Legal streams are less available for rentals than a year ago

Take a step back: the purpose of intellectual property law is to promote the creation of works. Assigning property rights to ideas is the means, not the end. If we believe compulsory licenses would ultimately promote the creation of more works, that trumps any property rights argument.

Would you be OK with the government saying "if a company won't release it's source code, you are ok to hack into their site to get it [...]

No, but I would be OK with the government saying "if a company won't release its source code, you are free to reverse engineer it."

Just as nuking the internet isn't an acceptable way to deal with the MPAA's problems, dampening property rights isn't a responsible way for me to insist on watching my TV shows (no matter how tempting it gets).

But one way I would look at it is that if, let's say, Apple were to produce a great piece of software and say "you have to come to Cupertino to use it" and then someone broke into the Apple's site and made that piece of software available on a P2P network, would the analogy still be valid?

I agree with you communication between both sides must exist but, in this case, the tech industry is actually providing a number of LEGAL ways for Hollywood to provide its content online (either per subscription or pay-per-view) and Hollywood is still saying "NO". It feels as if only one side is trying to find a compromise here.

Compulsory Licencing of Patents DOES work this way: they MUST offer terms that are reasonable or they can't prevent people from using the patent (for many countries)

"Some countries have "working provisions" that require the invention be exploited in the jurisdiction it covers. Consequences of not working an invention vary from one country to another, ranging from revocation of the patent rights to the awarding of a compulsory license awarded by the courts to a party wishing to exploit a patented invention. The patentee has the opportunity to challenge the revocation or license, but is usually required to provide evidence that the reasonable requirements of the public have been met by the working of invention."

http://en.wikipedia.org/wiki/Patent

Copyright and Patents aren't property the same way land or chattels are. They're time limited monopolies granted on the works of art.

Here is another compulsory license already in law:

"There are several different compulsory license provisions in United States copyright law , including for non-dramatic musical compositions,[9] public broadcasting,[10] retransmission by cable systems,[11] subscription digital audio transmission,[12] and non-subscription digital audio transmission such as Internet radio.[13] The compulsory license for non-dramatic musical compositions under Section 115 of the Copyright Act of 1976[14] allows a person to distribute a new sound recording of a musical work, if that has been previously distributed to the public, by or under the authority of the copyright owner.[15] There is no requirement that the new recording be identical to the previous work, as the compulsory license includes the privilege of rearranging the work to conform it to the recording artist's interpretation. This does not allow the artist to change the basic melody or fundamental character of the work.[16] In order to take advantage of this compulsory license the recording artist must provide notice and pay a royalty. The notice must be sent to the copyright owner, or if unable to determine the copyright owner, to the Copyright Office, within thirty days of making the recording, but before distributing physical copies. Failure to provide this notice would constitute copyright infringement.[17] In addition to the notice to the copyright owner, the recording artist must pay a royalty to the copyright owner. This royalty is set by three copyright royalty judges.[18] Though the compulsory license allows one to make and distribute physical copies of a song for a set royalty, the owner of the copyright in the underlying musical composition can still control public performance of the work or transmission over the radio.[19] If the underlying musical work is well known, the work can be licensed for public performance through a performance rights organization such as ASCAP, BMI, or SESAC."

from http://en.wikipedia.org/wiki/Compulsory_license

Pump the fees higher than anyone is charging now, make the market all about negotiating lower fees while allowing the creativity of everyone to create ways to distribute this content far far far and wide.