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The Stop Online Piracy Act: Class War in Cyberspace

Monday, 05 December 2011 09:19 By Dean Baker, Truthout | News Analysis
The Stop Online Piracy Act Class War in Cyberspace

(Photo: Kaptain Kobold; Edited: JR / TO)

The One Percent and their employees are masters of word play. They turned the estate tax into the "death tax," life-saving health and environmental rules became "job-killing" regulations and, of course, when it comes to taxes, the richest of the rich are now "job creators" who are supposed to be exempt from paying taxes. 

Given this track record, it is hardly surprising that a bill that would require every web site in the country to become unpaid copyright enforcement officers for Time Warner, Disney and The Washington Post comes packaged as the "Stop Online Piracy Act." While the name may lead the public to believe that Congress is trying to keep our email pure and our computer screens safe, the real story is that the One Percent are again trying to rig the rules so that they get as many dollars as possible from the rest of us.

The Stop Online Piracy Act (SOPA) would place an enormous burden not just on Internet giants like Google and Facebook, but any web site that allows people to post content or includes links to other sites. An owner of copyrighted material would be able to go the Justice Department and claim infringement and request that the whole site be taken down.

While sites are already required to remove material that is determined to be infringing under the Digital Millennium Copyright Act, the SOPA requires that sites in effect pre-emptively screen material for potential infringements. If they fail, they risk having their whole site taken down for a period of time, in addition to paying damages to copyright holders.

The question that serious people would ask is what problem is the SOPA intended to address? There is still plenty of money being made by online distributors of music, movies, books and software. The problem seen by the top executives at Disney and the other promoters of the SOPA is that they want to make more.

A substantial amount of copyright-protected material does slip through the system, as does an even larger amount of material with ambiguous copyright status such as a homemade video with parts of a copyrighted song or material whose copyright may have expired. The big entertainment companies want to impose large costs on web intermediaries (which will be passed on to consumers) and make it more difficult for people to gain access to totally open material, in order to make them pay more money for their copyright-protected material.

Although the SOPA strategy of reducing access while raising prices could fit the dictionary definition of "job-killing regulation," its advocates have the incredible audacity to be touting the 19 million jobs at stake. People really should take a moment to look at the industry's web site to see what might well rank as the most outrageous misrepresentation of economic reality ever to appear in a Washington policy debate.

The basic story is that if an industry is in any way directly or indirectly dependent on the output of a copyright protected industry, then the jobs in that industry will be put at risk if Congress doesn't approve the SOPA. By this methodology, all the jobs in the shipping industry will be at risk if we end the tax credit for solar power, since some of the materials used in solar panels are imported. This is patently absurd, but if you work for the One Percent, you can get such arguments taken seriously in Washington policy circles.

In reality, the higher costs that the SOPA will impose on consumers both directly and indirectly by raising costs to intermediaries, are money out of their pocket. The additional money that will be collected by the entertainment industry is money that will not be spent in local stores or restaurants.

It's true that some of the money earned by the entertainment industry will get back to writers, musicians, and other creative workers, but this will be a very small amount compared to the additional cost to consumers. If we had forward-thinking politicians in Washington, or economists who didn't sell their services to the highest bidder, policy would be focused on devising more efficient mechanisms for supporting creative work.

Copyright is an incredibly inefficient mechanism dating back from the 16th century. The costs of enforcement are soaring as the Internet makes it ever more difficult. This is a situation where we are relying on toll booths to pay for our roads, but it is becoming ever easier for travelers to evade the toll booths. Rather than looking for alternative ways to finance road construction, we are building bigger, more expensive toll booths and increasing the penalties for not paying tolls.

Of course, the point is to have money going to the road builders, not the people who run toll booths. There are alternative mechanisms for financing creative work. There is already a vast amount of creative and intellectual work that is not supported by copyrights. This includes work done by university faculty, work supported by nonprofit organizations and, even to some extent, work supported by the government.

We should be looking to expand and improve these alternative mechanisms rather than turn cyberspace into a copyright-protected police state. The SOPA is big government at its worst: an intrusion into the market to help the One Percent at the expense of everyone else.

Dean Baker

Dean Baker is a macroeconomist and co-director of the Center for Economic and Policy Research in Washington, DC. He previously worked as a senior economist at the Economic Policy Institute and an assistant professor at Bucknell University. He is a regular Truthout columnist and a member of Truthout's Board of Advisers.


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The Stop Online Piracy Act: Class War in Cyberspace

Monday, 05 December 2011 09:19 By Dean Baker, Truthout | News Analysis
The Stop Online Piracy Act Class War in Cyberspace

(Photo: Kaptain Kobold; Edited: JR / TO)

The One Percent and their employees are masters of word play. They turned the estate tax into the "death tax," life-saving health and environmental rules became "job-killing" regulations and, of course, when it comes to taxes, the richest of the rich are now "job creators" who are supposed to be exempt from paying taxes. 

Given this track record, it is hardly surprising that a bill that would require every web site in the country to become unpaid copyright enforcement officers for Time Warner, Disney and The Washington Post comes packaged as the "Stop Online Piracy Act." While the name may lead the public to believe that Congress is trying to keep our email pure and our computer screens safe, the real story is that the One Percent are again trying to rig the rules so that they get as many dollars as possible from the rest of us.

The Stop Online Piracy Act (SOPA) would place an enormous burden not just on Internet giants like Google and Facebook, but any web site that allows people to post content or includes links to other sites. An owner of copyrighted material would be able to go the Justice Department and claim infringement and request that the whole site be taken down.

While sites are already required to remove material that is determined to be infringing under the Digital Millennium Copyright Act, the SOPA requires that sites in effect pre-emptively screen material for potential infringements. If they fail, they risk having their whole site taken down for a period of time, in addition to paying damages to copyright holders.

The question that serious people would ask is what problem is the SOPA intended to address? There is still plenty of money being made by online distributors of music, movies, books and software. The problem seen by the top executives at Disney and the other promoters of the SOPA is that they want to make more.

A substantial amount of copyright-protected material does slip through the system, as does an even larger amount of material with ambiguous copyright status such as a homemade video with parts of a copyrighted song or material whose copyright may have expired. The big entertainment companies want to impose large costs on web intermediaries (which will be passed on to consumers) and make it more difficult for people to gain access to totally open material, in order to make them pay more money for their copyright-protected material.

Although the SOPA strategy of reducing access while raising prices could fit the dictionary definition of "job-killing regulation," its advocates have the incredible audacity to be touting the 19 million jobs at stake. People really should take a moment to look at the industry's web site to see what might well rank as the most outrageous misrepresentation of economic reality ever to appear in a Washington policy debate.

The basic story is that if an industry is in any way directly or indirectly dependent on the output of a copyright protected industry, then the jobs in that industry will be put at risk if Congress doesn't approve the SOPA. By this methodology, all the jobs in the shipping industry will be at risk if we end the tax credit for solar power, since some of the materials used in solar panels are imported. This is patently absurd, but if you work for the One Percent, you can get such arguments taken seriously in Washington policy circles.

In reality, the higher costs that the SOPA will impose on consumers both directly and indirectly by raising costs to intermediaries, are money out of their pocket. The additional money that will be collected by the entertainment industry is money that will not be spent in local stores or restaurants.

It's true that some of the money earned by the entertainment industry will get back to writers, musicians, and other creative workers, but this will be a very small amount compared to the additional cost to consumers. If we had forward-thinking politicians in Washington, or economists who didn't sell their services to the highest bidder, policy would be focused on devising more efficient mechanisms for supporting creative work.

Copyright is an incredibly inefficient mechanism dating back from the 16th century. The costs of enforcement are soaring as the Internet makes it ever more difficult. This is a situation where we are relying on toll booths to pay for our roads, but it is becoming ever easier for travelers to evade the toll booths. Rather than looking for alternative ways to finance road construction, we are building bigger, more expensive toll booths and increasing the penalties for not paying tolls.

Of course, the point is to have money going to the road builders, not the people who run toll booths. There are alternative mechanisms for financing creative work. There is already a vast amount of creative and intellectual work that is not supported by copyrights. This includes work done by university faculty, work supported by nonprofit organizations and, even to some extent, work supported by the government.

We should be looking to expand and improve these alternative mechanisms rather than turn cyberspace into a copyright-protected police state. The SOPA is big government at its worst: an intrusion into the market to help the One Percent at the expense of everyone else.

Dean Baker

Dean Baker is a macroeconomist and co-director of the Center for Economic and Policy Research in Washington, DC. He previously worked as a senior economist at the Economic Policy Institute and an assistant professor at Bucknell University. He is a regular Truthout columnist and a member of Truthout's Board of Advisers.


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