Economic Stimulus: It’s Right Under Our Noses
There is no question that America’s ingenuity fuels our economy. We must ensure that our patent system is as strong and vibrant as possible, not only to protect our country’s premier position as the world leader in innovation, but also to secure our economic future. Patents encourage technological advancement by providing incentives to invent, invest in, and disclose new technology. Now, more than ever, it is important to ensure efficiency and increased quality in the issuance of patents. This in turn will create an environment that fosters entrepreneurship and the creation of new jobs.
The Congress is now working toward passage of patent reform legislation that is intended to strengthen our innovation economy by establishing clearer rules to guide the courts and the United States Patent and Trademark Office (USPTO) in the administration of patents, and restrain patent abuses. But we cannot achieve an overall improvement in our U.S. patent system without putting a stop to Congressional diversion of PTO fees to general government program purposes - a practice which has plagued the system, reducing efficiency, for years.
When patents are developed commercially, they create jobs: both for the companies marketing products, and for their suppliers, distributors, and retailers. One single “deployed” patent has positive stimulatory effects across almost all sectors of our economy. And the USPTO is the world’s leading agency for granting patents; for the United States, the result is hundreds of innovative companies that have spawned millions of jobs. Properly examined patents, promptly issued by the USPTO, were vital to the growth of those companies.
Last year alone, nearly 500,000 patent applications were filed at the USPTO, and the current backlog of applications now exceeds 1.2 million applications. The sheer volume of patent applications not only reflects the vibrant, innovative spirit that has made America a world-wide leader in science, engineering, and technology, but also represents dynamic economic growth waiting to be unleashed. If there’s anything that has become apparent as the patent reform debate has gained momentum, it is this: if we are to have a durable economic recovery, we must rely on our renowned American ingenuity to lead us into prosperity again.
Thus, our view is that theroad to recovery begins with a high-functioning and well-funded USPTO. The USPTO is a feegenerating agency and is one of the few “user-funded” government agencies. Over the course of many years of feediversion, approximately $750 million has been siphoned off from the agency. Feediversion, coupled with the lack of fiscal flexibility for the agency, has resulted in a perfect storm at the PTO during this economic slowdown: the agency currently has a shortfall of $100 million compared to last year, due largely to precipitous drop in user fees. Fee diversion has compounded this problem over the years by limiting the PTO’s ability to grow with that workload, and the result is that the backlog of applications grows longer each year. When one considers what intellectual property means to our economy, the short-sightedness of some in the Senate who have been willing to jeopardize the health of our patent system for the sake of pet projects at home, or other general government priorities, is unfathomable. Why would anyone touch a dime from an agency that almost guarantees job growth in virtually every sector?In fact, fee diversion is nothing less than a tax on innovation.
A fully funded USPTO, with fiscal flexibility, would-- at the very least -- mean more and better trained patent examiners, more complete libraries of prior art, and greater deployment of modern information technologies to address the agency’s growing needs. All of these improvements would lead to higher quality patents being granted sooner. In other words, more jobs. For this reason, we believe that the anti-stimulatory practice of feediversion should become a central focus of the patent reform debate in Congress. The stimulus effect of putting new ideas to work is at least as powerful, and important, as other measures our government has taken to revive our moribund economy.