Doron Ben-Atar, in the Chronicle of Higher Education (4-1-05):

[Doron Ben-Atar is a professor of history at Fordham University and author of Trade Secrets: Intellectual Piracy and the Origins of American Industrial Power (Yale University Press, 2004).]

This week the U.S. Supreme Court will hear arguments in MGM Studios Inc. v. Grokster Ltd., a suit by 28 of the world's largest entertainment companies against Grokster, StreamCast Networks, and KaZaA -- software companies that develop peer-to-peer (P2P) file-sharing programs....

... Companies that try to suppress the development of P2P software are similar to the early 19th-century English Luddites, weavers who tried to save their jobs by smashing the machines. The plaintiffs' demand for monetary compensation is a ruse. P2P companies don't have the resources to pay the studios should the Supreme Court rule against them. The studios seek to destroy the P2P companies just as they did Napster in its previous incarnation. Our intellectual-property regime is their weapon of choice. A decision in favor of the plaintiffs would exclude American citizens and companies from taking part in developing and reaping the benefits of this promising technology. Other nations would quickly forge ahead in this cyberfrontier.

The neo-Luddite campaign of Hollywood studios is more than just a rear-guard action against vulnerable American-based companies. What allows the United States to remain the world's center of innovation is cultural experimentation and the free exchange of ideas. The solicitor general's brief betrays ignorance of the contradictory manner in which our own loose implementation of intellectual-property laws turned the United States from an underdeveloped confederation on the periphery of the Atlantic into the world's leading industrial power. The problems we face today are hardly new, and our conversation will be much enriched by a broader historical perspective.

The Constitution spelled out clearly America's commitment to intellectual property, granting Congress the power to "promote the progress of science and useful arts, by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries." Then the first Congress created an apparatus that spared authors and patentees the chore of having to secure grants in each of the individual states. And the American Patent Act of 1790 was the first intellectual-property legislation in the world that restricted patents exclusively to original inventors and established the principle that prior use anywhere on earth was grounds for invalidating a patent.

But the story behind the story is a little more complicated, and modern champions of intellectual property would be wise to look more closely at how the American system operated in its first 50 years. In theory the United States pioneered a new standard of intellectual property that set the highest possible requirements -- worldwide originality and novelty. In practice the country encouraged widespread intellectual piracy and industrial espionage. Piracy took place with the full knowledge and sometimes even the aggressive encouragement of government officials. Congress never protected the intellectual property of European authors and inventors; Americans did not pay for the reprinting of literary works and unlicensed use of patented inventions. The textile mills of Lowell, Mass., America's most famous industrial experiment, were founded on piracy. Charles Dickens was so incensed by the unlicensed reprinting of his books in the United States that he crossed the Atlantic in the 1840s in an effort to stop that practice. He failed, and expressed his resentment in his sardonic American Notes. He did, however, like Lowell.

What fueled the 19th-century American economic boom was a dual system: the principled commitment to an exacting intellectual-property regime, and the lack of commitment to enforcing those laws. That ambiguous order generated innovation by promising patent monopolies but, by declining to crack down on technology pirates, allowing for rapid dissemination of technology that made American products better and cheaper than those of other countries. The great American economic leap forward took place in the decades immediately after independence, when a culture of free international intellectual exchange turned the United States into an economic superpower....