A Brief Note on SOPA and PIPA

Today, permit me a brief break from academic papers to post about an issue of import to me both as a research blogger and as an economist working on invention and innovation. Across the internet, a number of sites tomorrow will go dark to raise awareness of two absurd bills, SOPA and PIPA, winding their way through the US Congress. These bills essentially allow the US government to seize the domain name of sites committing willful piracy, or those who link to sites doing so, without trial and with essentially no due process other than a sealed judge order. A related policy of the US Customs agency has already seen judges signing off on domain name seizures of sites that hosted music sent to them by the record companies themselves, that were completely legal in the country where they based (the .com registry is in the US, even though internet companies are based around the world), and that were accused completely mistakenly of hosting child pornography. In the first two cases, the sites seized were not illegal, but were competing with major music and movie companies: the US government was essentially deputized to reduce competition.

The site you are currently reading would violate SOPA and PIPA: I link almost exclusively to ungated copies of work whose copyright has generally been transferred to a journal. Though many journals essentially ignore the fact that authors place copies of their articles on personal websites without the journal’s permission, the fact remains that such articles are being backed up by their authors in violation of the journal’s copyright, absurd as this may be. Beyond simple academic research blogs, huge swathes of fast-growing internet firms from the past 15 years, such as Youtube, would never have appeared in a SOPA/PIPA world.

Until a recent uproar, these bills were sailing through Congress. I recently consulted for a white paper on a similarly wrongheaded bill, the Research Works Act, which would vastly limit your access to new research papers. In doing so, I had to read the records of Congressional hearings on these bills. Aside from a handful of congressmen, the people voting on issues related to invention, science and the internet have very limited knowledge of these issues; this is no surprise, as only four out of 535 congressmen hold a research doctorate, an average age in the Senate of 63, and technology firms have a relatively tiny lobbying presence compared to old media companies. The major movie and recording industry lobbyist groups also form one of Washington’s most notorious revolving doors: the MPAA head is former senator Chris Dodd, and the federal judge at the venue of choice for suits related to the music industry is herself a former RIAA lobbyist.

Economists and academics really need to make themselves heard on these bills and on other bills related to innovation. If nearly every major politician country frequently said that “we all agree that we need to ensure steelworkers get paid” with little concern for the broader welfare effects of tariffs, economists would surely bring up the vast amount of research that exists on Ricardian advantage, trade wars, the tradeoffs inherent in protectionism, etc. Yet politicians also say “we all agree that we need to ensure content creators get paid” even though, from the perspective of social welfare, that is completely unimportant. As social planners dealing with innovation, we need to worry about policies that both limit the creation of new content and inventions while simultaneously not expanding consumption of existing products enough to overcome that first decrease. It is striking that in Congressional testimony on copyright issues, no one arguing for SOPA and PIPA even pretends to argue that access to film and music and books and newspapers has decreased – it is clearly a Golden Age for access – or that the amount of new film or music or text has decreased. Given those facts, even though content creators, and particularly middlemen, may find it more difficult to extract rents from their work, as economists we realize that this “era of piracy” has probably led to massive social welfare gains. This is a perspective that, when economists have made it in the past, has been largely ignored, but nonetheless it is one we need to continue to make.

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