Pat Choate
In his 1990 book, Agents of Influence, economist and former vice presidential candidate Pat Choate argued that Japan successfully manipulated America's political system to its advantage. In his new book, Hot Property: The Stealing of Ideas in an Age of Globalization, Choate tackles another global issue, intellectual property, contending that America has never been more vulnerable.
Q: You paint a rather menacing picture of the theft of intellectual property. How did it get so bad?
A: It's a function of globalization. Inside the United States, people are well protected. Outside of America, countries use weak intellectual property laws as a means of facilitating the theft of advanced technologies. The United States did that. We stole technology from England, France, Europe, on a mass scale, 200-plus years ago. Germany did the same thing to England. Japan did the same thing to Europe and the United States in the mid-1950s. And China is following that same path.
The one thing that we have been better at than the rest of the world is innovation. We've had 4.5 percent of the world's population doing about 50 percent of its innovations. That's the place we're going to have to make it in the 21st century. So it's absolutely essential that we protect our property rights.
Q: What can be done?
A: We've got to crack down on the governments that host and in some cases collude with the pirate and counterfeit enterprises. We got all 148 members of the World Trade Organization to agree to establish a minimal set of standards. It's a powerful tool, but this administration will not use it. One, they say they want to use diplomacy. Two, they're depending on the Chinese for $200 billion plus a year to finance their federal budget deficit. And three, they want China to take the lead in dealing with Korea. The second thing is the federal government has an absolute responsibility to protect the secrets of inventors. Congress did something very foolish in 1999. It passed a provision called the 18-months rule, under which the U.S. Patent Office is obligated--18 months after a patent application has been filed--to make public all of the details. It now takes an average of 28 months to get a patent. So you've got a period in which all of your secrets as an inventor are up on the Internet, available to anyone.
Q: What advice would you give to companies eyeing the China market but worried about protecting their intellectual property?
A: Don't do it. If you need that cost advantage and you need those investment incentives, then take a look at India, Korea, and Taiwan. There are other places where the labor will not be as cheap but you can better protect your technology.
Q: What would you say to critics who might think you are scaremongering?
A: I start out by saying we did it. Japan did it. Germany did it. This is a natural thing. So defend yourselves. It's business.
This story appears in the June 20, 2005 print edition of U.S. News & World Report.
advertisement
