Former Vice President, U.S. Intellectual Property Policy, U.S. Chamber of Commerce
February 20, 2017
Since our nation’s founding, intellectual property (IP) has played a key role in American economic growth. Today, the same protections that were enshrined in our Constitution are a source of more than 45 million American jobs – that’s nearly one third of the American workforce.
These are the jobs created by businesses that depend on patents, trademarks, copyrights, and trade secrets. They consist of everything from manufacturing to medicine, from music to movies, from small businesses to large companies.
In fact, a 2015 U.S. Chamber report confirmed that IP-driven jobs contribute to the local economy in every single county, in every single state. IP is at the heart of over 81 innovative and creative industries.
The U.S. is also the world’s largest exporter of intellectual property. According to the latest U.S. Department of Commerce numbers, total merchandise exports of IP-intensive industries alone have increased to more than $842 billion, or almost 40 percent of all U.S. exports.
This is why IP matters. Real people and real businesses depend on a strong IP system, with appropriate IP protections, to maintain America’s competitive advantage in the global marketplace and protect American jobs.
The latest edition of the U.S. Chamber International IP Index reflects these realities. A measure of 45 of the world’s IP systems, the U.S. is deemed the strongest overall of any other country. But it also shows some areas for improvement.
Among the six categories the Index measures, American IP has begun to fall behind in two key areas: enforcement and patents. Over the last few years, the U.S. has fallen to fifth place in enforcement of our IP. To some, fifth place might not seem so bad at first glance. But when you once again consider the sheer volume of the U.S.’s IP economy, and the fact that IP industries support nearly a third of the U.S. workforce, protection against IP infringement comes into focus as a clear battleground for protecting American jobs.
In his State of American Business address, U.S. Chamber President and CEO Tom Donohue sounded a warning bell and laid out the work that needs to be done in response.
Specifically, Donohue highlighted ways that Congress and the Trump administration can:
- Increase physical security measures to stem the flow of counterfeit products crossing our borders. This includes providing additional resources to enforcement agencies and U.S. ports of entry and providing additional resources to law enforcement to prosecute cases.
- Bolster IP provisions in future trade deals and ensure that those provisions are implemented and enforced. This includes ensuring there are consequences when agreements are violated.
Lawmakers already have a head start on addressing the need for more support at U.S. ports. The “Customs Reauthorization” bill that became law in February of 2016 included language supporting stronger information sharing, additional training opportunities and dedicated staff. This law will enable us to better protect American consumers from harmful fake goods. We must ensure that bad actors - those who traffic in counterfeit goods to millions of Americans every year - are met with consequences. And a recent executive order took another positive step by emphasizing enforcement of federal law with respect to transnational criminal organizations. These are key components for strengthening enforcement at every level.
The Chamber’s Index also revealed that America’s patent protection standards have fallen even further – to tenth placed compared to the rest of the world. Part of the problem is that recent court decisions have created confusion regarding patent subject matter eligibility, or, in simple terms, what is eligible for a patent. The result of these rulings have made it more difficult for some of our leading innovators to secure patents for life-saving inventions and transformative information technology software.
It simply defies common sense that some of our most innovative sectors are prevented from securing patents in the U.S., despite years of work and billions of dollars in research and development, but are eligible for patent protection in the EU and China. We must address this issue and ensure that the U.S. patent system is non-discriminatory and rewards the hard work of inventors and innovators so that our nation can remain at the forefront of the innovation economy.
We cannot underestimate the value of IP to the American economy, and we cannot afford to fall behind when it comes its protection. These are just a few examples of the work that lies ahead of us in 2017 as we continue to champion American innovation, that supports American jobs, driven by American IP.
About the authors
Frank Cullen is former Vice President of U.S. Intellectual Property Policy.