The perm links to politics (and elections) more

Although the patent-plus-prize scheme is relatively simple administratively, and consistent with profit-making incentives, it is likely to encounter political opposition. If the government gives prizes equal to profit (or half of profit) from patents to large firms, eventually politically savvy actors would oppose the scheme. It would be attacked as “corporate welfare,” and the attacks would probably seem appealing to the median voter.12 To maintain the prize system in the face of such opposition, the government would have to continually remind voters that society gains more from the prize system than it loses. Political attacks on the prize system, by contrast, need only be successful once to put an end to the system. Eventually, the prize scheme would generate sufficient public opposition that it would be terminated.

What makes the patent-plus-prize scheme especially vulnerable to political attack is that it is an open transfer to patentees. If the transfer were in some sense disguised, it might be survivable. Many laws lead to disguised transfers from poor to rich. In Massachusetts, the Community Preservation Act subsidizes land conservation and public beautification projects in affluent suburbs while taxing residents in every community, affluent or not.13 The economically regressive transfer effected through the Massachusetts CPA, taxing residents of Dorchester to fund open space acquisition in Weston, goes largely unremarked because it is not open and obvious. But the patent prize would be an open and obvious transfer from the general public to the patentee, and, consequently, an easy path to political power through attacking the transfer as regressive.