Over time I have become more and more skeptical of Harberger taxes, which I first encountered somewhere in the works of Heinlein.
The idea is that you are taxed based on your own estimate of the value of a thing, with the estimate being public and binding as a sale price.
This sounds incredibly simple, with a natural mechanism of enforcement; if you undervalue a thing to pay lower taxes then you risk losing it at that price.
But I don't think this would work in reality. Pricing things is super hard. In a very liquid market it is difficult but doable, in an illiquid market (of one non-fungible asset) it is practically impossible. At what cadence do you update the estimate? How long is it binding for? If the value suddenly changes, how long a grace period do you have before you have to update the price?
You can try to patch this by saying that you have a right of first refusal -- that if someone offers to buy the asset at the price then you can accept their valuation as the new estimate of the price, and pay taxes going forward on the new value.
But then this defeats the point of the process because effectively the valuation is non-binding. So you have to put in all sorts of structures to prevent abuse -- maybe levy fines for past underpayment when the pricing is adjusted, or limit the number of re-pricings per time period.
And it incentivizes nuisance bidders, because owners will defend their property. So you have to put in restrictions like forcing escrow before the sale, or limiting bidding by a single entity.
Not to mention the difficulty in maintaining this registry of ownership of these assets, along with how to deal with more complicated deals about the rights involved -- film rights vs. tv rights vs. print rights, rights to individual characters, temporary licenses, etc., and all of that needs to be mechanized to allow a certain fixed list of the types of rights that can be granted, which right now is as extensive as a contract can contain -- if Sherlock Holmes were still in copyright, what if I just wanted to license Watson or make a film about Moriarty?
This is all just hopeless technocratic pie-in-the-sky dreaming.
Another problem in my mind is most creators could not afford the taxes for a high enough valuation (early on at least), but investment groups like blackrock could buy up all the copyrights/patents on the cheap. It also does not prevent the Disney scenario when a copyright is absurdly profitable. They could pay the tax indefinitely.
> Another problem in my mind is most creators could not afford the taxes for a high enough valuation
If you own 80% of something worth $1B - you have $800M. If you can't sell $2M at your preferred price to pay your taxes, then it's not worth $1B, and you wouldn't have to pay that much tax anyway.
Plus valuations change over time. In 1997, a valuation of $5m for the first Harry Potter book would've seemed excessive and the author would've probably had trouble paying taxes on it. But even with that valuation, someone could've made billions by snatching it away once Pottermania started (I suppose you could let authors update value on a daily basis but that seems like an insane amount of overhead)
I think the appeal is that it sounds simple -- you say "I bought my house for $1M, and I don't want to move, so I set the value at $2M, so I have to spend $20,000/yr to keep it, or someone can give me $2M and take the house."
That's the sort of thing that sounds very unappealing to the average voter. "I have to pay property tax on substantially more than it's worth and keep raising it on a regular basis, otherwise some property speculator might make me homeless" is much easier to understand than notional efficiency benefits.
Same goes for the Harberger tax on copyright, which is basically "only people and corporations who are already rich deserve to extract market value from their creations"
I think that drastically underestimates the (american, at least) knee jerk opposition to taxes, discomfort with novelty, and fear of having to move. Why would anyone go from a place where they pay a flat percentage of the assessed value to this new framework?
realistically there should just be some kind of homestead exemption for one primary residence. several states already have such a system, where you get reduced or frozen property taxes, and protection during bankruptcy.
>if you undervalue a thing to pay lower taxes then you risk losing it at that price. This sounds incredibly simple...
That doesn't sound so simple to me, everything has to be for sale all the time and\or you over pay on your taxes. Value your vehicle at market rate to pay the "right" taxes, anybody in the market for a vehicle can come buy yours at $1 over market rate if they want to. (It costs 2$ to drive to the closest one being sold at market rate, so it makes economic sense.) The only way to even partially defend yourself is to value your property way over market rate and pay taxes higher than the market value would suggest. Basically you have to value your stuff at market rate plus how much I would be annoyed to loose said item.
Piss off a billionaire? Guess who is never going to live indoors again.
The most glaring problem with taxes of this form in the system we have today is that there is no way to price it that does not either price regular people out of the system or allow all regular people's assets that fall under this scheme to be purchased for (relative) peanuts by the superwealthy and megacorporations.
That is to say, the prices you'd have to set to prevent very wealthy bad actors from just buying up everything and holding everyone hostage to it are so high that regular people would never be able to sustain them. And once they have obtained all the Stuff, even if they can't change the rules to make it so they no longer have to pay, they only have to keep the Harberger prices high for a fairly short time for the rents they charge us to bleed us dry enough that we have no chance of buying any of it back.
As always, and tediously, I want to remind people that the lifetime of the artist should largely be irrelevant in thinking about rewarding the creation of new works. An author writes their most lucrative bestseller when they're 20 years old, makes K dollars; another author writes their most lucrative book at 75, makes N dollars. Why are K and N different? The answer today is mostly that they're not, because the lifespan of the copyright itself is taken into account when compensating the author. Without that system, the 75-year-old author would earn drastically less than the 20-year-old, despite creating the same value.
I think that's backwards. The vast majority of all creative works make no significant profit past the first couple years of release. Publishers pay out based on what they estimate the work is going to make in the first couple of years, and discount the rest to 0.
The publisher might know that the work of a 75 year old might actually have some back catalog value, so might be willing to pay for it. For a 20 year old, they don't know that and aren't going to pay for it, even if the copyright they're buying likely has a much longer time frame.
If you used a 30 or 40 year old as your young example, I might buy the argument. Taylor Swift's back catalog as a 30 year old is worth hundreds of millions. Taylor Swift's back catalog as a 20 year old likely had an expected value close to zero, and there are very few 20 year olds as successful as Taylor Swift was at that age.
It can't be "backwards". You can believe the effect is muted by the new-release window, such that for the majority of all titles --- let's say, for books, the midlist titles --- a drastic reduction in the length of copyright wouldn't impact the comp authors would get from publishers. But you can't logically argue about the sign of the effect.
Meanwhile, virtually all of the copyright-driven industries are portfolio-based hit-seeking businesses. The comp for creators prices in some low (1-10%?) probability that a title will be a breakout success. Those returns would in fact be impacted by a drastic reduction in copyright terms.
Either way though: none of this matters. The point is that there isn't a logical argument for tying compensation to the lifespan of the author. Authors reap rewards today for returns on their IP that occur posthumously.
I'm confused... Are you saying the future value of the copyright is priced into the retail sales price of the book and/or % of that paid back to the author (or their estate) as royalties?
They are saying that when an author is looking to sell the rights to their work, the price of that work is discounted based on the expected lifetime of the author.
So in a parallel universe where the same work is written by a 20 year old and an 80 year old, the 20-year-old artist can sell the perpetual rights for more than the 80-year-old because the new rights holder will get 60 years of protection in the former case and only 10 years in the latter case.
I don't think I agree with the GP on the conclusion, but this part anyway seems logically sound to me.
Hmmmm, need to think through this a bit. Most authors earn more from royalties than anything else, so when discussing "rewarding the creation of new works", that's where my mind went.
The international Berne Copyright Convention was founded in the late 1800's precisely because Victor Hugo thought artists shoudn't have to think about such things. Copyright is automatic upon creation of the work and guaranteed for at least 50 years after the author's death.
Almost all countries are now party to the Convention, including the USA.
This is a really good idea, at least for now on large-scale abstract things such as radio spectrum and airline gates. Problems about liquidity can be solved with access to finance, which exists on easy to model things (such as, again, radio spectrum and airline gates) and then gradually expanded over time.
The dynamics are more interesting if you make a small change to this scheme: force the owner to accept public domain buyout if the value in the fund (+ interest less overhead) exceeds the current valuation. It also acts as a built-in termination period for orphaned works, since there may be no owner to actually accept an offer.
One question here would be that how derivative works are handled? Like let's use some character as an example. They appear in movie with other characters. Would you need to pay for each character and movie separately? If movie gets bought out would that allow making other works based on characters in the movie?
Also, would licenses terminate when copyright gets bought out?
How do you sustain yourself while writing full time?
Gwern
Patreon and savings. I have a Patreon which does around $900-$1000/month, and then I cover the rest with my savings. I got lucky with having some early Bitcoins and made enough to write for a long time, but not forever. So I try to spend as little as possible to make it last.
I should probably advertise the Patreon more, but I'm too proud to shill it harder.
It's also awkward trying to come up with some good rewards which don't entail a paywall. Patreon and Substack work well for a lot of people like Scott Alexander, because they like writing regular newsletter-style updates but I don't like to. I just let it run and hope it works.
Dwarkesh Patel
Wait if you’re doing $900-1000/month and you’re sustaining yourself on that, that must mean you’re sustaining yourself on less than $12,000 a year. What is your lifestyle like at $12K?
Gwern
I live in the middle of nowhere. I don't travel much, or eat out, or have health insurance, or anything like that. I cook my own food. I use a free gym. There was this time when the floor of my bedroom began collapsing. It was so old that the humidity had decayed the wood. We just got a bunch of scrap wood and a joist and propped it up. If it lets in some bugs, oh well! I live like a grad student, but with better ramen. I don't mind it much since I spend all my time reading anyway.
Gwern, some anecdotal thoughts from the world of business, where this sort of blind committed self pricing is sometimes called a "Mexican Standoff". Same idea on, say a cap table -- both parties agree that in event of a dispute, they will make sealed binding offers for the whole company; higher offer must pay. I often recommend this to young startup CEOs when they have a team they haven't worked with before, and I've occasionally suggested it to business partners.
Although I like the intuitive simplicity and game theoretic aspects of the arrangement, I've never seen it get through a partnership agreement or shareholder agreement round of redlines. Often lawyers feel nervous about it, and they'd prefer to litigate anyway; a space they are comfortable assessing and handicapping (and billing for). Often one party feels less sophisticated than the other, and thinks there might be a trap somewhere in there. Most sense, I think, that this sort of arrangement benefits the wealthier party. I think Harberger taxes suffer from the same sort of problem: the most money wins the asset.
You mention, rightly, the absolute trash heap that Brian Herbert has made of Dune. You speculate, wrongly, I think, that this arrangement would have cut him out and protected the IP. Au contraire -- I think Brian has done very well financially from this IP ownership -- sadly, enshittification pays -- and I don't see any reason to think that better stewardship would have resulted in more money to go buy out the IP than Brian's made.
Particularly in a world of art and human creative output, I'm negative on forcing IP rights to the wealthiest owners -- I'd prefer a system that leaves it in the hands of people who might have a variety of interests that could dominate, even if that gives us some tragedies in exchange.
Anyway, a system of transparent IP with buyout values (or reference values) attached is not, to my mind, uniformly better than what we have -- the reference values will be wrong, they will not capture non-monetary value, and they don't guarantee a ready buyer. It's hard to see what we'd gain; I agree that we wouldn't lose a lot, but there's a lot of social and legal work to implement between here and there.
I think asking people to put a value estimate on a thing is a hopeless task. The idea of having some sort of structured market for it is even more hopeless.
Better to just have a fee structure that starts off as the price of a carton of eggs and doubles every year that you extend it.
Copyright and patent are legal privileges (specifically a time limited monopoly on a work or invention), not natural rights.
The US Constitution proposes them as a way to “promote progress in the useful arts” and specifically calls out their time-limited nature. I think that “authors life + 95 years” arguably stretches “limited time” beyond reasonableness, but I digress.
There is a real cost, both to the society the law serves, and in the operation of law enforcement and judicial infrastructure needed to support copyright and patent enforcement.
Even if you 100% believe in copyright and patent, it seems like a reasonable thing for the direct benefactors of copyrights and patents to substantially bear the cost of enforcement. A one-time filing fee (for patents) and nothing (for copyright) seems low.
There is also a societal cost in suppression of innovation by allowing these to last long periods of time, so it seems reasonable that the cost structure should be (1) related to the value of the work to the creator/inventor, and (2) incentivize shorter times, especially if the values involved are low.
I don’t fully grok Harberger taxes but it seems to me that they try to satisfy both my proposed criteria, but are flawed in that the value is stated by the inventor/author without proof. Maybe I’m misinterpreting but I see other comments to that effect.
My proposal is to make the fee structure impute the value, by increasing over time. For example, we could require a fee of $1000 for issuance of a copyright or patent (separate from the application fee). The term would be for one year. The patent/copyright holder can extend for as many years as they want, but the cost goes up 10x each year. If it’s a valuable asset, you’ll keep paying until the cost of extension exceeds your perceived value. Now the value is established by the most informed party in the market.
This is my proposal. You can of course tinker with lengths and amounts and increase factors.
In sum the idea is that for valuable works (a Marvel Avengers movie or the patent on the RSA algorithm or a cancer drug) the copyright/patent holder will keep paying for many years until it’s not profitable anymore. For works that have little market value, they would fall into the public domain quickly and be able to help improve other works or inventions, and inhibit rent seeking. It practically eliminates the incentive for patent trolling, or for suing an artist decades later for having a beat similar to a song 40 years ago, or for establishing huge defensive patent portfolios. The economics aren’t there anymore.
I don't see malice sufficiently addressed. A billionaire could identify arbitrary copyright arbitrage opportunities in particular communities or among groups of individuals and buy out copyright, and hold on to them out of spite until the value of a property is lost, or manipulate memes and the spread of culture.
Deliberately giving things to the public domain, software licensing, and other issues arise in the context of hostility and malice and bad people existing. Stuff like this would only work if everyone participated in good faith.
By the time we figure out any sort of sensible copyright rules, AI will have made a total mockery of our systems, anyway.
AI generation of inventions could be used as a massive DOS attack on the patent system, by producing millions or billions of inventions immediately placed into public view as prior art.
The fundamental idea here is that you have no intrinsic right to the things you already possess. Should we force people to pay additional taxes on other property in order to continue to possess it? I think that would be wildly unpopular, but unless you're willing to do it in general, aren't you just picking on subpopulations you don't like?
The fact that BigCo. might be able to exploit an IP for some purpose -- perhaps making commercials out of popular songs -- in a way that would lead to revenue does not intrinsically suggest that it would be a good thing. Why shouldn't the artist retain control? Why shouldn't his heirs (who have already paid inheritance taxes) retain control?
Should an individual unable to pay taxes on his own organs lose them to someone who will pay the market value? I think most of us would think that grotesque. And it's grotesque because the viewpoint behind it -- that the highest bidder should automatically win, that it is intrinsically the "highest" and best purpose -- is grotesque.
Over time I have become more and more skeptical of Harberger taxes, which I first encountered somewhere in the works of Heinlein.
The idea is that you are taxed based on your own estimate of the value of a thing, with the estimate being public and binding as a sale price.
This sounds incredibly simple, with a natural mechanism of enforcement; if you undervalue a thing to pay lower taxes then you risk losing it at that price.
But I don't think this would work in reality. Pricing things is super hard. In a very liquid market it is difficult but doable, in an illiquid market (of one non-fungible asset) it is practically impossible. At what cadence do you update the estimate? How long is it binding for? If the value suddenly changes, how long a grace period do you have before you have to update the price?
You can try to patch this by saying that you have a right of first refusal -- that if someone offers to buy the asset at the price then you can accept their valuation as the new estimate of the price, and pay taxes going forward on the new value.
But then this defeats the point of the process because effectively the valuation is non-binding. So you have to put in all sorts of structures to prevent abuse -- maybe levy fines for past underpayment when the pricing is adjusted, or limit the number of re-pricings per time period.
And it incentivizes nuisance bidders, because owners will defend their property. So you have to put in restrictions like forcing escrow before the sale, or limiting bidding by a single entity.
Not to mention the difficulty in maintaining this registry of ownership of these assets, along with how to deal with more complicated deals about the rights involved -- film rights vs. tv rights vs. print rights, rights to individual characters, temporary licenses, etc., and all of that needs to be mechanized to allow a certain fixed list of the types of rights that can be granted, which right now is as extensive as a contract can contain -- if Sherlock Holmes were still in copyright, what if I just wanted to license Watson or make a film about Moriarty?
This is all just hopeless technocratic pie-in-the-sky dreaming.
Another problem in my mind is most creators could not afford the taxes for a high enough valuation (early on at least), but investment groups like blackrock could buy up all the copyrights/patents on the cheap. It also does not prevent the Disney scenario when a copyright is absurdly profitable. They could pay the tax indefinitely.
> Another problem in my mind is most creators could not afford the taxes for a high enough valuation
If you own 80% of something worth $1B - you have $800M. If you can't sell $2M at your preferred price to pay your taxes, then it's not worth $1B, and you wouldn't have to pay that much tax anyway.
Plus valuations change over time. In 1997, a valuation of $5m for the first Harry Potter book would've seemed excessive and the author would've probably had trouble paying taxes on it. But even with that valuation, someone could've made billions by snatching it away once Pottermania started (I suppose you could let authors update value on a daily basis but that seems like an insane amount of overhead)
There's an even simpler reason to be skeptical: They're complicated, and people don't understand complicated things, so they'll never happen.
Most people don't even correctly understand how progressive taxation works, so anything more complicated than that is dead on arrival.
I think the appeal is that it sounds simple -- you say "I bought my house for $1M, and I don't want to move, so I set the value at $2M, so I have to spend $20,000/yr to keep it, or someone can give me $2M and take the house."
That's the sort of thing that sounds very unappealing to the average voter. "I have to pay property tax on substantially more than it's worth and keep raising it on a regular basis, otherwise some property speculator might make me homeless" is much easier to understand than notional efficiency benefits.
Same goes for the Harberger tax on copyright, which is basically "only people and corporations who are already rich deserve to extract market value from their creations"
I think that drastically underestimates the (american, at least) knee jerk opposition to taxes, discomfort with novelty, and fear of having to move. Why would anyone go from a place where they pay a flat percentage of the assessed value to this new framework?
For the love of market efficiency!
realistically there should just be some kind of homestead exemption for one primary residence. several states already have such a system, where you get reduced or frozen property taxes, and protection during bankruptcy.
might be that the more onerous a taxation system, the more likely society will implode.
the stamp act, the townshend act, the boston tea party, etc...
might be "tax what you want less of" could be... citizens.
Oh, yes, because the tax code is simple.
>if you undervalue a thing to pay lower taxes then you risk losing it at that price. This sounds incredibly simple...
That doesn't sound so simple to me, everything has to be for sale all the time and\or you over pay on your taxes. Value your vehicle at market rate to pay the "right" taxes, anybody in the market for a vehicle can come buy yours at $1 over market rate if they want to. (It costs 2$ to drive to the closest one being sold at market rate, so it makes economic sense.) The only way to even partially defend yourself is to value your property way over market rate and pay taxes higher than the market value would suggest. Basically you have to value your stuff at market rate plus how much I would be annoyed to loose said item.
Piss off a billionaire? Guess who is never going to live indoors again.
You also have the silly situation where everything I own is worth more to me than it is worth - otherwise I'd have not bought it.
And even if my car is worth $5k, not having to sell it and buy another one (even if I can find it) is worth a premium.
It's likely that something like Harberger taxes could work in certain situations, but not normal people ones.
The most glaring problem with taxes of this form in the system we have today is that there is no way to price it that does not either price regular people out of the system or allow all regular people's assets that fall under this scheme to be purchased for (relative) peanuts by the superwealthy and megacorporations.
That is to say, the prices you'd have to set to prevent very wealthy bad actors from just buying up everything and holding everyone hostage to it are so high that regular people would never be able to sustain them. And once they have obtained all the Stuff, even if they can't change the rules to make it so they no longer have to pay, they only have to keep the Harberger prices high for a fairly short time for the rents they charge us to bleed us dry enough that we have no chance of buying any of it back.
As always, and tediously, I want to remind people that the lifetime of the artist should largely be irrelevant in thinking about rewarding the creation of new works. An author writes their most lucrative bestseller when they're 20 years old, makes K dollars; another author writes their most lucrative book at 75, makes N dollars. Why are K and N different? The answer today is mostly that they're not, because the lifespan of the copyright itself is taken into account when compensating the author. Without that system, the 75-year-old author would earn drastically less than the 20-year-old, despite creating the same value.
I think that's backwards. The vast majority of all creative works make no significant profit past the first couple years of release. Publishers pay out based on what they estimate the work is going to make in the first couple of years, and discount the rest to 0.
The publisher might know that the work of a 75 year old might actually have some back catalog value, so might be willing to pay for it. For a 20 year old, they don't know that and aren't going to pay for it, even if the copyright they're buying likely has a much longer time frame.
If you used a 30 or 40 year old as your young example, I might buy the argument. Taylor Swift's back catalog as a 30 year old is worth hundreds of millions. Taylor Swift's back catalog as a 20 year old likely had an expected value close to zero, and there are very few 20 year olds as successful as Taylor Swift was at that age.
It can't be "backwards". You can believe the effect is muted by the new-release window, such that for the majority of all titles --- let's say, for books, the midlist titles --- a drastic reduction in the length of copyright wouldn't impact the comp authors would get from publishers. But you can't logically argue about the sign of the effect.
Meanwhile, virtually all of the copyright-driven industries are portfolio-based hit-seeking businesses. The comp for creators prices in some low (1-10%?) probability that a title will be a breakout success. Those returns would in fact be impacted by a drastic reduction in copyright terms.
Either way though: none of this matters. The point is that there isn't a logical argument for tying compensation to the lifespan of the author. Authors reap rewards today for returns on their IP that occur posthumously.
I'm confused... Are you saying the future value of the copyright is priced into the retail sales price of the book and/or % of that paid back to the author (or their estate) as royalties?
They are saying that when an author is looking to sell the rights to their work, the price of that work is discounted based on the expected lifetime of the author.
So in a parallel universe where the same work is written by a 20 year old and an 80 year old, the 20-year-old artist can sell the perpetual rights for more than the 80-year-old because the new rights holder will get 60 years of protection in the former case and only 10 years in the latter case.
I don't think I agree with the GP on the conclusion, but this part anyway seems logically sound to me.
Hmmmm, need to think through this a bit. Most authors earn more from royalties than anything else, so when discussing "rewarding the creation of new works", that's where my mind went.
Right, but those royalties are based on the value the copyright owners derive from holding the copyright.
The international Berne Copyright Convention was founded in the late 1800's precisely because Victor Hugo thought artists shoudn't have to think about such things. Copyright is automatic upon creation of the work and guaranteed for at least 50 years after the author's death.
Almost all countries are now party to the Convention, including the USA.
I'd note you have to pay money to extend the life of a patent so a patent perceived to be worthless by its inventor expires quickly.
This is a really good idea, at least for now on large-scale abstract things such as radio spectrum and airline gates. Problems about liquidity can be solved with access to finance, which exists on easy to model things (such as, again, radio spectrum and airline gates) and then gradually expanded over time.
The dynamics are more interesting if you make a small change to this scheme: force the owner to accept public domain buyout if the value in the fund (+ interest less overhead) exceeds the current valuation. It also acts as a built-in termination period for orphaned works, since there may be no owner to actually accept an offer.
One question here would be that how derivative works are handled? Like let's use some character as an example. They appear in movie with other characters. Would you need to pay for each character and movie separately? If movie gets bought out would that allow making other works based on characters in the movie?
Also, would licenses terminate when copyright gets bought out?
It was surprising to only recently learn how little money Gwern makes and lives off of.
And then beautiful to see how the internet responded.
https://x.com/Suhail/status/1857102763249004655
Where it was mentioned?
For posterity, what's the current ballpark? I enjoyed that when I looked for it I found his comments from 2013 on HN talking about it.
From https://www.youtube.com/watch?v=a42key59cZQ
Dwarkesh Patel
How do you sustain yourself while writing full time?
Gwern
Patreon and savings. I have a Patreon which does around $900-$1000/month, and then I cover the rest with my savings. I got lucky with having some early Bitcoins and made enough to write for a long time, but not forever. So I try to spend as little as possible to make it last.
I should probably advertise the Patreon more, but I'm too proud to shill it harder.
It's also awkward trying to come up with some good rewards which don't entail a paywall. Patreon and Substack work well for a lot of people like Scott Alexander, because they like writing regular newsletter-style updates but I don't like to. I just let it run and hope it works.
Dwarkesh Patel
Wait if you’re doing $900-1000/month and you’re sustaining yourself on that, that must mean you’re sustaining yourself on less than $12,000 a year. What is your lifestyle like at $12K?
Gwern
I live in the middle of nowhere. I don't travel much, or eat out, or have health insurance, or anything like that. I cook my own food. I use a free gym. There was this time when the floor of my bedroom began collapsing. It was so old that the humidity had decayed the wood. We just got a bunch of scrap wood and a joist and propped it up. If it lets in some bugs, oh well! I live like a grad student, but with better ramen. I don't mind it much since I spend all my time reading anyway.
Is dynasty (family) inheritance of copyright assets (books and music) really that big of a problem?
Was Dune mismanaged? We got a lot of movies, TV shows and a famous video game from it!
Was Borges estate mismanaged? Wiki talks about two examples that are not dramatic.
What is the idea?
>We got a lot of movies, TV shows and a famous video game from it!
We also got Brian Herbert's terrible Butlerian Jihad books
There could be an incentive to produce even more 'terrible books' with a shorter or more expensive copyright window.
Gwern, some anecdotal thoughts from the world of business, where this sort of blind committed self pricing is sometimes called a "Mexican Standoff". Same idea on, say a cap table -- both parties agree that in event of a dispute, they will make sealed binding offers for the whole company; higher offer must pay. I often recommend this to young startup CEOs when they have a team they haven't worked with before, and I've occasionally suggested it to business partners.
Although I like the intuitive simplicity and game theoretic aspects of the arrangement, I've never seen it get through a partnership agreement or shareholder agreement round of redlines. Often lawyers feel nervous about it, and they'd prefer to litigate anyway; a space they are comfortable assessing and handicapping (and billing for). Often one party feels less sophisticated than the other, and thinks there might be a trap somewhere in there. Most sense, I think, that this sort of arrangement benefits the wealthier party. I think Harberger taxes suffer from the same sort of problem: the most money wins the asset.
You mention, rightly, the absolute trash heap that Brian Herbert has made of Dune. You speculate, wrongly, I think, that this arrangement would have cut him out and protected the IP. Au contraire -- I think Brian has done very well financially from this IP ownership -- sadly, enshittification pays -- and I don't see any reason to think that better stewardship would have resulted in more money to go buy out the IP than Brian's made.
Particularly in a world of art and human creative output, I'm negative on forcing IP rights to the wealthiest owners -- I'd prefer a system that leaves it in the hands of people who might have a variety of interests that could dominate, even if that gives us some tragedies in exchange.
Anyway, a system of transparent IP with buyout values (or reference values) attached is not, to my mind, uniformly better than what we have -- the reference values will be wrong, they will not capture non-monetary value, and they don't guarantee a ready buyer. It's hard to see what we'd gain; I agree that we wouldn't lose a lot, but there's a lot of social and legal work to implement between here and there.
I think asking people to put a value estimate on a thing is a hopeless task. The idea of having some sort of structured market for it is even more hopeless.
Better to just have a fee structure that starts off as the price of a carton of eggs and doubles every year that you extend it.
Copyright and patent are legal privileges (specifically a time limited monopoly on a work or invention), not natural rights.
The US Constitution proposes them as a way to “promote progress in the useful arts” and specifically calls out their time-limited nature. I think that “authors life + 95 years” arguably stretches “limited time” beyond reasonableness, but I digress.
There is a real cost, both to the society the law serves, and in the operation of law enforcement and judicial infrastructure needed to support copyright and patent enforcement.
Even if you 100% believe in copyright and patent, it seems like a reasonable thing for the direct benefactors of copyrights and patents to substantially bear the cost of enforcement. A one-time filing fee (for patents) and nothing (for copyright) seems low.
There is also a societal cost in suppression of innovation by allowing these to last long periods of time, so it seems reasonable that the cost structure should be (1) related to the value of the work to the creator/inventor, and (2) incentivize shorter times, especially if the values involved are low.
I don’t fully grok Harberger taxes but it seems to me that they try to satisfy both my proposed criteria, but are flawed in that the value is stated by the inventor/author without proof. Maybe I’m misinterpreting but I see other comments to that effect.
My proposal is to make the fee structure impute the value, by increasing over time. For example, we could require a fee of $1000 for issuance of a copyright or patent (separate from the application fee). The term would be for one year. The patent/copyright holder can extend for as many years as they want, but the cost goes up 10x each year. If it’s a valuable asset, you’ll keep paying until the cost of extension exceeds your perceived value. Now the value is established by the most informed party in the market.
This is my proposal. You can of course tinker with lengths and amounts and increase factors.
In sum the idea is that for valuable works (a Marvel Avengers movie or the patent on the RSA algorithm or a cancer drug) the copyright/patent holder will keep paying for many years until it’s not profitable anymore. For works that have little market value, they would fall into the public domain quickly and be able to help improve other works or inventions, and inhibit rent seeking. It practically eliminates the incentive for patent trolling, or for suing an artist decades later for having a beat similar to a song 40 years ago, or for establishing huge defensive patent portfolios. The economics aren’t there anymore.
I don't see malice sufficiently addressed. A billionaire could identify arbitrary copyright arbitrage opportunities in particular communities or among groups of individuals and buy out copyright, and hold on to them out of spite until the value of a property is lost, or manipulate memes and the spread of culture.
Deliberately giving things to the public domain, software licensing, and other issues arise in the context of hostility and malice and bad people existing. Stuff like this would only work if everyone participated in good faith.
By the time we figure out any sort of sensible copyright rules, AI will have made a total mockery of our systems, anyway.
As AI takes hold it's obvious parents and copyrights will have to be revisited.
AI generation of inventions could be used as a massive DOS attack on the patent system, by producing millions or billions of inventions immediately placed into public view as prior art.
Since it's so easy to invent with AI there's no need for patents or copyrights anymore. The money isn't the idea anymore, it's the product.
imagine spending weeks crafting pages of incomprehensible reformist apologia for a uselessly broken and totally unnecessary system
The fundamental idea here is that you have no intrinsic right to the things you already possess. Should we force people to pay additional taxes on other property in order to continue to possess it? I think that would be wildly unpopular, but unless you're willing to do it in general, aren't you just picking on subpopulations you don't like?
The fact that BigCo. might be able to exploit an IP for some purpose -- perhaps making commercials out of popular songs -- in a way that would lead to revenue does not intrinsically suggest that it would be a good thing. Why shouldn't the artist retain control? Why shouldn't his heirs (who have already paid inheritance taxes) retain control?
Should an individual unable to pay taxes on his own organs lose them to someone who will pay the market value? I think most of us would think that grotesque. And it's grotesque because the viewpoint behind it -- that the highest bidder should automatically win, that it is intrinsically the "highest" and best purpose -- is grotesque.
>Should we force people to pay additional taxes on other property in order to continue to possess it?
That is generally how property taxes are supposed to function.
It's better than taxing the output of hard work - work, unlike hoarding, is generally something we want to encourage.
> It's better than taxing the output of hard work - work, unlike hoarding, is generally something we want to encourage.
To what hoarding are you referring?