So much has been written about Ayn Rand’s magnum opus Atlas Shrugged that we have decided to focus on the three most original insights contained in this monumental novel. (Of course, just because an idea is novel or new does not make it true, but when evaluating a work of art, one can value originality for its own sake.) In our previous post, for example, we revisited Ayn Rand’s original, revisionist critique of Robin Hood. Today, we will explore another original idea in Atlas Shrugged, the idea expressed by one of the main characters in the novel (the Argentinian aristocrat and copper heir Francisco d’Anconia) that brands, corporate logos, and trademarks are the modern equivalent of the such bygone heraldic symbols as family crests and coats of arms. The passage in which Francisco d’Anconia makes this novel comparison appears on page 94 of the 35th anniversary edition of Atlas (Part 1, Ch. V), when d’Anconia tells Dagny Taggart, the heroine of the novel: “‘Dagny, I’ll always bow to a coat-of-arms. I’ll always worship the symbols of nobility. Am I not supposed to be an aristocrat? Only I don’t give a damn for moth-eaten turrets and tenth-hand unicorns. The coats-of-arms of our day are to be found on billboards and in the ads of popular magazines.’”
This comparison is not only novel and original; it is also central to the major premise of Atlas Shrugged: the morality and nobility of production (of rewards based on one’s ability) over the depravity and folly of economic redistribution (rewards based on one’s needs). In many ways, trademarks and service marks help promote this merit-based view of justice. Legally speaking, the primary purpose of a trademark or service mark is to identify the source or the origin of goods and services, so trademarks allow consumers to reward those manufacturers and service providers who offer quality goods and services. (See generally Nicholas S. Economides, “The economics of trademarks,” The Trademark Reporter, Vol. 78 (1988), pp. 523-539.)
But at the same time, this comparison has a huge blind spot, a gap that imperils the novel’s major premise. The blind spot is that trademarks and service marks are a form of intellectual property, and like all property rights, their scope is defined by law. By way of example, the Lanham Act, enacted by the Congress in 1946 and codified in volume 15 of the U.S. Code, creates a national system of trademark registration. But in order to register a mark with the U.S. Patent and Trademark Office, the mark must be used in commerce, and the mark must be distinct or have acquired a secondary meaning. In addition, property rights, including trademarks, are not absolute. The possibility of “genericide” provides a textbook illustration of this point: when a mark becomes so generic that it is used to describe a whole class of goods or services, the owner will lose the rights to his mark.
To sum up, although the comparison between coats of arms and trademarks is apt, my deeper critique of the premise in Atlas Shrugged is twofold. One is that property rights are not absolute. The other is that whatever their source (positive law or natural law), property rights require some level of private coercion (via self-help) or public coercion (via the courts). In short, although we agree with our libertarian friends that property rights are generally sacrosanct and that coercion should be minimized, there are no absolutes. Like everything else in life, there is an “optimal level” of coercion.