The Rights of Innovators

But as political ideas can work only if they are accepted by society, it rests with the crowd of those who themselves are unable to develop new ways of thinking to approve or disapprove the innovations of the pioneers. There is no guarantee that these masses of followers and routinists will make wise use of the power vested in them. They may reject the good ideas, those whose adoption would benefit them, and espouse bad ideas that will seriously hurt them.
— Ludwig von Mises, Theory & History (1957)

I t has been said that necessity is the mother of invention. But what if the incentives for inventions are thwarted, blocked, or confiscated?* Can we possibly think of a rosy future for health innovation if there are scant or no marketplace rewards?

* Jean-Luc Mélenchon, a leading candidate for the Presidency of France, has just called for a 100% tax on any earnings above €360,000 (about $478,000) per year. In these days of entrepreneurial self-booting, there may not be enough money to develop a new invention, let alone to popularize it.

There may be some who would devote their genius to “humanity,” but economic knowledge sheds little hope that the overall yield would be very great. Under the aegis of routinist bureaucrats, when a great biomedical discovery is made, it must first be recognized by a consensus- or populist-driven mass of bureaucrats. Then it must be subjected to a maze of lengthy studies, including deference to the precautionary principle. Then it must be prioritized and scheduled (if there is enough money devoted to it by the bureaucracy). Without a market to indicate what people are willing to pay for it, the speed of its availability is likely to be greatly hindered, or retarded in the very least, and left up to the whim of the routinist. On the other hand, if is not recognized, it may never see the light of day, let alone achieve mass-market phenomenon status. Also, the good-idea innovation is constantly in “competition” with the bad idea “innovation.” When there is no market mechanism, the choice will be up to a faceless bureaucrat, or a mass of them.

Bad Ideas Crowd Out the Good

As a reader of this publication, you are undoubtedly hopeful that your biomedical future will be bright. But while relentless exponentialists (such as those who cheer on the singularity†) point to the fact that the growth of scientific progress continued unabatedly during the Great Depression, it doesn’t necessarily follow that the technology did. This was especially so when a new idea was subject to being crowded out by the bureaucratic endorsement of a bad idea. If for example, you were selling the use of recreational land, it was difficult to compete with the Works Progress Administration, a kind of Gresham’s law (“When a government compulsorily overvalues one type of money and undervalues another, the undervalued money will leave the country or disappear from circulation into hoards, while the overvalued money will flood into circulation.”) in which bad ideas (supported by well-funded bureaucrats) drive out the good (unfunded, because of crowd out).

† See Kurzweil R. The Singularity is Near. New York: Penquin Group; 2005.

In our current era of financial devolution—call it the Great Recession—with stimulus money directed to, say, green energy or hypothetically “green medicine,” this crowding out is also taking place. However, there is an additional potential liability resulting from the violation of the rights of the innovator, aborting the upward spiral of biomedical advancement. Signed into law in 2011, as of March 16, 2013 the U.S. will switch over to a “first to file” patent system, and chuck its “first to invent” approach that it has used from the founding of the United States of America. Curiously known as the “America Invents Act,” violation of an inventor’s rights to his or her ideas will now be standard fare.

The Unalienability of Rights

As the founding fathers (primarily Jefferson) had written: “Life, Liberty, and the Pursuit of Happiness” are among the unalienable rights that every human is endowed with. The key word is unalienable, meaning that a real right is not transferable to another or capable of being repudiated. This means everybody has the same rights, such as the right to life. As an example, while one can agree to work under slave-like conditions, one is always free to break that bond because the right of liberty is inalienable, and cannot be surrendered or transferred. Of the three inalienable rights that appear, only “the Pursuit of Happiness” tends not to parse. This is because the phrase is interpreted to mean the accrual of property. It makes sense to say “the pursuit of” because humans have a right to earn a living and gather property in their own self-interest. On the other hand, we are not born with a right to have property, only with the right to use our effort and talents to earn property.

One of the great confusions in understanding rights is the concept of a “social or human right,” a idea that steals from the real meaning of rights—there is no right to material values that others have to provide, in violation of their rights—and packages such non-sequiturs as the “right to shelter,” the “right to food, and the “right to health.” It is in the name of political devices such as these the rights of innovators are made into fodder.

Live long and prosper,

Will Block

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