posted by David Adams on Mon 16th Aug 2004 17:44 UTC

"Section 9"
The established interests (software firms and their paid consultants) have been playing this sob story of how open source is putting them out of business and how it's a threat to the economy, insecure, more expensive, etc, etc. They've even been lobbying the government. It's the same old sob story we've heard over and over, and apparently there are plenty of people who will believe it.

I just hope that they're not successful in implementing any kind of artificial protections for themselves through lobbying, and I say this as a proponent of free trade. Protectionist tariffs and subsidies on domestic agriculture, raw materials, and manufactured goods are a constant temptation for a country that encounters competition from outside. Europe and the United States to this day continue to artificially prop-up domestic industry even as their governments preach the benefits of free trade and open markets. Who are the ones that want to open the markets? Ironically, it's sometimes the same folks who would call open source software proponents communists. The outcry over open source's negative effect on the economy is similar to the U.S. steel situation. The U.S. steel industry is having a hard time competing with imports from abroad, so they successfully lobby the government into slapping tariffs on foreign steel. That keeps steel prices artificially high, and subsequently the U.S. automobile and construction industries suffer. A few steel workers keep their jobs, a few auto workers lose theirs. I'm not familiar enough with the situation to know whether it was a net gain or loss for the country's economy, but the point is that you take away from one side, you give to another. That's the way things work.

Here's another example: Wal-mart has been bad news for small businesses all over the USA, and for their owners and employees. It's been bad for the downtown business districts, some of which have been decimated, while others have been merely forced to transform into restaurant and entertainment promenades. But in the larger picture, has it been bad for America? Well, ask the millions of rural Americans who now have access to socks for $2 per dozen and $35 DVD players. They'll say it's not so bad to have some economy of scale leveraging their purchasing power. (Disclaimer: personally, I hate Wal-Mart, and I love vibrant downtown business districts and small, quirky businesses.) But the point is this: just as we might decry the negative impact that foreign trade or big box stores might have one segment of the economy or society, the net result has been that these factors mean that a couple hundred million Americans can now buy a heck of a lot more for their money that they could twenty years ago.

In conclusion, the number of people who will be negatively affected by the availability of high quality, low cost software is relatively small. The software industry may need to transform, and some firms may not survive, but the overall impact on the economy will be positive. Just because the oil companies are enjoying increased profits due to higher gas prices does not mean that high oil prices is good for the economy. Quite the opposite.

We might have heard a similar story a couple hundred years ago, during the industrial revolution: "But millions of people are employed planting and harvesting, and the tractor will put them all out of business! And the cotton gin will put all those people picking the seeds out of cotton plants out of work! And mechanical looms will put all those weavers out of work! Oh the humanity!"

Every time there's a transformation in one segment of the economy, we hear the same outcry. And while it may be downright tragic for the affected parties, the rest of us can't get too caught up in the drama.

History is chock full of well-meaning people succeeding with their plans and inadvertently making life worse for many others. The early Communists thought they were fighting for freedom. Freedom is a good idea, but if you go about promoting it in the wrong way, you can end up making people less free. You may not notice what's happening until it's too late because ideology can blind you. Many people today who are fighting for intellectual property rules because they think it promotes innovation and progress may actually be actually hammering nails into innovation's coffin.

Table of contents
  1. "Section 1"
  2. "Section 2"
  3. "Section 3"
  4. "Section 4"
  5. "Section 5"
  6. "Section 6"
  7. "Section 7"
  8. "Section 8"
  9. "Section 9"
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