Thursday, January 9, 2014

Patents are a Necessity, Not a Hindrance, to the Free Market

In response to my comments regarding "Health care ‘deniers’Terence McKenna replied that he disagreed with me and agreed with the letter. 

McKenna stated that we may not have literal rationing, but we do have "effective rationing," because many can't afford health insurance and thus "forego care until too late." He also noted, correctly, that we don't have a free market. He cites medical licensure as an example. He also cites patents as an example of why we don't have free markets, claiming they "no longer create incentives to invent, but are a bludgeon to preserve market power."

Here is my answer:

Terence, however you phrase it, rationing has nothing to do with affordability.  If it does, then the term loses all practical meaning. I cannot afford a Mercedes, but as long as no one is forcibly denying my right to buy it, there is no rationing.

Blurring the definition of "rationing" is an Orwellian tactic of statists to blur the distinction between politics (force) and economics (voluntary coexistence) in order to justify forced redistribution and government control. 

And what about free markets? The "free" in free markets means the absence of forcible government interference into the market (like occupational licensure). We haven't had a free market in healthcare for decades, and that's the problem. A free market is the best and only moral alternative to either the status quo or the even more coercive ObamaCare.

As to patents, their purpose is not to "create incentives to invent," which exist naturally in a free market. The purpose of patents is to protect the property rights, including intellectual property rights, of creators and inventors. Patents are a moral necessity. There are no coercive "barriers to entry" in a free market, because the government protects rather than violates rights to freedom of production and trade in a free market.


Mike Kevitt said...

Speaking of patents, I believe the automobile was invented in Europe, probably in Germany. If the inventor got a patent, it must not have applied in the U.S So, here, everybody was free to take the idea and run with it, and so the competitive U.S. auto industry developed without having to wait for a patent to expire. Or, did everybody actually have to get license under an effective patent? That must be what happened in Europe, assuming there was an effective patent there.

Michael A. LaFerrara said...

I'm no expert on the subject. But isn't the automobile really a series of inventions? I think the key invention was the internal combustion engine (if you exclude the wheel). Everything else was added piece by piece.