Common Currency: 1790 Patent Act is 'economic genius at work'
"The Congress shall have Power... to promote the Progress of Science and useful Arts, by securing for Limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries..." Constitution of the United States, Art.I, Sec.8(8).
On this Constitutional authority, Congress adopted the first Patent Act in the United States on April 10, 1790, just one year after the adoption of the US Constitution. It is basis of all modern property rights granted for the invention of "any useful art, manufacture, engine, machine, or device, or any improvement thereon not before known or used."
It is a shame that the Constitution is almost exclusively taught and understood as a political document, because it overlooks the drafter's real economic genius at work. Not only is this where both the essence and limit of government power is enumerated, it does so in precise terms.
It is the economic manifesto that unified 13 nearly bankrupt colonies into a common market. In many ways, Article I Section 8 created the first modern free trade agreement, and should be taught to every first year economics class as a blueprint for a free market economy and the foundation of common prosperity.
Students of pure economics would also benefit from the understanding that "free markets" do not exist in a vacuum of calculus and integral equations, but government as regulator and enforcer has an equally important role in the creation of common prosperity as does private property rights and private enterprise.
The enumerated powers in Article I Section 8 are as timeless as the Pharaohs of Egypt, the Khans of Asia, and the Kings of Byzantium: Economic prosperity requires a unified currency for money exchange, a standardized system of weights and measures for use in commerce and trade, a system of taxation for civil administration, social justice, and regulation of the marketplace and laws for the protection of private property.
Every great civilization throughout history was built upon these fundamental elements of governance. The first right of patent is at least 2,500 years old, traced to the Greek city of Sybaris, which provided exclusive rights to profits to an inventor for "encouragement to all who should discover some refinement in luxury." The Code of Hammurabi dates back almost 4,000 years to ancient Babylon and provided for the enforcement of commercial contracts and the conduct and regulation of trade.
If I could make one New Year's wish come true for the coming 2012 election year, it would be that every student, voter, media pundit and political candidate read Article I Section 8 of the US Constitution; not because it makes a political statement of one kind or another, but precisely because it doesn't. It simply enumerates those powers that are necessary for governance, the common welfare, and the preservation of private property rights in commerce and trade.
However the political debates go next year, neither "free markets" nor "government regulation" is mutually exclusive to a thriving economy. Both are necessary, and require some healthy amount of tension, but prosperity and the general welfare is better served by some restraint on both.
Alan J. Zemek is a Park Rapids area developer and author of "Generation Busted: How America Went Broke in the Age of Prosperity." You can follow his blog, or comment on this article on his website, www.genera tionbusted.com.