[iDC] fwd: Copyfarleft, Copyjustright and the Iron Law of Copyright Earnings.

[Dmytri Kleiner]

Hello, I meant to publish this on this list, but it seems that I never did,
so better late than never. Here is my latest article writen for Mute, it is
also available in German and Portuguese here:
http://www.telekommunisten.net/venture-communism

Comments very welcome. Nice to see Keith Hart on the list, BTW, his book
"Money in an Unequal World" is highly recommended.

Cheers,

Dmytri Kleiner
editing text files since 1981

http://www.telekommunisten.net

~~~~~~~~~~~~~~~~~

Challenges to traditional copyright resulting from peer-to-peer
applications, free software, filesharing and appropriation art have caused
a wide ranging debate on the future of copyright. Dmytri Kleiner brings
existing critiques of material property from the left to bear upon the
realm of copyleft artistic production and asks how, within the existing
copyright regime, can artists earn a living?

COPYFARLEFT, COPYJUSTRIGHT AND THE IRON LAW OF COPYRIGHT EARNINGS.
By Dmytri Kleiner


In the area of software development copyleft has proved to be a
tremendously effective means of creating an information commons which
broadly benefits all those whose production depends on it. However, many
artists, musicians, writers, film-makers and other information producers
remain sceptical that a copyleft based system where anyone is free to
reproduce their work, can earn them a living.

Copyleft licenses guarantee intellectual property freedom by requiring that
reuse and redistribution of information be governed by ‘the four
freedoms,’ the freedom to use, study, modify and redistribute.

However, property is the enemy of freedom. It is property, the ability to
control productive assets at a distance, the ability to ‘own’ something
being put to productive use by another person that makes possible the
subjugation of individuals and communities. Where property is sovereign,
the owners of scarce property can deny life by denying access to property,
or if not outright deny life, then make the living work like slaves for no
pay beyond their reproduction costs.

David Ricardo first described Economic Rent. Put simply, economic rent is
income the owner of a productive asset can earn just by owning it, not by
doing anything, just by owning. Thus, Rent is the economic return for
allowing others to use property. What would a person pay for the right to
exist? Well, they would pay everything they produce, minus their
subsistence costs. This is the basic bargaining position faced by all of us
who are born into a world entirely owned by others.

THE IRON LAW OF WAGES

Rent allows owners of scarce property to drive propertyless workers to
subsistence, as David Ricardo explains in his ‘Iron Law of Wages’ in
his essay Of Wages: ‘The natural price of labour is that price which is
necessary to enable the labourers, one with another, to subsist and to
perpetuate their race’.[1]

Subsistence should not be taken to mean the bare-minimum required to
actually survive and reproduce. Even in Ricardo’s time, most workers were
generally not in the position that if they earned one penny less they would
immediately fall over and die,. Rather, workers, by their very definition,
are unable to earn enough to do anything more than make a living.

It is often claimed that the iron law of wages does not apply due to the
difference between the theoretical ‘natural’ price and the actual
market price of labour, but this is no argument against the iron law. So
long as workers do not have property, whatever wage increases they retain
are swept away by price inflation, most often as the result of increased
money competition for locations and the driving up of land rents. Reducing
real wages by inflation as an alternative to reducing money wages works
because of the ‘money illusion’. As John Maynard Keynes writes in his
The General Theory of Employment, Interest, and Money: ‘It is sometimes
said it would illogical for labour to resist a reduction of money-wages but
not to resist a reduction of real wages [...] experience shows that this is
how labour in fact behaves’.[2]

Price inflation, mostly in the form of econonic rent, prevents workers from
ever earning enough to accumulate ownership of productive assets themselves
and keeps them dependent on the property owners.

What the iron law of wages really means is that workers, as a class, cannot
become property owners and thus cannot escape from having to allow property
owners to appropriate the product of their labour. This creates different
interests between ‘owners’ of scarce productive assets and the rest of
society.

In modern usage economic rent is understood to apply to any scarce
productive asset. In Ricardo’s time that was primarily land. In his Essay
on Profits , David Ricardo argues: ‘the interest of the landlord is
always opposed to the interest of every other class in the community.’[3]

This opposition is called class struggle – the struggle of those who
produce against those who own. Socialism and all other movements of the
‘left’ start with this class struggle as their point of departure.

Socialism is the belief that producers themselves should own the means of
production and that rent is nothing other than owners stealing from
producers. As Pierre-Joseph Proudhon famously argued in his landmark
‘What is Property?’ published in 1840: 'property is theft'.[4]

Property is not a natural phenomena, but rather something that is created
by law. The ability to extract rent is dependent on one’s ability to
control a scarce resource even when it is being used by somebody else. In
other words, the ability to force that other person to pay for it. Or, in
terms of production, to force them to share the product of their labour
with the property owner. Control at a distance.

In this way, rent is only possible so long as it is supported by force,
which is happily provided by the state to the owners of property. Without a
means of forcing those who put property to productive use to share the
product of their labour with the absent and idle property owner, the
property owner could not earn a living, let alone accumulate more property.
As Ernest Mandel claims in Historical Materialism and the Capitalist State
(1980): ‘without capitalist state violence, there is no secure
capitalism.’

The purpose of property is to ensure a propertyless class exists to produce
the wealth enjoyed by a propertied class. Property is no friend of labour.
This is not to say that individual workers cannot become property owners,
but rather that to do so means to escape their class. Individual success
stories do not change the general case. As Gerald Cohen quipped, 'I want to
rise with my class, not above my class!'

The current global situation confirms that it is the case that workers, as
a class, are not able to accumulate property. A study by the World
Institute for Development Economics Research at United Nations University
reports that the richest 1% of adults alone owned 40% of global assets in
the year 2000, and that the richest 10% of adults accounted for 85% of the
world total. [5]

The bottom half of the world adult population owned barely 1% of global
wealth. Extensive statistics, many indicating growing world disparity, are
included in the report.

This is in the context of this great disparity of wealth and the struggle
between classes which any investigation of intellectual property must be
understood.

Intellectual Property, including copyright, is the extension of property to
immaterial assets, to information. Copyright is a legal construction that
tries to make certain kinds of immaterial wealth behave like material
wealth, so that they can be owned, controlled, and traded.

It is often unfortunately said that intellectual property is intended to
allow information producers to earn a living. To allow musicians, for
instance, to earn money from the music they make. However, an understanding
of class struggle makes it clear that so long as the owning class wants to
have music, they must allow musicians to make a living. They do not require
intellectual property for this purpose. Rather, they require intellectual
property so that property owners, not musicians, can earn money on the
music made by musicians.

In any system of property, musicians collectively can no more retain
ownership of the product of their labour than can workers at a textile
sweatshop. The purpose of intellectual property, to rephrase my earlier
statement, is to ensure a propertyless class exists to produce the
information profited on by a propertied class. Intellectual property is no
friend of the intellectual, or creative, worker.


THE IRON LAW OF COPYRIGHT EARNINGS

The system of private control of the means of publication, distribution,
promotion and media production ensures that artists and all other creative
workers can earn no more than their subsistence. Whether you are
biochemist, a musician, a software engineer or a film-maker, you have
signed over all your copyrights to property owners before these rights have
any real financial value for no more than the reproduction costs of your
work. This is what I call the Iron Law of Copyright Earnings.

There are, however, an important differences between intellectual property
and physical property. Physical property is scarce and rivalrous while
intellectual property can be copied, has almost no reproduction cost and
can be used simultaneously by anyone with a copy.

It is exactly this characteristic of unlimited reproducibility that
requires the copyright regime to make information into property. In the
long term, the exchange value of any reproducable good is driven towards
it’s reproduction cost by competition. Since there are few barriers to
reproducing an information asset it can have no exchange value beyond the
labour and resources required to reproduce it. In other words, it has no
long term exchange value of it’s own. Thus, owners of this property
(again, not to be confused with the producers) need laws to prevent this
reproduction. Only by making it illegal for others to copy it can the
owners extract rent for the right to copy.

While property itself is created by law, material assets are scarce and
rivalrous by nature. However, because copyable information is made scarce
only by law, it can also be made abundant by law, which brings us, finally,
to copyleft.

COPYLEFT AND COPYRIGHT

Information may not have any exchange value without copyright, but it
certainly has use value without copyright and there are many information
producers who’s motivation to produce is motivated by creating this use
value whether or not it can directly capture exchange value. It is
therefore no surprise that the idea of copyleft grew to prominence in
software development, in the rise of the free software community.

Software is used in production. Virtually every office, every academy and
every factory relies on software in their day-to-day work, for all these
organizations the use value of software can be directly translated into
exchange value in the course of their normal production, not by selling the
software directly, but by doing whatever business they do, selling whatever
product they sell and using software to increase their productivity.

Paying for software licenses and agreeing to the restrictive terms of such
licences is not in their interests. As David Ricardo said about landlords,
the interest of a software company like Microsoft is always opposed to the
interest of every software user.

The organizations that use software, schools, factories, offices,
e-commerce enterprises, collectively employ far more software developers
than the few companies who sell proprietary software, such as Microsoft.
Thus, free software is very attractive to them, it allows them to reduce
their individual development costs by collectively maintaining a common
stock of software assets.

Mikko Mustonen of the Helsinki School of Economics, even argues that
sometimes companies that do sell proprietary licenses have a strong
incentive to contribute to free software. In his 2005 paper ‘When Does a
Firm Support Substitute Open Source Programming?’ Mustonen argues:

A firm selling a copyright program has an incentive to support substitute
copyleft programming when support creates compatibility between the
programs and programs exhibit network effects.[6]

Thus the use value of free software is wanted by organizations who can and
do pay software developers to make it, even though they have no exclusive
copyright on it.

Yet, free software was not conceived as merely a way to reduce the cost of
corporate software development. Richard Stallman, The inventor of the
General Public Licence (GPL) under which a lot of free software is released
writes on his organisations website:

My work on free software is motivated by an idealistic goal: spreading
freedom and cooperation. I want to encourage free software to spread,
replacing proprietary software that forbids cooperation, and thus make our
society better.[7]

This spirit of cooperation is certainly not unique among software
developers, other creative producers have expressed the desire to work on a
common-stock, a ‘commons’ of intellectual material in their practice.
As a result copyleft has moved beyond the world of software and into art as
well. musicians, writers and other artists began releasing their work under
GPL-style copyleft licences.

However, there is a problem, art is not, in most cases, a common input to
production as software is. Owners of property will support the creation of
copyleft software, for the reasons described, however in most cases, they
will not support the creation of copyleft art. Why would they? Like all
copyable information, it has no direct exchange value, and unlike software
it generally has no use value in production either. It’s use value exists
only among the fans of this art, and if owners of property can not charge
these fans money for the right to copy, what good it is for them? And if
owners of property will not support copyleft art, which is freely
distributed, who will? The answer is unclear. In some cases institutions
such as private and state cultural funds will, but these can only support a
very small number of artists, and only by employing a dubious and
ultimately somewhat arbitrary selection criteria in deciding who does, and
who does not, receive such funding.

Copyleft, as developed by the free software community, is thus not a viable
option for most artists. Even for software developers, the iron law of
wages applies, they may be able to earn a living, but nothing more, owners
of property will still capture the full value of the product of their
labour.

Copyleft is thus not able to ‘make society better’ in any material
sense, because not only is it not viable for many kinds of workers, but the
majority of the extra exchange value created by producers of copyleft
information is in every case captured by owners of material property.

As copyleft cannot allow workers to accumulate wealth beyond subsistence,
copyleft alone cannot change the distribution of productive assets, which
is what any revolutionary strategy must seek to do. Yet the emergence of
free software, filesharing and art forms based upon sampling and reuse of
other media has created a serious problem for the traditional copyright
system.

The music and film industries, in particular, are in the middle of what
basically amounts to an all out war against their own consumers to prevent
them from downloading and sampling their property. It is clear that digital
network technology poses a serious problem to the recording and film
industries.

In the earlier stages of the free software movement most corporations,
especially software companies, reacted very negatively to the idea of
copyleft, and tried to fight it with the same aggressive tactics The
Recording Industry Association of America (RIAA) and its friends are
unleashing attacks on the filesharing community. Most famously these was
the SCO Group’s legal actions against companies that use or promote
Linux.[8]

The actions of RIAA can be understood in that same way, a conservative
reaction to protect their interests. However, not all owners of property
believe that legal action can stop new technologies from emerging. Many
believe that the music and film industry will need to adapt and that
copyright law must be modified for this changing environment.

COPYJUSTRIGHT

Thus, just as capital joined the copyleft software movement to reduce the
cost of software development, capital is also joining the copyright
dissident art movement to integrate filesharing and sampling into an
otherwise property-based system of control.

As copyleft does not allow the extraction of rent for the right to copy,
and what owners of property want is not something that will challenge the
property regime, but rather to create more categories and subcategories so
that practices like filesharing and remixing can exist with the property
regime. In other words, copyjustright. A more flexible version of copyright
that can adapt to modern uses but still ultimately embody and protect the
logic of control. The most prominent example of this is the so-called
Creative Commons and it’s myriad of ‘just right’ licenses. ‘Some
rights reserved,’ the motto of the site says it all.

The iron law of copyright earnings makes it obvious that it is not for the
creators of the music, videos and other creative works licensed that
‘some rights are reserved’, as artists have no means to bargain for
anything more than subsistence. Of the ‘some rights’ being reserved,
the primary one is the right of the creators to transfer ownership of these
works to the propertied class. When ever the propertied class find it in
there interests to take ownership, and, of course, entirely on the terms
dictated by the propertied class.

This iron law is illustrated in ‘Artists’ Earnings and Copyright’[9]
by Martin Kretschmer where he concludes that ‘The creator has little to
gain from exclusivity’ and in his 2006 study Empirical Evidence On
Copyright Earnings[10] which states: ‘Earnings from non-copyright, and
even non-artistic activities are an important source of income for most
creators’ which includes many startling statistics, for example the fact
that the median payment distributed by the Performing Right Society (UK) in
1994 to it’s copyright holders was £84.

So if neither copyleft, copyright or copyjustright can overcome the iron
law and ultimately increase the wealth of artists and other workers as a
class, is there any reason at all for a socialist to be interested in
intellectual property licenses?

Socialists promote the idea that wealth must be more justly and equitably
shared and controlled by the people who produce it. Perhaps the best method
of achieving this is through decentralized, worker-owned enterprises,
co-operatives, and councils. For Socialists interested in
workers-self-organisation and commons based production as a means of class
struggle, the answer is a 'yes'.

For the same reason that capitalist organisations support copyleft
software, because it represents a common stock of use value they can apply
to production to create exchange value and thus make money, commons based
production and therefor all worker self-organized enterprises, can also
benefit from such a common stock of copyleft art and can incorporate
artists in their collective enterprises and share in the resulting income.

As the International Workers of the World state in the preamble to their
Constitution (1905):

Instead of the conservative motto, A fair day’s wage for a fair day’s
work, we must inscribe on our banner the revolutionary watchword, Abolition
of the wage system.’ and further that ‘It is the historic mission of
the working class to do away with capitalism. The army of production must
be organized, not only for everyday struggle with capitalists, but also to
carry on production when capitalism shall have been overthrown. By
organizing industrially we are forming the structure of the new society
within the shell of the old.

COPYFARLEFT

For copyleft to have any revolutionary potential it must be Copyfarleft. It
must insist upon workers ownership of the means of production.

In order to do this a license cannot have a single set of terms for all
users, but rather must have different rules for different classes.
Specifically one set of rules for those who are working within the context
of workers ownership and commons based production, and another for those
who employ private property and wage labour in production.

A copyfarleft license should make it possible for producers to share freely
and to retain the value of their labour product, in otherwords it must be
possible for workers to make money by applying their own labour to mutual
property, but impossible for owners of private property to make money using
wage labour.

Thus under a copyfarleft license a worker-owned printing cooperative could
be free to reproduce, distribute, and modify the common stock as they like,
but a privately owned publishing company would be prevented from having
free access.

A trend in works by pro-copyleft artists seems in one sense related. The
copyleft Non-Commercial licenses create two sets of rules with
theoretically endogenic (orginating within the commons)
‘non-commercial’ uses being allowed while exogenic (orginating outside
the commons) ‘commercial’ uses are forbidden except by agreement from
the orginal authors. Examples of such licenses include the Creative Commons
Non-Commercial ShareAlike license.

However, in order to create commons endogenic terms, the works themselves
must be in the commons, and so long as the authors reserve the right to
make money with this work and prevent other commons based producers from
doing so, the work can not be considered to be in the commons at all, it is
a private work. As such, it can not have commons endogenic-free terms, such
as a copyfarleft license would require. This problem of creating ‘commons
deeds’ for works that are not really a common stock is typical of the
Copyjustright approach typified by the Creative Commons.

A copyfarleft license must allow commons based commercial use while denying
the ability to profit by exploiting wage labour. The copyleft
Non-Commercial approach does neither, it prevents commons based commerce,
while restricting wage exploitation only by requiring the exploiters to
share some loot with the so-called original author. In no way does this
overcome the iron law for either the authors or other workers.

‘Non Commercial’ is not a suitable way to describe the required
endogenic/exogenic boundary. Yet, no other commons license exists that
provides a suitable legal framework for commons based producers to use.

Only a license that efectively prevents alienated property and wage labour
from being employed in the reproduction of the otherwise free information
commons can change the distribution of wealth.

Dmytri Kleiner <dk AT haagenti.com> is an anarchist hacker and a co-founder
of Telekommunisten, a worker-owned technology company specialising in
telephone systems. Dmytri is a USSR-born Canadian, currently living in
Berlin with his wife Franziska and his daughter Henriette

FOOTNOTES


[1] David Ricardo,On the Principles of Political Economy, 1817. Available
from:
http://socserv2.socsci.mcmaster.ca/econ/ugcm/3ll3/ricardo/prin/prin1.txt
[1]

[2] John Maynard Keynes, The General Theory of Employment, Interest, and
Money, 1936. Available at:
http://www.marxists.org/reference/subject/economics/keynes/general-theory/
[2]

[3] David Ricardo An Essay on Profits, 1815. Available from:
http://socserv.mcmaster.ca/econ/ugcm/3ll3/ricardo/profits.txt [3]

[4] Available from:
http://etext.virginia.edu/toc/modeng/public/ProProp.html [4]

[5] James B. Davies, Susanna Sandstrom, Anthony Shorrocks, and Edward N.
Wolff, The World Distribution of Household Wealth,

http://www.wider.unu.edu/research/2006-2007/2006-2007-1/wider-wdhw-launch-5-12-2006/wider-wdhw-report-5-12-2006.pdf
[5]

[6] Available from:
http://ideas.repec.org/a/bla/jemstr/v14y2005i1p121-139.html [6]

[7] http://www.gnu.org/philosophy/pragmatic.html [7]

[8] For more information see:
http://en.wikipedia.org/wiki/SCO_Group#SCO-Linux_lawsuits_and_controversies
[8]

[9] Available at: http://www.firstmonday.org/issues/issue10_1/kretschmer/
[9]

[10] Available at: http://ipr.dime-eu.org/files/active/0/Kretschmer.pdf

Source URL:
http://www.metamute.org/en/Copyfarleft-and-Copyjustright
-- 
Dmytri Kleiner
editing text files since 1981

http://www.telekommunisten.net