Broken Windows, Broken Patents

Many of you, no doubt, are familiar with Bastiat's Parable of the Broken Window, in which is illustrated the fallacy of economic benefit caused by a small boy who throws a stone through the shopkeeper's window, causing money to be spent by the keeper to pay a glazier to replace the window, which the glazier then uses to buy bread and shoes, etc. The parable illustrates the fallacy of ignoring hidden costs by pointing out that the money the keeper had to spend on the window, if not broken, could have been applied directly to the breadmaker or shoemaker (or the coatmaker, or even the glazier), resulting in the keeper having both the window and other materials. Instead, the money now only buys him a window, those other possible transactions are no longer possible, and the boy has indeed caused economic harm to society as a whole.

What does this have to do with bad patents? The little boy in this case is he who seeks bad patents, whether a patent holding company, an independent inventor, or a large portfolio-stuffing corporation. Patent lawyers are represented by the glazier. A society which does not punish windowbreakers, or at least does not hold them accountable to pay for damages they cause, is a society that does itself great economic harm. Do we, by endorsing a broken patent system and allowing the USPTO to be hijacked by patent-holding interests, encourage window breaking?

When patents that clearly harm innovation, science, industry, and the freedom of creation are allowed to punish those who seek to bring inventions to the market, do we see the broken window for what it is?

What if the glazier were in league with the little boy, paying him a small amount for every window he breaks? Clearly, this would be seen as stealing, and punished as such. But what if the glazier, instead, pushed for laws that enshrined window-breaking as a beneficial activity, laws that actually encouraged window breaking? What if window breakers could get money directly from the shopkeeper when they broke his window, instead of from the glazier? Would we see through such a scheme?

Such is the current relationship between patent lawyers, patent holders, and our legal system. Overly-broad, obvious, and non-useful inventions are granted patent protection regularly. Patent trolls, who have no desire to ever create products from their patents, regularly shake-down others who do. We have no exceptions for independent invention, for scientific research, for private tinkering. We patent 'anything under the sun', even if it causes great harm to the useful arts and sciences. We allow software and business methods to be patented, even though both embody purely abstract ideas, and even though most of the rest of the world does not protect these pure ideas with patents. We've set up the USPTO to be incentivized to grant as many patents as possible. Our legal profession has every reason to prop up a broken system. And current patent-holders are self-interested to see that the broken system propogates, encouraging our legislators to 'reform' the system in ways that benefit only them.

The evidence is massive. When it comes to patents, we love window breakers.

Do we see it?