[Jimmy] I forgot the link in the original email. The article, by Laurence Lessig, is available here
From Jimmy O'Regan
"There is no doubt that piracy is an important problem--it's just not the only problem. Our leaders have lost this sense of balance. They have been seduced by a vision of culture that measures beauty in ticket sales.
[Sluggo] It's more than piracy. Our whole economic indicators are screwed up. Why is economic health measured in how much people spend rather than how much they save?
[Ben] That's some of that complicated ecominominomical stuff, ain't it? How do you expect reg'lar people to understand it? Besides, our politicians haven't told us to think about it, so it obviously ain't worth thinking about. You collitch-eddicated eggheads, I swear.
[Sluggo] This from somebody who teaches college-level courses? Whose Perl and sysadmin sandals I am not worthy to untie?
[Ben] And tie the shoelaces together to trip me, no doubt. I'm just saying that - unfortunately - a large segment of the US population has swallowed the "don't worry your pretty little head" myth, and this sucks. The ultimate responsibility of the individual citizen, in my mind, is to support their country by thinking and considering about the things that affect it - their own minds first of all. To me, the farmer from "Not Yours to Give" (short story from "The Life of Colonel David Crockett", Edward Sylvester Ellis) is the archetype of a good citizen and voter.
Ignorance of the average voter results in - well, the political system we've got.
[Sluggo] Another thing, pointed out in my favorite book Natural Capitalism (http://www.natcap.org, entire text online), is that environmental impact is ignored because doesn't appear on corporate balance sheets or tax forms, so the cost is treated as zero even though it's enormous. Trees are cut down because they're in the way, but is the $2 million benefit of a shopping center really more than the long-term benefit of oxygen, ecosystem nutrition, wood production, and carbon sequestering, none of which we can produce by artificial means? Same for polluting rivers, etc.
[Ben] Err, well - to the company receiving the $2M benefit, it certainly is. They're stealing the immeasurable benefit of the trees from the public at large, and putting the $2M into their own pockets; both the cost and the loss to them personally is minimal - and the public doesn't get to say anything about it. So, why wouldn't they steal it? There's no law against it - at least nothing enforcible.
[Sluggo] Another thing is measuring everything in terms of "sales". Many things are sold which might be better leased. (Again from Natural Capitalism . )
[Ben] It might be - the idea sounded good to me - but it doesn't seem to be working yet, at least not on a large scale. Essentially, you're talking about a method that's supposed to be more effective, in business terms, than the current sales-based system - but, and this is a big one, it presumes accounting that includes the cost of the natural resources. Which is not what's done now, and which is why the leasing arrangements of that type haven't sprung up all over the place and supplanted the current system. I'm a big fan of Lovins and Hawken (thanks to you), but the penetration of their ideas has been very, very slow. Dammit.
[Sluggo] These are both the same problem, of which you speak. "Externalizing" the environmental cost, as Hawken puts it. Externalizing it onto everybody, in fact, while the polluter laughs all the way to the bank. It's difficult to change the paradigm, but if we remember the goal we might have a chance. If we forget it or give up, we definitely won't.
[Ben] Agreed. Remembering it, talking about it, spreading the word so that others know and remember... sometimes, that's all you can do, and it seems like so frustratingly little... but it works, it really does. Enough voices raised in protest is what changes history.
[Sluggo] Many things have been accomplished in this world that seemed impossible. It only takes one person at the right place and right time: MLK, Gandhi, Rosa Parks, St Francis. None of them thought they were anyone special.
[Ben] Oh, I don't know. I think Gandhi knew it pretty well. But then, I don't see arrogance as a necessarily bad thing; arrogatio ("assumption of power/responsibility") can be the necessary factor in a situation.
[Sluggo] The more you speak up about this, the more people will realize "something ought to be done", and they'll pressure the politicians. I don't know how to put a dollar amount on pollution or habitat destruction, but the cost to restore it is a start.
[Ben] Or, perhaps, making people aware that they own these resources - forests, lakes, the air... "good stewardship" is a concept that goes deep in this culture, if it can only be coupled to these things via that sense of common ownership and kept at the forefront.
[Sluggo] If the mining companies in Montana had to pay the full cost of restoration up front, or Hanford's nuclear waste in my own backyard, maybe they'd think twice about doing their project at all. Especially if they could find no insurance company willing to write a bond for the amount. No more companies declaring bankrupcy and getting off scot-free. The cost would be passed on to the public, of course, and they would make their purchasing decisions accordingly. Maybe a PC would cost $100,000 for all the metal in it. Maybe that's not necessarily a bad thing. Organic farmers were laughed at for thirty years, but now there are organic supermarkets doing a very good business.
[Ben] I think - um, actually, I know - that there are environmentally-responsible ways to mine iron. A bit less profitable, certainly, but not a lot - and perhaps more profitable once the companies have financial incentive to apply brainpower to it (that's what NatCap says, and thought experiments that I can run in my head totally agree; the synergy of having the energy of nature available to you as you work can't help but improve your end results.) Reserving the top soil as you strip-mine, then creating a lake in the pit and a forest on the hill of the material you've dug up is not some huge project for people who are doing all that earth-moving in the first place - and they could harvest the resulting timber in the future (or sell the rights to another company who'd do it.) Tax breaks for creating a new oxygen source and providing a recreation area for the local community, water rights on the new lake (perhaps selling licensing for the marinas, buying up the surrounding property because the real estate in the area is going to go up due to the lake/forest)... there's millions of ways to make a profit out of the situation and serve the world. I don't buy the current insanity of "you have to rape the world to make a profit."
[Ben] (Mind you, Interface - the producers of that recyclable carpeting from Georgia cited at NatCap - is doing quite well. Unfortunately, they seem to be a minority phenomenon in the business world.)
[Sluggo] Instead of buying a heater, why not buy a "heating service" where the manufacturer provides you with warmth somehow (which probably means installing a heater in your home) and takes responsibility for maintaining it?
The ESB, Ireland's electricity company (erm... semi-state company) provides a hire purchase facility for electrical goods,
[Sluggo] What kinds of "electrical goods" are available?
Everything from blenders to washing machines, digital cameras to computers, TVs, heaters, etc. They don't have a wide range of brands, but those they do have are pretty reputable.
[Sluggo] And what is the lease rate compared to the purchase price?
Depends on the amount of repayments. Seems to be around 22.9% APR, and it seems they're not calling it 'hire purchase' anymore, it's an 'appliance loan' (administered by the Irish branch of the Bank of Scotland). Have a look for yourself: http://esb.ie/retailasp/esb_shops/product1.asp?cat=21&subcat=3&prodcode=6272840
[Sluggo] 22.9% interest? That's even worse than putting it on a credit card. The maximum credit cards can charge here is 18%. But if they're talking loans and APR, that's different than I was talking about. I was talking about something more like a subscription.
I don't have a credit card, so I can't say for sure, but I think that rate is roughly on par with credit card charges here. I did mention that it was hire purchase, I assumed you knew what that meant, though I will admit I was wrong to say "they're not calling it 'hire purchase' anymore", it quite simply is a loan.
[John] ISTR reading the fine print on one of the credit card offer mailings I received not too long ago, and noticed that the rate was somewhere around 22%, so I don't think that the 18% rate is universally applicable in the U.S. anymore either.
[Rick] Indeed, one of the reasons why most US credit card companies relocated to South Dakota just after 1980 is that that's when that state repealed its usury laws, removing the ceiling on interest rates. Read all about the appalling aftermath, here:
[Sluggo] It may have gone up.
Ironic they'd be raising rates when the prime rate has been at a historic low the past two years. Oh, but we have a Congress that tightened restrictions on bankrupcy filings for poor people while not affecting corporate bankrupcies. At least they're consistent.
[Ben] From Mark Morford's "Morning Fix": http://sfgate.com/cgi-bin/article.cgi?f=/gate/archive/2005/09/09/notes090905.DTL&nl=fix
Everyone is slamming poor Dubya. Everyone is saying, oh my God, he's more inept than we ever imagined, he has no idea what's really going on, he's oblivious and in denial and he pretty much let all those poor black people die in filth and misery, and he basically ignored the massive Katrina disaster for days before finally being pressured into cutting his umpteenth vacation short and actually taking action.
But it's so unfair, isn't it, to attack poor Dubya like this? Just a little misplaced? After all, Bush has always been the rich white man's president. He is the CEO president, the megacorporate businessman's friend, the thug of the religious right, a big reservoir-tipped condom for all energy magnates, protecting against the nasty STDs of humanitarianism and progress and social responsibility.
He has always been merely an entirely selective figurehead, out of touch and eternally dumbfounded, a hand puppet of the neoconservative machine built and fluffed up and carefully placed for the very specific job of protecting their interests, no matter what. Repeat: No. Matter. What. Flood hurricane disaster war social breakdown economic collapse? Doesn't matter. Corporate interests über alles, baby. Protect the core, reassure the base, screw everyone else unless it begins to affect the poll numbers and then finger-point, deflect, prevaricate. All of a piece, really. Because Bush, he was never actually meant to, you know, LEAD.
[Sluggo] Well, except his business interests and neoconservatism are two different things. His financial and oil interests (and Cheney's) are basically an old-boys' network that has stayed the same for decades. Neoconservatism's "bring democracy to the world" and "freedom is on the march" seem to have conveniently dovetailed with their interests. Bush also seems to have undergone a conversion to neoconservatism after 9/11. Before, he was focusing on domestic affairs (and removing foreign entanglements like meddlesome treaties). He even had a good idea, improving relations with Mexico and reforming the border situation.
It's amazing how much he sticks to this "no matter what". What drives me up the wall is when he blatantly says one thing and does something else. Everyone knows Iraq is so convenient for his oil interests, why doesn't he just say so? That doesn't negate other, better motivations he may have had. But pretending it's no factor stretches his credibility to the breaking point. Same for the prescription-drug benefit, so well tailored for the pharmacutical industry. 20% discount for seniors, how nice. Unless they raise prices more than 20%, then what have you gained? And each manufacturer-sponsored plan has a different set of drugs it discounts most. Good luck finding a plan that discounts all the ones you need. Or going through the paperwork if you're not as sharp as you used to be. And what if your doctor changes your medication? The company can change which drugs it discounts at any time -- but you can't change plans.
More than anything I want an apology from Bush, an acknowledgement of what he's doing. I want the people to hold him accountable and guarantee shenanigans like this won't happen with future presidents. I guess my idealism is as unshakeable as his corruption.
[Sluggo] The word 'hire' surprised me because we use it only for people, not things. So you hire a gardener but rent a lawnmower. Or you hire a taxi but rent a taxicab. (That is, assuming you wanted a taxicab.
[Sluggo] Maybe your really weird friends are getting married and want to drive it to their honeymoon.) You rent a video but hire a video production company.
Also the same.
[Sluggo] I understand in Europe you rent real estate but hire everything else. So I translated 'hire' to 'rent' and then to 'lease'. Leasing is the same as renting but with a long-term contract. So you rent a car by the day but lease it for six months. Or you lease an apartment for a year, then it becomes a month-to-month rental (and the landlord can raise the rent). With products you usually have the option to buy it for the remaining purchase price ("rent to own"), but the price is high. The kind of lease I'm talking about is basically a subscription. There may be a "rent to own" option but it would defeat the purpose if that was emphasized. I don't know what a 'hire purchase' is, but I guess you mean buying something with a financing plan, like a home mortgage.
Kinda. It's kind-of like a 'rent-to-own' scheme, except there are specific laws that apply. IIRC (and it's been 8 years since business studies class), once you've paid 2/3, it's considered yours, and they need to sue if you stop paying. Over 1/2, it's an iffy no-man's-land, less, it's considered rental only.
[Sluggo] 23% interest, ouch. Here the unscrupulous cards charge 18%, but the better cards are 6.9%. When I was in Russia in 1996, interest was 10% per month. And when the banks were closed for lunch, you changed money with the tough guy standing in front of the bank with a stack of $100 bills in his hand. Because nobody kept their savings in rubles, inflation was too high. But you had to buy things in rubles. I always went into the bank because it had a better exchange rate, but my Russian friend went to the guy in front of the bank to show that he was rich enough not to care about a few extra dollars. I always wondered how these money changers could do it every day without getting mugged, but I guess guys who wear dark sunglasses don't worry about things like that. And he was wearing dark sunglasses, as was my friend. When you go into a bank, a guard meets you at the door and asks what you want, then lets you in one at a time. I have no idea if it's still like that. My friends say, "You wouldn't recognize Moscow; there's been so much construction."
More stories. In 1998 he was living in Germany and I went to visit. One weekend he wanted to see a girl in Liege. I'd convinced him to be a cheapskate, so we made it from Duesseldorf to Liege and back for a ridiculously low $12 each. We had a weekend railpass and went to Aachen. It was $50 to Liege so I asked for the nearest stop in Belgium (Verviers) but that was still almost $50. (Oops, I pronounced it "Ver-VERSS". She corrected it "Fer-VYAY".) I asked if we can walk across the border and she said no. I asked why, is it illegal? She said you just can't, and pointed us to a local bus. The bus went to Eupen. I was expecting a passport check and a sharp differentiation, but it was just the outskirts of one small town merging into another small town on a narrow, windy, hilly road. Gradually the ordinary signs turned from German to French, but the luxury signs (cars and real estate) remained German. At the bushof there was a problem with our ticket. My French was minimal; my friend's was nonexistent. I asked, "Sprechen Sie Deutsch?" The driver said, "Seulement francais." So we were shouting at the neighboring driver to translate. "The driver said this ticket was good all the way to Liege. ---Who said that? ---The driver from Aachen." He said "Aachen!" dismissively, as in "Those Germans!", but stopped hassling us. At Verviers we transferred again to Liege. It was 8pm and there was a hotel across the street, but my friend said we'd find something better and we went into a bar. First I experienced the ATM. The smallest amount was 100 franks. I had no idea how much that was but the big number was scary. I finally assumed that if that was the smallest amount, it must be around $20. It turned out to be $33. We went into the bar. The bartender spoke only French. My French is just enough to order a beer, so we drew pictures on napkins for a conversation. He put on cowboy music to make us feel at home! I'm American but I don't like country music. My friend is Russian but he likes to pretend he's American so he gets treated better. So the bartender got us both wrong. I bet he never knew. My friend called the girl and found out she's working in Brussels now (oh no!) but she's in Liege this weekend visiting her parents (yes!). We arrange to meet the next day. I get more and more paranoid about finding a hotel that's not full, so at 11pm I force my friend out of the bar. We walk around looking for a place. Being a yank I assume there'll be motels everywhere. Not in Liege. We walk for three hours and don't see anything except a Holiday Inn (too expensive). Finally we come across an outdoor map and discover there's only three hotels/hostels in the city. So we return to the original hotel at 3am and check in. On the way we see a sign for a town called Huy. We took a picture of it because huy means penis in Russian. http://sluggo.kicks-ass.org/pix/199801_germany/199805-069-1.jpg.html
where the charge is added to your electricity bill (which is pretty convenient). IIRC, the oil company my parents get their oil from do the same thing with their furnaces, the "waste management" company provides the bins, etc.
[Sluggo] Or a printer with a guaranteed upgrade every year? Then the manufacturer would have an incentive to make it long-lasting and with recyclable parts, to cut down their expenses. If you buy an appliance and it falls apart or was a bad technological choice, it's your problem and the manufacturer can ignore it (and sell you a new one). But if you lease an appliance and it falls apart, it's their problem. I don't quite buy this leasing argument completely coz I don't see how to prevent price gouging; i.e., I've seen cars and computers leased for more than they would cost to buy, but I assume the right company could come up with an attractive lease.
That example is terrible, as it underlines exactly why people seek to sell things that could be leased, and I fail to see how leasing something could ever cost less than buying it outright.
[Sluggo] Some things you need only for a few months, others you use only occasionally. Those would be the easiest ones.
(I didn't realize your original message was from a Slashdot story about the public domain, which I came across later. Hence the change of subject.)
You have to assume a non-evil company that cares about their customers and the environment. Say Google or Magnatune decided to build air conditioners.
[Sluggo] A small unit costs $120. The initial working goal is a rate that equals the purchase price over the lifetime use of the product. $2/month is likely not profitable, but maybe $5 is. If the person only needs it for a few months and has a return-anytime lease, they're obviously ahead, and the company can redeploy the unit elsewhere. The person doesn't have to go to the trouble of selling or disposing it. But say the person keeps it more than two years, they'd lose. That's what happened in the 60s and 70s in the US with telephones, people leased them for ever and ended up paying several hundred dollars for them. But they got a new one free if it broke.
It was the same here, until recently. (After Eircom was privatised, I think).
[Sluggo] Say the company not agrees not only to replace a broken air conditioner for free, but to give you an upgrade to the latest model every two years. If you're the type who buys one air conditioner and runs it into the ground over twenty years until even duct tape won't hold it together, you won't be interested. But say you're the type who replaces stuff every two years anyway like some people do with cars, then you won't have a net loss even the third or fourth year. And you'll gain a bit by keeping the money you would have spent up front in a savings account.
Erm... if you're trying to encourage the mass adoption of this kind of system, I'd advise you not to use that as a benefit: I can see that translating as "you can't afford this anyway".
[Sluggo] Now say the new model uses half the electricity of the old one. Wow, your expenses go way down. No biggie if you would have bought a new one anyway, but a big gain if you wouldn't. Plus you don't have to get rid of that old air conditioner: convenience for you, and the fish will breathe easier without that toxic waste. The company knows it will get the unit back eventually, in two years maximum, so they have an incentive to make the parts long-lasting and reusable in their new designs. Their engineers certainly know how to do this better than you do. And if they were somehow paying for the energy cost too (e.g., if they were providing a "cooling service" rather than a product), they'd have an incentive to keep that down as well. So there are a lot of variables involved, which would make some products more attractive for leasing than others. A company that does this would obviously have a small niche at first, but if they had a superior service (we can't say "product") they might find it turning into a big niche as demand rose. The Starbucks factor. Now if the company designs this right (and otherwise they should not do it at all), their profit would be at least as high as selling said commodities (which would be crap quality), so the shareholders would be happy. Then they could start designing a second produt to lease....
Obviously there are problems, like if it's stolen or your house burns down and you have to pay for all the appliances. Or if the company is not as benign as it seems and gives you a WinPrinter for an upgrade. (But then you'll just tell them where they can stick their printer.) Or if they're price gouging for the toner. (But printer companies don't do that, do they?) But these can all be worked out for the right product with the right plan and some kind of insurance.
[Sluggo] A major part of the book talks about eliminating waste, which makes sense if you view it as nonperforming assets. He gives examples of companies and individuals cutting down waste by 50% in a year by redesigning their products/lifestyles, and it's a win-win situation. E.g., a change in manufacturing process eliminates production of a toxic byproduct; this reduces expenses. The new process creates another byproduct that can be fashioned into another product and sold, so profits go up. Things like that. Much is possible if you base your business plan on minimizing waste, which is really lost profits. On a personal level, adding energy efficiency to a house drives up the cost but only to a point. When you get to the point that you can eliminate a heater or air conditioner, suddenly expenses go way down. The purchase price is only 10% or less of the TCO of an appliance; 90% is the energy cost to run it over the years. Likewise, if you get a $100 raise or cut your expenses by $100, the net result is the same, but the latter is easier and under your control, whereas the former requires the cooperation of others.
[Jason] Actually, it's not the same. Because of taxes, you have to get a raise larger than $100 to put an extra $100 in your pocket, whereas if you save $100, that's $100 you have free and clear.
Heh. My raise was supposed to come through this week, but the idiots who do the payroll didn't have the manager around to hold their hands, so I only got paid the old rate (they should've been able to tell I should've been paid at a higher rate because I was paid a related bonus). But at least I got paid something, which is more than can be said for a few people. (Oh, and my raise is ~100 euros
[Sluggo] Better than my friend got. He was hired for a warehouse job at $10/hour but trusted them too much and didn't get the rate in writing. For several weeks he thought his paycheck was low but figured it was all the deductions. He couldn't check his past timesheets because they refused to give them to you. Finally he added it up and realized he was getting $8/hour. He called the payroll department (at some headquarters in a land far, far away) and they said everyone with that job was paid $8 and it couldn't be changed. Finally he forced his manager to remember he had agreed to $10 in the interview, which two other interviewers had witnesses. Then it was another several weeks to get the payroll department to adjust the rate. Then another several weeks of stalling to get his back pay, which I don't know if he ever did get before he quit. Then the manager threatened to hold his last check for.. I don't remember, not give notice probably, but that's highly illegal so he was able to talk them into giving him it pretty easily. Then he met a Labor and Industries rep who said he could look into the case, but he sent him the info and the guy said there wasn't enough evidence to make a case.
"They are apparently untroubled by a world where cultivating the past requires the permission of the past. They can't imagine that freedom could produce anything worthwhile at all.
The danger remains invisible to most, hidden by the zeal of a war on piracy. And that is how the public domain may die a quiet death, extinguished by self-righteous extremism, long before many even recognize it is gone."
[Sluggo] As many have pointed out, the public just doesn't see the public domain as valuable. I don't think this is as much about the piracy wars as the fact that the proponents of "intellectual property" have really managed to convince the public that it's the same as physical property. A lot of it may just be because of the word "property".
[Ben] The rich in this country, at least, have considered IP to be one of the best all-around investments for a long time. There are few or no production costs, there's nothing to wear out - and the yield, ceteris paribus, is damn near infinite if you own the thing. It's no wonder that they're fighting so hard to maintain the legal fable that allows it to exist in its present form.
I've always had a problem with the term "intellectual property". Does it mean "something you only think you can own"?