> 1. Someone has to invest money in creating intellectual property.
Most intellectual property takes the form of time invested rather than a monetary investment, and plenty of 'art' as we know it today was just commissioned work ('work for hire') when it was first produced.
> At a minimum, the actual creators have to come up with enough money to buy food, shelter, etc., for themselves and perhaps their families while they're doing their creative thing.
This is true, but between the stereotypical 'starving artist' and the 'rockstar milionaire' there is a broad range of normalcy that plenty of artists can aspire to. Britney wouldn't be one of those though.
> (I won't even get into whether the creators' investment of their time is deserving of compensation; I happen to think it is, but that's not important here.)
I think it is, but only if they can sell their product the first time out. The ransom model is an interesting concept that has a direct measurement of perceived value to a group of fans or some other form of market or audience. Once released the product becomes part of the public domain.
> 2. The harsh reality is that investors normally will not make such investments unless they have at least a reasonable expectation of getting their money back (purely-altruistic motives being rare).
This is true. So the quantity of works will go down, hopefully the quality would go up. That remains to be seen of course, but I'm fairly sure that if it were not for subsidized art we'd see either a larger unemployment level or more people in the workforce (where I live).
> 3. If prospective investors know that copiers will quickly destroy the ability to charge money for the fruits of the creative process, they're highly likely to give a thumbs-down to that particular request for their money.
No, they may have to find a way to get their moneys worth at the moment of release knowing that if they don't do it then they will never do it. This will reduce the avenues available to them, and will likely result in a lower margin but that does not mean that it won't happen at all. It's a matter of degree, not an absolute.
> (As an analogy, imagine the effect that Hugo Chavez's 'nationalization' -- read: confiscation -- of foreign oil companies' interests in Venezuela has had on the willingness of those and other companies to risk any more money there.)
Contrary to your view on this in the longer term this may actually benefit Venezuela more than it may hurt it in the shorter term. Oil will likely get more valuable, if Chavez' antics cause Venezuela to be one of the last oil reserves on the American continent that might work out very well for them. I'm cynical enough to suspect that being the people in charge of a valuable resource is probably a health risk because a 'war of liberation' is a viable option when you're sitting on a resource that someone else wants badly.
> 4. So while copyright infringement may not seem like stealing, it can have a remarkably similar economic effect.
No, it does not have a similar economic effect. Copyright infringement in any particular case could only be shown to have an economic effect if you can actually prove that a sale would have been made and as far as I know that is not possible without visiting alternative universes. You can make a statement to that effect by observing aggregates but you'll never be sure of it.
> 5. That's why intellectual property law tries to strike a reasonable balance between the interests of creators and their backers and the interests of the public.
Right, which is why Mickey Mouse is still not in the public domain and singing 'happy birthday' is copyright infringement. The interests of the public went out the window as soon as the various organizations realized that copyrights (and patents) are licenses to print money in very large amounts.
> EXAMPLE: The U.S. Constitution authorizes Congress to give authors and inventors exclusive rights, but only for limited times.
Which have since been extended multiple times, and which now can be assumed to be extended indefinitely until the opposite is proven.
> EXAMPLE: Copyright is limited by the fair-use doctrine.
Which is further and further eroded.
> 6. There's often room for argument about whether any particular aspect of IP law is productive in supporting creativity. For example, it can be legitimately debated whether patents for business methods are a net positive or a net negative.
Try to argue they're a net positive, I'm really interested in how that could ever be the case.
> 7. But a blanket statement, implying that egregious copyright infringement should never be punished as criminal behavior, is short-sighted.
No, I think that's just fine. Criminal laws are supposed to be used to weed out the 'worst' people and to protect the 'good' people. We have civil laws for everything else and this should be a civil matter, after all, you don't have a time machine, you can't visit that other universe, any damage assessment is purely speculative, there is no victim, there are no bodies, there are no crimes.
Just some people that may have received less money than they assumed they were going to make. And most of those people are not the 'starving artists' who routinely get shafted by the exact same groups that pretend to have their best interests (and ours!) at heart.