Posts Tagged: "US Economy"

Innovation and entrepreneurship are central pillars of America’s economic strength and critical vehicles for job creation. Reporter John Schmid of the Milwaukee Journal Sentinel wrote an article that was published on Sunday, January 16, 2011, aptly depicting the problems facing would-be job creators. Schmid wrote in part of his article about a professor from the University of Wisconsin-Milwaukee who needed 11 years to obtain a patent on his revolutionary invention. How many jobs were lost as a result of unacceptably slow processing by the Patent Office?

According to Pascal Levensohn, Managing Partner of Levensohn Venture Partners, the problem with the US economy is the lack of Initial Public Offerings. He opines that without an increase in IPOs in the United States it will be difficult, if not impossible, to see the economic growth that we want. Without economic growth there will be no job creation, and the sluggish US economy will continue on its anemic path. He suggests that the best way to increase IPOs is to increase venture capital and make it more attractive. He writes that is our leaders really wanted to fix the job problem in America “there would be no higher legislative priority than promoting regulatory and tax reform to stimulate new capital formation and venture capital in the U.S.”

In 2011 expect Congress to take up patent reform again, expect it to go nowhere, and expect the anti-patent forces to continue to look to the Courts to do what they have been unable to achieve in Congress, which is the substantial weakening of patent rights. Truth, science and economics are on the side of a strong patent system that rewards innovators. Make it your New Years Resolution to talk to friends, family and business associated about the need for a better functioning Patent Office and meaningful patent rights that can support the creation of new companies and industries. The more we talk about it the better. We can’t call a press conference and get hundreds of media there like the ACLU can, so we need to excel at the ground game — a grassroots movement that isn’t afraid to say it like it is and point out the agenda of those who would prefer to harm innovation in America.

Just like in the story-line of Independence Day, where the alien death ships slowly but surely positioned themselves over each major city, with the eventual outcome well understood, so too is Intellectual Ventures (I.V.) slowly positioning itself as the patent overlord over many major industry segments. Just like in the movie, the eventual outcome is well understood. To wit: Complete usurpation of the U.S. Patent system. The outcome is a ,gigantic tax/toll collector controlling the pulse of innovation in the U.S. or, like the movie, extermination of innovation.

What we need to focus on are those that are taking from the patent system without returning anything to the patent system. Rather than call these groups patent trolls, I would much rather call them what they really are — innovation vampires. These innovation vampires grab hold of as many patents as they sink their teeth into a company and begin to suck the life right out by holding the company, and often times the entire industry, hostage. No tax policy could ever do as much damage to an economy. This massive redistribution of wealth without an iota of benefit to society must stop!

In the election yesterday the Republicans scored an enormous victory in the United States House of Representatives, gains of a still unknown number in the United States Senate, and gains in Governors’ races as well as State House and State Senate chambers across the country.  Earlier this afternoon, at 1:00 pm Eastern Time, President Barack Obama held a press conference…

Like it or not, the patent system is a great motivator, and used appropriately to incentivize the type of behavior we want to encourage it is a powerful tool in the government arsenal. To fundamentally alter what is considered patentable subject matter will not only negatively impact cutting edge biotechnology research, but it will also have a chilling effect. Uncertainty causes business paralysis and forces investors to the sidelines. The uncertainty that would be created by the curtailing of patentability would not be isolated to the biotechnology sector, and is exactly the opposite of what our economy presently needs.

Pundits I have heard talk about the economy suggest that there is anywhere from $1 trillion to $3 trillion sitting in business bank accounts just waiting for a signal. As that money starts to go online jobs will be created, the economy will look up and consumer confidence will start to rise, all of which are critical to signal a new economic re-invigoration. I sense that 2011 will be a better year than what most are predicting because I see signs that the economy is ready to explode, waiting for good news and reason to no longer fear the unknown.

Upon the expiration of the Bush tax cuts, among increases in the tax rate for all tax brackets, the dividends tax rate will increase. So even if Congress and the White House extend the Bush tax cuts for all but the top earning Americans, virtually all small business owners, regardless of their tax bracket, will see an increase in their effective tax rate as a result in the increased tax rate for dividends. Policies that make job creation more difficult and investment in innovation more unlikely are reckless, particularly at a time when our economy is so hurting. That is why the Bush tax cuts should be extended across the board at least temporarily.

Those who don’t believe innovation leads to job creation have their heads firmly implanted in the sand and simply must choose to ignore history, which proves otherwise. It is flat out irresponsible to suggest that speeding up the process at the USPTO would be anything other than one darn good idea, and practically essential to the resurgence of the US economy. The authors and the Wall Street Journal should be ashamed of themselves. We all should expect more from one of the Nation’s papers of record.

As explained by the Organisation for Economic Co-Operation and Development in a draft report draft report: “The overall degree to which products are being counterfeited and pirated is unknown and there do not appear to be any methodologies which could be employed to develop an acceptable overall estimate.” The OECD draft report goes on to explain that based on best estimates that international trade in counterfeit and pirated goods could well have accounted for up to US$ 200 billion in 2005, but that figure does not tell the entire story. This $200 billion figure does not include counterfeit and pirated products that are produced and consumed domestically, nor does it include the significant volume of pirated digital products distributed via the Internet.

For now we can be thankful that the U.S. enjoys dominance in an important and growing field like nanotechnology. Even though China does not receive high marks yet, it seems only a matter of time before the Chinese figure out what we in the United States, most in Western Europe and many in Asia have know for a very long time. Significant investment in technology and the creation of a business friendly climate lead to businesses locating, investors investing and high-paying technology jobs being created. Of course, there is also the national security angle to consider as well. So not only are we allowing other nations to catch up to us from a technology and business standpoint, we are allowing other countries to catch up to us from a military technology standpoint, which is concerning.

This past Sunday there was a brief but very interesting segment on Fox New Sunday that actually discussed the plight of the United States Patent and Trademark Office and how the enormous backlog of inventions in the queue at the USPTO is preventing organic job grow at a time when our economy desperately needs job creation. Sitting in for Chris Wallace was Brett Baier. He was interviewing Mark Zandi, who is Chief Economist for Moody’s Analytics, and Liz Claman, an anchor on the Fox Business News channel. The topic for this 11:54 second segment was the health of the U.S. economy and what can and should be done by our leaders in Washington, DC. Surprisingly, at least to me, Claman brought up the USPTO as an ideal opportunity for “instant stimulus.”

Straight from the “it’s about time” department comes breaking word that the so-called popular press are finally identifying the most under reported news story of this recession. The United States Patent and Trademark Office of foundering and it needs more money in order to do its job. Despite their lip service to innovation and job creation, politicians seem to year after year leave the Patent Office under funded and incapable of satisfying its purpose. But thankfully CBS did a 2 minute and 36 second segment on the crisis this past weekend!

In this interview Kappos discusses with me his management style, his famously long hours, how he manages to inspire the Office to work harder than ever before, his efforts to get funding for the Office, how the USPTO can help innovators create new businesses and new jobs, and how to inspire young people to do public service. We also learn that he and Judge Rader share the same favorite movie (see Judge Rader Interview at the end), he likes Star Trek and Star Wars equally (an astute political answer no doubt) and the famous American inventor he would like to meet is a “Mount Rushmore” inventor.