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Codified at 17 U.S.C §107, fair use is an affirmative defense to copyright infringement that permits the unlicensed use of copyright-protected work in certain circumstances. 27 According to the Supreme Court, the fair use doctrine “permits [and requires] courts to avoid rigid application of the copyright statute when, on occasion, it would stifle the very creativity which that law is designed to foster.”28 Rather than use a bright-line rule, §107 requires courts to engage in a case-by-case determination to establish whether a particular use is fair.29 To aid this case-by-case analysis, §107 provides four factors to consider when determining if an unlicensed use of a copyright-protected work is fair use.30 The factors are:

(1) the purpose and character of the use, including whether such use is of commercial nature or is for nonprofit educational purposes; (2) the nature of the copyrighted work; (3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and (4) the effect of the use upon the potential market for or value of the copyrighted work. 31

But there’s a check on all that control that copyright law provides: fair use. Fair use is written right into the Copyright Act, and it says that certain kinds of copies are okay. Since the law can’t predict what everyone might want to do, it has a four-factor test written into it that courts can use to determine if a copy is fair use.

But the legal system is not deterministic or predictable. Any court gets to run that test any way they want, and one court’s fair use determination isn’t actually precedent for the next court.

13. Please identify how the current state of patent eligibility jurisprudence in the United States affects the public. For example, does the jurisprudence affect, either positively or negatively, the availability, effectiveness, or cost of personalized medicine, diagnostics, pharmaceutical treatments, software, or computer-implemented inventions?

In general, restoring patent eligibility to its gatekeeper role is likely to benefit U.S. consumers by encouraging investment in innovation in fields of endeavor that have been negatively impacted by the uncertainty and unpredictability of current eligibility jurisprudence.

Answer: An accurate answer to this question must distinguish the static situation where one simply compares the prices of consumer products where they are protected by patents versus the prices of the same consumer products where they are not protected by patents. Of course, it is possible that stripping patent protection from already-invented products would reduce the price of those products. Stripping patent protection would allow copiers to sell the same product without charging a price that includes any effort to recoup the cost of developing the product—the copiers, by definition, did not develop the product. Likewise, adding patent protection to already-invented products might increase the price of those products. Adding patent protection would not allow copiers to sell the same product without charging a price that includes any effort to recoup the cost of developing the product. All of this, however, is dependent upon the level of competition in the market for the relevant products, and in most instances noninfringing products constrain the pricing of patented products. Anyway, this is not what I understand the proposed reforms seek to do. They do not seek to strip patent protection from already-invented products or add patent protection to already-invented products. Rather, the proposed reforms seek to return patent eligibility to its historical focus on practical utility. It also is unclear whether the proposed reforms would be given retroactive application. (One possibility, however, is restoring the historical scope of patent eligibility prior to the Supreme Court’s decision in Mayo and applying this scope to already-issued patents. This would not strip patent protection from already-invented products or add patent protection to already-invented products, but instead for some already-invented products provide certainty that patents covering them meet the requirement of patent eligibility.)

The reality, moreover, is that the patent system operates in a dynamic situation; the patent system is built upon the idea that it spurs the creation of new products. As a result, to answer the question accurately one needs to compare the price of a first set of consumer products developed without the proposed reforms with the price of a second set of consumer products developed with the proposed reforms.

c. Could the proposed reforms increase consumer prices? If so, in what industries or on what products?  

i. I do not believe the proposed reforms will increase consumer prices. Instead, I believe the proposed reforms will increase the rate of investment in innovative technologies, which will increase the rate of innovation. Increased innovation leads to more products in the market, and more products in the market place leads to cost-lowering competition.

The Federal Reserve is risking tipping the economy into contraction by not cutting interest rates now, according to the author of a time-tested rule for when recessions happen.

Economist Claudia Sahm has shown that when the unemployment rate’s three-month average is half a percentage point higher than its 12-month low, the economy is in recession.

Our model implies the probability of a recession starting within the next 12 months is 25%-30% (see chart 1). The model is based on key forward-looking financial market indicators and the Organization for Economic Co-operation and Development's leading economic index through May. While the probability of a recession in the near term has fallen since last fall due to easing financial conditions, it remains elevated at twice the unconditional probability of recession (baseline comparison) since World War II. The still-high probability of a recession compared with normal times largely reflects the inverted yield curve (see The Mighty Yield Curve Is Still Inverted).

The Mighty Yield Curve Is Still Inverted

The US economy is edging precariously close to a recession, and it's flashed a handful of warning signs in just the last week that suggest a downturn is on the horizon, according to Société Générale.

The European bank has warned of a recession to hit the US over the last year, despite many investors and economists remaining bullish on a soft-landing.

Boston Federal Reserve President Susan Collins on Tuesday cautioned against getting carried away with recent inflation data that suggested price pressures may again be retreating back to the U.S. central bank's goal.

"It is too soon to determine whether inflation is durably on a path back to the 2% target," Collins said in the text of a speech to a group in Lawrence, Massachusetts. "We should not over-react to a month or two of promising news, just as it was not appropriate to take too much (of a) signal from the disappointing data at the beginning of this year," she said.

The current U.S. inflation rate is 3.3% for the 12-month period leading up to May 2024. The consumer price index (CPI), which measures changes in prices, remained the same in May after rising 0.3% in April, according to the latest release from the Bureau of Labor Statistics[1]. The BLS notes that the declines in gasoline and energy prices offset a rise in the shelter index. The next monthly update will be released on Wednesday, July 11, 2024.

A 3.3% inflation rate may not seem like a lot, or as much as the price changes you've noticed at the grocery store. But to put inflation in context over the last few years, consumer price inflation rose 21.75% between January 2020 and May 2024, and stubbornly high housing costs persist.

Why has inflation stayed above the Federal Reserve’s 2% target for so long?

Housing and rents are major reasons inflation has stayed above 2%. Rental prices are up due to higher construction and maintenance costs, as well as strong demand from people priced out of homeownership. Home prices and mortgage rates remain high, making home purchases difficult, particularly for first-time homebuyers.

The world is in the midst of one such decade. As with other historical hinges, the danger today stems from a sharp decline in world order. But more than at any other recent moment, that decline threatens to become especially steep, owing to a confluence of old and new threats that have begun to intersect at a moment the United States is ill positioned to contend with them.

On the one hand, the world is witnessing the revival of some of the worst aspects of traditional geopolitics: great-power competition, imperial ambitions, fights over resources. Today, Russia is headed by a tyrant, President Vladimir Putin, who longs to re-create a Russian sphere of influence and perhaps even a Russian empire. Putin is willing to do almost anything to achieve that goal, and he is able to act as he pleases because internal constraints on his regime have mostly disappeared. Meanwhile, under President Xi Jinping, China has embarked on a quest for regional and potentially global primacy, putting itself on a trajectory that will lead to increased competition or even confrontation with the United States.

In addition to its internal struggles, the Western alliance now faces an “axis of resistance” – centered around Russia and China – that might be tempted to threaten its hegemony with a simultaneous, coordinated challenge. Like sharks, they undoubtedly smell blood in the water.

VIENNA – Ukraine has about a month before it runs out of artillery shells, and the US Congress cannot agree to ship more. Russian opposition leader Alexei Navalny is dead. The slaughter in Gaza continues with no end in sight. The Yemeni Houthis are attacking ships in the Red Sea. The North Koreans are testing intercontinental ballistic missiles. In normal times, pessimism can look like an intellectual fad. In times like these, it becomes a starker form of realism.

The Pentagon wants to develop advanced weapons systems to counter emerging overseas threats. Many defense contractors are avoiding projects that could turn into money-losers.

The industry’s discontent has been brewing for months and reached a crescendo this past week when Northrop Grumman NOC 0.27%increase; green up pointing triangle said it would take a charge of $1.2 billion building the first batches of the new B-21 Raider. The long-range bomber aircraft will be capable of carrying nuclear weapons and is a centerpiece of efforts to deter military actions from China and Russia.

The Pentagon may be heading toward a reckoning with industry over the cost of parts, equipment and weapons, with defense companies less amenable to taking on financial risk in future contracts, the head of the Aerospace Industries Association warned on Thursday.

The defense industry has acted as an initial “shock absorber” for the Pentagon on inflation, taking the brunt of cost increases caused by rising labor costs and the price of high-demand commodities like titanium, Eric Fanning told reporters during a roundtable.

Inflation is a persistent problem and in addition to making groceries and gas more expensive, it has also been affecting the Pentagon. A new report from the National Defense Industrial Association, “How Inflation Hurts America’s National Defense And What We Can Do About It,” lays out how inflation has continued to affect the defense industry.

“The Department of Defense (DoD) is dealing with significant inflation for the first time in 40 years. As detailed in this report, the DoD is particularly vulnerable to sudden inflation because of its lengthy budget and acquisition process,” the report said. This has diminished the department’s purchasing power.

Edward Alden, “Why This Global Economic Crisis Is Different,” Foreign Policy, 14 June 2022, https://foreignpolicy.com/2022/06/14/inflation-stock-market-economic-crisis-trade-wto-ukraine-energy-food-shortages-fed-central-banks/.

One of the remarkable things about the global economic order since World War II has been the flexibility of governments in responding to serious crises. From stagflation and the collapse of the Bretton Woods currency regime in the 1970s to the Asian financial crisis of the 1990s to the global financial crisis in this century, the world’s major economies have proven surprisingly adept at finding ways to cooperate to address serious challenges. This time around, that lucky streak may finally break. The current concatenation of problems—the Russia-Ukraine war, inflation, global food and energy shortages, unwinding asset bubbles in the United States, debt crises in developing countries, and the lingering impacts of COVID-19-related shutdowns and supply chain bottlenecks—may be the most serious crisis of them all, not least because central banks can’t print wheat and gasoline. Yet there are few signs of the collective responses that will be needed to meet these challenges. Global cooperation has never been more urgent—and seemed less likely. Fraying cooperation is, ironically, mostly a consequence of past successes. The world’s past ability to manage crises, transcend disruptions, and restore the trajectory of global growth means that many more countries today have become rich enough to wield influence and demand their interests be considered. Others are pursuing territorial or ideological goals they consider more urgent than immediate economic priorities. As a result, consensus has become almost impossible to find. The upshot is that in this crisis, the world will be condemned to a series of competing and partial responses rather than again finding a way to come together to address the challenge. The meeting of trade ministers at the World Trade Organization (WTO) in Geneva this week, originally scheduled for 2020 but postponed due to COVID-19, is a case in point. With 164 members and the rule that any agreement requires consensus among all of them, the WTO is handcuffed. Member states are still struggling, for example, to approve a waiver on patent rights for COVID-19 vaccines—already more than a year past the time it might have really helped. Similarly, they have been negotiating for more than two decades over curbing the subsidies that lead to destructive overfishing in the world’s oceans. Where the WTO once broke new ground to set trade rules and resolve disputes, it has played little role in addressing current supply chain challenges. Nor is it likely to respond effectively to the global food crisis as more than two dozen countries have already enacted export restrictions to preserve food supplies threatened by the collapse of Ukrainian and Russian grain exports. This week’s meeting in Geneva could even bring about tariff hikes by inaction: On Wednesday, a 1998 moratorium on tariffs for cross-border e-commerce—such as Apple downloads and Netflix streaming—automatically expires, and India and South Africa are blocking its renewal. No institution is indispensable, of course, and in the past, governments have found new and creative ways to cooperate when old institutions proved insufficiently adept. That was the case in the 1970s, when the world faced the closest analogy to today’s challenges. A perfect storm of runaway inflation, wars in Vietnam and the Middle East, an oil cartel that drove up global energy prices, the collapse of the gold-backed currency system under Bretton Woods, and the Watergate political scandal in the United States produced a period of global instability and weak growth. At first, governments were unable to cooperate sufficiently to address those challenges. A burgeoning literature emerged at the time on the “legitimation crisis” of Western capitalism. But the finance ministers of leading Western economies did come together to try to build a new monetary system after then-U.S. President Richard Nixon ended the gold convertibility of the dollar in 1971. These efforts led directly to the first G-6 summit meeting in France in 1975, where leaders of major industrialized nations tasked themselves with finding mutually reinforcing ways to revive their ailing economies. The group, which later became the G-7 (and later G-8 when it added Russia, only to drop it again following its 2014 annexation of Crimea), continues to provide a loose coordinating structure for the leading Western economies of today. More than two relatively uneventful decades later, the G-20 was born out of a series of destabilizing financial crises, including the 1994-1995 Mexican peso crisis, the 1997-1998 Asian financial crisis, and the 1998 Russian currency collapse. By that time, significant new economic powers had emerged, and the creation of the G-20 recognized that changing reality. The group includes China, India, Brazil, Russia, Mexico, and Indonesia, among others—broadening the rich nations’ club to one that was more representative of the 1990s economy. Like the G-7, the G-20 began as a regular meeting of finance ministers and was upgraded to an annual leaders’ summit during the 2008 global financial crisis. Amid the crisis and its aftermath, the G-20 became the focal point for global efforts to restore economic growth, helped jump-start the global economy through coordinated stimulus measures, worked to strengthen financial regulations, and expanded the lending capacity of the International Monetary Fund. To be sure, such cooperative efforts have rarely been transformational. Both the G-7 and the G-20 lack decision-making authority, serving more as an effort to nudge countries to undertake mutually supportive policies. The purpose of such organizations is often less about developing grand schemes for recovery and more about keeping matters from getting worse. One of the key accomplishments of the G-20 during the global financial crisis was to get strong pledges from member states to avoid protectionist responses, which would have worsened the global slowdown—pledges that were mostly met. Even such modest accomplishments are vastly better than countries working at cross-purposes or actively undermining one another’s economic interests. So if the WTO is handcuffed by consensus and if the G-7 and G-20 lack authority, what group or body might ride to the rescue this time? Merely asking the question shows how hard it will be to coordinate a global response to the current set of crises. The United States and its allies are actively working to damage Russia’s economy through the broadest sanctions ever levied, and Russia is responding by blocking shipments of Ukrainian grain through its Black Sea ports. This leaves the G-20 divided and powerless. U.S. Treasury Secretary Janet Yellen has called for Russia’s expulsion from the group and threatened to boycott meetings if Russia attends. Along with finance ministers and central bankers from several countries, she walked out of an April G-20 meeting in Washington when the Russian delegation was speaking. The meeting ended without the usual communique indicating areas of agreement. But removing Russia from the group is unlikely to happen; only Canada and Australia have formally joined the United States’ demand to do so. This year’s summit host, Indonesia, has already invited Russia to the planned November meeting (and issued a one-time invitation to Ukraine, which is not a member). Russia’s participation alone might be enough to neuter the G-20, but other members are also unlikely to get on board any strategy premised on strengthening the global economy while isolating Russia. China, in particular, has refused to break ties with Russia and is focused on greater self-sufficiency to protect its economy from the sort of sanctions levied against Russia by Western economies. These Western economies, through the G-7 and other fora, are more united than they have been in years, even if there are continued differences over how far to ratchet up sanctions against Russia. This is no small achievement: The G-7 economies still account for nearly half of the global economy and lead in the most sophisticated technologies. The United States and Europe have largely moved past disputes over trade in steel, aluminum, and aircraft that now look trivial in the current environment. But the scale of the current challenges is beyond what the G-7 countries can meet on their own. For example, the G-7 has developed a potentially robust plan, supported by more than 50 nations, for addressing food security issues by expanding financial and technical support in exchange for countries agreeing to forego export bans and other measures that would further distort global food markets. But India, which banned wheat exports last month, has so far blocked the initiative. New Delhi is also resisting other measures to free up food stocks for poorer nations to pursue greater self-sufficiency in agricultural production. The Biden administration has been creative in trying to find workarounds and build coalitions of like-minded countries. The U.S.-EU Trade and Technology Council has been coordinating responses on issues related to export controls, data sharing, and resilience in critical technologies. During his visit to Tokyo last month, U.S. President Joe Biden launched a new Indo-Pacific Economic Framework, which includes Japan, South Korea, and India. Although details are vague, the new forum is intended to promote cooperation on issues such as digital trade, decarbonization, and tax coordination. At last week’s Summit of the Americas in Los Angeles, the United States unveiled its Americas Partnership for Economic Prosperity with a similar agenda. But the meeting was not attended by Latin America’s second-largest economy after Brazil: Mexican President Andrés Manuel López Obrador boycotted the summit after the Biden administration excluded Cuba, Venezuela, and Nicaragua. Although admirably creative, none of these initiatives are remotely equal to the urgency of the moment. During previous crises, the world’s leading governments were able to set aside enough of their differences to come up with robust responses. This time around, that is nowhere in sight. This breakdown of cooperation may be the most lasting and worrisome effect of the current series of overlapping crises. So far, the disruptions have not significantly harmed global trade as a whole: Trade values hit record level in 2021, though they are slowing this year, and sectors like food and energy have been significantly disrupted. But the current crises have brought a hard stop to the confidence that, whatever their differences, the world’s leading economies are united on the importance of economic growth and stability and can work together to the greatest extent possible to achieve those goals. This time, there is no one steering the ship.

Jeff Cox, "It's official: The Covid recession lasted just two months, the shortest in U.S. history," CNBC, 7-19-2021, https://www.cnbc.com/2021/07/19/its-official-the-covid-recession-lasted-just-two-months-the-shortest-in-us-history.html

The Covid-19 recession is in the books as one of the deepest — but also the shortest — in U.S. history, the official documenter of economic cycles said Monday. According to the National Bureau of Economic Research, the contraction lasted just two months, from February 2020 to the following April. Though the drop featured a staggering 31.4% GDP plunge in the second quarter of the pandemic-scarred year, it also saw a massive snapback the following period, with previously unheard of policy stimulus boosting output by 33.4%.

The next economic crisis is closer than you think. But what you should really worry about is what comes after: in the current social, political, and technological landscape, a prolonged economic crisis, combined with rising income inequality, could well escalate into a major global military conflict. The 2008-09 global financial crisis almost bankrupted governments and caused systemic collapse. Policymakers managed to pull the global economy back from the brink, using massive monetary stimulus, including quantitative easing and near-zero (or even negative) interest rates. But monetary stimulus is like an adrenaline shot to jump-start an arrested heart; it can revive the patient, but it does nothing to cure the disease. Treating a sick economy requires structural reforms, which can cover everything from financial and labor markets to tax systems, fertility patterns, and education policies. Policymakers have utterly failed to pursue such reforms, despite promising to do so. Instead, they have remained preoccupied with politics. From Italy to Germany, forming and sustaining governments now seems to take more time than actual governing. And Greece, for example, has relied on money from international creditors to keep its head (barely) above water, rather than genuinely reforming its pension system or improving its business environment. The lack of structural reform has meant that the unprecedented excess liquidity that central banks injected into their economies was not allocated to its most efficient uses. Instead, it raised global asset prices to levels even higher than those prevailing before 2008. In the United States, housing prices are now 8% higher than they were at the peak of the property bubble in 2006, according to the property website Zillow. The price-to-earnings (CAPE) ratio, which measures whether stock-market prices are within a reasonable range, is now higher than it was both in 2008 and at the start of the Great Depression in 1929. As monetary tightening reveals the vulnerabilities in the real economy, the collapse of asset-price bubbles will trigger another economic crisis – one that could be even more severe than the last, because we have built up a tolerance to our strongest macroeconomic medications. A decade of regular adrenaline shots, in the form of ultra-low interest rates and unconventional monetary policies, has severely depleted their power to stabilize and stimulate the economy. If history is any guide, the consequences of this mistake could extend far beyond the economy. According to Harvard’s Benjamin Friedman, prolonged periods of economic distress have been characterized also by public antipathy toward minority groups or foreign countries – attitudes that can help to fuel unrest, terrorism, or even war. For example, during the Great Depression, US President Herbert Hoover signed the 1930 Smoot-Hawley Tariff Act, intended to protect American workers and farmers from foreign competition. In the subsequent five years, global trade shrank by two-thirds. Within a decade, World War II had begun. To be sure, WWII, like World War I, was caused by a multitude of factors; there is no standard path to war. But there is reason to believe that high levels of inequality can play a significant role in stoking conflict.

If one takes a longer-term perspective, however, a sustained economic depression could make war more likely by strengthening fascist or xenophobic political movements, fueling protectionism and hypernationalism, and making it more difficult for countries to reach mutually acceptable bargains with each other. The history of the 1930s shows where such trends can lead, although the economic effects of the Depression are hardly the only reason world politics took such a deadly turn in the 1930s. Nationalism, xenophobia, and authoritarian rule were making a comeback well before COVID-19 struck, but the economic misery now occurring in every corner of the world could intensify these trends and leave us in a more war-prone condition when fear of the virus has diminished.