We're on the Road to Economic Perdition
The recent onslaught of disappointing economic and political news continued to bring gloom and doom to the United States this past Labor Day weekend. With unemployment rates still hovering over 9 percent, all eyes anxiously cast about for a solution—a solution made more urgent when all the forward-looking indicators point in the negative direction.
What then should be done?
In Monday’s Labor Day speech, President Obama did not tip his hand. The short answer is to reject the most common suggestions, such as those for grandiose government initiatives put forward on a weekly basis by the New York Times. Congress should not rush to pass dumb legislation. The Federal Reserve should avoid unsound macroeconomic forays. Congress and the president should work hard to undo counterproductive labor market regulations.
Let’s start with dumb legislation. It is always tempting to promote bold legislative reforms as short-term economic relief. Congress is now posed to pass the America Invents Act, a patent reform bill that favors large firms at the expense of small-startups in the technology sector. The patent protection of these startups will be systematically eroded under the new legislation. President Obama has urged Congress to pass this act so that jobs can be created.
Putting the details of that legislation aside for now, what is critical to understand is this: if jobs are the issue, Congress has gotten into the business of throwing Hail Mary passes. Why should we have any confidence that our grotesque legislative process can turn out any statute that could actually improve economic matters by creating jobs?
Over at Defining Ideas, I go into more detail about how Democrats are serving up a smorgasbord of job-killing policies.
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Jun '10
Re: We're on the Road to Economic Perdition
Why did Obama wait so long to present his plan? Because he's developing plans that only work for about a year. A year is all he needs.
Jun '10
Re: We're on the Road to Economic Perdition
To paraphrase: Hard economies make bad law.
Oct '10
Re: We're on the Road to Economic Perdition
I will admit I haven't looked too closely at the America Invents Act, but I am do not share the positive feelings toward our current patent law and some of the resulting recent court decisions. When RIM paid Visto $267.5 M in 2009 to go away rather than wait to see if the courts invalidated the last of their patents, I thought that was a bad decision. When Microsoft was ordered to pay i4i $290 M in July, at least they will still be able to sell Word, which had been ordered off the shelves earlier in the case. The question of whether Google is buying Motorola Mobility for $12.5 B merely for their patent portfolio (after losing out on the $4.5 B Nortel portfolio to a consortium including Apple and Microsoft) is still unresolved. Technology News in recent months has nearly become Patent News and I don't think that serves anyone's interest.
Sep '10
Re: We're on the Road to Economic Perdition
The infrastructure bank will be more of the same waste as well:
http://www.bankstocks.com/ArticleViewer.aspx?ArticleID=6333&ArticleTypeID=2
Tom Brown has it exactly right.
May '10
Re: We're on the Road to Economic Perdition
I would think that an excellent starting point would be to recognize that this is not a normal recession. This is a balance sheet/excessive debt recession/depression that will take some time to unwind on all fronts; households, industry and government. If this principal is accepted than the proper steps for government become pretty straightforward:
1. Don't add to the debt problem, control spending and priorities.
2. Streamline regulations and do not add to them. Especially, strip out those regulations and licensing bottle necks that stand in the way of low cost domestic energy production.
3. Reform the tax code to broaden the base and lower rates.
4. Reform entitlements so as to be financially sustainable.
5. Take a page from Calvin Coolidge and don't do anything else.
Aug '10
Re: We're on the Road to Economic Perdition
I admit that I have not read the entire piece of legislation. I work for a major university in an IP support function. I also belong to the Association of University Technology Managers (AUTM). Both my university and AUTM support the America Invents Act, specifically the First-to-File vs. First-to-Invent provision. We spend an inordinate amount of time and money copying and verifying lab notes and documenting inventions. The only reason we do this is the current First-to-Invent rule. I would think that First-to-File would benefit small start-ups as much as it would large organizations. The key is education and making sure that your organization's management knows the law regarding materials transfers, invention disclosures and patents. Where am I wrong? Do you have objections to other provisions in the legislation?
Jun '11
Re: We're on the Road to Economic Perdition
I would disagree that the First-to-File system would be advantageous to both small start-ups and big corps. Big corporations will be lying in wait to file an extremely broad provisional patent before the small start-up firm has the chance to assemble their own. While producing detailed verification to prove inventorship may be costly, it would be more costly not to have the patent at all.
Also, with a race to the patent office, firms will not take the time to draft narrowly tailored, accurate patents. The influx of sloppy patent applications will slow down the already backlogged patent office.
Additionally, there is a constitutional issue with the first to file system, at least to an originalist. Congress is granted the power to issue patents in Art. I Sec. 8 "to promote the Progress of Science...by securing for limited Times to... Inventors the exclusive Right to their respective...Discoveries"
In 1787, an inventor was “one who produces something new; a devisor of something not known before." It would have been repetitious to say "first inventor" like some have suggested. Therefore, if Congress issues a patent to someone other than the inventor, it would be unconstitutional.