Global Intellectual Property Center

Congress Creates New Defender of Economic Growth

Congress Creates New Defender of Economic Growth

Just last week, the Senate confirmed Victoria Espinel as the first-ever U.S. intellectual property enforcement coordinator. This position was created by the bipartisan PRO-IP Act, which became law last year, and assigned the heavy task of improving enforcement and promoting intellectual property rights in the United States and abroad.

This position carries great historical as well as political significance, and it is the result of forward-looking leaders who recognized the increasing importance intellectual property plays in America’s competitiveness and economic growth. Strong and enforced IP rights not only incentivize and protect the innovation and creativity that drive human progress, they also provide the legal framework under which these “creations of the mind” are shared with others to advance our common knowledge.

Congress and the Obama administration have shown a clear willingness to defend and promote IP rights around the world. They rightly see American innovation and creativity as a catalyst for economic recovery and job creation and — when it comes to confronting piracy and counterfeiting — saving jobs and protecting consumers. However, more can be done; that’s where the U.S. IPEC comes in.

This new office has the potential to be a game-changer in the struggle to protect IP rights both here and abroad. American intellectual property is worth $5.5 trillion — more than the gross domestic product of any other country — and accounts for more than half of all U.S. exports, helping to drive 40 percent of our domestic growth. Recognition of this fact is what helped drive the creation of the U.S. IPEC to begin with, and if properly resourced and empowered, this office will be essential to reinvigorating a weakened economy.

Espinel must be provided the necessary staff, budget and authority to bring interagencies together and get things done, however. Her assignment to the White House must give her access to people at the top and the means to pull in staff from all across the administration. Why? One of Espinel’s first tasks will be to develop a national IP strategy, something this country has never had in its history. Indeed, it is surprising that America has been such a world leader in innovation without an overarching plan, yet it is something no national economy can succeed without in the 21st century. If we are to stay on the cutting edge of creativity and inventiveness and maximize the talents of our work force, we need to stop the counterfeiting and piracy that quietly eats away at our core strengths.

This Joint Strategic Plan, as the national strategy is formally called in the PRO-IP Act that mandated it, will serve as a landmark statement to the world about America’s plans to enhance its competitiveness, spur economic growth and protect consumers.

To begin, we must improve enforcement here at home. Espinel will need to work with Congress and industry on a broad range of anti-counterfeiting and piracy efforts while improving enforcement coordination among the government agencies ranging from the Department of Justice, the United States Trade Representative, Customs and Border Protection and the U.S. Immigration and Customs Enforcement. IP intensive industries employ 18 million Americans today, and these jobs on average pay better than others. But counterfeiting and piracy is taking a heavy toll on them and our economy.

According to the Customs and Border Protection service, counterfeiting and piracy have resulted in the loss of hundreds of thousands of jobs; the FBI reports that these illegal activities contribute billions of dollars annually in lost sales. But that’s only half the story. The exponential growth in this illicit trade is costing the U.S. government lost tax revenue in an era of growing deficits, while also denying industries the means to create new jobs and new products.

The counterfeiting of medicines and consumer goods is especially troubling. Fake drugs are being sold that either fail to perform as promised or contain toxins that can harm or kill patients. The same is true of fake products ranging from electrical cords that catch fire to brake pads made from cat litter that fall apart and pose serious safety risks.

The IPEC will also need to take a leading role defending today’s international system of global IP laws and norms. Working with Congress, this task ranges from opposing international efforts to weaken IP rights in any future climate change agreement, to pushing back on misguided ideas that weaken patent regimes or undermine trademark rights by mandating how companies package and advertise their goods. Without strong IP rights, the incentive to invest money, time and effort in a new idea will surely run aground if there is little promise of return on these investments.

Innovation and creativity are long-standing American qualities built into our collective DNA. They have helped build one of the most entrepreneurial and advanced societies the world has known. Indeed, more than one-third of global IP filings in 2006 were owned by American firms. IP is an American commodity, and it must be protected from the counterfeiters, pirates and a handful of governments that want to weaken the rights that create the incentives to dream, invest and work hard.

As the new U.S. IPEC, Espinel has the opportunity to seize the moment provided to her by Congress and the administration. If given the proper resources and authority, she has the chance to craft a national strategy and coordinate an interagency plan to confront the ever-growing and changing threats to IP that are chipping away at our economic strength and competitiveness. Strong IP rights can drive the innovation and creativity that will generate new jobs, a new economy and new advances that will guarantee America a leading role in the 21st century. Now is the time to unleash that potential.

Mark Esper is executive vice president of the U.S. Chamber of Commerce’s Global Intellectual Property Center. Learn more at www.theglobalipcenter.com.