The Misalignment of Union Leadership

The City of Newark announced today that they are going to have to lay off 167 police officers effective next Tuesday because of the misaligned incentives of union leaders and their membership. This is another case study in why the modern union is a dysfunctional beast. Let’s look at the winners and losers in this situation to understand why:

Who loses in this situation?

The citizens of the City of Newark lose because there will be fewer officers on their streets.

The officers who are losing their jobs lose because they won’t have jobs going into the holidays and the new year.

The officers who remain on the job are losing because with fewer fellow officers their workload will expand. The crime rate will go up and there will be fewer officers to cover an increasingly difficult situation.

So the citizens, the laid off officers, and the remaining officers all lose – So who wins?

The union leaders win and here’s why.

The city of Newark offered a complex, but reasonable set of compromises (read: pay cuts) that would be spread around the police force as a whole. Mayor Booker asked for the leadership to put the proposal to a vote of the members. The leadership of the Newark Fraternal Order of Police refused to let their membership vote on the proposal and save the jobs of their fellow officers. Why?

Well it’s rather simple: The leadership wants to keep their jobs safe, not the people they represent, and thus their incentives are not aligned with the union’s membership. When faced with the choice between some pain for everyone or extreme pain for a few, the leadership will always choose the latter. From the leadership’s perspective they have no incentive to keep officers employed. Once fired, an officer will soon fall out of the union (payment of dues will be prohibitive and he or she will likely move on), and once out of the union that fired officer won’t vote against the leadership that sacrificed them because they won’t have a vote. If the leadership refuses compromise but loses membership, they can say to the remaining members “I saved your job, I saved your benefits, I saved your wage,” whereas if they agree to broad compromises in the interest of the city, the department, and their members, they run the risk of members being disgruntled at the compromise and voting them out of their jobs.

The Newark Fraternal Order of Police leadership failed their membership today and everyone, except those leaders, will lose.

Terrorists Vs. The TSA (I’ll Take The Terrorists)

I was having a conversation with a friend about the completely absurd new round of security theater being rolled out by the TSA. Let us be very clear, this is security theater as it makes traveling by air virtually no more safe than it was two weeks ago. Here are some key points from that conversation:

A quick web search suggests a consensus view that there are, on average, about 30,000 commercial flights in the US per day (the total number of flights per day is considerably higher since it includes a significant amount of general aviation usage, but the TSA policy is only affecting commercial travelers, if you want to board a Boeing Business Jet you can basically walk right on). How much successful terrorism could there be if we did a reasonable, but not complete, step down in security? If there were one successful attack every week, which sounds insanely high to us, then your odds of dying in such an attack, if you are contemplating one single plane flight, would be about one in 210,000. If there were one successful attack per month, your odds, for one single plane flight, would be about one in 900,000. If there were one successful attack per year, your odds, for one single plane flight, would be about one in 11,000,000. (We’re assuming, of course, that every attack would result in the death of everyone on the plane, which may not be true at all, as a number of the attacks might be attempted hijackings rather than bombings. We realize, as well, that the “one year” odds of dying would have to be increased to reflect the number of times per year you travel.)

How does this compare to the one year odds of dying in a number of more familiar manners? My friend found some data allegedly from the National Safety Council (whatever that is) from 1999:

Transport accidents (all types): one in 5,877
Occupant of a car: one in 18,752
Accidental fall: one in 20,728
Drowning: one in 77,308
Exposure to smoke, fire and flames: one in 81, 487
Exposure to forces of nature: one in 183,347
Accidental poisoning: one in 22,388
Suicide: one in 9,343
Homicide: one in 16,154

Perhaps our favorite:

Air and space transport incidents (e.g. A “normal” plane crash): one in 381,566

This last one is especially interesting. If we read this right, terrorists would have to blow up about a full plane every two weeks, all year, to get the odds of dying in a terrorist attack on a plane up to the odds of dying in an ordinary plane crash. (We have a feeling that this statistic includes general aviation and that the odds for dying in a small, private plane are MUCH higher. We’ve seen other estimates on the web that the odds of dying in a commercial plane crash on a one year basis are about one in a million.) Now, we realize that terrorism is especially frightening, but has anyone recently suggested that being in a “normal” plane crash isn’t one of the scariest things you can possibly imagine? So what does it say about our rationality that we think it’s rational to put ourselves to enormous inconvenience, stress and violation of privacy to try to deter a risk which is about equal to the risk we ALREADY HAVE in flying anyway – and no one is suggested radical changes to the maintenance, training and air traffic control procedures which presumably are our means of cutting back on “normal” plane crashes.

It should also be noted that if a terrorist’s goal is to terrorize Americans about air travel then they don’t even have to go through security. As has been pointed out by numerous security experts, committing a terrorist attack on the security line itself would be easily as effective in crippling our air traffic as attacking a plane.

One final note. My wife and I were in Fiji on our honeymoon earlier this year. We were preparing to board a flight back to the US and went through security. When we arrived at our gate area of the relatively small Nadi International Airport, there was a secondary screening for US-bound passengers. I’ve seen this before and, despite how silly it seemed, I watched as my wife was led into one half of a plywood box and I was led into the other and our stuff was searched a second time. In searching my carryon a local TSA contractor pulled out a small, one-ounch clear container of hand lotion. He turned to me and said: “Sir, this needs to be in a plastic bag.” I asked him why and he said that all toiletries need to be in a clear plastic bag. I tried to explain to him that the purpose of that rule is so that he can easily examine toiletries (plural) but since this was a single container, already clear, that the clear plastic bag served no purpose. He replied, “But Sir, this has to be in a clear plastic bag.” I went on: “You do realize that the clear plastic bag doesn’t provide any magical form of security, don’t you? You are aware that the whole point of the plastic bag is to see, clearly, the object that you are currently holding in your hand? That if this object were nefarious, a glad sandwich bag would not have any ability to protect us.”

His response: “Sir, I’m not worried about that. The rule is that this has to be in a clear plastic bag.”

In an effort to help security for all Americans he then said: “If you need a clear plastic bag, you can buy one from that shop over there,” and pointed across the departure area to a small pharmacy shop. I shook my head sadly. I pointed to two gentlemen sitting in the “secure” area of US departures, and said to my TSA person: “But what about those two guys? They both have 12-ounce glass bottles of Snapple iced tea. How did those get in? Were they in clear plastic bags?”

His response was fantastic and without irony: “No, they bought those bottles at the shop.” I handed him the lotion and told him he could keep it.

Let me be clear in all this. I don’t want to see any terrorist attacks. I don’t want to see anyone hurt. However, if we’re going to be serious about security touching people’s junk, humiliating breast cancer and urinary tract cancer survivors, groping screaming 3-year-olds, feeling up half-naked children, putting clear plastic bottles in clear plastic bags, and other absurd exercises in theatricality are not the place to start.

A Sad Day At Ground Zero

Hate-monger Pamela Geller conducted her disgusting rally against the Park 51 Islamic Center in Tribeca (it’s not at Ground Zero, so let’s be clear here, ok?).

The following occurred:

A man walks through the crowd at the Ground Zero protest and is mistaken as a Muslim. The crowd turns on him and confronts him. The man in the blue hard hat calls him a coward and tries to fight him. The tall man who I think was one of the organizers tried to get between the two men. Later I caught up with the man who’s name is Kenny. He is a Union carpenter who works at Ground Zero. We discussed what a scary moment that was for him. I told him that I hoped it did not ruin his day.

It’s hard to watch that scene and not think that it is not a far distance from that type of moment to Kristallnacht. This is not what America stands for. If Imam Rauf is forced to move Park 51 it will be a tragic day for the American experiment in freedom and tolerance. Listen to this story of Kristallnacht and, most importantly, listen to 7:30 in the video:

And here’s one more angle on that worker incident at the hate rally today:

Fuck you Pamela Geller for doing this. Fuck you Rupert Murdoch for supporting this. Fuck you Abe Foxman for supporting this. Fuck you Howard Dean for supporting this. Fuck you Charles Krauthammer for supporting this. Fuck you Newt Gingrich for supporting this. Fuck you Harry Reid for supporting this.

(ht: LittleGreenFootballs)

Score One For The Good Guys

A federal appeals court just struct down the FCC’s indecency ban as unconstitutional.  This is a win. In particular the court held that the indecency ban was an infringement on the 1st Amendment because it was unconstitutionally vague.  Here are a couple key paragrphs:

[W]hen Judge Leval asked during oral argument if a program about the dangers of pre-marital sex designed for teenagers would be permitted, the most that the FCC’s lawyer could say was “I suspect it would.” With millions of dollars and core First Amendment values at stake, “I suspect” is simply not good enough….

The FCC assures us that it will “bend over backwards” to protect editorial judgment, at least in the news context, but such assurances are not sufficient given the record before us. Instead, the FCC should bend over backwards to create a standard that gives broadcasters the notice that is required by the First Amendment….

For a very interesting look at Justice Clarence Thomas’ concerns that radio and television are less constitutionally protected than other media from an earlier phase of the case that made it to the Supreme Court, definitely visit the always compelling Volokh Conspiracy.

Business Hours (On The Web)

I’m setting up a new LLC at the moment. We have a film that will be starting in the fall and one of the key steps in that process is establishing a legal entity for the film. We’ve drafted and filed the key documents and the next step is to file for an Employer Identification Number or EIN. This is, essentially, the corporate equivalent of a Social Security Number.

This is a process that is an essential part of the modern American financial system. Something the government should be efficient at. And, at first glance, it is. You simply go to this website and apply. Here’s what the page looks like:

(click to enlarge)

So far, so good? Except there’s a little detail on the page that jumped out at me:

Say what? The Government’s computers are incapable of accepting an online application between 12:30am and 6:00am? Frankly, I’m not sure what they’re saying here. It could be that the application is available from 6am Monday until 12:30am Friday… but that wouldn’t make sense since 12:30am on Friday is right after midnight thursday, no? Better yet, on Sunday it’s only available from 7pm until midnight? Why?

This is a combination of poor programming (that your computers can’t accept applications 24/7), poor UI design (that it’s hard to figure out what hours you are available), and a general paucity of thought. Whoever is responsible for this should be ashamed.

Why Unions Are Not Your Friend

Dear Reader,

Unions are the enemy of independent film.

I know, I know, they have “indie” deals but at the end of the day, they are your enemy. And now it is starting to show.

Craig Mazin is a very successful screenwriter (SCARY MOVIE 3 & 4) & sometime director (SUPERHERO MOVIE) and the author of a blog that I really enjoy, The Artful Writer. It is definitely worth adding to your RSS feed as he has lots of good insights. Craig is also a former board member of the WGA West and last week he wrote a post On Net Neutrality…

In his post, Craig makes an interesting argument against net neutrality legislation and in particular, WGAw current board member Carleton Eastlake’s assertion that the WGAw should support net neutrality.  Below are some of Mazin’s points from the post and some of my thoughts. But where it really gets interesting is in the comment section which I highlight below. But let’s start with the content of the post:

if we do not have net neutrality, it’s quite easy to see how the major ISP’s could, as part of content provision deals with the studios, throttle or completely block out the major P2P channels. In fact, the efficacy with which this could be accomplished is one of the battle criesfor net neutrality by those who support it. This isn’t a question of conjecture.

Mazin is arguing here that the best thing for writers (and content creators in general) is to let the major ISP’s strike deals with studios as that will ensure that the ISP’s will pay the studios for that content and the studios will pass that money on to the creators.  Craig is being incredibly optimistic here. First, he’s assuming that the ISPs will be paying the studios and not that the studios will be paying the ISPs NOT to be slowed. If I’m an ISP, what’s to stop me from going to each studio and saying: “Hey there, that’s a mighty nice set of films you have there. Would be real shame if something were to slow them down… hehehe”. If Craig would like proof of who is setting payments, take a look at iTunes. You want on the best distribution network out there, you have to play by their rules. You don’t want on the network, fine, you can go sit with all the other people making fortunes in the Capitol Records building these days.

Oh wait… I forgot…. *crickets*

Then Craig is assuming that the studios will share that revenue in a reasonable way. But the reality is that that revenue (if there is any) won’t be generated film by film, it will be an overall deal. A blanket payment for content. How do you, as a content creator, ensure that you’re getting a fare cut of it. This is a fair pricing issue and one which is far more complex than anything the unions have encountered as it doesn’t involve the sale of content. It involves the speed of data. Craig continues:

I’m a big believer in free speech on the internet. However, let’s be honest about P2P networks. They exist almost primarily to circumvent licensing agreements on software, music and video. And they’re stealing money from writers every day. What an odd institution for the WGA to be defending…

Craig’s just wrong here. Some networks are dominated by illegal file sharing but others don’t have any. Take Skype. Yep, the calling service. Guess what, it’s P2P. How about Chat Roulette, the hot site of the moment? Yep, P2P as well. And there are dozens of other examples. If you pass judgement on the whole set of P2P as illegitimate you’re shutting down innovation because you aren’t smart enough to enforce your laws effectively. It’s akin to saying that we should ban highways because a lot of people speed. There are even people using the most “dangerous” of the P2P networks and turning them into powerful marketing and distribution networks for their work. Check out Jamie King’s Vodo if you want to see how that can work. Criags argument is what happens when people who don’t understand technology try to come up with 20th Century solutions to 21st Century issues.

Then comes this exchange with Carleton which I think gets to the most interesting point. First Carleton:

As for maximizing the revenue of the surviving major media companies on the net by allowing a degree of monopolization, that’s a point I’m ready to debate. I agree that no one should want out of spite to reduce the revenue pool that writers and other talent share in from the major companies. But I’d much rather see independent and specialty production and distribution companies also thrive on the Net. Having worked for several years at Cannell, a successful writer-owned TV production and distribution company that expired along with fin-syn “broadcast neutrality”, to coin an analogy, I’ve directly experienced the model of how net neutrality can restore an era of independent production that creates enormous opportunity -and revenue – for writers.

And now Craig’s response:

This is kind of shocking, coming from a board member of the WGAw. Let me get this straight. You favor the economic prospects of individual EMPLOYERS over the economic prospects of individual EMPLOYEES? Cannell the man was a writer. Cannell the company was an employer. As union members, our interests have to first run to the employees, Carleton. I, for instance, write movies for studios. My salary generates dues and P&H contributions to the union. Are you honestly saying that my financial bottom line is less important than the financial bottom line of a company hiring writers for an internet show?

See, the thing is, we’re writers until we’re not writers. The day I create The Mazin Internet Studio and launch a web show and hire writers to write on that web show, I’m an employer. I’m on the other side of the table. That’s not to say that I can’t be a good guy. However, it is to say that my interests as an employer shouldn’t be anywhere in the same galaxy of concern for the WGA as the interests of my employees.

In short, while I think it’s nice that writers can be as entrepreneurial on the web as they wish, the Writers Guild of America has to serve its primary function, which is to protect my interests as an employee. That’s what it’s federally chartered to do. That’s what all labor unions do. It’s fine for the WGA to help its employees grow into businesspeople, but not at the expense of the writers who still get hired to write.

Yes, we want to make sure that there are lots of employers for our services, and in that regard, I understand the desire to avoid anything that feels like it will throttle competition between the employers. But let’s be real…the companies that will challenge Fox, Disney, Sony, Universal, Paramount and Warner Brothers aren’t internet shops set up by individual writers. It’s the other big monsters out there like Microsoft, Google, Clear Channel, etc.

This inspired the following exchange between Craig & I in the comments. First from me (with some edits to avoid repeating points I just made above):

Your proposal to hand over arbitration of download speeds to companies like Verizon and Time Warner means ensuring that independent artists remain out in the cold. Why would Time Warner allow these artist’s work to come over their pipes if they could, instead, throttle that content in favor of work they have a greater profit incentive for. Your position on this Craig is basically saying to independent artists that unless they sign up with a major studio that audiences shouldn’t have the same access to their work.

I am mildly opposed to Net Neutrality legislation for legal reasons (I think it is potentially an unfair restriction on commerce) and I think that companies that choose to create walled gardens of preferred content will ultimately shrink and die under market pressure. We all forget, we’ve seen this before.

AOL once believed that they knew what parts of the internet we would like best and chose to give that, and only that, to us. Then upstart service providers came along and offered people open pipes to any content they wanted.

We know who won that war.

Craig’s response (emphasis added is mine):

With all due respect to my fellow writers who work outside of the studio system, I don’t. I work within it. The WGAw is designed primarily to represent writers who work within the studio system. The vast majority of the WGAw’s financial resources are derived from writers who work within the studio system. Our pension and health is funded by the studios.

So yeah, my opinion is that the WGAw should be more concerned with promoting those of us who work within the studio system. Sure.

So apparently all writers in the WGAw are equal, but some are more equal than others. My response:

But to your point Craig, you are saying not that “it’s best at getting us paid” but, rather, “it’s function should be to ensure those of us who are paid the most continue to be paid the most. If you don’t make as much as me then the Union should be less interested in your opportunities.”

Is the function of a union primarily to help maintain the lifestyle of those who are best off in the union or to ensure that those who are most in need of defense in the union have that defense. Your argument is the former.

By that logic SAG should only do what is in the interest of the top 5% (the WGAw probably the same) since they provide the vast lion’s share of the money to the union – heck, why even bother with covering background actors? I guess I’m surprised to hear that the Union should only support the interests of those who pay it the most in residuals.

I understand your point of view and certainly why it makes sense to you. I respect it. I guess it’s just interesting to hear that the union should prioritize the interests the wealthiest parts of its membership.

In the context of this argument, why should the WGA have it’s low-budget agreements at all?

Craig responds:

Not at all. Not sure how you got that.

My argument is that anyone earning a minimum as part of a Guild job deserves to be defended by the Guild. AND my argument is that virtually all of those people currently work for the studios. AND my argument is that the day any of those people start their own internet production company, they’re no longer someone the Guild must defend for, but rather defend against, because they’ll be employers.

It’s not rich vs. poor. It’s employees vs. employers. Or, I suppose…professional studio writers vs. independent non-studio writers.

Now this sounds reasonable at first blush. But hang on a second. If you have points on a film, points above scale, aren’t you a form of an owner. You have a profit interest in the film that is on a par with the owners of that film. Furthermore, it highlights a serious shortcoming of the WGA, DGA and SAG. The very premise of a union is predicated on the idea of collective bargaining. You take groups of people who have no capacity to individually bargain for better terms and you bundle them all together.

If you work on an assembly line in Michigan and you demand $1 an hour more than you’re being paid now they could fire you and replace you with someone else who can do your job. You have no individual value and thus no capacity to individually bargain. You are replaceable. But that’s not the case with a writer. Diablo Cody writes Juno and gets an Oscar. The next film she writes she gets paid WAY above scale because she now has individual bargaining power. What then is the purposes of the union? In Craig’s world the union is a collection agent. It’s there to do accounting work. But that’s not what they’re built for. Craig is asserting that unions should represent the interests of the members who contribute the most, but those members generally aren’t subject to the minimums that the union bargains for since they are the individual bargainers. Jack Nicholson or Tom Cruise gain nothing from being members of SAG. Joe Schmoe who just moved to Hollywood gains a a lot, but Craig says that he who pays the most should get the best terms.

My response to Craig:

What about the writer who receives points beyond basic residuals? They should now be considered someone to defend against as well, no? They are now a part of the production entity with an ongoing profit interest in the work that is in line with the producers (employers) and now should be treated as such.

You carve out an interesting role for the WGA with the following criteria for union support:

1) You must work with studios.

2) You must not have an ownership interest in your work.

Again, there is a logic to that position it just seems to narrow the role of the union and ensure that up and coming writers will likely want nothing to do with it until they’ve signed (an increasingly elusive) studio deal.

[snip - diversion section here on union history]

Also, I put the question back to you, since you say “professional studio writers vs. independent non-studio writers” – what then is the point of the low budget agreements?

Craig never answered that question.

So I ask you, what is the point of the union for the independent world if it’s primary function, according to members of it’s board, should be to represent the interests of those who earn the most by working for studios and don’t own their content in any way?

Thoughts?

The Rich Die Richer

Earlier, I saw a small AP newswire piece about a guy named Jeffry Picower who was found at the bottom of his swimming pool in Palm Beach, Florida today. Police are investigating the circumstances of Mr. Picower’s death, especially as he was accused of profiting to the tune of $7 Billion from Bernie Madoff’s ponzi scheme. Picower definitely seems like a shady guy and his death is no exception. So, why do I bring this up?

A little, un-noted line in the article:

“Picower suffered from Parkinson’s disease and had “heart-related issues,” said family attorney William D. Zabel. He described Picower’s health as “poor.”"

Why is that interesting? Well Bill Zabel wrote a book, ironically titled: “The Rich Die Richer And You Can Too“

I guess he was right…

You’re Feeling Very, Very Sleepy (The Australian Hypnotism Affair)

The doldrums of August have come around. The industry is in state of rest and I, for one, am trying to resist the temptation of being horizontal all day in the sun (though it should be said, with my Viking-like complexion, the sun and I have an understanding that we only meet on rare instances and then, only in disguise).

That all is a round-about way of saying that I hope to return to a steady diet of analysis and insight in September but for now, it seems that recent posts have been a little lighter in intellectual heft. Following that trend, here is an interesting one for you:

Channel Nine in Australia was just found guilty of attempting to hypnotize its viewers.

Yep, let that one sink in…

From The Australian:

BROADCASTING authorities have found A Current Affair guilty of breaching the TV code by trying to hypnotise viewers.

This is no joke. After a lengthy investigation, the Australian Communication and Media Authority has today ruled on the rare breach and ordered Nine to retrain staff.

In October last year ACA host Tracy Grimshaw opened the show and said: “If you’d like to trim down, well settle in, get comfortable and concentrate, [our hypnotist] is
about to hypnotise your kilos away.”

What followed was a typically silly segment on the latest diet fad – using hypnotherapy to “Think Slim” in which the hypnotist promised “the nation” would lose weight, guaranteed, through his tricks.

Read on…

(ht: James Kane)

The Economy Of Content Without Valuing IP

I just listened to Lance Weiler’s most recent podcast of This Conference Is Being Recorded. It was an interview with Nina Paley, the creator (I use creator since she is the writer, director, animator and producer) of the remarkable film SITA SINGS THE BLUES. In the interview Nina provides a protracted explanation of why she has released the film under a Creative Commons Attribution Share-Alike License and her opinions about copyright, IP ownership and revenue. I strongly recommend listening to the conversation.

Sita Sings The Blues

I have generally held the belief that content creators should have the right to control the means and methods of the distribution of their content, should they so choose. That being said, I have had a challenging time resolving, in my own mind, the parallel ideas of content being shareable and creators profiting from their work. I get concerned about a lot of these conversations ignoring the legitimate right of creators to define certain terms of the engagement with their work and also that somehow, as “artists”, we should forego compensation for our work. Nina helped me clarify some of these ideas in her framing her reasoning behind the release of SITA.

I think before going too much further I should explain a little bit about Creative Commons licenses for those that are unfamiliar. Creative Commons licenses are the middle ground between no rights reserved (public domain) and all rights reserved (copyright); they are, for all intents and purposes, “some rights reserved”. The licenses come in a variety of flavors, including ones which require attribution or that prohibit commercial reuse of the work covered (this blog is covered by a creative commons attribution license).

Often, in the argument for a redefinition (or elimination) of copyright, there is the assertion that all content should be free and many proponents of this view have embraced the Creative Commons however, the creative commons license system is a control of rights and the CC licenses are built on the foundation of copyright. You must have control of the content in order to assert the restrictions that a CC license entails. The requirements for attribution, or the refusal to allow me to make money off of my remix of your work (if under a non-commercial CC license) is as much of a restriction as a record label’s control of synch rights to music. I will cede that the intentions of CC licenses are perceived as more altruistic (and they generally are) but they require copyright to function.

This is not to say that the copyright system is not in need of some fundamental rethinking. The idea of copyrights extending for decades beyond the life of the creators seems deeply antiquated and overly restrictive. However, if an artist chooses to make a single print of their work that will be valued far beyond on the nominal value of a single print in the context of many prints (ie: a limited run of 1 versus an unlimited run) then that artist has that right (in my opinion), for a period of time.

As an aside, the Creative Commons notion also assaults the concept of the ‘original’. Is there any value to the original Adele Bloch Bauer I that Klimt painted by his own hand? The aspiration of the CC movement seems, if unintentionally, to destroy any notion of the original. Somewhere Baudrillard is laughing.

That all being said, I think that Nina makes a very interesting, if self-conflicting, point about how content creators can be compensated for the intellectual property they create. On her website, Nina’s justification for making the content free (something she interestingly chose to do only after discovering she could not afford to keep the rights herself) is as follows:

I hereby give Sita Sings the Blues to you. Like all culture, it belongs to you already, but I am making it explicit with a Creative Commons Attribution-Share Alike License. Please distribute, copy, share, archive, and show Sita Sings the Blues. From the shared culture it came, and back into the shared culture it goes.

Nina goes further in her conversation with Lance, asserting that everything belongs to everyone since all ideas stand on the shoulders of other ideas. Because of this, it is not reasonable to charge for content since it is the property of all mankind. Taking this as as supposition, the case is then made by Nina that it is reasonable to charge for materials (like prints and DVDs) that have empirical costs of their own and it is acceptable to mark up those costs for profit. Here, I think, is a slight error of omission in the logic.

IP should be free:

It is reasonable to charge for materials and therefore the materials containing IP are things one can charge for.

The omission is the justification for marking up the costs of those materials. That markup does not represent any intrinsic value of the materials but, rather, it represents the value of labor. In fact, the ability to charge a “profit” on material containing IP is due to the valuation of labor.

The argument could be drawn that the variable net charge in all economies is, in fact, labor.

1. We are willing to pay someone for labor on it’s own (labor): eg someone hanging wallpaper in your home.
2. We are willing to pay someone for materials that were laborious to create (labor + materials): eg glue and brushes used to hang the wallpaper.
3. We are willing to pay someone for materials that were created by someone’s creativity (materials + labor + IP): eg the wallpaper itself with some sort of designed pattern.**

Why then would we not be willing to pay for labor + IP?

It seems to be the only component of labor we are claiming should be free. Artists should be able to charge for the labor that went into creating the content that they are sharing. By framing the argument this way we can create a reasonable argument for artists to ask for compensation for their work by those who consume it.

** Wallpaper is an interesting example in this case. For decades the British film industry was based on a financing system called the sale & leaseback that owes its origin to, of all things, wallpaper. After WWII the British government allowed companies to depreciate 100% of the value of new machinery in a single year as a method of encouraging the rebuilding of the British manufacturing sector. Film distributors saw this and made the argument that reels of films were machinery and thus eligible for the accelerated depreciation. They won and for a number of years did just that. Then, one day, the inland revenue service went after a wallpaper manufacturer in the midlands for writing off not only the equipment but the die casts (the prints) as well. The company fought back in court, arguing that without the die casts the equipment was useless. Ultimately they won and a few smart producers, led by John Heyman (father of David Heyman, producer of Harry Potter), saw this and argued that the film reels being depreciated by distributors were useless without the film on the reel and thus the entire cost of the film should be depreciable. They won and that system lasted for over a quarter century.

We Shoot Pirates, Don’t We?

I have a bone to pick. I am really tired of people claiming that it’s ok to steal something if it’s not available fast enough. Since when is convenience a reasonable defense in a court of law?

“Your honor, I do realize that I stole those diamond earrings from Tiffany but if I had had to earn that money it would have taken years!”

For me, it started with a conversation I had with someone at brunch a few months ago telling me that he liked using torrents because the download speed was faster than iTunes. He made the argument that it was an issue of convenience and if only the world provided him a legal means to get the same level of service he would pay for it.  After discussing the ethics of it (and largely not agreeing) I then posed the question: “Well, if you could pay to get that service, would you?”

He paused and we both knew what he was thinking. Then he admitted:

“Probably not. Why should I?”

And this is what concerns me. It’s a slow, inexorable move towards a culture that believes they are entitled to steal media or, more problematically, they believe that media is not something that is worth paying for.  If we do not pay for content then the creators of that content cannot continue to create and the content will dry up. Our society’s creative output will be starved due to our laziness and our thievery. People argue that it’s because they don’t feel bad stealing from “the big media companies” but in fact, by allowing this we are digging our own grave. Every filmmaker who is going to get their work out there on the DIY circuit, who is going to do VOD, and DVD (or blu-ray, or whatever), and try to make a living, or at least be compensated for people’s viewing their art, is going to be out of luck.  After all, they are now indistinguishable from the “big media companies”.  Do you think the torrent-freak stops to think whether a given title came from Fox, or from you?

If you think they do, then you’re kidding yourself.

The latest outrage for me is this absurd article in Slate magazine by the dopey Farhad Manjoo (I assert his dopiness based on the fact that he is a ‘technology columnist’ and has a blog that doesn’t lay out properly in a state of the art browser like Safari 4).

We have to take a stand against this people.  Here is a journalist, in a major magazine, telling everyone that it’s ok to steal if you can’t get just what you want, the way you want it (and if that way is ‘free’, then you should be entitled). It’s arrogant. It’s illegal. It’s amoral.

Write him and tell him so, ok?

Here is the note that I sent him:

Farhad,

I just read your piece in slate about your desire to see a more inclusive streaming video service (http://www.slate.com/id/2216328/pagenum/all/#p2).  I think you wrote a wildly irresponsible piece. How do you justify, in a reputable journal like Slate, discussing how you break the law because you find the law annoying?  I quote:

“I sometimes feel bad about my plundering ways. Like many scofflaws, though, I blame the system. I wouldn’t have to steal if Hollywood would only give me a decent online movie-streaming service.”

So, by this reasoning I should be entitled to break into Tiffany’s and steal jewelry because they don’t make it easier for me to obtain?  The law is the law.  If you don’t like it, vote to change it.  But ignore it simply because it’s inconvenient and you should be punished.

Furthermore, by doing what you do, you are stealing from good and hard working men & women who are trying to make a living providing you the entertainment you desire.  If you are unwilling to pay for your media then what will allow them to keep making that media. You claim it is “the system” that is at fault, and yes, there should be better services out there, and there will be, but because there isn’t does not entitle you to hurt the people who work to make this material.  I do hope when your next book comes out that you will not object if google offers it for free and amazon places it on the kindle without compensating you.

Frankly, I think you owe a public apology to the thousands of artists and craftsman from whom you have invited your readers to steal.

Sincerely,

Noah