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Why Trump Won't Do Anything About AT&T's H-1B Abuse
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Last year, AT&T got a $3 billion dollar tax break from the GOP’s “Tax Cuts and Jobs Act” giveaway to the rich.

During its push for the tax cut, the telecommunications giant promised it would create thousands of new middle class jobs. One thing they left out: not for Americans.

An excellent investigation conducted by Axios revealed that since the law passed, AT&T has teamed up with Indian outsourcing firms to replace thousands of its employees with H-1Bs. To add insult to injury, 90% of these laid off workers are being forced to personally train their replacements.

Insight into this decision making process can be seen by a public list of demands from the Jew Paul Singer’s hedge fund, Elliot Management, from last October. In it, Singer’s Jewish speculation network, which owns a large stake in AT&T, orders the company to use its big profits to boost stock buybacks, expand its corporate board, and “enhance operational efficiency” – code for laying workers off and replacing them with white collar immigrants. The GOP tax cut bill has further encouraged other forms of parasitism and abuse by incentivizing outsourcing.

The Republican party and Trump have played dead during this scandalous process, even though Trump famously campaigned alongside American tech workers victimized by rapacious capitalism and abuses of the H-1B immigration racket. Singer is one of the GOP’s top donors, and has also given millions to Trump after he won in 2016. This is bribery to get politicians to look away.

Trump’s new tune on H-1Bs is that America needs “smart people,” even as plenty of smart American workers are laid off by the thousands and wages in STEM jobs have continued to stagnate. His claim during his atrocious interview with Laura Ingraham is that foreign companies are dying to open up shop in America, but “can’t” find workers. Are tech jobs yet another sector full of work “Americans don’t want to do”?

From a purely market liberal point of view, Trump has a point. Wages must be watered down in the US if the country hopes to attract foreign capitalists and the easiest way to do that is via immigration. The problem with that is the increased investment provides no benefit to ordinary people if we are forced to become Bangladesh or Mexico in the process.

AT&T is using its tax-cuts like every other corporation has after Trump’s sole signature legislative achievement: stock buybacks, mergers, and paying middlemen to traffic immigrants to replace domestic workers. IBM and AT&T are now declaring that they are in a “multi-year strategic alliance.”

All the tax-cuts in the world will not compel AT&T to innovate. Most American technological advances are a product of government funded research and development, an idea borrowed from the Soviet and Third Reich planned economies to make up for the inefficient allocation of capital and human resources in our system. In 2018, the percentage of GDP allocated for R&D was the lowest since 1955.

China is coming close to matching the US dollar for dollar in the research and development field, with many of its companies owned and directed by the state anyway. Unsurprisingly the US is falling behind and this will inevitably get worse.

Instead of learning from the Chinese system, US plutocracy prefers to hand more money to AT&T, and indirectly the even worse vulture parasites at Elliot Management, so that they can surf the “record high” stock market index. Rather than seriously competing with state and worker-owned Chinese firms like Huawei, AT&T and the US government have been reduced to threatening and concern-trolling countries that choose to do business with the superior innovator.

America could win the global technology war with China simply by getting the state to harness and concentrate white genius and creativity. This has worked for the past 50 years. Instead, America’s tech workers have their wages cut and dignity trampled upon by greedy and useless CEOs and financiers.

After four years of GOP economic orthodoxy, it’s clear Trump has chosen to make the New York Stock Exchange Great Again. He’s proud of it too, just read his twitter.

(Republished from National Justice by permission of author or representative)
• Category: Economics, Ideology • Tags: Donald Trump, H-1B, Immigration, Wall Street 
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  1. anonymous[827] • Disclaimer says:

    Trump has fallen in line with the basics of American foreign and economic policy, shuffling off whatever revolutionary rhetoric and sentiments he indulged in previously. That the government is a tool of the wealthy isn’t a new thing; the Slave Power (old term) always gets it’s way. They have no liking for the average American and swear allegiance to the flag of money. Here and there the mass of people have gotten concessions but only when the system had gotten shaky in order to preempt anything more radical taking place. Now with technology things can be done that couldn’t be accomplished before. The H-1Bs and other imports can be squeezed more easily than local Americans so that’s one advantage. That they’d be importing incompatible cultures and people isn’t their concern. Did the Slave Power care that they were implanting an alien people into this land and ever ponder the long term consequences? Over a century and a half after the Civil War we’re still grappling with the problems caused by that.

  2. “Most American technological advances are a product of government funded research and development”

    Citation needed.

    • Replies: @Sean
    , @houston 1992
  3. Anonymous[878] • Disclaimer says:

    concentrate white genius and activity

    you mean concentrate ASHKENAZI genius and activity. Or HAN genius and activity.

    look at europe, their big industry is all fashion and design.

    the golden age of american business was built on the government sponsored activity of ASHKENAZI refugees working in government labs(teller, oppenheimer, von neumann etc), the present non-ASHKENAZ talent that fuels and staffs silicon valley is HAN.

    trolling aside America has to be a civnat country due to its mutt heritage. but civnat does not imply Jewish subservience. And civnat America does not imply civnat europe, europe should never be civnat.

    sadly civnatism requires socialism and americans are money obsessed refuse from europe who left their actual homelands because they wanted easy money(what american euphemistically call “opportunities”) or they were run out of europe for being social misfits. thus creating the money loving individualism that destroys any chance of authenti culture and places jews at the top of society because they are the best at money accumulation and by american the best at everything and worthy to rulr those not so good at wealth attainment.


    • Troll: Tusk
  4. A123 says:

    Trump is still fighting with China on trade. This is essential to create decent paying, blue collar jobs for U.S. Citizens.

    Until the China situation is stabilized, Trump cannot afford to pick a fight with India over H1B visa abuse. The risk of India and China teaming up is simply too great.

    The approval of USMCA and “Phase 1” with China should allow Trump to restrict or eliminate H1B and OPT visas during his 2nd term.

    PEACE 😇

  5. Exile says:

    This is some harsh reality that free marketeers and fellow travelers have to confront.

    Whatever the corruption and double-speak of a socialist system, there is still at least a nominal commitment to the public good. Capitalism treats private sector self-dealing and sharp practices as virtues and sees the public good as a by-product, not even a desired outcome.

    “Companies don’t exist to create jobs. Jobs are a by-product of profit-making.” This was a mantra in the Great Recession among the Milton Friedman set. It’s a half-truth that says more about the ethics of the speaker than the role of jobs and profit in a healthy human society.

    The only way capitalism can work somewhat as advertised in the brochure is if the helms of industry are manned by Ayn Rand’s noble knights rather than robber barons.

    The Davos set is notably lacking in the ancient virtues of noblesse oblige and there is no mechanism in place to select between the knights and barons. In a thousand competitions between an honorable competitor and an unscrupulous cheat, with weak external deterrence, who wins on a long timeline? Rand would have had us believe that white-knight trumps robber-baron, but our lying eyes say otherwise.

    At the very least, capitalism has to be subordinated to a strong, constant and correspondingly-complex external system of ethics and laws, with harsh penalties sufficient to deter sharp dealing even when billions of dollars are at stake.

    China works in part because it puts enough robber-barons and Madoff types to the wall “pour encourager les autres.”

    Capitalism becomes Leviathan when it’s allowed to self-police, or worse yet, when it becomes a cargo cult.

    All of this suggests that capitalism needs major reforms to become net-positive for our people. I’d suggest just for starters that:

    1. corporate “personhood” and limited liability entities in general need to be harshly constrained if not entirely banned;

    2. business needs to be scaled down across the board; and

    3. the distinction between “white collar” and “blue collar” crime needs to be erased by punishing “financial crimes” with penalties appropriate for the degree of social damage they cause, including the death penalty.

  6. @Exile

    Having written a couple of hundred words of blather regarding the “No True Whiteman” trope yesterday, it’s funny to be writing something that’s amenable to the same “No True Scotsman” critique today. Difference is, today the critique would be misplaced.

    I agree 100% on your views regarding the likelihood that corrupt practices ‘win’ under the system that we have in the West.

    I disagree that this is due to the ‘free market’ aspect of the system.

    It’s entirely due to government intervention in, and distortion of, markets – which favours (and subsidises) size, not efficiency.

    The reason it favours size is in turn due to a bunch of factors, none of which can possibly ‘bite’ in a genuinely free market. Corruption; rent-seeking; lobbying; regulatory capture… to the political class, these are features of the system, not bugs: they are the mechanism by which a 115-IQ sociopath can enrich himself (most politicians aren’t smart, and they retire vastly wealthier than can be explained by their salaries and savings rates).

    Free markets – genuinely free, unfettered markets – favour efficiency. There is nobody to bribe; nobody can make a law prohibiting people from copying your process; nobody can be bribed to make your profession be subject to licensure (i.e., high-end unionisation – lawyers, doctors, dentists etc)

    If there is no Big Brother doling out vast amounts of money with huge embedded profit margins, or tilting the playing field in some oligarch’s favour, then the only way to become rich is by producing things that people are willing to buy, at a price that enables them to include it in their budgets AND reward your risk-tolerance.


    The Davos set is the problem, but they are not to blame: they are doing precisely what a rational individual would do given the opportunity – use all means at their disposal to achieve their objectives, preferably at the least cost of doing so. And if it is possible to change the ‘playing conditions’ in your favour, do so.

    Their objective is to become rich – fair enough. It’s not my objective, but we are all wired differently. There is nothing inherently wrong with being wealthy: where it goes awry is when the wealthy individual exploits the corruption of the political class.

    Easily the lowest-cost mechanism to help achieve their objective is to get the political class to reduce the extent to which they (the Davos set) have to face the cold merciless rigour of the free market.

    So they bribe (influence) the political class to divert large wodges of tax revenue towards them, and/or use regulation, licensure and other mechanisms to grant them monopoly-power (which cannot exist in a competitive market with free entry/exit, unless the minimum efficient scale is 1 firm, which it never is).

    Effectively, they get governments to force us to pay protection money, which then gets given to the ‘capitalist’ class.

    I think it was Roderick Long who coined the term ‘zaxelbax‘ to describe the illogical notion that most people have in their heads when they use the word ‘capitalist’ to mean both free-market economies, and the system that we currently have.

    (And to further cloud the issue: I am certain – 100% absolutely certain – that the long-run outcome for humanity is one of absolute material abundance, zero prices, work as a ‘prime want’ and zero stratification.

    In that I agree with Marx regarding what the aim ought to be… it’s clear to me that he fucked up royally on the optimal transitional dynamics – which shouldn’t surprise anyone since he was an innumerate charlatan.

    Turns out that the optimal transitional dynamics is mixed-economy until roughly a 19th-century level of technology, and thereafter voluntaryism – the latter would’ve been inappropriate prior to the Industrial Revolution, because of high costs of innovation and information-transmission.

    • Replies: @MarkinLA
  7. @Exile

    One of the most economically viable reforms is profit sharing. It’s absurd the multiples of income a CEQ earns. Share the wealth is the reverse of record income and wealth disparity we see today, and the source of much of the social issues we face.

  8. Sean says:
    @Magic Dirt Resident

    Gen. Robert Spalding can explain this to you, the link goes straight to the relevant part of the interview

    There is a great explanation to the background in a programme on this which the economic system in place by the 50’s is explained by J.K. Galbraith as the corporation being made resistant to shareholder input. As alway seems to happen in these cases it was maybe overdone, and then when Reagan loosened the rules on takeovers and unleashed the corporate raiders the pendulum swung back to the opposite extreme. The current American free market forces CEOs to endlessly maximise immediate shareholder value by outsourcing, replacement of indigenous workers with foreign drones, and not spending (wasting) money on R&D, except perhaps to hand over the inventions through forced technology transfers in return for access to the Chinese market.

    “I know why I was targeted,” Bush said. “We had a flat stock for over three years. And Athena was a steal. It’s a great business to own.” An activist could look at it and see, “R&D and marketing spend going up but the stock isn’t,” he said.

    The way he took down technology entrepreneur, Jonathan Bush and others led to Bloomberg dubbing Singer ‘The World’s Most Feared Investor’. Singer buys into companies where he sees the management as as failing to deliver maximum value to the shareholders, then applies pressure to raise the share price (in Bush’s case extremely personal pressure) that often leads to the departure of the CEO and sale of the company. That immediate extra value for the shareholder Singer creates puts working people out a job. Because of Singer and his imitators, CEO’s are outsourcing and importing replacements for indigenous workers in those services that cannot be outsourced, while being loath to foster innovation that could bring about long term growth, because that would interfere with squeezing out more and more shareholder value. Bush also said “there are half as many stocks on the Nasdaq today as there were when I took Athena public ten years ago… it’s an unfortunate dynamic for investors because when companies aren’t publicly traded, “only wealthy private-equity type players get to have these returns.”

    Most readers associate evolution with Darwinian natural selection, but Wagner points out its limited creative capacity. In natural selection, a better adapted organism produces more offspring. This preserves good traits and discards bad ones until it reaches a peak of fitness. This process works perfectly in an “adaptive landscape” with a single peak, but it fails when there are many—and higher—peaks. Conquering the highest—true creativity—requires descending into a valley and trying again. Natural selection never chooses the worse over the better, so it can’t descend. …. The human parallel with natural selection is laissez faire competition, which is efficient but equally intolerant of trial and error.

    Or R&D it seems.

    • Replies: @Anonymous
  9. Trump is pushing for the mass legal immigration invasion of millions of foreigners.

    Trump is pushing the H-1B visa scam and Trump wants to staple a green card to the diplomas of millions of foreigners who have been allowed to invade the USA on student visas.

    Trump says he wants to flood the USA with mass legal immigration “in the largest numbers ever.”

    Trump is using the H-1B visa scam to attack American workers.

    Trump has crawled into bed with the Republican Party CHEAP LABOR FACTION.

    Trump is using mass legal immigration and mass illegal immigration and guest worker visa foreigners and green card foreigners and other foreigners to attack and undercut the wages of American workers.

    Trump and the rancid Republican Party will do everything in their power to replace and displace American workers in low skilled and high skilled occupations.

    Trump and the rancid Republican Party are attacking young White Core Americans by flooding tens of millions of foreigners into the USA.

    Trump and the rancid Republican Party push mass legal immigration and mass illegal immigration and amnesty for illegal alien invaders.

    Mass legal immigration and mass illegal immigration lowers wages, increases housing costs, swamps schools, overwhelms hospitals, increases income inequality, harms the environment, causes urban and suburban sprawl, destroys habitat for wildlife, brings crime and infectious diseases to the USA, destroys cultural cohesion and national sovereignty and brings Islamic terrorism to the USA.

    The H-1B Visa Scam is used by greedy, money-grubbing cheap labor hogs to replace and displace American workers.

    Trump Tweet Pushing The H-1B Visa Scam:

  10. I wrote this in January of 2019 about Trump pushing the H-1B visa scam and mass legal immigration:

    President Trump is a BACKSTABBING shyster politician who pushes mass legal immigration.

    The H-1B visa scam is used by money-grubbing rats to undercut the wages and benefits of native-born American workers.

    The H-1B visa scam is used by money-grubbing cheap labor hogs to displace and replace native-born American workers.

    President Trump has abandoned native-born American workers by putting the interests of foreigners ahead of the interests of American citizens.

    President Trump wants to massively increase the guest worker visa scam and the foreigner visa worker scam and every other cheap labor politician trick that undercuts and attacks native-born American workers.

    President Trump has stabbed his voter base in the back by crawling into bed with foreigners and plutocrat shysters such as Shelly Adelson and Mark Zuckerberg and Jeff Bezos.

    The Pewitt Immigration Plan Is Patriotic And It Puts The Interests of American Citizens Ahead Of The Interests Of Foreigners:



  11. • Replies: @Paul C.
  12. Anonymous[238] • Disclaimer says:

    Singer buys into companies where he sees the management as as failing to deliver maximum value to the shareholders, then applies pressure to raise the share price (in Bush’s case extremely personal pressure) that often leads to the departure of the CEO and sale of the company.

    What’s interesting is how this sort of “activist” investing is similar to Jewish “activism” in politics and other arenas. It’s also similar to the tactics that racketeers and organized crime, which Jews used to be heavily involved in, employ to take over organizations or strip them of assets for illicit profits. Singer’s tactics are similar to what you find in Saul Alinsky’s Rules for Radicals. It’s easy to imagine how someone like Singer, had he been born several generations earlier in a time when high finance and corporate America were mainly exclusive clubs for elite WASPs, might have ended up as a labor organizer/racketeer or political activist employing similar tactics and exhibiting similar behavior.

    You’ve often argued that Jewish success can be attributed exclusively to higher intelligence and some sort of unique ability to intuit what people want to see, like Hollywood films and pornography. But it’s clear that there’s more to it than that, namely that Jews in general seem to be less inhibited about engaging in certain behaviors and exploiting certain aspects of human nature. Most people understand at a conscious, intellectual level that low brow Hollywood fare and pornography are enticing, and that aggressive gangsterish “activist” tactics and ruthless cost cutting and firing of people can be profitable. But most people also regard peddling such fare or engaging in such activity as being shameful or dishonorable and feel guilty about it. What seems to distinguish Jews are fewer inhibitions and greater willingness to engage in certain behaviors.

    Why this difference exists seems to be best explained by the long diaspora history of horizontal migration among different host populations. Frequent migration tends to cultivate greater virulence, since the migrant group and the specific host group don’t share the same fate. The migrant group tends to come to regard specific hosts as temporary resources that can be exploited.

    “According to evolutionary medicine, optimal virulence increases with horizontal transmission (between non-relatives) and decreases with vertical transmission (from parent to child). This is because the fitness of the host is bound to the fitness in vertical transmission but is not so bound in horizontal transmission. “

    • Replies: @Sean
  13. Mark Hunter says: • Website

    “Most American technological advances are a product of government funded research and development, an idea borrowed from the Soviet and Third Reich planned economies to make up for the inefficient allocation of capital and human resources in our system.

    The last part is completely false, not a scintilla of truth in it.  Sure, if you steal from Peter and give to Paul – so Peter has less resources with which to work and Paul has more – you might eventually point to Paul’s concrete, existing, inventions and crow about how productive government grants are;  while opponents of government grants have the broken dreams of Paul to point to, only it takes some mental effort to see what is not concrete.

    Some examples of  “efficient allocation of capital and human resources”  not due to, or in spite of, government:

    Thomas Edison – the high voltage electric power distribution system (Tesla only refined it by upping the voltage, taking the risk of using dangerous AC instead of comparatively safe DC, but the idea that you can efficiently send power over long distances by using high voltage, low current, was Edison’s),  the phonograph,  many other inventions.

    Edwin Armstrong – improvement to the AM radio receiver (superheterodyne circuit),  invented the FM transmitter and receiver.  (Sarnoff’s RCA tried to steal FM. Armstrong’s widow eventually won in court after he killed himself, ultimately from the stress of the legal battle.)

    Philo Farnswarth – inventor of the first practical television and other inventions.  (Again Sarnoff’s RCA tried to steal his work on TV.)

    Bell Labs – the transistor,  Hamming’s self-correcting code,  many others.

    Etc. etc.  You could go on and on.

  14. Sean says:

    Lapouge’s characterisation of the Jew was ‘arrogant in success, servile in calamity, cunning, a swindler, a great a masser of money, of high intellectual qualities and yet unable to create. He is by nature incapable of productive work. He is a courtier, a speculator; he is not a worker an agriculturist … A predator, nothing but a predator’. Nevertheless, I would not be so one sided as to say that an economy can do without predatory businessman feeding on lame ducks in the same way that a ecological network needs something like carnivores to stay in equilibrium.

    Living in a Landscape of Fear: How Predators Impact an Ecosystem
    In the fifteen years since wolves returned, the deer had been behaving differently—more wary, not standing in one place, eating all the shrubs down to nothing. After the first three years I seldom saw deer browsing in the meadow, and then only for brief periods. And after a decade the meadow was nearly gone, with shrubs and young aspens filling in what used to be open grass.

    Which is great if you want meadows and scrawny deer whose priority is avoiding danger from wolves. The thing is that China is not doing things the same way as America and the West, which have basically followed the UK. Professor Simms book asserts that Hitler was not motivated by antipathy to the Soviet Union. It was loathing for the international finance capitalism of “Anglo-America”, which he saw as Jews mounted on a workhorse of the best German (migrant) blood, that Hitler saw as the enemy. That system won WW2, and the Cold War, but the free enterprise of the late 30s to the 80s was not the hypercapitalism of today, which is all natural selection / laissez faire.

    The economy of China has much more of what in Wagner’s terms is genetic drift and ability to go down into the valleys to reach new fitness peaks in its economic mix than the West especially the UK which is so far down the road of hypercapitalism already it’s as heavily dependent on banking as Singapore. As a result Britain has to turn to China when it wants a nuclear power station built and

    THE United States is trying to persuade Britain not to use Huawei’s equipment over what Washington says are security risks. “Senior U.S. officials told a group of reporters that using Huawei technology for 5G in the UK would be ‘an act of madness’

    The Chinese are less creative for being racially and culturally homogenous I am sure, but going by 5G, the US system is not going to win the next war with characters like Singer influencing the economy to the extent he currently does. As Gen. Robert Spalding points out in the part of the interview with Bass I linked to, Bell Labs was funded by the government.

    • Replies: @Anonymous
  15. Paul C. says:
    @Charles Pewitt

    I’m glad Laura Ingraham challenged him. I don’t watch “the news”. This is a response to your other posts as well. The US (and world) is firmly controlled by the Central Bankers. They control the government and media. You can forget Republican/ Democrat, don’t waste your time.

    The Central Bankers are satanic and anti-Christ. They’re anti-humanity and especially hate white Christians who they’re actively dispossessing. The problem is that most of us are unaware of who our enemy is. With a slight awakening occurring, they counter with anti-semitism and anti-zionism laws, curtailing free speech and the discussion of those who are committing treason and heinous crimes against humanity. This is the game. Trump is a puppet like all the rest. He’ll give you 10% red meat to gnaw on while stabbing you in the back the other 90%. The propaganda machine (media) does its best to hide this through all the drama and bread and circus. Unfortunately most do not have discernment so they continue on the treadmill of left vs right.

    • Replies: @Charles Pewitt
  16. @Paul C.

    I’m glad Laura Ingraham challenged him. I don’t watch “the news”. This is a response to your other posts as well. The US (and world) is firmly controlled by the Central Bankers. They control the government and media. You can forget Republican/ Democrat, don’t waste your time.

    The globalized central banker shysters are the puppets of the various ruling classes in the world.

    You could say that the globalized central banker shysters are one and the same with the various ruling classes in the world.

    The JEW/WASP ruling class of the American Empire has crawled into bed with the Chinese Communist Party. The Bank of China is pulling the same kind of monetary extremism that the privately-controlled Federal Reserve Bank is doing. The globally coordinated monetary extremism of the globalized central banker shysters is the only thing holding the global asset bubbles together.

    The Fed tried to normalize the federal funds rate, but they couldn’t push it past 3 percent before all Hell was going to break loose. The normal federal funds rate is 6 percent and Yellen was talking about 4 percent being the new normal federal funds rate, but the central banker shysters couldn’t get it past 3 percent.

    The Fed was contracting the Fed’s balance sheet but they stopped that and are now expanding the balance sheet. The Fed is flooding the repo market with liquidity to keep the asset bubbles fat.

    Beppe Grillo used to go to basketball arenas to tell thousands of people how central banking worked and Andrew Jackson explained central banking to the voters of his day, so it can be done, but the politicians are all bought and paid for whores of the ruling class.

    Debt and Demography

    Monetary Extremism and Mass Immigration

  17. MarkinLA says:

    Free markets – genuinely free, unfettered markets – favour efficiency. There is nobody to bribe; nobody can make a law prohibiting people from copying your process; nobody can be bribed to make your profession be subject to licensure (i.e., high-end unionisation – lawyers, doctors, dentists etc)

    Then why waste the tremendous amount of money required for truely innivative R&D when somebody can simply copy it for free? The more efficient way to do business is simply copy and reverse engineer everything.

    There is no way in the modern world to have a free market like you describe. Once you need hundreds of millions of dollars for R&D you need patents. Once you have patents, you have to have a mechanism to protect them. Once that is in place people start getting creative at using them in unintended ways to put barriers in place of competitors. For example, I saw once that Apple applied for a patent on a foldable Iphone, even though one is not on sale. The whole patent seemed to revolve around how the components were laid out. You wonder how this nothingness could be patented, but a patents was granted. Apple will defend their patent on anybody making a foldable phone even if does not copy their design.

    • Replies: @Kratoklastes
  18. @MarkinLA

    All you’re doing is parrotting monopoly talking points. And you veer into breathless naïveté when you claim

    Once that is in place people start getting creative at using them in unintended ways to put barriers in place of competitors.

    ‘Unintended’? Really?

    If that is to be taken at face value (i.e., you weren’t just bullshitting) you mustn’t have any idea how copyright and patent law came to exist in the first place.

    The entire purpose of patents is to give excess returns to capital for the life of the patent. They do not exist in order to guarantee a normal risk-adjusted rate of return on capital: they exist to permit monopolistic rates of return. The way you can tell: they’re associated with government.

    So for the term of the patent, consumers get dudded two ways: first, they pay a significant monopoly premium to patent-holders (leaving less consumer budget to spend on all other things[1]); second, the rate of progress is stunted by the inability of others to advance the technology that is subject to the patent.

    Having monopoly profits as a result of patents, gives patent-holders a fund to stymie potential competitors by using litigation to raise the costs of innovation. That slows progress.

    Watt’s behaviour after being granted his patent for his steam engine is a case in point: he spunked away vast amounts on patent-enforcement lawsuits, knowing that this type of behaviour would serve as a disincentive to anybody to enter the market.

    So there was very very little development during the life of the patent – and an absolute explosion of development in the decade after it expired.

    And the reason he was able to waste vast amounts of money on legal fees… was that he was earning significantly above normal returns on capital. His patent was what enabled that: the expenditure on patent-protection did nothing to advance humanity or technology.

    The patent period was a setback, and delayed the Industrial Revolution by almost an entire human generation.

    There have been patents in some form or another from the middle of the 1st millennium BCE, but they were piecemeal. More to the point, it was all unenforceable across national boundaries until well into the 20th century; even today, getting international IP protection is hugely expensive.


    Add up everything you’re ignoring: the vast amounts of money spent on lawyers to defend patents; the technological innovation foregone as a result of excessive patent life; the use of patent-pre-emption (buying a patent for a thing that competes with your product, then refusing to produce it until your product becomes generic); the consumer surplus lost because patented products have embedded monopoly profits…

    It’s just a variant of the Broken Window fallacy.


    That’s not to say that removing all IP monopoly grants would result in an unchanged technology landscape.

    Without the possibility of patent protection there would certainly be some projects that would no longer pass a benefit-cost hurdle at a given point in time; that would mean that the project could not proceed until there was some change to the cost structure.

    It doesn’t mean it would never happen: “zero output” is the big ‘booga booga’ that is used as a talking point. Those who favour public expenditure on their infatuations – healthcare, education – always claim that without public expenditure there would be zero production (to your credit you didn’t say that: you simply implied that technological progress would be slower – which itself is genuinely unknowable a priori).

    Think of all the things you use every day that are not patent-protected: for example, the core of the internet (Apache; PHP; Python; HTML; CSS; JavaScript; SQL variants; TCP/IP; TLS/SSL; Linux [the main web server OS]). The core of the code world – LISP; Haskell; C++; Python (again); Java (not for much longer). Core frameworks like TensorFlow; Keras; Theano; SageMath.

    Think of all the tools that developers use to stitch that shit together in an orgy of creativity unrivalled since the Renaissance.

    Now compare that to the shitberg that is Microsoft: IIS (insecure shitberg); Windows Server 2012 (insecure shitberg); Visual Studio (shitberg); Office (insecure shitberg); VBA (gack just kill me now). Patents out the fucking wazoo, but haven’t done anything innovative since Windows 7 (which was mostly correcting fuckups from XP).

    Or Apple… patents out the ass, but all they make is monotasking low-spec insecure shitware that rimless-glasses wannabes will queue for half a day to obtain. They are to technology, what CSS is to computer programming: they are the ‘rounded corners and glass buttons‘ of hardware.

    inb4 iPhone. The idea that the smartphone wouldn’t exist without Apple is fucking retarded – like suggesting that routers wouldn’t exist except for Cisco, or that spreadsheets wouldn’t exist but for Microsoft.


    Patents are like university tenure, affirmative action and all other forms of preferment: those who deserve it don’t need it, and those who need it don’t deserve it.

    [1] The existence of monopoly rents means monopoly profit components in consumer prices, and deadweight losses. Those deadweight losses represent value not spent on ‘everything else’, which lowers returns to capital everywhere else, and reduces the level of investment and technological progress. There is no society-wide free lunch from patents: there is only monopoly-enrichment of the favoured.

  19. Anonymous[189] • Disclaimer says:

    But when we start introducing biological and ecological analogies to economic and business phenomena, the question of what exactly is the appropriate analogy arises. I’m sure Sir Goldsmith liked to conceive of himself, or at least portray himself to others as being like a noble predator, a lion picking off the weak gazelles that needed culling, but why should this necessarily be the right analogy? Perhaps that should be reserved for something like if Goldsmith had used to his access to enormous amounts of capital to build a better company with better methods or technology that then went on to devour the older sclerotic companies in the marketplace. But of course that’s not what he and his ilk did. Rather he exploited finance’s position as a lifeblood for companies to infiltrate and then devour them from within. That sort of behavior would be more analogous to pathogenic disease or parasitism than carnivory. In parasitic castration, the parasite diverts host resources away from reproduction towards the benefit of the parasite, analogous to private equity methods that divert a host company’s assets away from reproducing the enterprise and stripping them to pay the private equity firm:

    A parasite that ends the reproductive life of its host theoretically liberates a significant fraction of the host’s resources, which can now be used to benefit the parasite. Lafferty points out that the fraction of intact host energy spent on reproduction includes not just gonads and gametes but also secondary sexual characteristics, mate-seeking behavior, competition, and care for offspring.

    • Replies: @Sean
  20. Sean says:

    ‘Britain’s first self made billionaire’ Goldsmith (whose mother was of French peasant stock by the way) did other things than make money, he spent scores of millions on the Referendum party in the late 90’s and he can be called a grandfather of Brexit as much as Enoch Powell. I suppose that was the ‘genetic drift’ part of Sir James’s activities.

    Adilson Motter has some interesting ideas about exterminating certain species to save the whole system, and while I think it is an exotic you have in mind

    IN the long run, I think we will have people in the field advocating for the suppression of native species.” He points out that land managers are already doing so, less systematically, by running regulated hunting of prey species in areas where top predators have been extirpated. Human impacts are just too great on most ecosystems, he says, for us to just hope they will sort themselves out. “In the presence of perturbations, it is reasonable to consider compensatory perturbations,” he says.

    As the post correctly focuses on, the context of Trump’s decision is a competition with China. America won the Cold War with the USSR economically. Post WW2 the Soviets probably always were capable of steamrolling Nato conventionally, and both having the nuclear weapons made first use the threat of an incredible action that was not a credible deterrent. Yet the Kremlin knew it could not win the conflict fought across the globe against the world’s most powerful economy that would have inevitably followed a military conquest of Western Europe. Hence economic strength is the ultimate deterrent.

    Everyone understood by the 50’s that Marxism did not work and in a country like Russia that had been backward for half a millennium and still lacked a trans Siberian all weather road, America could more or less coast. The paternalist corporate structure of America did not matter too much, and at the high water mark of the Soviet Union Carter issued an order that all officials were to facilitate trade with China, the idea bring to use it as a counterweight to the USSR. But the policy was kept going so that the big players in the new hyper capitalism that emerged could make money. It has now become evident that China was a bloody great cuckoo chick coming back to be fed for weeks after it left the nest.

    The parasite finally rejected, the race with it is on, and if America loses the shadow war (for wealth) there will only be kinetic means left. Thucydides wrote: “It was the rise of Athens and the fear that this instilled in Sparta that made war inevitable. The profitability of major US companies is therefore crucial for the avoidance of a shooting war, and I am afraid if replacing Americans with Indians is the way to make the US outperform China, then that is what will have to be done.

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