in there because they’re afraid of copyright liability. But I know for a fact I’m dealing with some I I worked for with for with some companies that are trying to find ways to minimize this copyright liability. I mean there was a study done about 10 years ago by John Deharanian a law professor this before AI when he just said what’s the average American user of the internet? What’s his liability for copyright infringement? Just an average person like you know you you copy a picture you forward it onto someone you have a blog post and because of statutory damages which is like $150,000 per statutory infringing work he said every every human every American citizen on average is liable potentially for $4.5 billion a year of copyright infringement liability uh now you can multiply that times maybe a thousand or a billion for for AI companies so if you really start enforcing copyright law seriously, you would shut them all down. So, something’s going to have to break. And I think what’s going to happen is what happened with music sharing and all that on the internet. You’re going to have some kind of licensing scheme. You’re going to have fees being paid to someone. You’re going to buy some people off. You’re going to have some lawsuits. You’re going to have some settlements. But what’s going to happen is you’re going to have the large AI companies. They’re going to have the money to pay these settlements. And this is going to make it hard for small startup companies to compete because they won’t be part of that deal. So it’s going to lead to oligopolies and cartelization of these industries which restricts innovation and also distorts it. Um I mean it’s already being hampered. It it admits that it’s hampered. I’ve got a blog post on my on my IP site called c4sif.org is my site. It’s about how um copyright is gimping or distorting AI development. So, I’m worried that it’s going to be an like an existential threat to AI, but I think that the self-interest of these nation states, they’re not going to let it be killed completely, but they’re not going to they’re not going to really amend their IP law enough to stop it. So, I don’t know what the the end result’s going to be. It’s going to be a mess and it’s going to generate a lot of work for my fellow lawyers is really what’s going to happen. So, it’s going to make the product more expensive, uh, hampered, hobbled, and, uh, less innovative, and slower slower developing than it otherwise would. So, it’s it’s a big problem. I think it’s, uh, I think it’s horrible.

Su: Yeah. Um, Zulu wanted mentioned, um, Zulu, can you put that tweet on screen?

Zulu: So, everyone, I don’t know how to put things on your I can try, but I I also don’t know how to um, secretive jump. Oh, here we go. It needs to be in the same tab. I see. There we go. Okay. So, yeah, this is this is uh basically somebody used like Claude or something to essentially reimplement all of Adobe software. Um, every feature and everything just a fresh um and people are actually like downloading this and uh and using this now. I I haven’t gone to work in myself yet, but I’m going to be trying this out. And like I this is another way in which I think AI just kills IP.

Kinsella: I totally agree. So just like the internet has helped to kill copyright enforcement, AI is going to help too. Uh because right now the world has ossified into these different IP regimes which different companies and uh rely on. So they rely on copyright, they rely on patents and they also rely on trade secrets. But in the knowledge that it’s hard to so they they they protect some of their their proprietary processes with trade secrets instead of with patents um uh because they assume that it’s hard to reverse engineer. So yeah, source code and the object code uh or the source code of of software has to be out there and and AI can theoretically reverse engineer that. Now, the current law has said that if something is not patented and it’s protected by a trade secret and you don’t have a contract with them, it’s perfectly fine to reverse engineer it. It’s just that the people relying upon trade secrets assume that it’s difficult to reverse engineer. But if all of a sudden that’s harder, then I could see people trying to modify trade secret law or some kind of IP right to like I think that this would drive Objectivists nuts because they would say, “Well, you’re stealing, right? You’re stealing by reverse engineering because if I look at an iPhone, I don’t know what’s under the hood. If they have some some kind of some kind of ROM chip in there that’s got some kind of uh design and they they don’t make it public and they don’t patent it, I don’t know what it is, but if you can copy these things with with reverse engineering is yeah, you’re going to be able to get around a lot of these copyright monopolies and I think it’s I think it’s going to be fantastic, you know, unless the the unless the state lashes back by strengthening IP law to prevent even that.

Su: I think um with my company um it’s an application. I’m not going to give too much information but it’s it’s basically an application. It has someone from China just uh replicated the whole app and you know like of course my company is like you know they they defend copyright and patents because the apps like copyright protected like they’ve been trying for months to take the app down and the app store is just not taken down. On it. It’s like a 101 exact replica of our whole application, but it’s like one tenth of the price. And I’ve been watching them um try to take it down, but um they they have failed. Uh the app is still out there. So I I’m I’m a little bit curious of um how seriously they taken right now these um basically AI replications of software where every doodle is able to produce the same app. When we say also replicating it is just like um it’s literally just writing the same code a similar code or at least writing a different type of code where it can have the same result. Um how the US law is treating this in general just completely replicating app and um how does it I I’m still confused like how does it work to own ones and zeros right like coding is technically just like writing random codes and it ends in a result. How does the law of work?

Kinsella: Well, that’s that’s a yeah, that’s another that’s another absurdity. I mean, if you push copyright law and patent law to the limit, you get it’s like dividing by zero. You get absurdity. Um because if you have a first amendment which protects freedom of speech and freedom of the press, then if it bans the publishing of software, that’s in a sense just a a string of zeros and ones. And but like every book and every every photograph can be digitized. So every artwork is really just can be represented and every three-dimensional object can be represented in digital form. So in effect copyright and patent laws are a type of censorship. But what happens is when the courts have these arguments where there’s a what they call a tension between the law which means they have incompatible contradictory laws because they’re made by legislation. And they’re not organically grown around the principles of justice. They’re just made up by Congress. And sometimes these laws are incompatible with each other. So then the courts have no choice but to try to balance them out because they can’t just choose one over the other. So for example, the court has recognized that copyright law violates the first amendment because it prevents you from publishing a book. So there’s a tension between those two things. So the court instead of saying well we side with the first amendment they say well we have to have a balance and they say they do the same thing. You have the antitrust laws which are unjust but which make it illegal to try to have a monopoly but the patent law grants you the ability to have a monopoly. So you have this tension between antitrust laws which are anti-monopoly and the patent laws which grant you a monopoly. So all they they have this doctrine of abuse. You can’t if you get a patent you could have a monopoly but you can’t abuse it. So that’s their that’s their solution. I mean, you you know, you had uh you had patents causing high pharmaceutical prices in the US and because there’s price controls in more socialist countries like Canada, the same drug is manufactured by the same American pharmaceutical company and sold for like 100th or one tenth of the price in Canada. So, people engaged in what’s called arbitrage. They just went they went to Canada. They bought the pills. They brought them to the US. They just started reselling them for like you know a a good deal for the customer. But that meant that you now you have a conflict between free trade principles and between patent rights. And so you had some scholars at Cato, this is about 15 years ago. It was Mickey Krauss and Doug Bandow and and Richard Epstein. They said, “Well, we should stop allowing free trade between us and Canada because otherwise you could you could allow the import of these cheaper drugs and undercut the patent monopoly in America and prevent these pharmaceutical companies from charging a monopoly price.” So when they they they saw that there’s a conf the point is there’s a tension or conflict between these things. I mean there was the same thing with copyright. Uh there was uh some some students would go to India and widely these publishers would sell these textbooks in India for like one tenth or 1/20th the price because it’s a it’s a poorer country and they would sell them on cheaper paper like onion paper but it was the same book and it was legitimate because they were selling it but these people would just buy these textbooks in India and bring them back to the US and then there was a big lawsuit that went to the Supreme Court because they were sued for copyright infringement for for bringing a book printed in India or sold in India to the US and so the court had to decide uh whether copyright law bans the the sale of a book that you bought legitimately from the same publisher in another country. These laws are all it’s a schizophrenic state that has these laws which which run into each other because they’re they’re just made arbitrarily by the dictate of or by the decree of a legislature and there’s no guarantee that law number seven is going to be compatible with law number two and the courts have to have to try to grapple with that. So, I think what’s going to happen with AI is the courts are going to try as hard as they can on policy grounds to expand the application of the fair use principles to try not to put the AI companies out of business. But I how much they can do that, I don’t I don’t know. I’m I’m worried about it. I mean, it’s it’s it’s it’s not a small threat.

Arbitrary IP Laws

1:34:05

Kinsella: Yeah. And um and by the way, one more thing. So you had up until this day, you had these this phenomena of patent trolls. So the patent trolls, they run around buying these patents from these bankrupt companies and they just they they file nuisance lawsuits against existing companies and they just ask them for a little taste of their business. So they pay me pay me a fee to go away. Give me a tiny royalty and I’ll and of course that that raises cost for everyone. So it’s like a constant nuisance is is called patent trolls. And then in the worst case is when you have one company suing another company trying to put them out of business and sometimes they succeed. Um uh but I think you’re going to have the the rise of copyright trolls because there’s as I said billions and billions maybe even trillions or quadrillions and I’m not even exaggerating quadrillions of dollars of potential damages uh that these AI companies are subject to for copyright infringement. So, you’re going to have lots of lots of copy publishers and people like that. They’re going to sue. They’ve already brought these lawsuits that they’re going to, you know, there’s there’s been some settlements. There’s a $1.5 billion settlement already, but that was just a tiny a tiny piece of the pie. It was like the cigarette companies, the tobacco companies. They they had to pay billions of dollars just to keep doing business, but they were able to buy everyone off and move forward. I don’t really see the end of it with copyright trolls coming after the AI companies unless some kind of judicial or legislative reform is made in the way copyright applies to AI because the AI and the other the other problem that’s going to happen is you’re going to have people creating artistic works and inventions with a AI and then they’re going to claim well someone’s going to accuse them of violating their IP rights when they did that but then they’re going to claim IP rights in their inventions. So, I mean, if your if your AI generates a painting, is there an author at all? Is it like the monkey thing where there’s no author and there’s no copyright? Or is the guy that told the AI what to do a copyright owner? Or same thing with patents. If if AI invents a new cancer solution, is it patentable by the owner of the computer or is it not patentable because there’s no human inventor? I mean, we don’t know these things, but the point is there’s no objective answers to any of these things. They’re all the arbitrary it’s the application of arbitrary non-objective legal standards that are embedded in these these 20th century um and 19th century statutes.

Su: I know the current because real quick and then I’ll go to the current law um because of the field I work in. I work in like LAR 3D reconstruction etc. And um uh the company like with any AI reconstruction of image the person that completes the construction as far as I’m aware owns it. Then the company can own the underlying software and the like the proper API or the processing engine. But you the person that generates the reconstruction is the one that has like 100% ownership as far as I know with the current approach to it. So, what are we going to say? You know, I was wondering if if Kinsella, do you think that um because of all this IP nonsense going on in the US against the um US AI companies, do you think this we should expect to see the Chinese AI companies kind of taking over because the Chinese seem to care a lot less about IP?

Kinsella: Um, it’s possible that it could give us a could give China a competitive advantage. Um on the other hand I think it’s a little bit exaggerated uh when people say China doesn’t respect IP. Uh China is a member of uh all the major patented copyright treaties and they do have functioning copyright and patent systems. Um so I I I don’t see that the problem would be fundamentally different in China uh as to here because unfortunately China has been bullied by the West into adopting our type of IP laws. Um it’s true that in poorer countries and in countries that are emerging uh economies there’s a longer uh practice and tradition on the part of the people to get away with uh like trademark piracy you know like fake purses and uh not bootleg CDs and things like that. Uh but technically speaking they’re all violating copyright and patent in their countries too and trademark law too. So, I don’t I think it could give China some advantage, but um uh but it’s not I don’t think it’s huge. But I but by the way, so I just I look I I just had a weird thing. I was in Finland two weeks ago for the uh Bitcoin BTC Helsinki, Bitcoin Helsinki, and the economics minister of um of Helsinki wanted to speak with me because he had read one of my books and he’s like a Austrian libertarian guy. He’s in charge of the economic innovation policy of Finland and we were talking about what they could do to help Finland out with with regard to AI and Bitcoin and mining and you know I was pointing out well if you abolished your IP law or copyright law or you or you just relaxed it a little bit and you made it easier for AI companies to train their models there without being in fear of being sued to death. You could attract companies to train their AIs there or if you um if you uh you know got rid of capital gains tax then you could have Bitcoin Bitcoin would be more popular there and other things like that and and but he said well but unfortunately we’re part of the European Union and they they don’t have the flexibility to even do that. They can’t change their their monetary law. They can’t change their tax law. They can’t change their copyright law. Um now you could have some countries like Iceland or maybe some small island country. They could they could become a copyright free haven but then they would be attacked by all the other countries just like if you’re a tax haven or a drug haven or a terrorism haven you know so I think that the world weight is against people experimenting too much with that I was just advising uh Tippolis which in some of these free city projects and they’re trying to get these free market zones like in in Honduras there’s the uh the Prospera the free cities thing, but they can have a free market there with no taxes, but they can’t they can’t u have copyright not go punished there because they’re part of copyright treaties. Like it this web of copyright treaties and patent treaties is so extensive. Even even individual countries have very little power to get out of them at this point. It’s kind of it is it is insane just how deep these tentacles run. Like it’s it’s so nefarious.

Su: I have one thing to add to that. Even if Finland was um like by the way for the EU um wouldn’t it kind of backfire considering the US would um impose like strict like trade policy mechanisms to make sure they bring back copyrights? Wouldn’t that kind of like damage their economy significantly?

Kinsella: Yeah. Well, I mean what what if you look at the slow creep of what happened? Uh I mean the US was in a way slow to join some of these things because in the beginning the US was a pirate nation. I mean uh copyright on foreign author’s works wasn’t covered. It was only American works. That’s why Charles Dickens had to come to the US to lecture so he can make money because his his books were being pirated. But eventually in the 1980s we joined the Berne Convention. And in the in the I’d say from the mid 1900s to to now the US has used its way to to basically engage what I call IP imperialism. So whenever they negotiate a trade treaty with another country and by the way free trade like let’s let’s lower our tariffs you lower your tariffs that’s a free trade agreement has nothing to do with the local property rights in that country. So, for example, if I have a trade agreement between the US and Zimbabwe, it might say we’re going to have low tariffs, but it doesn’t say you have to protect property rights in your country cuz that’s a that’s a investment treaty thing. That’s got nothing to do with trade treaty. But even though free trade has nothing to do with the internal property rights of the other countries for decades now, the US uh uh State Department people that negotiate these treaties, they have these canned forms where they insert these IP provisions in there and they basically force these other countries to agree to adopt uh Western style patent and copyright law protections or increase them just to get trade negotiators with us. I mean, Canada was negotiating this thing with the US for a while which fell apart. Um, uh, it was like a big free trade agreement in the Western Hemisphere and then the Pacific and the Pacific nations. Uh, and Canada agreed to extend part of their copyright term by 20 years to match the US term just so they could be part of the negotiations. I mean, so this this has been this creeping influence. And the way I look at it to to simplify is you basically have three industries in America. Pharmaceuticals, Hollywood for movies and maybe the book publishing industry and the music industry like those industries which rely heavily on copyright and patent. They own the US government and they use the US government to twist the arms of every other country in the world and basically exact tribute from all their consumers and American consumers for the pockets of these four industries in America. It’s kind of crazy. I think I want to give an example. I grew up in Turkey as I said and um in Turkey they did not care about um like movies and shows and books and things like that mostly and um it was people nobody like everyone watched online like free websites or torrent or whatever like that’s just the norm everyone like nobody actually pays it everyone watches it for free pirate online and then um in 2016 or something in those years I mean with it cuz I Netflix entered the Turkish market and suddenly like I couldn’t find any content online like all all the websites were shut down and I’m like what is going on and then it just became the norm that it’s like all the websites like the moment they come up that the government shuts down and then 10 other come up at the next day and you know it’s because uh there was finally a corporation in Turkey that was willing to pursue it. So Netflix tried to shut down all these websites and like the more they shut down the more people came up with more websites and uh discontinued for a few years and at one point the government kind of gave up like now everyone like uh kind of still pirates like movies and TV shows like because the culture is there it’s really really hard to change culture and people only pay for Netflix because you know they kind of want to have the convenience they don’t want pop-up ads like they don’t want the sexual content that comes with it etc etc. Um, but like it was not even a thing. Like when I was a kid, no one even called it pirating. They just called watching. But the term pirating was only introduced when Netflix entered the Turkish market. Like that was experience I had.

Kinsella: Yeah. You see these stupid commercials like uh a gay person say you wouldn’t you wouldn’t you wouldn’t download a car. I’m like, “Yeah, I would if I could print a car in my if I could print a car in my garage. I would print a car.” I mean, what are you talking about?

Su: Exactly. Um, we have someone who wants to speak, do you have anything else to say about the topic, Zulu?

Zulu: I I do have one I do have one quick question from the uh super chats on YouTube uh from Mustard Seed, I believe, for $5. Thank you very much. Um who’s asking uh Kinsella what are your thoughts on copy left licenses such as um uh the GNU public license I believe GPL and uh he’s saying how can we compete with IP target companies without using IP uh so I believe that the the GPL it requires that subsequent licenses be open subsequent software be open source um but I mean I suppose is there is there some license where it kind of just gets in the way of subsequent uses enforcing IP.

Kinsella: Okay. So, in a copyright free world, the concept of a license would disappear. I mean, you don’t need someone’s permission to copy something. So, the whole concept of licensing would go away. Um um I I have mixed feelings about the copyleft stuff. I think it’s better than what we have now. And I I like the open software movement. Um now for books and for printed material like websites and books I prefer the Creative Commons BY license or the zero license like uh the only restriction is you have to um uh give attribution keep the name of the author on to me that’s not a big not a big impediment um not a big restriction the the analog in the Creative Commons space to copyleft is called ShareAlike like so the only way you can um remix or reuse something with permission of someone if it’s under a CC ShareAlike license is you have to impose the same license on everyone else. And I don’t like that to me there’s an activist element to that. You’re still relying on copyright to some extent. What you’re saying is um well they’re not even clearly saying they’re against copyright. Let’s say even if you were against copyright, um what they’re saying is the only way we can have this software be free of copyright in in our world is to open it up to everyone and to not use copyright and to open it up. I would just use the software equivalent of a CC BY license. But they use the copyleft license which imposes on you have to keep putting the same restriction on others. And I think it complicates the software. And to me, it’s like you’re mixing in um a principled attempt to stop you avoid using copyright and to not be part of the evil system. You’re you’re also combining that with your activist tendency. You’re trying to like force people by using the threat of copyright to force them to use your serial life license, too. So in other words, the threat is I’m only going to give you permission to use my copyrighted software if you agree to put the same kind of license on your the copyleft license on yours. So I don’t like it. Uh I would prefer a simple CC BY type approach. Although I still think the CC the copyleft movement is is is better than I think copyright copyleft software is often better than regular software. Um, and then one one one quick thing about um, uh, this this is Su. Sorry, this is Su. I don’t know if you’re pronouncing your name right, but um, Su, my name is I’ve been to Turkey. Su, sorry, Su. In Turkey, I’ve been there a lot lately and I was in Istanbul last year and I went to the one of the markets and my friend was telling me, “Yeah, there’s these there’s these knockoff purses everywhere, right? Like like uh Gucci bags and Chanel bags, but my friend said um these are the uh these are the fakes, but if we go to this street, they’re the they’re the genuine fakes. So, like there’s different tiers of counterfeits. There’s the there’s there’s the expensive counterfeits which are like $100 each, you know, they’re called genuine fakes. I just love that they call them genuine fakes there.

Su: Yeah. Like that’s that’s the thing. You have fakes and they’re the cheap Chinese knockoffs and you have the genuine fakes which are like the expensive Chinese knockoffs and um like most things in Turkey are like unless you’re going to the mall and it’s a corporation, they’re all like, you know, like no one’s paying for those licenses. You have the genuine fakes.

Kinsella: That’s that’s I kind of I I took after um the the footer you have on your website. Actually, I modified it a little bit um for like my website and for my YouTube videos. That the most permissive thing I can do for my YouTube videos is put them under Creative Commons attribution. That that is the most permissive thing that YouTube will allow me to do. Yeah. Yeah. But then I like in this in the bottom of the description I have this disclaimer saying, “Hey, I don’t know if this is legally bindable or anything, but you don’t have to attribute this, you know, just let a thousand blossoms bloom.” I think that’s the most that I can do.

Su: We have a yeah in the in the footer yeah in the footer of my websites I have a CC0 license but I kind of had to make it up myself because it’s not clear that these things are even enforceable and like if you do Amazon if you do if you self-publish a book on Kindle like you can’t even or if you even make an EPUB you can’t even create an EPUB and allow people to copy big pieces of text from it even if you want to like the the default is so control oriented you know in all these systems they They Yeah, like you say, YouTube won’t even let you open it up CC0. They won’t even let you.

Zulu: Yeah, we have a question. Uh, should I let the question come in, Zulu? Yeah.

Diego: Hello, Diego. Can you hear us? Hello. Hello, Zulu. Can you hear us? Yeah, I can hear you. Can you hear me? Yeah. Yeah. So, yeah. What’s good? Okay. Okay. So, I have a question for Professor Kinsella. Um, do you think Bitcoin is a genuine or property right? Like if I colloquially own Bitcoin, do I really own it under your legal theory or do I not really own it because it is not a physical thing?

Bitcoin and Ownership

1:54:51

Kinsella: Yeah. Um, under today’s law, you do because it’s considered property so that the government can tax it. Um, sort of like uh uh the reason we have all these property title records from like the Domesday Book from like 700 years ago or whatever is the government was trying to uh have good records so they could tax people. So, you know, the government wants you they want to call it property so they can they can tax it. Um, so it’s a mixed blessing. Uh in my theory, I think uh there is no ownership of Bitcoin. It’s not a thing that exists um independently. It doesn’t have an independent existence. It’s just um and by the way, it’s not a criticism of Bitcoin. I think it’s actually a benefit of Bitcoin. Um or put it this way, it’s Bitcoin is so so many advantages that you you don’t even the property rights are superfluous in it. But no, the short answer is, and I’ve written I’ve got some articles on this, u I’ve got a speech I did in Turkey a few years ago called uh Nobody Owns Bitcoin. Um Bitcoin is just the way we conceptually categorize the entries on a decentralized spreadsheet or ledger. Um so it’s just the informational units of this of this of this uh of this ledger. And that’s just information. It’s how we is how we perceive of and categorize and organize that information. Um we and then we but but the system allows you to trade it. So this goes to this distinction between control and ownership. So control is the ability to in in the physical world it’s the ability to physically manipulate and employ a resource, a scarce resource. And ownership would be the legal right to use force to stop someone from taking it from you. Um for Bitcoin there’s only the control and the control is not a physical control. It’s just the it’s just the rules of the system. You have to you have to enter your certain private encryption key to transfer the movement of these coins or these these Satoshis on the on the ledger. Um so you do have possession in that sense. You have the ability to manipulate it but you don’t have you do not have ownership in my view.

Diego: Okay. I’m asking because I think this can be a contradiction in your legal theory because you justify physical force as the way in which we violate property rights because property is scarce. That’s the main gist of it. However, Bitcoin is in fact scarce too. Like my design if you use this piece of Bitcoin then I can’t use that piece of Bitcoin in order to transfer it. Uh so I do think Bitcoin applies as a scarce resource. However, it is not a physical resource. Uh so I think that’s an instance of an resource that’s not physical. Yeah.

Kinsella: No, I get it. And um um in my original book, I use the word scarcity a lot. I tried to distinguish but there there are there are different senses of the word of the word scarcity. Um and nowadays I tend to say rivalrous which is or or I even say conflictable sometimes. So I’m I’m getting at the type of thing in the world that you can use as a causal causally efficacious means of action over which there could be physical violent conflict. That’s what I’m talking about and that’s what that’s what you get at in the economic concept of rivalry or rivalrous. So that’s the concept of that’s the economic concept of scarcity that I’m talking about. Um in common in common language people use the word scarcity in a loose sense to mean something that’s not that’s not abundant. Um but properly speaking when something is scarce a scarce means of action in terms of praxeology and and Mises’s uh concept of of what human action is um he distinguishes between the the means of action and the general conditions of action. So like gravity and time and the space you know the even the air right now the air those are all general conditions of action. They’re not scarce because you don’t have to economize on them. So scarcity in my sense in the sense that applies to the type of thing over which there could be conflict and over which there could be property rights is something that’s the opposite of super abundant. Okay. So super abundance is like the idea of abundance pushed to the limit. So if you imagine the garden of Eden which Hoppe uses an example it’s a land of milk and honey the land of cocaine like the land where there’s no there’s no scarcity there’s no want. You can think of it like this. Imagine we lived in a world where uh you like bananas, but there’s an infinite number of bananas. Or put it this way, you could you could you could think about it and you could conjure up a banana in your hand. So that would be that in that sense there would be no scarcity of the bananas in in in the technical economic sense because so it wouldn’t make sense to have property rights in bananas because it wouldn’t be possible to steal it because if someone stole my banana it’s the same thing as copying it or put it this way if they stole my banana I could just make another one. So it wouldn’t make sense to have copyright property rights in super super abundant things. So property rights apply only to things that are actually uh the lack the opposite of super abundant that is they’re physically scarce. So in our world even if there’s a lot of bananas we might say that there’s no scarcity bananas that they’re abundant but they’re not super abundant which means that every particular banana can have an owner because if you take that one banana from me you’ve deprived me of that banana. So that’s why we use the word scarcity. It doesn’t apply to Bitcoin. Even though you could say there’s only so many bitcoins, but look, there’s there’s already there’s also so many letters in the alphabet. There’s 26 letters in the alphabet. There’s a scarce number of letters in the alphabet. That doesn’t mean that every letter in the alphabet is a scarce thing. You see what I mean? So, just because we we have to be careful using words that have too many loose uses and and implications. So, I don’t think Bitcoin is scarce in the property sense. Is scarce in the in the sense of being suitable as used for money because we can conceptually regard the units of the Bitcoin ledger as relatively homogeneous if we so choose which we apparently do so far and they can only be controlled by the use of these keys but Bitcoin’s like a game it’s like everyone agrees to play this game with certain rules um so for example with the cold card hack I I mean I don’t know the details of how that was done. Assuming there was no fraud and no breach of contract by the manufacturer of CoolCard, then I don’t think that the bitcoins that were taken were owned or they weren’t stolen. There’s actually another one that the guests there’s actually another one just very recently with Ledger where apparently resellers of Ledger wallets um they the resellers would install certain pieces of hardware um which allowed them to get the private keys.

Zulu: Yeah. Um, so I I suppose in that case, I don’t know if that was AI or not, but yeah. Yeah, that that’s fraud or some kind of contract breach. I suppose in that case, like what would the damages be? Like giving them back the Bitcoin? Cuz like if nothing was stolen, is it just giving them back the money they spent on the wallet? Cuz that’s like a pance.

Kinsella: No, no, no, no, no. I think No, no. I I I think I think the way to look at it is if you commit an act of trespass, which is you’re using someone’s owned resource without their permission. Okay, that’s that’s that’s what that’s what crime is. That’s what tort are. That’s what that’s what trespass is. That’s what aggression is. When you do that, then you incur some kind of obligation to the victim. So, for example, if I break into your house, I’m committing trespass, right? So, I’m already a criminal. And if if when I’m in your house, if I take uh an empty canvas from you and a blank canvas and some some of your paint and I leave with it, then you know, if you catch me, you might I might have to pay you $100, you know, or or $1,000 compensation. But if I took an already painted painting that is worth on the free market a million dollars, then I owe you more because you have to it’s called it’s called uh uh uh consequential damages. The reason that we’re opposed to aggression is because it has consequences. It’s just like the reason like if I if if if we had super abundant bananas and I took your banana from you but you could make another one, I’m not harming you. It doesn’t have any consequences. So in the real world, we have property rights because there’s conflict and because only one person can use the thing at a time. So that means that if I deprive you of something, you don’t have it anymore. That’s the consequence that is the result of not respecting rights. But that means that the consequences can be and have to be taken into account when we determine what the remedy is when there’s an act of trespass. And that means that if I take your your your blank paper and I take your already painted valuable painting, then there’s a difference in how much harm I’ve done to you. And that’s what has to be taken into account. So, the answer is if someone uh defrauds you somehow by selling you a a a CoolCard a Ledger device and they use it to take one of your bitcoins worth $84,000, then I think they owe you $84,000 or something, but they owe you they owe you the so the value can be taken into account in terms of the the the consequences of the damage the consequential damages. So, so we could I suppose we could sort of analogize because you own the Bitcoin. Yeah, I suppose we could sort of analogize a Ledger wallet with one Bitcoin on it as like you can’t just get you can’t just give them back the Ledger wallet. It has to have one like I suppose secure Bitcoin on it, one Bitcoin they can use. Um, in a similar way as if I like spray painted over your over your wall, I would have to the restitution would be I have to restore your wall to what it was before. Yes. Correct. So if if you walk into my house and you don’t take anything, but if you walk into my house and you and you destroy my television, then you’ve committed trespass in both cases, but the consequences to me are different. So the amount of damages that you owe are different. So So, so um take a simple example. I have a co I have a Ledger and I I buy a Ledger and then I open it up and I I I uh I manipulate it in the way you said and I sell it to you with the implied promise that I didn’t do that to it. So that’s a type of misrepresentation right there. So that’s where the fraud is in the in what the concept of fraud is. So then later that night you put a bitcoin on it and I take your bitcoin from you. So I’ve damaged you $84,000 worth of damage. If you had seven bitcoins on it, I would have done seven times as much damage. If you had nothing on it, then the damage is trivial. Just like in the law, there’s something called the eggshell skull doctrine, which is you take your victim as you find them. So if I if I get hotheaded at a bar and I punch some guy in the head, he might be able to sue me for, you know, $1,000 damages. But if he’s got a soft skull and I didn’t know about it and he dies, now I’m guilty of murder. Like the the the consequences matter to the extent of the damages owed, right? So if for example um I were to steal well let’s not say a seal take Bitcoin uh by discovering a new algorithm that destroys all previous cryptographical schemes uh in history uh and basically I can hack into any Bitcoin account because uh the cryptographic uh problem is trivial to me. Um then that wouldn’t be like something punishable by natural law. Correct?

Kinsella: And that’s my view. So for example, let’s just take a simple example. Let’s suppose I know you have 100 bitcoins. I can see it on the blockchain, but I don’t know what your private key is. Let’s say I guess it. I just I type I’m going to take a guess. Now, it’s astronomically unlikely I could guess it, but let’s suppose I guess it. And I guess your key and I enter it and I take your 100 bitcoins. That’s permitted by the rules of the system. There’s no contract saying I can’t do that. There’s no terms of use saying I can’t do that and you don’t own the bitcoin. So I didn’t steal anything that you own. It’s just that that’s so unlikely people don’t worry about that happening. So that that’s my view. I think I I I was debating some people in Finland about this. They they think that um if you guess even if you guess someone’s key, then you’re you’re committing theft because you own the Bitcoin that’s protected by your key. Even if you like what if I I put my key on my I write it on paper and I leave it on my on my table and my neighbor can see it. Someone visiting the house sees it or someone can see it with a telescope looking through my my bedroom window and they now they know my key. If I was careless about it and they take my Bitcoin, did they commit theft? I don’t think that they did.

Diego: Yep.

Kinsella: Now, the one problem with my theory is that by this same token, you could argue dollars are not actually ownable property because they don’t really exist. They’re also entries on a ledger. It’s just a centralized ledger. Um because the dollar is not the piece of paper. It’s the it’s the Federal Reserve system or the Treasury system, whatever, however it works. Um, so for the moment, I’m okay with the fiction that treats dollars as ownable. We shouldn’t have dollars like that anyway. But, um, and I don’t I don’t have heartburn over I mean, look, almost every case you can imagine of someone that takes someone’s bitcoins without their permission. In almost every case, there’s some kind of they broke into your house to get the key or they they violated the contract. Like if your lawyer or your accountant has your key and they they use it to take your bitcoins. In almost every case you can imagine, it’s there’s some kind of contract breach or or active fraud or active trespass. But in principle, if someone just could guess it, I don’t I don’t see how they’re violating anyone’s property rights.

Diego: Okay, I’m going to push back a little because I just thought like the password is supposed to be a certificate of your own identity. So, you are inherently committing uh a fraud when you uh yeah take a private key or a password or something that’s supposed to certify your identity.

Zulu: I I couldn’t hear that. I don’t know if anyone else could. I couldn’t make that out. He he was saying that you’re committing fraud because um the the the private key is supposed to be a certificate of your identity. So, you’re committing a a fraud by taking those bitcoins.

Kinsella: If if the Bitcoin terms of service required that, I might agree, but I don’t think it does. It’s an open system that doesn’t require any kind of assertion that you are the uh that you’re the owner or that you’re the the genuine most recent recipient of the of the key or something. I mean, I could be wrong about the way the Bitcoin scheme works, but I don’t think it’s part of the terms of service of using Bitcoin. I think also all Bitcoin says is if you have if you have a key, you can use it to transfer bitcoins.

Diego: I think also fraud is supposed to be theft by deception. So, we’re already presupposing that there is a thing to be stolen. But I just don’t see how that is the case with Bitcoin.

Kinsella: Yeah, that’s a good point that most people don’t see. But you you could have here’s a let’s suppose you you gave an example of of of signatures. Um, in in the in in in modern commercial paper law, you know, people write checks and the check uh it’s possible for someone to take to forge a check. But if the bank pays the person that presents the check, but I didn’t actually sign it, then the bank doesn’t actually have my permission to do it. Okay? But it’s still possible to get away with it. Um, so you could imagine that uh even if let’s say someone walks into a bank and they pretend to be me, their identity thief, and they use that to pretend to be me and to take money out of my account or to open up my safety deposit box or whatever, they are committing some kind of of tort because they’re either committing trespass because you could say that the the the the bank would have the implicit rule that you’re permitted to come onto our property only if you’re not impersonating one of our other customers, something like that. Um because if you admitted that, they wouldn’t let you in to do it. So, so sometimes fraud can be not just a taking of u an owned thing, but it can be the way you gain access to property and you’re committing trespass in the very process of it. But it’s still it’s still a type of trespass by theft by trick in a sense. Yes.

Zulu: I I do have a I do have a counterargument coming in from um on on the Bitcoin isn’t property position from the from the YouTube chat which I think is very good. Um where Super Boy boys who is um Nicola Pavkovich is saying that property is being damaged because the ledger is like this thing which is stored on a bunch of hard drives and you’re essentially saying yep I’m able to modify this thing because I am this person when you’re not actually allowed. So you’re effectively trespassing against everybody who is storing the Bitcoin ledger. Right.

Kinsella: Well, there’s a there’s a similar argument which I’ve made in the past for um it’s a it’s a tort that was developed u in the beginning of the internet. It’s trespass to chattels and it applies to things like spam and I do think you can so normally there there are default presumptions um about the use of property. Um, so for example, I can walk up to your house and knock on your door to ask you a question and I’m not committing trespass because the default assumption is the owner is permitting people to use their sidewalk and use their door to knock on it or something like that. Unless you put up a posted sign and you change the default presumption. Um, so, so that’s sort of the way you determine when people uh, uh, can use resources. But and if someone calls your home or if they send you an email, which is what we sometimes call spam or telemarketer calls, the question is, so the law has said that if you send someone unwanted spam and it actually interferes with the use of your computer because it gunks up the memory and all this kind of stuff, then they’re actually using your property without your consent. So, if I have a telephone and you use the telephone system that I’m part of and you you you call me my number, you’re you’re using my property, but you’re using with my consent because my consent is implied by me by by me joining that network. But if I tell someone, here’s a do not uh do not call registry I’ve signed up to. I do not consent to people using my phone to make uh marketing calls or I don’t consent to people sending me spam. At that point in time, they’re using my property without my permission and they’re committing a type of trespass, right? But the thing is the nature of the Bitcoin network is that every person that runs a node or it’s a miner, they have their own computer which they own and they voluntarily join this network and it’s kind of akin to having a telephone connected to the telephone system or uh or having a door a door someone can knock on. So the terms of service of the Bitcoin network do not require someone not to be impersonating someone else. If it did, it would be it would be another matter, but it would also change the nature of the network, and I don’t think it would work then. So the nature of the system means that if you participate in the network, you’re consenting to people uh transferring the updating the blockchain every 10 minutes to when they take when they take the Bitcoin because they they guessed or they stole the key. Um, so I don’t see how someone could complain that their memory device on their computer are updated because they’re the ones who voluntarily joined a network that permits this to happen. So they they went into this process with eyes wide open. So I don’t see how they can complain that it was trespass against their computers that it receives an updated copy of a blockchain with with with a transfer on it, which which they don’t like. I mean, they can always leave the network if they don’t want to be part of Bitcoin anymore.

Closing Thoughts

2:15:33

Zulu: All right. Uh I think a little you have um another question.

Su: Yeah. Yeah. One one final question. I I think that does make sense. I’ll have to think more about that particular point. Um but uh my my I suppose my final question is you you talk a lot in the book about um well there there were all these um arguments about from libertarians even about why IP is a good thing. Do you think that you’ve had like an actual like major impact on how libertarians view IP? Like do you think now it’s way more verboten to be in favor of IP than it was before uh you came along and started doing your work?

Kinsella: Well, I I I actually do um I I think this is a hopeful example of the power of ideas. Um um it’s unlike a lot of other arguments uh which are hard to make progress on. But uh I believe that when I started writing this now I wasn’t the first by the I mean, some of the earlier pioneers were Benjamin Tucker in the late 1800s and but especially the modern it was um uh Wendy McElroy and uh Sam Konkin and then then really a more sophisticated work came out in 1989 from uh Tom Palmer um and then I based my work on their stuff. So, but I I started writing on it more uh more authoritatively because I was an IP lawyer and it is more systematic and it it drew more heavily and more uh on Austrian theory and libertarian theory and sorting out property rights and it was right at the right time when uh the internet was happening and everyone was wondering about this issue. So, in my impression um uh in the last 20 years I think that the pendulum has swung a great deal. My impression is that uh before and no one read Tom Palmer’s articles unfortunately but when I started writing everyone sort of debating this issue and I think it’s made a huge impact. I think that the vast majority probably far more than the vast majority of of anarchist libertarians now both left-libertarians and Rothbardian types are anti-IP and a lot of the utilitarian the utilitarians are still hard to crack and the Objectivists are hard to crack but among um like more radical principled libertarians I and more Austrian libertarians the impression I got is that uh now anyone arguing for IP is on the defensive Right.

Zulu: I think um Zulu, do you have anything to follow up on that?

Zulu: Yeah. No, I I think that’s I think it’s a great thing. It does show that when you bring in these legitimate arguments. Um it can spread very far and very wide. And I think uh I’m making inroads with the Objectivists to spread that argument in that sphere. And then really all we have to care about is utilitarians. And you know who cares about them anyway? They’re utilitarians. It doesn’t matter. Um I want I very much want to thank you for coming along. Kinsella Hamsters. I I appreciate it. Thank you for the thanks for the for the u the for the venue. It was nice.

Kinsella: Absolutely. Yeah. Intelligent civilized question. And thank you Su.

Su: Yeah, absolutely. That uh brings us everyone to the end of today’s episode of Objectively Speaking. Again, uh for me as well, a huge thank you to the special guest, especially Stephan Kinsella and you know for sharing his insights and we have um our co-hosts Zulu and Edardo for being part of the discussion and of course thank you to everyone who tuned in, listened and contributed to the conversation. Um, if you enjoyed today’s space, make sure to give everyone who participated a follow. And uh, for those who have few who want to join us again, Objectively Speaking takes place every Monday at 4:30 p.m. Eastern time. And if you want to find out about what next week’s episode will be about, make sure to follow me on Twitter and stay tuned. I will I usually announce the topic on the same day, so keep an eye out for that. And yeah, thanks again for listening everyone and uh, see you next Monday.

Zulu: Can I add on one thing? Kinsella, can you follow me back on my new account, please? Cuz I got banned on the other one.

Kinsella: Done. Thank you. All right. Take care everyone. Thanks.

Zulu: Have a good Monday and see you next week. All righty. So let’s uh these super chats gang chats big. Can I can I zoom in on this? Yeah, that’s a little bit that’s a little bit better. We have a hoop crew who’s now a member for seven months. Thank you very much. And then we got a Griffin one for $5. Thank you very much. Zal Zulu Kinsella will have to tune in after work. Well, I hope you enjoy after your work’s done. And we got a hack protector X for 100 kroner. It’s a lot of money. Thank you very much. Uh it be very useful the the kroners. I’m planning to go to Sweden in the new year. So maybe I can make use of those. Uh, your friend Liquid Zulu 2 on Twitter is going apeshit. Yeah, that’s that’s not my account. Um, I I’ve I’ve told him like, you know, can you stop pretending to be me? Can you call yourself something different? If you’re listening to this Liquid Zulu 2 on Twitter, please knock it off. People keep thinking that I’m you. Knock it off. Make it very clear that I’m not you. Okay. Can we Can we do that? Is that acceptable? Um, then we got a Odd Nova for $2. Thank you very much. Did the French Foreign Legion get Monop potentially? I mean, yeah, he’s he’s not been particularly active recently. Um, we got Hack Protector X for another 100 kroner. Thank you very much. Um, India’s economy is crumbling before our eyes. I mean, yeah, we had a we had an England an Indian guy in here earlier wanting the live translations. Um, maybe if India’s economy booms some more uh then uh YouTube can provide that. Unfortunately, I’m not able to provide that service. I don’t know how I don’t know how to do that. Um, but yeah, maybe if economy comes back around, then uh things can change. We got a Griffin one for $10. Thank you very much. Uh, as one of the tribe, I could talk about monopoly drug prices for a long time. Uh, my life, uh, one of the tribe uh, presumably referring to the ask gang cap last night. Um, I could talk about monopoly drug prices for a long time. My life and well-being have been put into jeopardy over the state’s IP laws. Yeah, this is a very good thing that Kinsella emphasized there is that the more important the industry is, it’s actually that much more urgent that we don’t have IP there. It’s the same thing with uh the state where it’s like no, the state only has should only do we should only central on the most important industries. It’s like no, that’s ever more urgent to get rid of the state there. The less important industries less urgent doesn’t matter as much. Then handle your candle one aka man chararma for 100 rupees. Thank you very much. He’s saying he’s not feeling well today and here’s a sporting super chat. Well, thank you very much. Hope you feel better soon. Then another for 200 rupees saying me and Anarco Econ worked on an IP related project basically based on my sidea uh that there are legitimate moral norms about how ideas are used. Uh but property is the wrong framework to think about it. Yeah, definitely. I mean, cuz I think we’re all against plagiarism, like presenting yourself as something you’re not, passing off somebody’s work as your own. That violates the virtue of justice in my view. It’s it’s treating yourself as something you aren’t, trying to cheat reality to gain a value. It’s it’s no good. Um, but yeah, it’s nothing to do with property rights. Then we’ve got a Foreman Georgie for $5. Thank you very much. Saying Bitcoin can’t be reproduced in the same way other IP can though. It’s purposely set up to make it uh a valid currency. Valid in the aleatory sense certainly. Um but I still I I’m not convinced that you can have a property over Bitcoin cuz like Bitcoin is not a particular thing. Anyhow, thank you everybody who tuned in and thank you especially to those who donated. I’ll see you next time.