The head as a source of revenue
The contradictions of intellectual property

Intellectual property is a controversial matter. Many people don’t see why they should pay for text, software, music, or movies when they can be copied without effort or downloaded for free from the Net. And some people discover the ugly, unjust side of property in the ownership of “immaterial” goods, while the ownership of tangible, physical things they consider entirely proper. On the other side, it is not only the majority of artists who insist on the right to their works, from which they also have to be able to live. Politicians for their part find that especially intellectual property gets too little respect. They are willing to listen to the complaints of the media companies, which need a fully enforced copyright for their profits. The German government considers that already quite well realized within the country, but only inadequately put into practice outside it. The world abroad is rife with the “theft of ideas” and “product piracy,” by which not only the profits of multinationals are stolen, but also the “technical edge” of “our” economy in general. For the leading economic powers, it is a challenge to look after the protection of intellectual property abroad where foreign rulers decide how to deal with copyright, patent, and trademark complaints. Intellectual property has consequently become the object of a political struggle in global competition.

A system-conforming absurdity of bourgeois working life

Let’s start with the right of the creator to his work.^[1] Everyone is familiar with this: the products of mental labor come into the world, just as one knows those of manual labor do, as property of their producers. This is so familiar to everyone that the peculiar character of this relation and its reason are not given a second, objective thought. Because this is not self-evident. Works of science, literature, and art are by their nature universal: their creation is aimed at their being disseminated, and not just being noticed by the rest of humanity, but also being made their own object; no writer or thinker wants to take his intellectual creations with him to the grave. The discoveries about nature and society need to be reproduced and generalized; the communications of the artistic imagination aiming at moral edification need to be adopted and enjoyed by the public and thus made a canonical part of social education. Furthermore, the whole progress of science and culture lives from reflection on what others have thought before in order to come to new discoveries by analyzing the older ones. Though they are brought about through the intellectual efforts of an active subject (doer), they then possess an objectivity apart from scientists and artists, hence are universal also in this respect.^[2]

The modern state, which appreciates knowledge and culture as a productive force of its economy and rule, wants this universal availability of the results of intellectual labor. At the same time, the universality of knowledge contradicts the universal purpose its bourgeois society has determined for it: the accumulation of private monetary wealth. What applies to all labor also applies to intellectual labor: without selling its results, no money can be made with it; and that presupposes the exclusive disposal over intellectual works. As already mentioned, the products of intellectual labor, according to its use-value, are not at all suitable for excluding others from access: anyone can reflect on discoveries without having to materially take hold of them — as one has to do with the means of satisfying physical needs — and they do not thereby become “less” or consumed when others comprehend them, thus making them their own.^[3] Creating them is precisely “universal labor.”^[4] So for it to be private labor, which creates property for economic purposes, the higher power of the state must join in: in copyright it specially defines the exclusive character of this universal labor and painstakingly secures it, so that the exclusive right of disposal also remains valid if the thing to which it refers has long since passed irrevocably into general use. It prohibits the — mainly economic — use of artistic and scientific achievements by anyone other than the creator and regulates access to these products of mental labor via licensing agreements and money.

In the case of intellectual property, many people notice that property is exclusion; and that its reason and purpose lie solely in turning a thing into a source of money, namely, into a commodity with which its owner can take others’ money by withholding what others need or can use. The ownership of material things does not attract nearly as much criticism — as if the individual existence of these things and the circumstance that they are used up or consumed through their use would “by nature” predestine them to be property. In fact, from political-economic principle, there is no difference when the state imprints the products of material labor with the character of private property that they, too, do not have by nature. In this case, too, an act of sovereign power turns labor into private labor; hence into a production of useful things, a production intended for social need, although not to satisfy it but to be used for the producers to make money. What is different therefore are only the state precautions required to enforce the definition of the respective creations as property: with material products, which each exist just once, it is sufficient to prohibit and punish the physical removal of the thing; ideas and discoveries become property only through the state prohibiting the use of this ideated product, usable universally and everywhere, as soon as it is created, and monitoring its entire society accordingly.

An income source for creators

The state guarantees the creator “the exclusive right to exploit his work in material form” (German Copyright Act § 15), as well as the right to an “adequate remuneration for use” (§  11).^[5] Copyright protects the ownership benefits of intellectual activity, i.e., their marketability, establishing in this way, in a world of owners, a monetary interest in the production of immaterial goods and at the same time enabling money to access them.^[6] Money, however, is not yet earned solely with this right. Whether writers with their stories or singers with their songs actually earn money depends in the normal case on a marketer who turns their “works” into a salable commodity and then successfully conducts the sale. He puts his capital to use by buying from the author his “absolute right to the appropriation” (Hegel, Philosophy of Right § 44) of his work.^[7] Hence the first in line to profit from copyright are the media companies — as the condition for copyright to then prove itself as livelihood for writers, composers, and singers. Only then can more than a louse or two live off their heads.^[*]

Once mental, universal works are protected as exclusive private ones, political controversies over intellectual property do not end for society, and the regulatory requirements of intellectual property do not end for the state. Since the invention of this legal category by the early bourgeois state, the dispute over plagiarism has gone on. It revolves around the only important question in a world of property owners: where in an intellectual work does one’s own achievement begin and where has one merely taken over another’s body of ideas — what is thought or written is only of importance under this legal point of view. In the normal case, however, this judgment is anything but simple. After all, there are plenty of thinkers and artists who with a “minimal stroke of genius” in a theory here and a “trifling modification” in a work of art there bring about “alterations that more or less superficially stamp someone else’s property as our own.” (Hegel, Philosophy of Right, § 69) This satisfies the definition of theft: not only for the early bourgeois philosopher of right, who was obviously committed here to his own cause, but also for the modern constitutional state.

The state recognizes a second theft of intellectual property besides plagiarism: a pirated copy. This is virtually invited owing to the “physical form” by means of which creators and marketers “exploit” intellectual content. Books, recordings, cinematic or visual works of art are such forms, through which intellectual efforts become an external thing in which the aimed-for monetary benefit can be gotten from the sale of the thing as a commodity. The material existence of the “works” is produced mechanically, hence it can be reproduced any number of times — without any intellectual effort, as must be put into the production of the original. As long as printing and publishing have existed, there has been “illegal” copying of the works they distribute. The state makes this a punishable offense and thereby turns the intellectual product, which anyone can duplicate, into property that non-owners are not allowed to duplicate, at least not out of business motives.^[8] With copyright, the state prohibits commercial copying — with one major exception: it is permitted for personal use. In this case, the state not only has an eye on the educational and information needs of its citizens, but above all its own interest in the scientific-moral-cultural education of the nation and the formation of a political will: the reproduction of works for classroom use is permitted as a matter of principle; the collective knowledge of society may be used for education and research without restriction as long as the source is properly cited; public works or art may be reproduced by photo, film, or painting; copyright also doesn't apply to political speeches, newspaper articles, and media news reports. Someone who makes use of them is nevertheless implicitly supposed to pay the creator a “reasonable remuneration.” The state counters the large-scale attack on “the work of art in the age of mechanical reproduction” (Walter Benjamin, 1936 essay) with a reprographic or storage media levy for the manufacturers of copying machines and computers as well as with the formation of levy-collecting associations to secure the monetary proceeds that intellectual property is entitled to.

And here the old matter of theft of intellectual property gets a new urgency from technological progress: the Internet frees immaterial works from their connection to a physical means of conveyance, making them available with a key click for anyone, anytime, and across national borders. On the World Wide Web, the greed for no-cost downloaded texts, images, music, as well as software of all kinds, which is celebrated as freedom, comes up against the complementary greed by which “content” is protected as property on the Net, too, and works as a source of enrichment.^[9] The state finds itself challenged by the conflict of interest to regulate something it does not want to decide unequivocally: it values the Internet as a formidable business sphere; it does not want to harm its growth by placing the users of the Net, their offers of “content,” and their access to it under the general suspicion of copyright infringement. On the other hand, it considers it a matter of course that the principle of property has to remain valid even in a virtual space, which requires a scale of monitoring that Honecker and his Stasi would only have been able to dream of. However, one thing is at least certain in the undermining of copyright via the Internet: it’s an abundant source of income for lawyers.

This does not quite settle the matter, however. A state responsible for a modern, cultural nation cannot just stop with the protection of intellectual property. It insists on and promotes the flourishing of the arts and sciences in all areas and thereby emancipates to a certain degree the intellectual creativity of the nation from the necessities of private money-making. The state is not unaware that one can make a living from one’s head in capitalism after a fashion, if at all. No money is earned from the discovery of electron spin or the further development of the structure-function method in physics. The state therefore directly pays the researchers in its universities, so that they can advance science with their discoveries, which it views as a productive force for its economy and rule. And since it also appreciates the services of the fine arts for the idealization of social relations and conditions and at the same time knows that acting, singing, or violin playing are extremely precarious sources of income, it subsidizes theaters and opera houses from its budget. In this way, both the suitability of intellectual labor as a source of income and the services of scientists and artists to the progress of the nation are taken care of.

Inventions and “patents” as productive forces of capitalist locations

The most capitalistically important service of intellectual activity is the application of scientific findings in the form of “inventions in all fields of technology” that “are new, involve an inventive step and are capable of industrial application.” (German Patent Law § 1). Inventions are first of all the means of competition of capital; and secondly the state recognizes science and technology as key conditions for the success of its capitalist site. This is based quite as a matter of course on the prevailing purpose of the “inventive step”: new products are developed in order to do business with “innovative” goods, i.e., to enter a market and “conquer” it with them — not in order to broaden and satisfy human needs as use-values. An invention is supposed to prove itself a great success for the company in siphoning off existing buying power, because the new products have no competition yet and yield a monopoly profit for their producers at the attainable prices. And also with new production processes, the other type of invention, the professed intent is not to make work easier and reduce working time but to cheapen production, which results in selling prices for products that are more competitive, i.e., lower than those of other suppliers but that nevertheless include a decent profit. With each “technical advance,” businessmen emphasize the fact that cost reduction, crucial for the competition of capital, is not some physical or chemical property of technological innovation, but rather requires its systematic economic application at the expense of the workers: improved machinery, innovative processes, and new materials cheapen industrial products only if they save on the — paid — labor needed for their production. New technology is worthwhile for the employer if it saves more wages per product than it itself costs. It increases the efficiency of paid labor, thus allowing the employer to purchase relatively less of it, and thereby increases the profit on his invested capital. The businessman wages the fight for the market with this reduction of his production costs: he can sell more cheaply than his competitors, expand his market share at their expense and increasingly steer the available buying power into his accounts. This is how technical innovation is supposed and able to prove itself as a lever in competition: namely, making labor costs — the livelihood of the masses — superfluous by increasing the ability of capital to exploit the workforce remaining in active service.

The state, in its role as “ideal collective capitalist”^[†] and guarantor of the conditions of competition between private property owners, takes account of the economic circumstance that capitalism lives off technical progress. It recognizes the interest of the capitalist class in “knowledge-based innovation” as an inherent necessity of their competition and at the same time knows that, for businessmen competing over the increase of money, the investigation of nature is a basic condition of their business, but not itself a business. It feels challenged by a contradiction inherent in the capitalist mode of production, namely, between the need to develop every capacity of science as the universal wealth of society and the private form of its appropriation as a business means of the capitalist class. The state takes on this contradiction by pursuing the development of science itself, freeing scientific and technological research from “short-term” cost-profit and other private calculations, in order to secure access to knowledge as a productive force in the “long-term,” i.e., reliably and permanently. It provides for universities and other top-notch research institutions, bears the costs of equipping them, and pays for the livelihoods of its mostly permanently appointed scientists. At the same time, the state as sponsor of science always bears in mind the private business purpose that all research has to serve: it insists nowadays that its university research institutions should just commercially “exploit” their discoveries themselves, for example through affiliated technology parks as “incubators” for entrepreneurial start-ups; the universities are also supposed to open themselves up to direct access by business in order to undertake joint research projects as a guarantee of “application-oriented” discoveries.^[10]

The separate sphere of science and research organized alongside and apart from economic competition produces the advance in universal knowledge that is as important to the state as the private exploitation of knowledge as a means of competition for companies. In this way, science becomes a power of capital. The companies appropriate universal knowledge with paid brainworkers. Salaried researchers and engineers further develop it for the specific requirements of the firm in order to turn it into new products and technological processes.^[11] The company increases its profits with these because and as long as it has exclusive control over these “innovations.”

A businessman therefore sees the economic benefits from his inventions threatened by his peers. Inventions have the characteristic of every “idea”: as soon as it is out in the world — all the more when the inventive idea has taken real, mechanical shape — it can be theoretically appropriated by competitors and a copy built. And in the modern age of the Internet and the “digitization” of every production process, in which software is the technology of rationalization par excellence, cars or smartphones no longer have to be disassembled in order to uncover their “design secrets,” which incidentally no longer have to be understood. For if a competitor manages to get access to the software, he can appropriate the new invention with the commands ‘copy’ and ‘paste’ completely “mechanically” and without charge. The highly profitable competitive advantage of the invention’s sole “industrial application” by the technology leader is ruined by the complementary interests of rivals to possess the new technology themselves as quickly as possible. Monopoly or extra profits are only obtained as long as competitors do not possess comparable technologies. It is not the knowledge, but the knowledge lead that counts in competition. The absolute increase of this productive force — in itself an enlargement of the wealth of society, because more use-values can be produced with shorter working hours and less trouble — is only of benefit when it is also a relative increase, i.e., advances more rapidly than with competitors; so that they are driven from the market with new, cheaper products and cost-saving production processes, and their parallel efforts are devalued and thwarted. Inventions, the practical utilization of nature on the basis of its theoretical mastery, are capitalistically worthless once competitors have disposal over them.

With patent law, the state intervenes in the conflict of interest that dominates the competition of capitalists: it grants the businessman the exclusive right of economic use of his invention. The patent is the form of intellectual property with which the state differentiates between a socially available technical innovation and its exclusive business use. The law authorizes the patent holder to forbid competitors from using his invention because he wants sole use of it, or else to permit them to use it for a fee, i.e., to profitably sell the rights of use in the form of a license.^[12] By protecting patents, the state guarantees the exclusivity of the exploitation of inventions and at the same time the universality of the use of new technologies. It wants innovations from which not only a single capital profits but also with which overall capitalist growth is advanced on its capitalist site. That is its interest in the “technical progress” corresponding to which it develops patent law. Only a “new” and “industrially applicable” idea is patentable, so it has to represent an advance in the development of the productive power of social labor, including its prospective capitalistic application in the production process. The patent is granted for 20 (in exceptional cases 25) years, which is supposed to secure the inventing company both the amortization of its research costs and an extra or monopoly profit. The state spurs on the innovation efforts of its capitalist class through the temporary monopoly, as well as through the built-in expiration date: the companies can only avoid the foreseeable loss of their state-guaranteed competitive advantage with ever newer patentable inventions; what was once cutting-edge technology is after a short time generalized into the new minimum standard of capitalist profitability on the national site. The “disclosure” obligation associated with the right to a patent serves the same aim as accelerated “innovation”: in return for the company being allowed exclusive business use of its invention, it must document its underlying scientific-technical knowledge for the patent office and make it accessible to everyone. The state thereby makes the cutting edge of technology freely available to the companies for further research and development efforts based on it, but also to research and teaching in its technical universities.^[13] Patent law is certainly not supposed to hamper advances in knowledge in the natural sciences and technology, which is why it distinguishes between “inventions” worth protecting and fundamentally non-patentable “discoveries.” This is how the state handles the protection of intellectual property as a lever to turn its capitalist site into an automat for continuous production of “innovative technologies.”

The spirit of research and invention stimulated by the state’s patent laws ensures that the need for state regulation never ends. The advances in biotechnology and genetic engineering in particular are a challenge to its sovereign art of defining: where do “discoveries” end or “inventions” begin, and what should be patentable in the first place? Its law stipulates that “the human body ... cannot constitute a patentable invention,” whereas “An element isolated from the human body or otherwise produced by means of a technical process, including the sequence or partial sequence of a gene, may constitute a patentable invention even if the structure of that element is identical to the structure of a natural element.” (Patent law § 1a) With such distinctions and drawing of boundaries, it creates the legal basis for the competition of biotechnology and genetic engineering companies over the patenting of drugs and production processes whose development and effectiveness are based on the decoding of human genetic material. At the same time, the state is familiar with other, higher interests on account of which the stimulated thirst for research and the business acumen of the companies specializing in life sciences must be checked: not everything that is technically feasible is allowed to be done with “human life” in general, and especially with “nascent life.” When it comes to the production and reproduction of the national population, the state claims absolute right of disposal over its living inventory; it decrees what “public order or morality” requires, namely, a ban on patents for “cloning human beings,” for “modifying the genetic identity of the germ line,” and for the “use of human embryos for industrial or commercial purposes.” (Patent law § 2)

Otherwise, the state fully supports the business of the biotechnology and pharmaceutical industry with its patent law; it assures them monopoly prices for drugs, even if on the other hand this jacks up the costs of its health care system. Then the state has to get the lacking money from its citizens and ensure that they pay for pharmaceutical profits out of their meager incomes. After all, this has to make sense to them for their health’s sake: in a society in which everything revolves around money, no research-based pharmaceutical company would ever develop a single drug without patent-protected monopoly profits.

Another field of business competition: the “brand” and the protection of corporate identity

The “brand” is another one of the goods that the state protects as intellectual property.^[14] Trademark protection is like a caricature of the patent, but in the world of property, the category of caricature does not exist. What the state protects here has nothing to do with mental labor, but touches on the identity of a company in competition with its peers on the market. If a company doesn’t have a monopoly on the product because the same thing is made by many, then it can at least have a monopoly on the sign attached to its product. The state grants an exclusive right to this external mode of appearance of the commodity, which “prohibits third parties from using identical or similar signs without the consent of the proprietor of the trademark.” (German Trademark Act § 4 ) In the fierce battle for the money of their customers, successful companies consider the name, logo, and style of their products as their most important “intangible capital” and trump card for future market success. In fact, they can rely on the idiocy of a widespread brand awareness that has long since been detached from its basis in a special quality of the product. Self-confident consumers remain loyal to “their” brand. They casually shell out more money for the car with the star, the smartphone with the bitten apple, or the “energy” drink with the red bull because these suit their demanding personalities and consequently are “worth” more than comparable products. It is one of the absurdities of the market economy that the exclusivity of a brand alone earns a company extra profits. To be fair, the imitation of successful products on the market is one of the marketing strategies of competitors. To brand-name companies, this is a fraudulent misrepresentation to customers, consequently a theft of their “intangible assets.” The state sees things the same way and criminalizes as “unfair” competition everything its courts consider to be a clear case of imitation.

The intellect as weapon and object of dispute in international competition

With the legal institution of intellectual property, the state transforms mental labor into a source of income and profit for its economy. It organizes the entire matter in such a capitalistically proper manner that “innovations” are the motor of the national site — and vice versa. The edge in science and technology monopolized on the domestic site for capital is the state’s weapon abroad in the competition against and at the expense of competing national sites. The companies operating at home with the superior productivity of the social labor embodied in patent-protected products and production processes, and with an exclusive “brand,” are supposed to conquer the world market. With the export of newer and cheaper commodities as well as investments in their own high-tech production facilities abroad, they are supposed to wage the fight over the appropriation of the proceeds of global capitalism, to enrich themselves, and thereby increase the wealth of the nation.

Here the state sees itself challenged once again: it must ensure that the power of disposal over “innovative” technology is and remains the exclusive means of the companies operating on the domestic business site — just because they make their profits on foreign markets. So it does everything in its power to secure other states’ respect for intellectual property. Foreign sovereigns have to place their power in the service of protecting the intellectual property of the international capital whose commodities or manufacturing facilities are located on their territory; they are supposed to protect foreign intellectual property as if it were their own. They are confronted with the contradiction of barring their domestic economy — i.e., the source of their national power — from using the advanced techniques that ensure the superior profitability of foreign competitors. They are supposed to turn these foreign interests into valid law and thereby guarantee them. That would be “fair competition.” The states challenged in this way along with their local business communities by no means resign themselves to falling behind in competition, as is demanded of them. They consequently set about “exploiting” the feature of an “intangible good” that once it is invented and produced, it is universally available: they obtain insight into the construction plans disclosed in the patent or just get the finished product in which the inventive know-how is embodied, in order to contest the market of the “technology leader” with a cheap imitation. It is not just foreign companies that steal “our” intellectual property; the states themselves lend a hand: they give their ministries, their research institutions, and intelligence agencies the task of systematically investigating protected inventions in the country, in order to build their own modern industries overnight and catch up with the competitive advantage of the “technology leader.” Of course, the leading industrial nations never miss a trick either, and, turning the tables, investigate which technological breakthroughs the competitor has achieved.

That does not change anything about the common interest of the established world economic powers in defending their monopoly on the capacities for advances required by economic growth against “developing” and aspiring “emerging” countries. The efforts of the latter to gain access to advanced technologies are, for the leading industrial nations, identical to an attack on intellectual property rights and thus on their acquired economic standing, against which they jointly have to defend themselves:

“Intellectual Property Rights (IPRs) are a key asset of the EU, ensuring its leading role in the ‘knowledge economy’. The EU can only remain competitive, if it can rely on innovation, creativity, quality, and brand exclusivity. These are some of our main comparative advantages on the world market, and they are all protected by intellectual property rights. Only, the means of adequately enforcing those rights in our main export markets to date are limited.” (MEMO/10/508 of the European Commission on the Anti-Counterfeiting Trade Agreement — ACTA, October 10, 2010)

“China needs to learn how to deal with intellectual property as we are accustomed to, because it is robbery if one simply copies.” (German Chancellor Merkel, interview with ZDF on May 23, 2006)

The struggle of Germany and Europe for the application of national and European regulations as an internationally binding regime of “Intellectual Property Rights” is a matter of imperialist power and extortion of the first order. For the governments in Berlin and Brussels, it is important in negotiations with the other global economic powers and the rest of the world of states to push through a world-trade order that ensures global respect for intellectual property — and thereby codifies their status as permanent beneficiaries of their technological lead. They have chalked up the 1995 TRIPS Agreement (Agreement on Trade-Related Aspects of Intellectual Property Rights) within the framework of the WTO as a success in this struggle.^[15]

At the present time, the EU, the US, and Japan see the need for new efforts in intellectual property. An increasing share of their profits from world trade and capital exports comes from the use of productivity-increasing know-how, i.e., “intangible goods.” And in the meantime some emerging countries have become serious competitors who possess the amount of capital and mass of credit needed to exploit “inventions” for their own growth and to make world-class products from blueprints. China in particular, but also India, Brazil, and Russia have come to the fore as nations that displace our “Made in Germany” products from established export markets with their “piracy” and inundate our domestic market with their “pirated copies.” This changed competitive situation gives new relevance to the ability of the established global economic powers to maintain their intellectual-property rules of procedure against the upstarts. To supplement TRIPS, they are working on new trade and investment agreements that are supposed to result in better protection of copyright, patent, and trademark rights all over the globe by confirming EU or US law as supranational law that not only must be adopted by all countries, but also finally obligates these countries to criminally pursue and punish infringements.^[16]

Since Europe and the US are not getting the consent of the emerging nations combined under the acronym BRICS, on which consent they are dependent, they are concluding bilateral and multilateral trade agreements that position more and more third countries (i.e., other than the principals) against the incriminated sinners in order to deprive them of their export markets. The third countries are being blackmailed with their own interest in the indispensable access to the domestic markets of the USA, EU, and Japan; they receive a “regulated admission” — the price is that they have to position themselves toward China and other emerging rivals as an extended enforcement arm of Western legal claims.^[17] This is how the global protection of intellectual property advances.

© GegenStandpunkt 2015