The conservative case for taking on the copyright lobby

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Today, the R Street Institute released a report on copyright duration titled “Guarding against abuse: Restoring constitutional copyright.”

In recent decades, a number of special interests called the “copyright lobby” have ensured their copyrighted works would never enter the public domain by keeping their copyright terms continuously elongated. The public-policy goals of this copyright-inflation movement have been in clear violation of the Constitution’s text and its original public meaning.

The recapture of works that would be in the public domain represents one of the biggest thefts of public property in history — and has had significant economic effects upon our culture, personal liberty, and economy.

This grand larceny has affected learning, creation, and innovation.

copyrightchart

The copyright for 1928′s “Steamboat Willie,” which introduced the world to Mickey Mouse, was extended by both the 1976 and the 1998 amendments to the Copyright Act. It is set to expire in 2023.

Current U.S. law provides copyright protection for the life of the author plus 70 years. For corporate authors, the term is 120 years after creation or 95 years after publication. But those changes reflect only part of the reality. In fact, lobbyists have usurped the policy-making process itself to ensure that whenever one term of copyright is set to expire, the law is extended.

Several times, these extensions have even been made retroactively, reapplying copyright protections to works that already had moved into the public domain. Thus, the degree to which the current life-plus-70 standard can be relied on to accurately project when a specific work may move into the public domain is limited.

The practical effect of this policy is, effectively, a regime of indefinite copyright. During oral arguments of the 2002 case of Eldred v. Ashcroft, Justice Sandra Day O’Connor said of the policy of continual copyright extension that it “flies directly in the face of what the framers had in mind, absolutely.”

If you repeat a lie often enough

Jack Valenti, then head of the Motion Picture Academy of America, testified during the legislative run-up to passage of 1998′s Sonny Bono Copyright Term Extension Act (colloquially known as the Mickey Mouse Protection Act) that “copyright term extension has a simple but compelling enticement: it is very much in America’s economic interests.”

We have lots of reasons to be skeptical of Valenti’s claim. One, it wasn’t backed by data. Two, there is overwhelming data to the contrary from economists. Three, Valenti was well known for making stuff up that was demonstrably untrue and for having little regard for the rest of the economy.

Case in point: Consider the content industry’s campaign of trying to ban the VCR, which, the MPAA warned, would destroy the entire industry. In 1982, Valenti testified before Congress:

I say to you that the VCR is to the American film producer and the American public as the Boston strangler is to the woman home alone. … We are going to bleed and hemorrhage, unless this Congress at least protects [our industry against the VCR]. … We cannot live in a marketplace … where there is one unleashed animal [the VCR] in that marketplace, unlicensed. It would no longer be a marketplace; it would be a kind of a jungle, where this one unlicensed instrument is capable of devouring all that people had invested in.

Just two years after the 1984 Supreme Court decision in which the MPAA lost its suit to ban the VCR, revenues from videotape sales and rentals were $4.38 billion, eclipsing 1986′s box-office revenues of $3.78 billion. In 2012, the home-media-consumption market that the MPAA tried to stamp out blossomed into an $18 billion market.

Given the content industry’s track record, policymakers should be highly skeptical of the industry’s claim that longer copyright terms are in our national interest. Despite Valenti’s assertion, like his argument that home-media consumption would destroy the MPAA’s business, the MPAA has produced no credible research to back up the claim that extending copyright terms is in the U.S. economic interest, while evidence to the contrary is overwhelming. The extension of copyright, particular to life-plus-50 under the Berne Convention, is a direct result of importing foreign law with lobbyists arguing for “international harmonization.”

When the idea of international harmonization was first presented in the United States in the 19th century, Congress wisely chose not to disregard the original public meaning of copyright. Mark Twain even testified before Congress in favor of longer copyright terms and importing international law through the Berne Convention. Congress rejected Twain’s arguments. This was a big deal. The United States rejected increasing copyright terms vastly to life-plus-50 under Berne in particular, because the United States was the only major industrialized country that wouldn’t join the convention. This demonstrates how big of a deviation such a long copyright extension was perceived to be.

But the content industry would get stronger over 100 years, fulfilling the fears of our founding fathers. James Madison warned that copyright must be guarded with “strictness ag[aint] abuse.” When the content industry corrupted copyright, there was no standing up for the Constitution, the public and content creators.

The United States would join the Berne Convention in the 1980s, more than 100 years after it was proposed.

Today, copyrights have been extended from 14 years to the life of the author plus 70 years. Special interests are trying to lock in life-plus-70 through an international treaty (the TPP), and in 2018, major copyright holders will likely push for an even longer copyright term of life-plus-100.

Steep costs of long copyright

The steep costs to perpetual extension of copyright have been long known and are well documented. This is why the British copyright statute, the Statute of Anne, limited copyright duration to 14 years; why 12 of the original 13 colonies had similar copyright durations in their own statutes; why the Constitution includes the phrase “limited times”; and why the founders limited copyright to 14 years.

In a brief submitted during the Eldred case, Nobel laureates Milton Friedman, Ronald Coase, James Buchanan, George Akerlof, Kenneth Arrow, and 11 other economists argued that a “lengthened copyright term…keeps additional materials out of new creators’ hands” and ultimately results in “fewer new works” and “higher transaction costs in the creation of some works.” The economists argued that the 1998 extension is inefficient and “reduces consumer welfare,” as consumers are denied the ability to acquire derivative works and content that otherwise would be in the public domain.

Justices John Paul Stevens and Stephen Breyer wrote separate dissents in the Eldred case, with Breyer noting that the increased royalty payments that result from copyright term extension “will not come from thin air.”

“Rather, they ultimately come from those who wish to read or see or hear those classic books or films or recordings that have survived … Further, the likely amounts of extra royalty payments are large enough to suggest that unnecessarily high prices will unnecessarily restrict distribution of classic works (or lead to disobedience of the law)—not just in theory but in practice.”

As a result of extremely long copyright terms and unclear fair-use laws, we have clear evidence that rather than serving as an incentive to create, excessively long copyright — well beyond what the founders would support — hinders creation. New artists, directors and writers are unable to create derivative works without paying fees that can be so high as to make the cost of derivative works prohibitive or even impossible.

‘Happy Birthday to You’ banned

There are very real costs to indefinite copyright: It hinders creativity, stifles innovation, limits free speech and hurts the public. The R Street report delves into each issue in depth, but as one case in point, we can see how indefinite copyright hurts society with the timeless song “Happy Birthday To You.”

Recently, Warner-Chappell has claimed a copyright to “Happy Birthday To You,” which the Guinness Book of World Records calls the most famous song in the English language. Its claim is based on a published version of piano arrangements from 1935.

Warner-Chappel is a major record label representing Madonna and Michael Jackson’s estate, not a fly-by-night operation. So far it has collected an estimated $2 million a year in licensing fees from thousands of people they have forced to pay licensing fees. According to one estimate, it is the song that earns the highest royalty rates.

Today, every time somehow wants to use a portion of this song in a video or publicly perform it, they have to pay a license fee or risk being sued. It has been reported that restaurants such as Applebee’s and Shoney’s have developed songs that are used instead of “Happy Birthday To You” to avoid copyright infringement and avoid paying hefty royalties. Under current copyright law, “Happy Birthday To You” will remain under copyright under 2030, but expect a push to expand the copyright beyond that year.

What is the public-policy rationale for requiring people to pay a license fee to Warner-Chappel for a song that is over 80 years old? Warner-Chappel didn’t even compose the song, but today it can use it to receive a rent from the economy. Such a long copyright term does not “promote the progress of the sciences,” that is, the constitutional purpose for copyright.

Get the data

The Constitution provides a clear road map for Congress on how to design copyright laws: It must “promote the progress of the sciences.” To do so, Congress should first get the data. But Congress no longer cares about the data.

There have been numerous studies on copyright duration, and every one of them shows that today’s copyright terms are killing content creation and hurting the public. There simply is not any study to justify the copyright system. The only explanation is cronyism. In fact, at times the MPAA has even been frank on how it wields its enormous checkbook and political influence to get its way:

“Candidly, those who count on quote ‘Hollywood’ for support need to understand that this industry is watching very carefully who’s going to stand up for them when their job is at stake. … Don’t ask me to write a check for you when you think your job is at risk and then don’t pay any attention to me when my job is at stake.”

Very candid indeed. Chris Dodd said this after members turned against their SOPA-PIPA legislation to censure the Internet when millions of Americans rose up to protest. Candidly, this seems like arguably potential evidence of quid pro quo bribery, which is a felony. Maybe that’s an exaggeration, but not a very big one. Dodd is the epitome of the fear that the founders had of these systems being abused by special interests generations later — and precisely why Madison told us to guard these instruments against abuse. To their credit, in moments of candor, content-industry lobbyists at least admit their goal is to repeal the copyright clause from the Constitution.

The costs of one of the greatest thefts in American history by these special interests hinders learning, destroys our cultural legacy, hurts innovation and the public, but, most important, it impedes filmmakers, artists, deejays and other content creators who need to be able to build upon the work of others to create new content — as we have done for centuries. If current policy is extended, Disney will have succeeded in making billions from the public domain, and then ensuring that no company could ever become another Disney again by shutting off the public domain of the future.

Over 200 years ago, James Madison warned us that copyright and patents, as monopolies, must be “guarded with strictness aga[inst] abuse.” It’s up to us to guard them now. We know the costs of continuing extremist copyright policies completely removed from the Constitution’s original public meaning; the American people deserve better than politicians selling out to Hollywood.

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