The WasteWatcher: The Staff Blog of Citizens Against Government Waste

New CAGW Report on Intellectual Property

The WasteWatcher is the staff blog of Citizens Against Government Waste (CAGW) and the Council for Citizens Against Government Waste (CCAGW). For questions, contact blog@cagw.org.


On November 17, 2014, Citizens Against Government Waste (CAGW) will release its latest report, “Intellectual Property: Making It Personal.”  Co-authored by CAGW President Tom Schatz and Director of Technology and Telecommunications Policy Deborah Collier, the report describes the positive effects of intellectual property (IP) for individuals, companies, and the U.S. economy, as well as the negative consequences of IP theft.

There are several examples of how artists, designers, filmmakers, and producers have been impacted when their work is stolen, which adds a personal touch to IP.  In addition, the report discusses innovative methods of licensing patents that can help monetize the $1 trillion value of active patents.

As a result of the foresight of the Founding Fathers when they promoted and protected IP in Article 1, Section 8 of the Constitution, creators of IP in the U.S. enjoy opportunities to be rewarded for their work that are unavailable in other parts of the world.

The report includes the following:

According to the Global Intellectual Property Center (GIPC), in 2012 IP was responsible for more than 55 million jobs across the country, including California (7.3 million jobs), Texas (4.6 million jobs), Illinois (2.8 million jobs), New York (2.7 million jobs), Ohio (2.6 million jobs), Pennsylvania (2.5 million jobs), and Florida (2 million jobs).

In a comparative study on the value of IP, economists Kevin A. Hassett and Robert J. Shapiro estimated that “innovation in its various forms accounts for 30-40 percent of the gains in productivity by the American economy during the 20th century.”  The study further found that the value of IP in the U.S. was between $5 trillion and $5.5 trillion in 2005.  By comparison, in 2010 that value had increased to between $8.1 trillion and $9.2 trillion, or the equivalent of 55-72.5 percent of U.S. GDP.

Every time something is designed, created, manufactured and sold in the United States and globally, it has an intrinsic IP value.  When that item has a patent, trademark or copyright and is copied or remanufactured without the permission of the inventor, creator, or artist, it is stolen.  While most people don’t think about the illegal knockoffs they buy online or on the street corner as stolen goods, these items are not innocuous.

The broad impact of IP theft was described by U.S. Immigration and Customs Enforcement (ICE) Assistant Secretary John Morton, who said it “robs people of their innovation, jobs and tax revenue that funds vital government services. … IP theft is a crime organized criminals engage in, turning their profits toward other criminal activities, and IP theft creates safety risks for everyone due to the proliferation of substandard goods, including counterfeit pharmaceuticals, aircraft parts or daily consumables like toothpaste.”

Since IP has such a substantial impact on economy, the importance of protecting IP rights both in the U.S. and abroad cannot be overemphasized.  The report covers piracy; pharmaceuticals; music and movies; trademarks; patents; and electronics, software and national security.  The purpose of the publication is to educate the public about the value and importance of IP, the impact on individuals and the economy from the theft of IP, and how IP helps innovation flourish and economies around the world thrive.

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