Sunday, November 30, 2008

IP & THE ECONOMY - Never Allow a Crisis to Go to Waste

Most governments are now taking decisive steps towards decisions on and implementation of major stimulus/investment packages to rescue, resuscitate and even reinvent national and international economies. Canada, apparently, is going about this in its own way, with no such decisions yet announced. In Canada, things are actually getting “curiouser and curiouser” as we head towards a political crisis.

However, following Rahm Emanuel's widely reported maxim that “Rule one: Never allow a crisis to go to waste...They are opportunities to do big things”, here are some bold ideas that would probably never fly or even be seriously considered in normal times in Canada about using IP and IP policy to help fix up the economy. Some of these would require legislation or regulations. Some would not and would only require sufficient leadership, will and skill at the political level - which are not necessarily any easier to come by:

1. A real and really “high speed” (> 200km/h and preferably 300 km/h) train system from Windsor to Quebec, including Ottawa, Edmonton to Calgary, Vancouver to Seattle and maybe even Montreal and/or Toronto to Boston and/or New York. This is a huge undertaking, to be sure, and was rejected by a previous government as recently as 2002. However, that was then and now is now. It is long overdue and has been studied many times over and had several false starts. This would be an ┼▒ber IP intensive project, if Canada were to make a commitment to take the opportunity to push the technology beyond what even far smaller countries and economies have used for a long time and go for state of the art. This would:
a. Help Canada to catch up with and hopefully leap beyond the USA, Europe, Japan, China, Russia, Finland, Norway Korea and South Africa where high speed trains have long since proven to be an essential and bountiful investment. Even Russia, which has a very “cold climate” and notorious economic, political and technological baggage, has scheduled trains that do better than 200 km/h. Canada is the only G8 country without high speed rail. And we are behind several small and developing countries, some of which have very cold climates.
b. Provide countless high tech R&D, engineering, management and other high paying IP related and other white collar jobs in Canada
c. Generate many important patents
d. Provide many skilled manufacturing jobs in Canada
e. Replace many lost skilled jobs in the automotive and manufacturing sector in Windsor, Oshawa, and other depressed points right along the main rail route, such Prescott, Cornwall, etc.
f. Provide many semi-skilled labour jobs that would be far more productive than filling potholes and patching bridges, which should be done anyway as basic maintenance - but is simply a necessity and hardly a visionary investment that would constitute an FDR “New Deal” order of magnitude stimulus.
g. Reduce pollution and save energy
h. Stimulate commerce and tourism in Canada’s business and cultural cores
i. Enable Canada to develop leading edge technology for cold climate high speed rail transportation - which could be sold to other countries
j. Teach a major and essential competitive lesson to Air Canada, which sorely needs improvement.

2. Provide a tax break, like Ireland, to artists though reduced or eliminated taxes on copyright royalties. This would:
a. Relieve that public purse, at least to some degree, of its obligation (as seen by most current governments outside of Canada) to provide direct subsidies
b. Encourage successful Canadian start to return home or remain at home
c. Stimulate artistic activity in Canada, which has a huge multiplier effect throughout the economy.

3. Reform the patented medicines regime so as to:
a. Stimulate more actual R&D in Canada
b. Result in lower drug prices in Canada - both for patented and generic drugs
c. Reduce the immense amount of litigation that benefits lawyers but not consumers and is tying up the federal court system
d. Allow the Federal Court and Federal Court of Appeal to get back to more productive work.

4. Reform the copyright collectives and Copyright Board regime (though which almost $500 million a year now flows) so as to ensure that:
a. Canada has smarter and more efficient collectives than other countries, and not simply more and more inefficient collectives than any other country
b. Canadian collectives serve the interests of their members and not just their managers, lawyers and consultants
c. Canada’s Copyright Board - the largest such tribunal anywhere - holds hearings and renders decisions sooner
d. The costs of objecting to copyright tariffs are more affordable
e. Copyright Board decision are not unreasonably retroactive.

5. Revive competition law and enforcement in Canada so as to ensure that:
a. Canada’s ISPs do not throttle everything from bandwidth to overall innovation due to vertical integration, conflicts of interest and lack of antitrust enforcement
b. Restart serious oversight and enforcement at the Competition Bureau and move beyond the Bureau’s apparent attitude that the mere exercise of IP rights will almost always be efficiency enhancing and rarely, if ever, should be subject to scrutiny. It is time to recognize, as has Judge Posner and many other great jurists and economists , that IP rights can be and are frequently leveraged well beyond the legitimate economic interests of owners and can become harmful to economic efficiency
c. Ensure that the CRTC better serves the public interest, if necessary, through better legislation
d. Canada has competition and innovation in wireless and ISP technology, instead of allowing the CRTC and Competition Bureau to bless a duopolistic regime that has put Canada behind countless other countries in terms of cost and quality of service.

6. Protect Canadian consumers through:
a. Anti-spam legislation
b. Serious do not call legislation and not the current “do no hesitate to call” regime, as Michael Geist calls it
c. Clarification of copyright law to ensure that parallel imports of products not themselves protected by copyright cannot be prevented and free trade thereby seriously compromised by means of a paper exercise involving the assignment of copyright in some element of a package or label or logo, which is a possibility touted by some law firms since the Supreme Court of Canada’s 2007 Kraft decision.
d. Balanced copyright reform that will expand users' rights, protect consumers from excessive DRM and TPM, eliminate statutory damages against individuals and non profit institutions for private activity and increase them for real commercial piracy.

7. Ensure that the billion dollar plus a year subsidy to the CBC is used for the purpose intended in the Broadcasting Act and not for the purpose of embarrassing, incompetent and unnecessary attempts to compete with commercial radio and television, which will, incidentally, result in additional payments of millions of dollars a year in additional royalties to the commercial music industry at taxpayers' expense. This does not mean privatizing the CBC, but rather fixing it from the top down.
Will any of the above see the light of day? I doubt it - but these are strange times and Canada should “never allow a crisis to go to waste.”


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