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Comment by natosaichek | Hacker News Reader

I saw an argument not long ago that the revolving door ensures more rigorous review of the regulated company. Basically, domain experts are hired out of a regulatory agency if they demonstrate their domain expertise by being a competent regulator. Would you want to hire someone who didn't do their job well? Also, the 'toughest' regulators are the ones who the companies don't want in their jobs anymore - they'd rather those people were on the other side of the fence, so they hire them. The people who are soft (or incompetent) are useful in their role, so are left alone, not hired out.

Not sure this is actually true, but the incentive arguments seem like they run in the right direction.

This may not apply to patents as much as other regulatory agencies due to the way patents are argued (Not in court)? Maybe they cover these arguments in the paper... I just read the abstract and didn't pay to get the whole thing.

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Former British chancellor George Osborne passed a bunch of pension deregulation - then was hired by investment management company BlackRock being paid £650,000 ($859,000) a year to work 1 day a week [1].

IMHO this fits better with the "deferred compensation" model of regulatory capture than it does with the one you outlined.

[1] https://www.google.com/search?q=George+Osborne+BlackRock

If I worked for a regulator and wanted to maximize my revolving-door compensation, then I'm not sure whether I'd want to be harsh or lenient. As you say, there are forces in both directions. I'd probably aim for the middle of the pack, since I (a) don't want to make my future employer hate me, and (b) also don't want them to think I'm an idiot lackey more valuable to them in government than on their payroll.

But, I think I have a pretty straightforward incentive to create maximum procedural complexity--that is, to draft and enforce regulations that require lots of administrative effort to comply with, but in the end have little economic effect beyond the legal fees. If I'm really clever, then I might even get whoever thought regulation was needed to perceive the paperwork burden as satisfying that--so the company might not even mind the legal fees, if they get an offsetting PR benefit from the procedurally strict (but substantively meaningless) rules. This is the legal equivalent of a computer programmer's job security through poorly-documented code, just with the creation and maintenance phases split across two different employers.

A lot of what patent attorneys do sure feels like it meets that description. If the regulatory capture mentioned in the paper exists, then I'd guess it works more through that procedural complexity than through substance.

Unless I misunderstand, the parent's hypothesis doesn't try to explain the data, which apparently shows a strong correlation between:

A) volume of patents granted by the examiner, and

B) applicant hiring that patent examiner & applicant hiring the same year as the grant of patent.

The parent seems to be an argument that they would expect the data to be otherwise, but it's not. Do I misunderstand?

I don't think natosaichek's comment above attempts to explain the paper's observed correlations. Possibilities include that:

1. Examiners who want to get hired in private industry go easy on their future employers' applications. That would explain the linked paper's correlations.

2. Examiners who want to get hired in private industry help create a quagmire of complex procedures that they will then be uniquely qualified to help their employer follow. That also would explain the linked paper's correlations.

3. Examiners who want to get hired in private industry go hard on their future employers' applications. That would not explain the linked paper's result, though it could still be true if some confounding variable (e.g., different approval rates for different fields and types of client, as patentatt speculates) explains the correlation.

People worried about the revolving door are usually thinking (1). I suspect that it's actually (2), since that achieves the same effect in a way that superficially seems less corrupt, and that requires less trust between the revolving-door employer and employee.

> 2. Examiners who want to get hired in private industry help create a quagmire of complex procedures that they will then be uniquely qualified to help their employer follow. That also would explain the linked paper's correlations.

From my amateur point of view, that would seem to cause a decrease, not an increase in granted patents. At best the number would be unchanged and the process would take longer. So how would (2) explain the observation of an increase?

The paper studied the relative benefit to firms that hire former examiners. That relative benefit is the same regardless of whether examiners go easy on revolving-door employers, or hard on non-revolving-door employers.

Run of the mill examiners don’t set policy, so I’m not sure how that would work

An employee who knows the policy has revolving door value, even if they didn't personally create it. You'd know better than I would how much of the USPTO's policy exists as law vs. published guidance vs. internal documents vs. shared habits that never actually get written down; but it often seems as if our lawyers act based on "policy" that's on the fuzzier end of that continuum. That's what's hardest to learn without hiring/being a former examiner.

Like, where do you learn to say "a plurality of" instead of "two or more"? "A first X" and "a second X"? When to express algorithms as flow charts? Those particular examples are well-known, but I presume there's a lot more culture/style like that. That seems as important to me as the formal policy, not necessarily anything substantive but a sign that you're in the club.

“not necessarily anything substantive but a sign that you're in the club.”

That’s most of what this stuff is, you hit the nail on the head. Normal people don’t talk or write in ‘patentese.’ Some of it is just an optimal way to be extremely precise in written English, but a bunch of it is just accumulated cultural nonsense. Good point.

The problem is that a lot of people think that way, but "middle of the road" actually means average where the average is people who are middle of the road to people trying to be nice to a future employer.

The result is a ratchet effect making patent examiners more and more friendly to patent applicants over time.

That kind of ratchet can happen, but I still think the "be nice" effect is much less important than the "add procedural complexity" effect. I don't see how a study could distinguish the two without re-examining every patent, but:

1. Anecdotally over my interactions with patent examiners (using both large firms studied in the linked article and small firms), that's how it felt. I never felt the big firms were getting directly special treatment. I often felt they had an oddly perfect understanding of a mostly-arbitrary set of rules not necessarily grounded in any statute or case law that they nonetheless somehow shared with the examiners.

2. The "complexity" effect doesn't require trust. The former examiner genuinely has specialized knowledge that will benefit the new employer, so the employer has an incentive (beyond some vague hope of goodwill from examiners still in government) to keep up the bargain.

Examiners don’t set policy or create procedures, they just examine patents. There’s thousands of them, it’s not like every patent examiner has different procedures.

In the UK the patent examiner's manual - the Manual of Patent Practice - is publicly available; it explains standard precedence cases, tests used (eg to tell if an invention is software as such).

Patents aren't that complex that you can tie them up to make them only processable by the original examiner. UK examiner's have about 1-2 days total processing time per search/examination (less in some fields).

The technical aspects are set by the applicant, as is the language of the claims.

There are definitely some hacks to force through a patent, but it will be of low worth and easily defeated in court (and obviously so to a good patent attorney).

There is also a major confounding factor: many people come from industry to begin with, and want to become regulators because they think that light regulation will benefit the industry and the public.

Imagine there was a privacy regulator. Do you think all the folks on HN cringing about GPDR now, would, if they found themselves working at said regulator, act to regulate the tech industry aggressively? Or would they regulate lightly, out of the belief that big-data supported companies are beneficial to the public?

Pai: Verizon -> FCC

Note that Pai worked for a couple of years at VZN, as a relatively junior person just a few years after graduating law school. He then spent a decade in the public sector, before becoming a partner at a law firm.

Which raises the other issue: many regulators go work at law firms, who benefit from more regulation, not less. Those positions are generally also more lucrative than positions in the regulated companies themselves. So there is good reason to believe that the incentives are aligned toward overregulation, not underregulation.

Wheeler came from the industry too, though.

Would I want to hire someone who didn't do their job well? Absolutely, if their incompetence was incompetence in my favor, which is something I'd want to reward. Alternately, if hiring them off freed up an opening for a friendlier regulator, I'd hire them that way too.

Kind of like how donating to the political campaigns of the longest-lasting, most honorable, and least corruptible judges in your local area will ensure they'll always recuse themselves in litigation you find yourself involved in.

To appear balanced, patent examiners must feel more than a little pressure to come down hard on the little guy.

Given the mountains of conflicting evidence with the recent financial crisis that has cost trillions and the crisis before that this argument seems to be baseless.

The linked paper itself goes into some detail to explore alternative explanations in good faith before confirming something of the opposite.

The idea that a revolving door does not have deep ethical implications with massive conflict of interest can be made in good faith only in an 'idealized' world, in which case everything is moot.

Revolving doors are usually delayed compensation for services rendered, not the future potential of the candidate going through the door.

Anywhere power is consolidated is going to be targeted for corrupt purposes. Around 50 people on the Congressional budget committees are effectively in charge of trillions of dollars of spending by the federal government, making it easy to bribe and get in your pork spending. Most startups would be far better off making a few donations to some politicians and getting fat government contracts rather than making a great product.

Just look at Amazon and their billion dollar federal cloud contracts. Politicians sell themselves cheap, the ROI is fantastic, probably the best growth hack out there.

Logical conclusion is to limit the size and power of the government to limit consolidation of power and thus make corruption less worthwhile/viable. The founding fathers understood this and that's why they essentially limited the federal government to only managing national defense and left the rest to the states, if you didn't like what your state was doing you could vote with your feet.

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