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Social Distance and the Patent System

This article is more than 10 years old.

One of the most compelling parts of Twilight of the Elites is the discussion of social distance. For example, Chris Hayes points out, Ben Bernanke spent the duration of the housing bubble denying that there was anything amiss in the subprime mortgage market. He might have been more perceptive if he'd had friends or neighbors who were personally participating in the subprime market. Conversely, it's hard to imagine the Fed taking such a blasé attitude toward the slow economic recovery if its board had members with roots in minority neighborhoods still suffering from double-digit unemployment. Theoretically, they see data indicating that so many millions are unemployed. But knowing that the unemployment rate is 8.2 percent is different from having a brother-in-law who can't find work.

I think a similar dynamic was at work in my May interview of Judge Paul Michel, until recently the top judge on the US Court of Appeals for the Federal Circuit, the appeals court in charge of patent cases. I pointed out to him that many computer programmers think they'd be better off without software patents and asked for his thoughts. I was not, of course, the first person to make this argument to him. Indeed, Michel has apparently heard it so often that he had a rather lengthy rant on the subject to share with me.

Nevertheless, it was clear from our conversation that Michel doesn't have a very deep understanding of the concerns of many in the software industry. And, more to the point, he clearly wasn't very interested in understanding those concerns better or addressing them. On a theoretical level, he knew that there was a lot of litigation in the software industry and that a lot of people were upset about it. But like Fed and the unemployment rate, this kind of theoretical knowledge doesn't always create a sense of urgency.

One has to imagine that if people close to Michel—say, a son who was trying to start a software company—were regularly getting hit by frivolous patent lawsuits, he would suddenly take the issue more seriously. But successful software entrepreneurs are a small fraction of the population, and most likely no judges of the Federal Circuit have close relationships with one. In contrast, every judge on the Federal Circuit knows numerous patent attorneys, so they're well-attuned to the concerns and strongly pro-patent worldview of the patent bar.

You can see exactly this bias at work in the work of noted legal theorist Richard Epstein. While Epstein has done a lot of great scholarship, his "maximalist" approach to copyright and patent issues tends to underestimate the economic frictions introduced by these legal regimes. But there's one exception: he has a clear understanding of the problems weakened fair use rights pose for documentary filmmakers. Why? Because his son is a documentary filmmaker who has experienced firsthand the difficulty of assembling the rights necessary to publish a documentary film.

This is a general and hard-to-solve problem, since senior public officials can only have so many friends and relatives, and they're going to prefer to form social bonds with people relatively similar to themselves. But it does underscore the importance of diversity in elite decision-making bodies. I've made the case for abolishing the Federal Circuit because a specialized court dominated by patent lawyers is going to produce worse, not better, patent law. More generally, affirmative action programs can be seen as a way of reducing the social distance between governing institutions and minority communities that tend to be under-represented in government.