New APPS: Art, Politics, Philosophy, Science

Big Data + Health Insurance = Bad

Big data can - and very often is - used to discriminate.  It was only a matter of time before health insurers started using it to predict who might be more likely to get sick, and to charge them more (yes, they've figured out how to circumvent the ACA).  ProPublica has the story here.

Be very afraid, especially if you recently moved to a smaller house or lived on a poor street growing up.  And remember that automated analysis of Facebook likes indicates that if you like hello Kitty, you're more likely to be depressed.  And that can be $$$.

Chicago Antitrust and Neoliberalism’s Blindspots

By Gordon Hull

As Foucault emphasizes in Birth of Biopolitics, one of the signal moves in American neoliberalism is the extension of economic analysis into all aspects of life.  As he puts it, the American neoliberals “try to use the market economy and the typical analyses of the market economy to decipher non-market relationships and phenomena which are not strictly and specifically economic but what we call social phenomena” (BB 239-40).  This “absolute generalization” of the market form “functions … as a principle of intelligibility and a principle of decipherment of social relationships and individual behavior,” enabling a “sort of economic analysis of the non-economic” (BB 243).  Foucault uses the neoliberal analysis of crime as exemplary.  Rather than pursuing the panoptic dream of zero-crime, or earlier theories about “the delinquent” as a character type, the neoliberal treats crime as an economic activity: we are all potential criminals; the key to lowering crime is to raise its cost.  This has sometimes surprising results, one of the most important of which is that one should not spend more social resources on combatting crime than the crime costs.

For example, Jeff Sessions and his stupid “zero-tolerance” policy are not just barbaric: they are economically irrational.  Tinpot Dictator must have an inkling of this, which is why he tries to say that all immigrants are gang members, so as to make them look more costly than they are. Sort of like ticking-time-bomb scenarios try to make torture look efficient. Yes, I know he is motivated by racism. Posner & co. never let conscious motives get in the way of a good description.  You just assume that Tinpot has stable preferences (racism and narcissism and more racism), and then “all human behavior can be viewed as involving participants who maximize their utility from a stable set of preferences” (Essence of Becker, 13).

Foucault’s “Analytic Philosophy of Politics”

By Gordon Hull

The current issue of Foucault Studies contains the first English translation of a lecture Foucault gave in Japan in 1978.  This “Analytic Philosophy of Politics” is essential reading if you have an interest in the transition between Foucault’s “power” and “ethics” work and/or his later understanding of power and resistance.  The Tokyo lecture underscores a profound continuity in his thought along a number of lines. Here are a few things that emerged for me on a first reading (there are also references to Confucianism that I am totally unqualified to address, so I will simply note that they are present):

(1) Foucault proposes that the question of power emerges in the wake of fascism and Stalinism, which he treats as both singular but as tied to “a whole series of mechanisms that already existed within social and political systems” (189).  That is, movements now challenge “this overproduction of power that Stalinism and fascism clearly manifested in its stark and monstrous state” (189).  The emphasis on Stalinism and fascism corresponds to the lectures that bookend Society must be Defended a few years prior, where Foucault begins by critiquing “totalitarian” discourses in the form of orthodox Marxism and closes with an analysis of state racism (exemplified by the Nazis) as a form of biopower.  So too, at the beginning of SMD, he refers to some of the same movements – anti-psychiatry, the recovery of “subjugated knowledges” that are the examples in the Tokyo lecture.

(2) Second, Foucault is interested in the role of the philosopher and philosophy.  This is not a surprise given his other interviews and essays on the topic, but it’s worth mentioning that he explicitly poses as a problem that philosophies of liberation presented during the 19c have become tools of oppression in the 20^th.  As he puts it, “each and every time these philosophies of freedom gave birth to forms of power that, whether in the guise of terror, bureaucracy, or even bureaucratic terror, were the very opposite of the regime of freedom, the very opposite of freedom as history” (191).  As with the critique of Marxism and Freudianism at the start of SMD, the text here underscores why Foucault is skeptical of revolutionary discourses and thinks they may be a part of the problem, not the solution.  Thus, “one should no longer imagine that one can escape relations of power all at once, globally, massively, through a sort of radical rupture or a flight without return” (193).

In this, Foucault is on a page very similar to Deleuze, at least on this point.  A moment in an interview of Deleuze by Antonio Negri is instructive. In it, Negri asks about a “tragic note” he detects in Thousand Plateaus. Deleuze responds with a gesture to Primo Levi and a “shame at being human,” of being tainted with what people have done. “This,” he adds, “is one of the most powerful incentives toward philosophy, and it’s what makes all philosophy political…. What’s so shameful is that we’ve no sure way of maintaining becomings, or still more of arousing them, even within ourselves” (Negotiations, 171-3).

Instead of wanting to know if power is good or bad, etc., “one should simply try to relieve the question of power of all the moral and juridical overloads that one has placed on it, and ask the following naïve question, which has not been posed so often … what do power relations fundamentally consist in?”  In so doing, the job of the philosopher is to “make visible what precisely is visible, which is to say to make appear what is so close, so immediate, so intimately connected with ourselves that we cannot perceive it” (192).  The remark certainly recalls the early Heidegger on the question of Being, but it’s here put in service of understanding power as a form of subjectification: the later part of the Tokyo lecture is precisely interested in pastoral power as a technique of individuation.

Huuuge Win for Privacy

By Gordon Hull

Santa Claus knows when you’ve been sleeping, knows when you’re awake, and knows if you’ve been bad or good.  Your phone knows all of that too, because it knows exactly where you are.  It then sends all that information to your carrier, which keeps it in its logs for five years.  Stay out late drinking last night?  Your phone knows. Had an affair a couple of years ago? Your phone knows that, too. Get up early for a workout and then work?  Yep, your phone knows that too.  Up until today, it was pretty easy for the police to know it as well, as they were able to subpoena your phone’s geolocation records from your phone carrier.  Under the “third party doctrine” as articulated primarily in Smith v. Maryland (1978), you lose any expectation of privacy over information that you "voluntarily" hand over to someone else – this this case, your phone carrier.  In a 5-4 opinion today, Chief Justice Roberts and the four liberals on the Court refused to apply third party doctrine to phone location data.  Justice Roberts writes:

“We decline to extend Smith and Miller [a case where the government subpoenaed bank records- GH] to cover these novel circumstances. Given the unique nature of cell phone location records, the fact that the information is held by a third party does not by itself overcome the user’s claim to Fourth Amendment protection. Whether the Government employs its own surveillance technology as in Jones or leverages the technology of a wireless carrier, we hold that an individual maintains a legitimate expectation of privacy in the record of his physical movements as captured through CSLI. The location information obtained from Carpenter’s wireless carriers was the product of a search”

As Roberts noted at the start of the opinion (which, btw, is a model of legal writing), the Fourth Amendment was originally motivated in substantial part by concern over generalized warrants.  His conclusion is therefore not a surprise.  Indeed, tapping phone records pretty much achieves everything a general warrant hoped for; as Roberts notes, “a cell phone faithfully follows its owner beyond public thoroughfares and into private residences, doctor’s offices, political headquarters, and other potentially revealing locales. Accordingly, when the Government tracks the location of a cell phone it achieves near perfect surveillance, as if it had attached an ankle monitor to the phone’s user” (internal citations omitted).  And of course it does so with absolutely zero police effort.  When the GDR Stasi wanted to track your every move, they at least had to assign an officer to do it.  Here, the data is collected automatically and without human intervention.

The Big Data Train Chugs On, Predictive Personality Edition

By Gordon Hull

One of the things that marketers like about big data is that they can personalize ads.  That operation is getting increasingly sophisticated.  We’ve known for a while that basic personality traits (like introversion/extraversion) can be predicted from Facebook likes.  I missed this paper when it came out, but some of the same authors as the initial Facebook “likes” paper have now done the inevitable follow-up.  By targeting Facebook ads on the basis of openness and extraversion (where the correlation with likes is fairly robust), they were able to make users 1.54 times more likely to make a purchase (thus about 40% more likely) than with non-“psychologically-tailored” advertising.  The study size, as with most research on FB, is enormous – the study reached some 3.5 million users (a point the authors use to try to defuse some objections).  The authors duly note the murky ethical issues that emerge: on the one hand, you could proactively try to assist people who show signs of depression; on the other hand, weaknesses like susceptibility to addictive gambling or dubious political targeting could be exploited.  That observation is pretty obvious now, in the wake of Cambridge Analytics.  Two other takeaways stood out more to me.  First, the study predicted personality on the basis of only one like.  As the authors note, that means the study likely underestimates the potential effect of psychological targeting.  Second, the authors emphasize that a point that a lot of us have been trying to make for a while: that these results undermine a lot of the current regulatory strategy for privacy. I’ll let them speak:

Malthus’ Marshmallow

By Gordon Hull

We’ve all heard of a version of the experiment: you set a kid down with a marshmallow, and tell him that if he can sit there and not eat it for a while, he can have two.  Some kids can do it, and others can’t.  A famous paper suggests that whether the child has the willpower to wait is predictive of his future success in life.  Apparently, not so much.  According to a piece by Jessica McCrory Calarco in the Atlantic, new research casts this finding into doubt.  It seems that the original study enrolled fewer than 90 children, all of them selected from Stanford’s lab school.  Let’s just call that an unrepresentative sample.  A new, larger and more representative study concludes that willpower isn’t what’s driving the result; it’s socioeconomic status.  As Calarco puts it, “the capacity to hold out for a second marshmallow is shaped in large part by a child’s social and economic background—and, in turn, that that background, not the ability to delay gratification, is what’s behind kids’ long-term success.”  For example, once you factor in whether the mother has a college degree or not, the children’s ability to wait wasn’t predictive:

Hypernudges as Subjectification

By Gordon Hull

In a recent paper, Karen Yeung introduces the concept of a ‘hypernudge’ as a way to capture the way Big Data intensifies design-based ‘nudges’ as a form of regulation.  Yeung’s discussion draws partly from discussions of Internet regulation, partly from literature on design, and partly from legal literature around privacy and big data.  Yeung’s basic argument is that, in the context of big data:

“Despite the complexity and sophistication of their underlying algorithmic processes, these applications ultimately rely on a deceptively simple design-based mechanism of influence – ‘nudge.’ By configuring and thereby personalizing the user’s informational choice context, typically through algorithmic analysis of data streams from multiple sources claiming to offer predictive insights concerning the habits, preferences and interests of targeted individuals (such as those used by online consumer product recommendation engines), these nudges channel user choices in directions preferred by the choice architect through processes that are subtle, unobtrusive, yet extraordinarily powerful” (119)

Ordinary nudging technologies – she cites the humble speed bump – are static.  In contrast, the sorts of nudges provided by data analytics are dynamic, continuously and invisibly updating the choices a user sees.  They work both to make decisions automatically based on what users have done or can be predicted to do, and by guiding decision-making by influencing what choices are available (and how they are presented).  Because of both the dynamism and invisibility, data-driven nudges can be incredibly powerful in comparison to their static cousins. 

Yeung’s paper also enables one to advance a couple of points in the context of information ethics.

Charlotte/Mecklenburg votes against 287(g)

Yesterday was a big news day.  The biggest story was probably our Tinpot Dictator’s decision to unilaterally violate the Iranian nuclear deal.  In addition to alienating almost everyone not named Bibi Netanyahu or John Bolton, and making the world less safe, the main thing this proves is that Trump can’t see more than ten minutes into the future: very soon, he will supposedly be sitting down with North Korea’s Kim Kong Un to… negotiate a nuclear deal.  What a wonderful time to petulantly scream that the U.S. does not abide by its nuclear deals!  Back home, if you pay attention to local elections, you’ll have heard that in the Republican primary that includes a sizable part of Charlotte, U.S. House incumbent Robert Pittinger narrowly lost to Rev. Mark Harris, a far right preacher who led the state’s 2012 anti-gay-marriage constitutional amendment.  Conventional wisdom is that Harris will be easier for Democratic nominee McReady to challenge in the fall.

The news that I suspect didn’t make it out of the local area is that Mecklenburg County’s Sheriff Irwin Carmichael just lost – badly – his re-election bid.  There were three candidates in the Democratic primary, and nobody on the Republican ticket, so the winner last night won the office.  Carmichael had defended the County’s use of 287(g) rules that allowed the ICE agents access to those detained in Mecklenburg County (which includes Charlotte; Charlotte police do not participate in  287(g)) jails.  His support for that program is, by all accounts, why he lost. Both of his opponents came out against it, and there was a strong grass-roots mobilization campaign.  The winner also plans to roll back two of Carmichael’s ending in-person visits with inmates and condoning the use of solitary confinement. 

That’s a good day for those of us who care about criminal justice reform and a reminder that local politics can matter.

Are Patents Property? Depends on what you mean…

By Gordon Hull

The Supreme Court issued a landmark patent ruling yesterday in Oil States v. Greene.  The most recent major revision to the Patent statute specifies that the validity of patents – in terms of whether they meet conditions of patentability (utility, non-obviousness and novelty - the opinion does not directly specify whether questions about patentable subject matters are included here, but it cites §101, so I think that’s probably covered too)  – can be challenged and resolved through an administrative inter partes review.  This review process has a number of procedural requirements, but at the end of the day the decision reached can result in a patent revocation and is conducted entirely within the administrative apparatus of the PTO.  The question posed is therefore whether the government can revoke a patent without going through the courts.  The answer delivered in a 7-2 opinion by Justice Thomas, is yes.  I haven’t digested the opinion fully, and there was another, somewhat related case yesterday that I haven’t even started on.  That said, Oil States is a very interesting decision, including the dissent authored by Justice Gorsuch.  Here’s some initial reflections on it (I did some context-setting earlier: see here).  I’ll first talk about the opinion, and then end with a thought about the underlying policy problem, for which inter partes review is basically a band-aid solution.

The basic argument of the opinion is that patents aren’t private property so much as they are a public franchise, and as such aren’t the sort of thing the Constitution is talking about when it says property claims have to run through the judicial branch.  As Thomas argues, “the decision to grant a patent is a matter involving public rights—specifically, the grant of a public franchise” (op. slip, 7, his emphasis).  As 19c case law establishes, a patent “take[s] from the public rights of immense value, and bestow[s] them upon the patentee” (op slip, 8), by granting a right of exclusion (traditionally the core of property).  It does so to incentivize invention.  It then follows logically that the decision to remove a patent is also a matter of public franchise.  Thomas cites a 1966 ruling that administrative review covers the “issuance of patents whose effects are to remove existent knowledge from the public domain” (8-9).  In other words, if the patent doesn’t cover something novel, it takes knowledge that was available to the public and privatizes it.

The ruling strikes me as exemplifying what I call “public biopolitics,” which is basically the pre-neoliberal version that Foucault identifies (especially in Security, Territory, Population and Birth of Biopolitics) with classic liberalism.  They don’t quote Mill, but the opinion is the sort of thing that the Mill of the Principles of Political Economy could get on board with. For example, Mill justifies the departure from laissez faire on the grounds that inventions are of tremendous public value, but require nurturing by the state. Similar instances of justified state intervention include public funding of things like universities (p. 968).  He also explains what happens in terms of a publicly-granted patent license: “this is not making the commodity dear for [the inventor’s] benefit, but merely postponing a part of the increased cheapness which the public owe to the inventor, in order to compensate and reward him for the service” (p. 928). Thus, even in the case of patents, Mill conceives of the production of knowledge as the production of something that benefits the public generally, and which the application of laissez-faire will not supply. The point is not to internalize externalities for the sake of the inventor.  This sense of knowledge as a public good is specific to modern liberalism.  As Foucault puts is, “activity that may go beyond this pure and simple subsistence will in fact be produced, distributed, divided up, and put in circulation in such a way that the state really can draw its strength from it” (STP 326).

Facebook and the Dispossession of Preferences

By Gordon Hull

A little more than a year ago, I floated a version of the thesis that Big Data functions as a form of capitalist accumulation by dispossession.  “Accumulation by Dispossession” is David Harvey’s term for what Marx called “primitive accumulation,” and the basic idea is that capital has to extract value from individuals in a way that pushes them into its system of value extraction.  It does that by depriving them of other sources of value.  For example, the enclosure laws in 16^th-Century England served to dispossess commoners and small-scale farmers of the ability to subsist off the land, and so thrust them, “free” into the urban labor pool.  Absent this initial dispossession, the formation of the urban market in “free labor” would have been impossible.  My argument focused on the dispossession of preferences, and was that data analytics function to deprive us of the capacity to form and express preferences outside of the logic of capitalist markets.  That is significant because the more our “preferences” are restricted to those things that we can buy, the more our lives are determined by market logic – and the more things that exceed market logic become invisible.  We are dispossessed of the ability to imagine life differently.

So.  Back to Facebook.  A recent piece by Sam Biddle in the Intercept, based on a leaked internal FB document, suggests that Facebook is deeply engaged in exactly this process.  According to Biddle:

Hostile Information Architecture

By Gordon Hull

Surprise! Facebook is back in the news and the doghouse, this time for allowing vast amounts of user data to find its way to Cambridge Analytica, which then used it to try to elect Donald Trump.  The only surprise is that anyone is surprised.  I’ll review why that is first, then offer a term that gets at what I take to be the real problem: we live in a deliberately-created hostile information architecture.  Let’s first rehearse why the FB-Cambridge Analytica nexus is not a surprise.

Property as Juridical and Biopower (part 3, with a little bit about subjectification)

By Gordon Hull

In the two previous posts, I first suggested that Thomas Merrill’s logical argument for why the right to exclude was the sine qua non of any conception of property was inconclusive.  I then offered a brief reading of the Foucauldian distinction between juridical and biopower, applying it to Locke to suggest that in Locke’s case, both aspects of power were present, but juridical was dominant.  In what follows, I want to argue that the opposite is the case with the contemporary Demsetzian account: here, biopower is dominant.  In other words, a look at endpoint historical instances of property theory suggests that the view of power underlying them has changed from Locke’s time to ours, even as the (quasi-juridical) right to exclude remains a common thread.

To return to Merrill’s thoughts on exclusion, how might we combine exclusion with Foucauldian theories of power?  An initial argument is straightforward, and goes something like this: any conception of property that says the right to exclude is essential retains at the very least that much of a juridical understanding of property.  Since rights are an aspect of juridical power, and since juridical power is about the right to repress and to prevent, it’s easy enough to see the exclusionary right as juridical.  Merrill’s arguments about the priority of the right to exclude over the right to use and develop suggests that any biopolitical emphasis on optimization is ultimately secondary to a basic ability to repress.  Importantly, Merrill extends his argument to commons-based regimes: any internal use privileges are secondary to the initial ability of the villagers to exclude non-members.  In short, even as we increasingly live by biopolitical regimes, juridical power retains its force at the very core of those regimes: the property right which has been the central feature of capitalism.

Property as Juridical and Biopower (part 2)

By Gordon Hull

Last time, I suggested that Thomas Merrill’s logical argument for why the right to exclude was the sine qua non of any conception of property was inconclusive.  With that space cleared, I want to focus on what I think a focus on the right to exclude does emphasize.  Merrill is right that property theory has tended to take the right to exclude as fundamental.  A historical dive into how that right is conceptualized says something important about how we have understood power.

That is, the focus on the right to exclude does show us something important has changed.  If we use Locke and Demsetz as points of comparison (in the sense that they present historical endpoints), it is clear that both theories of property rely on both juridical and biopolitical justifications.  However, in the Lockean case the biopolitical end is subordinate to the juridical one; in the Demsetzian case, the opposite holds.  In other words, we have away moved from a model of property in which juridical power is dominant to one where biopolitical power is dominant.

Property as Juridical and Biopower (part 1)

By Gordon Hull

In a 1998 paper, Thomas W. Merrill argues that the presence of the right to exclude others is the necessary and sufficient condition for the presence of a property right.  In this, he views himself as arguing against a “nominalist” interpretation of the right.  This nominalist interpretation, associated with legal realism and the familiar Hohfeldian “bundle of rights,” says that property is best conceived as being located in a conventionally established set of rights, the exact contours of which will vary between jurisdictions and time periods, and within which no one element is necessary.  At the risk of importing a somewhat anachronistic term, we might say that the Hohfeldian bundle leads somewhat directly to a “family resemblance” theory of property (Julie Cohen applies it to property in the paper I’m using below; the approach has also been used to good effect for privacy, and with explicit reference to Wittgenstein).  In defense of this proposition, Merrill offers three kinds of justifications: a logical one, a historical one, and one based on established legal use.  More about the first in a moment; the latter two rely on accumulated historical record and precedent.

The NRA went down to Georgia

I live in North Carolina, the state legislature for which has been basically bought by Art Pope, a smaller-scale Koch brother (the Koch brothers themselves, meanwhile, have been successfully buying the federal government).  The NC legislature has done some truly staggering things, so I’m pretty jaded on the topic of what state legislatures can do.  But the sheer cynicism of the Georgia GOP is worth noting.  When Delta Airlines decided to end its discount program for NRA members, Georgia’s lieutenant governor Casey Cagle immediately took to Twitter to announce that he would scuttle a tax break the airline was about to receive. Cagle, of course, has an A+ rating with the NRA and has received the organization’s endorsement.

In any sane universe, this would inspire a talk about whether Cagle’s behavior broke laws against corruption.  Therefore, it’s legal in this universe and no doubt the NRA is just exercising it’s Free Speech money-words in manner that just happened to be persuasive.  Just like the Charles Koch and his wife weren’t in any way involved in corruption when they sent a $500,000 check to Paul Ryan’s campaign almost immediately after the GOP passed its handout to billionaire donors tax reform package.

Good riddance to yet another corporate giveaway. The problem here is the process, not the unexpectedly happy result (some Georgia conservatives even learned the term "crony capitalism" once their brothers in the NRA had been made to suffer so greatly), but in the meantime, Mr. Cagle, I don’t know what bet you lost, but the NRA got your soul.

John Perry Barlow (1947-2018)

John Perry Barlow, Grateful Dead lyricist and one of the early advocates for a libertarian cyberspace free of governmental regulation, as well as founder of the Electronic Frontier Foundation (EFF), died yesterday.  The EFF notice is here.  Barlow is perhaps best known for his "Declaration of the Independence of Cyberspace."  As we look at  a world where authoritarian  governments use Twitter to arrest and imprison protesters, and where  the NSA is apparently intercepting and recording pretty much everything online, Barlow's vision can seem too optimistic, or even naive.  But viewed as critique, it also reminds us that the Internet is a human creation, and its regulation can be changed by human laws and human interventions.  The EFF is a lasting contribution to that critical vision, and is a frequent litigant defending privacy and other rights online.

I had the chance to bring Barlow in for a talk many years ago when I was  at Colorado College.  He was thoughtful, engaged, and a genuine pleasure to host.  He will be missed.

Healthcare and the Nature of the Firm

By Gordon Hull

Yesterday, a group of very rich and influential corporations – Amazon, Berkshire Hathaway and JPMorgan Chase – announced that they would be teaming up to form an independent healthcare company for their employees.  From the NYT:

“The alliance was a sign of just how frustrated American businesses are with the state of the nation’s health care system and the rapidly spiraling cost of medical treatment. It also caused further turmoil in an industry reeling from attempts by new players to attack a notoriously inefficient, intractable web of doctors, hospitals, insurers and pharmaceutical companies.  It was unclear how extensively the three partners would overhaul their employees’ existing health coverage — whether they would simply help workers find a local doctor, steer employees to online medical advice or use their muscle to negotiate lower prices for drugs and procedures. While the alliance will apply only to their employees, these corporations are so closely watched that whatever successes they have could become models for other businesses.”

The CEOs were very clear that they weren’t sure what they were going to do, but that they intended to improve the healthcare cost problem for their employees and corporations.  This announcement falls only a couple of weeks after a consortium of hospitals announced that they’d be forming an independent drug company to supply them with cheap generic drugs.  That announcement was spurred in part by the recent behaviors of investors who scoop up old drugs for rare diseases, and then raise the price enormously, knowing that the drug is uncommon enough that there won’t be market competition.  But the behavior of those who exponentially raise the prices of EpiPens and Daraprim is really only an exemplar of the more general pricing strategy of Pharma, as the Times reported with regard to the doubling of the price of rheumatoid arthritis drug Humira since 2012. 

What the Amazon/JPMorgan/Berkshire Hathaway consortium and the hospital consortium have in common, then, is that they are committing to find new ways to make health care cheaper.  And they are doing so by attempting to internalize costs that they would otherwise have to pay for on the market.  Two thoughts:

Intellectual Property, Creative Commons and Neoliberal Biopower

By Gordon Hull

In “Intellectual Property’s Leviathan,” Amy Kapczynski argues that both advocates of strong IP protection, and critics from the creative-commons (CC) side tend to view the state in the same way: “both those who defend robust private IP law and their most prominent critics … typically describe the state in its first instance as inertial, heavy, bureaucratic, ill-informed, and perilously corruptible and corrupt” (131-2).  On the pro-IP side, neoliberal economic doctrine (she cites Hayek) view the state’s role as establishing markets and getting out of the way.  The state otherwise lacks the information to decide winners and losers efficiently, and in any case, it would tend to be corrupted by political or other sectarian interests (ignore for the moment the corruptibility of markets).  On the creative commons side, which Kapczynski identifies with Yochai Benkler and Lawrence Lessig, there is a tendency to adopt exactly the same view of the state: “the commons, they suggest, is a concept that seeks not only to liberate us from predatory and dysfunctional markets, but also from predatory and dysfunctional states” (137).  As she points out, IP does present a number of obvious instances of regulatory capture, so the fear is not an irrational one.  The irony behind this distancing, however, is that both views also require the state to be a functioning entity capable of creating and executing reasonably coherent policy.  For the pro-IP camp, the state has to be able to administer a property regime (and a complex regulatory bureaucracy); for the commons camp, the state has to be able to do things like fund basic research through agencies like the NIH.

Kapczynski’s point is an important one, and I have only a couple of things to add.  First, she notes that the commons theorists tend to treat infrastructural projects and commons-based private ordering systems in the same camp.  As she notes, this is a strange move:

Revising Foucault on Neoliberalism: the Role of Monopolies (part 2)

By Gordon Hull

As I suggested last time, the current neoliberal expansion of IP hinges on the acceptance of monopolies, and the relation between deadweight loss (as advanced by Arrow) and incentives theory (as advanced by Demsetz) is accordingly essential to understanding it.  Here I want to expand on that point, and then say something about contemporary theory.

The debate is one that Demsetz’s side is winning.  When term limits came before the Supreme Court in Eldred v. Reno, a set of seventeen economists – including such neoclassical luminaries as Arrow, James Buchanan, Ronald Coase, and Milton Friedman – submitted an amicus curiae brief to the Supreme Court opposing the 1998 Copyright Term Extension Act (CTEA).  These economists made arguments precisely in terms of incentives and deadweight loss: a further increase in term length is highly unlikely to make a meaningful difference to incentives to create works, while likely to burden the public with reduced access, and other creators with greater licensing fees.  They conclude:

Revising Foucault on Neoliberalism: the Role of Monopolies (part 1)

By Gordon Hull

In rereading Philip Mirowski’s critique of Foucault on neoliberalism (as it’s presented in Never Let a Serious Crisis Go to Waste, his book on the 2008 financial crisis), I noticed a limit in Foucault’s analysis that I hadn’t really thought about before.  Although Foucault correctly sees that a key (if not they key) feature in the transition from classical liberalism to neoliberalism is the realization that markets are something that the state can create and curate, he does not see that neoliberalism also puts a lot of weight on the neoclassical tolerance for monopolies.  This is a significant reversal from classical liberalism.  I work on intellectual property, which is a legal regime that attempts to create markets in intellectual goods by way of granting monopolies to their creators, which means it’s hard to ignore the tolerance of monopoly.  But the point is worth expanding on more generally.

As Foucault points out (as will be apparent, all of my references will be to Birth of Biopolitics; I’m not aware the topic comes up elsewhere in his work), classical liberalism – the “liberal art of government” (BB 65) – requires anti-monopoly legislation for the “freedom of the internal market to exist” (BB 64).  Competition, if left unchecked, will tend to lead to monopolies.  By the New Deal, and the political opposition is engendered, liberalism faced a “crisis … due to the inflation of the compensatory mechanisms of freedom” (BB 69) such that anti-monopoly legislation could be perceived as part of a “’legislative strait-jacket” (BB 68).  The ordo-liberals thus pick up on the “problem of competition and monopoly” but “do not depart in any way from the historical development of liberal thought” (BB 119).  For early neoliberalism, the “problem will be to demonstrate that monopoly is not in fact part of the economic and historical logic of competition” (BB 134).  Instead, they look at what non-economic policies are supposed to have led to monopolies, and argue that competition and markets do not, without these external distortions, lead to monopolies.  They also reframe the problem with monopolies, which is that they will distort the operation of the price mechanism (BB 136, citing von Mises).  The essential claim is thus that a monopolist will have to charge market prices, or competition will unseat him.  So intervention is not necessary (BB 137).