1
00:00:03,200 --> 00:00:07,960
Speaker 1: This is Bloomberg Law with June Brussel from Bloomberg Radio.

2
00:00:15,240 --> 00:00:18,920
Speaker 1: I know this is hard for you, but Windsor is coming.

3
00:00:20,400 --> 00:00:24,200
Speaker 1: We know what's coming with it. We can't face it alone.

4
00:00:25,760 --> 00:00:30,000
Speaker 1: Despite John Snow's warning, did you watch Game of Thrones alone?

5
00:00:30,520 --> 00:00:34,239
Speaker 1: The record viewership for the HBO drama indicates maybe not.

6
00:00:34,560 --> 00:00:37,600
Speaker 1: But did you use someone else's log in and password

7
00:00:37,680 --> 00:00:40,680
Speaker 1: to watch the show? You might be surprised to learn

8
00:00:40,760 --> 00:00:45,800
Speaker 1: that HBO doesn't care. In fact, HBO encourages it. That's

9
00:00:45,840 --> 00:00:48,120
Speaker 1: just one of the lessons in the book Mine, How

10
00:00:48,159 --> 00:00:51,600
Speaker 1: the Hidden Rules of Ownership Control Our Lives by Michael

11
00:00:51,640 --> 00:00:55,160
Speaker 1: Heller and James Saltzman, and Professor Heller of Columbia Law

12
00:00:55,200 --> 00:00:58,480
Speaker 1: School joins me, Now, why the title mind One of

13
00:00:58,520 --> 00:01:02,400
Speaker 1: the first words babies. How does that relate to adults? Well,

14
00:01:02,480 --> 00:01:04,280
Speaker 1: let me give you an example. Actually was with my

15
00:01:04,400 --> 00:01:06,560
Speaker 1: kids in the park and they were fighting over a

16
00:01:06,560 --> 00:01:09,319
Speaker 1: little toy shovel and one of them said mine, I

17
00:01:09,360 --> 00:01:11,720
Speaker 1: had it first, and the other said no, I'm holding

18
00:01:11,800 --> 00:01:14,040
Speaker 1: onto it. And I realized that that little fight that

19
00:01:14,120 --> 00:01:17,440
Speaker 1: they had is actually very revealing about ownership works, not

20
00:01:17,520 --> 00:01:19,320
Speaker 1: just for kids, but for us grown ups as well.

21
00:01:19,520 --> 00:01:21,839
Speaker 1: So when my daughter was saying I had it first,

22
00:01:21,920 --> 00:01:24,640
Speaker 1: first in time, my son was saying, I'm holding onto it.

23
00:01:24,760 --> 00:01:27,559
Speaker 1: Possession is nine tenths of the law. They were using

24
00:01:27,680 --> 00:01:31,160
Speaker 1: two of just six simple stories that everyone uses to

25
00:01:31,200 --> 00:01:34,920
Speaker 1: claim everything in the world. Much remarkable is that businesses

26
00:01:34,959 --> 00:01:38,759
Speaker 1: and governments use those exact same stories, the exact same

27
00:01:38,840 --> 00:01:43,360
Speaker 1: mind and first to basically allocate all the resources that

28
00:01:43,400 --> 00:01:45,840
Speaker 1: we all fight about. This is how we decide climate change,

29
00:01:45,959 --> 00:01:48,240
Speaker 1: this is how we decide wealth inequality, and it's also

30
00:01:48,400 --> 00:01:50,480
Speaker 1: how we get in line as adults for everything that

31
00:01:50,480 --> 00:01:54,560
Speaker 1: we all want. Let's start with the axiom possession is

32
00:01:54,680 --> 00:01:57,840
Speaker 1: nine tenths of the law, and you say not really.

33
00:01:58,720 --> 00:02:01,240
Speaker 1: There are hundreds of ownership disputes that we're involved in

34
00:02:01,320 --> 00:02:04,720
Speaker 1: every day without realizing it. Part of why a maxim

35
00:02:04,760 --> 00:02:06,880
Speaker 1: like possession is nine tenths of the law is so

36
00:02:06,920 --> 00:02:11,280
Speaker 1: powerful that it feels natural and just and right. But

37
00:02:11,360 --> 00:02:14,000
Speaker 1: once you understand it, it's just a maxim. What savvy

38
00:02:14,040 --> 00:02:16,520
Speaker 1: businesses can do is turn those upside down. So let

39
00:02:16,560 --> 00:02:19,120
Speaker 1: me give you an example. Say you click by now

40
00:02:19,240 --> 00:02:22,079
Speaker 1: on Amazon to download a book or a movie. When

41
00:02:22,080 --> 00:02:24,280
Speaker 1: you click buy now, you have a little shopping cart

42
00:02:24,520 --> 00:02:27,040
Speaker 1: you have a buy now button, it feels like you

43
00:02:27,160 --> 00:02:30,239
Speaker 1: own that, And actually, studies are shown the pent of

44
00:02:30,320 --> 00:02:34,160
Speaker 1: people believe that buying something online is the same as

45
00:02:34,200 --> 00:02:37,320
Speaker 1: buying a physical copy of the book or the DVD,

46
00:02:37,720 --> 00:02:40,880
Speaker 1: and that's just not true. So what Amazon, Apple and

47
00:02:40,960 --> 00:02:44,360
Speaker 1: other online retailers realize that they can mobilize our deep,

48
00:02:44,480 --> 00:02:48,600
Speaker 1: our childhood instincts about possession, but actually sell us something

49
00:02:48,880 --> 00:02:51,920
Speaker 1: quite different and much less. So it's the case today

50
00:02:52,280 --> 00:02:55,720
Speaker 1: that Apple or Amazon can, and actually they have deleted

51
00:02:55,800 --> 00:02:58,200
Speaker 1: content right off of people's devices, and they have the

52
00:02:58,320 --> 00:03:00,320
Speaker 1: right to do so. But there's a big and growing

53
00:03:00,440 --> 00:03:03,000
Speaker 1: gap between what you feel like you are and what

54
00:03:03,120 --> 00:03:06,839
Speaker 1: you actually own online and the online retailers they get

55
00:03:06,880 --> 00:03:10,120
Speaker 1: an extra unearned premium on every single one of our

56
00:03:10,160 --> 00:03:14,560
Speaker 1: downloads we leave. The customers are not always right. So

57
00:03:14,600 --> 00:03:18,240
Speaker 1: in other words, you might buy a book for your

58
00:03:18,320 --> 00:03:21,840
Speaker 1: iPad or your Kindle and later find out that the

59
00:03:21,880 --> 00:03:25,720
Speaker 1: book has disappeared from your online library the book you

60
00:03:25,800 --> 00:03:29,680
Speaker 1: thought you had purchased. Isn't that crazy? Doesn't happen very often,

61
00:03:29,919 --> 00:03:34,120
Speaker 1: But actually some years ago Amazon deleted by George Orwell

62
00:03:34,280 --> 00:03:37,119
Speaker 1: right off people's devices, which is actually kind of amazing.

63
00:03:37,120 --> 00:03:39,360
Speaker 1: If that was exactly what Big Brother would do. There

64
00:03:39,400 --> 00:03:41,440
Speaker 1: was a licensing dispute, and don't turn up, they couldn't

65
00:03:41,480 --> 00:03:43,480
Speaker 1: sell that version of the book. But there have been

66
00:03:43,480 --> 00:03:46,160
Speaker 1: a number of cases where Apple and Amazon and the

67
00:03:46,160 --> 00:03:49,440
Speaker 1: other retailers have essentially bricked your device. You still have

68
00:03:49,520 --> 00:03:51,640
Speaker 1: the hardware, you still have the shell of your cell phone,

69
00:03:51,800 --> 00:03:54,360
Speaker 1: but they can basically lock you out of your contact

70
00:03:54,600 --> 00:03:56,520
Speaker 1: in ways that people will be surprised. You feel like

71
00:03:56,560 --> 00:03:59,600
Speaker 1: you own it, But the reality today is that possession

72
00:03:59,680 --> 00:04:01,960
Speaker 1: is much more like one sense of the law when

73
00:04:02,000 --> 00:04:07,600
Speaker 1: you're online. Amazon and Apple do they have provisions in

74
00:04:07,640 --> 00:04:10,280
Speaker 1: their terms of agreement that allow them to do that.

75
00:04:10,320 --> 00:04:13,440
Speaker 1: Those terms of agreement that no one ever reads. I

76
00:04:13,440 --> 00:04:15,840
Speaker 1: imagine they do. I'm saying I imagine they did, because

77
00:04:16,040 --> 00:04:19,320
Speaker 1: literally no one ever. I teach this stuff and I've

78
00:04:19,360 --> 00:04:21,560
Speaker 1: never read them. And what's amazing is in those terms

79
00:04:21,560 --> 00:04:23,280
Speaker 1: of service that they call them, they can put a

80
00:04:23,320 --> 00:04:25,120
Speaker 1: lot of stuff in there that you would just never

81
00:04:25,600 --> 00:04:27,840
Speaker 1: No one ever knows, no one ever. They're designed to

82
00:04:27,880 --> 00:04:30,880
Speaker 1: be unintelligible, and all everyone does is just click the

83
00:04:30,920 --> 00:04:33,000
Speaker 1: little I agree button a quick the buy now button,

84
00:04:33,240 --> 00:04:35,680
Speaker 1: and by doing so, the version of ownership that you

85
00:04:35,720 --> 00:04:39,600
Speaker 1: get online is a very highly limited, non transferable license

86
00:04:39,760 --> 00:04:42,200
Speaker 1: that gives them a lot of control over what you

87
00:04:42,240 --> 00:04:46,040
Speaker 1: can do with what you buy. What about subscription services

88
00:04:46,200 --> 00:04:51,280
Speaker 1: like HBO and Netflix. It's become acceptable to borrow someone's

89
00:04:51,360 --> 00:04:54,640
Speaker 1: log in and password and watch shows when you're not

90
00:04:54,680 --> 00:04:57,440
Speaker 1: paying for them. So what are the ownership rules there?

91
00:04:58,000 --> 00:05:00,200
Speaker 1: Isn't that crazy? Like when I ask people, like you know,

92
00:05:00,279 --> 00:05:02,760
Speaker 1: people who share passwords with friends for Hbo, where I

93
00:05:02,800 --> 00:05:05,279
Speaker 1: spend this throup for Netflix? All of my students, all

94
00:05:05,279 --> 00:05:07,160
Speaker 1: of my friends say, sure, of course we do. That's

95
00:05:07,160 --> 00:05:10,479
Speaker 1: just standard practice. And you said, it's borrowing. It's not borrowing.

96
00:05:10,480 --> 00:05:12,839
Speaker 1: It's actually illegal. It's actually a federal crime. It's not

97
00:05:12,880 --> 00:05:17,120
Speaker 1: even close to legal. But here's the thing. HBO knows

98
00:05:17,120 --> 00:05:20,320
Speaker 1: that you're borrowing these passwords. They can track you down,

99
00:05:20,640 --> 00:05:24,080
Speaker 1: and they choose not to. They don't just tolerate, they

100
00:05:24,080 --> 00:05:27,479
Speaker 1: actually encourage best of their core content. How is that

101
00:05:27,520 --> 00:05:31,440
Speaker 1: even possibly the case? Possible? Because HBO and Netflix are

102
00:05:31,480 --> 00:05:35,080
Speaker 1: some of the most stephisticated and savvy businesses about ownership design.

103
00:05:35,440 --> 00:05:38,039
Speaker 1: We all know that rocket engineering puts people on the moon,

104
00:05:38,480 --> 00:05:41,400
Speaker 1: but a few people realize how ownership engineering is us

105
00:05:41,440 --> 00:05:44,719
Speaker 1: all day long every day. So what HBO is using

106
00:05:44,880 --> 00:05:47,560
Speaker 1: in this contact the reason that they're actually encouraging people

107
00:05:47,600 --> 00:05:50,600
Speaker 1: to share passwords, they're using an ownership strategy we call

108
00:05:51,080 --> 00:05:54,960
Speaker 1: tolerated staffs. Tolerated staffs work for them because what they

109
00:05:54,960 --> 00:05:57,400
Speaker 1: are trying to do actually, in the words of HBOS

110
00:05:57,440 --> 00:05:59,960
Speaker 1: president Richard Leppler, he said, what we're trying to do

111
00:06:00,000 --> 00:06:02,880
Speaker 1: it was build video added so they could come after you,

112
00:06:03,320 --> 00:06:05,799
Speaker 1: but instead they want you to think that you're stealing

113
00:06:05,880 --> 00:06:08,839
Speaker 1: just a little. It actually profits them as part of

114
00:06:08,880 --> 00:06:12,599
Speaker 1: a long term customer acquisition strategy. They actually write about

115
00:06:12,600 --> 00:06:15,520
Speaker 1: this in some detail strategy that savvy businesses are using

116
00:06:15,680 --> 00:06:19,120
Speaker 1: in a Harvard Business Review article that's titled even Elon

117
00:06:19,200 --> 00:06:22,120
Speaker 1: must doesn't care about patent should view. And the point

118
00:06:22,200 --> 00:06:25,719
Speaker 1: there is that savvy businesses have strategies life tolerated stuff

119
00:06:25,920 --> 00:06:29,520
Speaker 1: where they're re engineering your experience of ownership for their profits.

120
00:06:30,080 --> 00:06:33,080
Speaker 1: You right that the meek shall inherit very little, and

121
00:06:33,160 --> 00:06:37,400
Speaker 1: you point to South Dakota as the new Switzerland. Howls

122
00:06:37,480 --> 00:06:40,479
Speaker 1: South Dakota become the go to money haven for the

123
00:06:40,560 --> 00:06:44,440
Speaker 1: super rich. What a wild place. I mean when I

124
00:06:44,480 --> 00:06:46,480
Speaker 1: think of South Dakota, I think of like the sturgist

125
00:06:46,520 --> 00:06:49,720
Speaker 1: motorcycle raality, or maybe like Mount Rushmore. But if you're

126
00:06:49,760 --> 00:06:53,400
Speaker 1: super rich, South Dakota is a very special place. It's

127
00:06:53,440 --> 00:06:55,720
Speaker 1: where the wealthiest people, not the one per centers, but

128
00:06:55,839 --> 00:06:58,240
Speaker 1: the one percent of the one percenters go to hide

129
00:06:58,240 --> 00:07:00,839
Speaker 1: their money. It's a place that has cre aided essentially

130
00:07:00,960 --> 00:07:04,320
Speaker 1: legal system that makes payment of taxation essentially optional for

131
00:07:04,400 --> 00:07:07,920
Speaker 1: many kinds of taxes. It also makes facility or responsibilities,

132
00:07:07,960 --> 00:07:10,960
Speaker 1: for examples, to pay former spouses or provide child support,

133
00:07:11,360 --> 00:07:14,280
Speaker 1: or payoff people use injured in all practice cases, or

134
00:07:14,360 --> 00:07:17,200
Speaker 1: business partners use defrauded. It makes all that payments and

135
00:07:17,240 --> 00:07:21,040
Speaker 1: all that responsibility largely optional. And because it's so attractive

136
00:07:21,080 --> 00:07:25,120
Speaker 1: for avoiding responsibility and taxes, it's become in recent years

137
00:07:25,160 --> 00:07:29,000
Speaker 1: the world leading money caymer. It actually crushes Switzerland and

138
00:07:29,080 --> 00:07:31,560
Speaker 1: the payments. This is where the world super wealthy go

139
00:07:31,640 --> 00:07:34,520
Speaker 1: to hide their money. And most Americans don't realize that

140
00:07:34,560 --> 00:07:37,800
Speaker 1: we now have in this country is too actually separate

141
00:07:37,840 --> 00:07:41,440
Speaker 1: systems for wealth transmission, the super concentration of wealth in

142
00:07:41,440 --> 00:07:44,080
Speaker 1: the very small handful of families, the fact that today

143
00:07:44,200 --> 00:07:48,960
Speaker 1: sixty of wealth in America has inherited. It's inherited not earned,

144
00:07:49,200 --> 00:07:52,480
Speaker 1: and only one percent of families have fort of total

145
00:07:52,520 --> 00:07:55,640
Speaker 1: wealth that doesn't happen through market cources. It isn't a

146
00:07:55,760 --> 00:07:58,760
Speaker 1: factive nature. It is results from a deliberate set of

147
00:07:58,840 --> 00:08:03,240
Speaker 1: choices by fas like South Dakota to create this basically

148
00:08:03,280 --> 00:08:06,960
Speaker 1: optional taxation and responsibility system. They've created a way to

149
00:08:07,080 --> 00:08:10,400
Speaker 1: create actually a new aristocracy in America. And I don't

150
00:08:10,400 --> 00:08:13,200
Speaker 1: even mean that metaphorically. The name of the trust that

151
00:08:13,280 --> 00:08:17,240
Speaker 1: avoid stay taxes in particular are called dynasty trusts. They're

152
00:08:17,240 --> 00:08:20,120
Speaker 1: meant to create modern dynasties. For most of us, we

153
00:08:20,360 --> 00:08:22,880
Speaker 1: actually have to pay our taxes and fulfill our responsibilities.

154
00:08:22,880 --> 00:08:25,080
Speaker 1: And if you drive a Honda and hit somebody, they

155
00:08:25,080 --> 00:08:27,400
Speaker 1: can garnish your wages to pay off the claim. But

156
00:08:27,440 --> 00:08:29,360
Speaker 1: if you have a trust set up in South Dakota

157
00:08:29,480 --> 00:08:31,720
Speaker 1: and you're wealthy enough to hystem with your Lamborghini, you

158
00:08:31,800 --> 00:08:34,240
Speaker 1: never have to pay. It's really something that the founders

159
00:08:34,280 --> 00:08:37,800
Speaker 1: would have been appalled by. It's not something that's consistent

160
00:08:37,840 --> 00:08:40,800
Speaker 1: with either a progressive vision of America, and it isn't

161
00:08:40,800 --> 00:08:44,600
Speaker 1: consistent with a conservative vision of America equal either. It's

162
00:08:44,600 --> 00:08:48,240
Speaker 1: been consistent with a vision based on responsibility and uh

163
00:08:48,320 --> 00:08:51,480
Speaker 1: you know, opportunity and working hard. But we've done and

164
00:08:51,520 --> 00:08:53,440
Speaker 1: what we've done in this country is to create an

165
00:08:53,520 --> 00:08:57,240
Speaker 1: alternate legal system UH through which people can basically create

166
00:08:57,640 --> 00:09:01,280
Speaker 1: aristocratic dynasties. Actually very much in mentioned with the founding

167
00:09:01,320 --> 00:09:04,160
Speaker 1: principles of this country and the ownership. Reason for this

168
00:09:04,760 --> 00:09:08,720
Speaker 1: is that property in America is not defined by federal law.

169
00:09:09,600 --> 00:09:13,760
Speaker 1: It's not defined by the Constitution. It's defined by individual states.

170
00:09:13,880 --> 00:09:18,720
Speaker 1: So states like South Dakota can basically impoverish um states

171
00:09:18,760 --> 00:09:21,839
Speaker 1: where people actually want to live, States like California and

172
00:09:21,880 --> 00:09:25,920
Speaker 1: New York EXAs of Florida, where wealthy people live. The

173
00:09:26,000 --> 00:09:29,680
Speaker 1: chief Justice of that state Supreme Court said, well, many

174
00:09:29,720 --> 00:09:32,480
Speaker 1: people may find a way to fly over South Dakota.

175
00:09:32,920 --> 00:09:35,680
Speaker 1: Somehow their dollars find a way to land. Here is

176
00:09:35,720 --> 00:09:38,560
Speaker 1: the money helping the people of the state. What's so

177
00:09:38,960 --> 00:09:42,160
Speaker 1: galling about what South Dakota has done is that no

178
00:09:42,200 --> 00:09:44,559
Speaker 1: one in South Dakota benefits. There isn't one road in

179
00:09:44,600 --> 00:09:47,679
Speaker 1: Sathakota that gets paid by their ability to decrease the

180
00:09:47,840 --> 00:09:50,559
Speaker 1: taxation pays to the states where people actually live. That

181
00:09:50,720 --> 00:09:54,040
Speaker 1: one road get pays now, one school book gets brought.

182
00:09:54,360 --> 00:09:57,120
Speaker 1: The only people in South Dakota. Who benefits are the

183
00:09:57,280 --> 00:10:01,200
Speaker 1: tiny handful of trust administration lawyers and bankers who wrote

184
00:10:01,200 --> 00:10:03,959
Speaker 1: these laws, who updates them every year, and who get

185
00:10:03,960 --> 00:10:07,640
Speaker 1: fees for administering them. One legislature says, there probably aren't

186
00:10:07,679 --> 00:10:09,920
Speaker 1: a hundred people in the states who realize that they're

187
00:10:09,960 --> 00:10:13,600
Speaker 1: creating a studel aristocracy in America. But because of South

188
00:10:13,679 --> 00:10:17,520
Speaker 1: Dakota is taking the lead. Other states, Nevada in particular, Alaska,

189
00:10:17,679 --> 00:10:20,560
Speaker 1: a handful of others are racing to catch up with

190
00:10:20,720 --> 00:10:23,240
Speaker 1: giveaways to the super wealthy. So we now have what's

191
00:10:23,280 --> 00:10:26,120
Speaker 1: called a race to the bottom. It's actually competing with

192
00:10:26,160 --> 00:10:29,240
Speaker 1: each other forever more elaborate giveaways that are sort of

193
00:10:29,320 --> 00:10:32,720
Speaker 1: under the table, hidden in this parallel legal system for

194
00:10:32,800 --> 00:10:38,360
Speaker 1: the super rich. That's fascinating. Let's go on to another rule,

195
00:10:39,080 --> 00:10:42,320
Speaker 1: which is your home is your castle. You say your

196
00:10:42,320 --> 00:10:44,960
Speaker 1: home is really not your castle, right, So what we're

197
00:10:44,960 --> 00:10:47,760
Speaker 1: what we're going through here is um uh. Some of

198
00:10:47,760 --> 00:10:49,920
Speaker 1: the ownership stories has said at the beginning there are

199
00:10:49,920 --> 00:10:52,880
Speaker 1: only six of them, and we turns out that possession

200
00:10:52,920 --> 00:10:55,400
Speaker 1: is one tense of the law. You're a savvy business owner,

201
00:10:55,840 --> 00:10:58,480
Speaker 1: and it turns out that the meekshell not inherit very much.

202
00:10:58,960 --> 00:11:01,360
Speaker 1: If you're in the world of stu upakotas Um dynasty

203
00:11:01,400 --> 00:11:04,640
Speaker 1: truck and now we're going to uh, your home is

204
00:11:04,640 --> 00:11:06,480
Speaker 1: your cassitle. It turns out that your home, that's a

205
00:11:06,559 --> 00:11:10,080
Speaker 1: very powerful feeling we have, that's my space peep out.

206
00:11:10,920 --> 00:11:14,240
Speaker 1: But that notion of ownership is so powerful that it

207
00:11:14,320 --> 00:11:18,000
Speaker 1: becomes a tool that's available for all sorts of governments

208
00:11:18,000 --> 00:11:21,160
Speaker 1: and business businesses to sort of redefine what it means

209
00:11:21,200 --> 00:11:23,720
Speaker 1: to have home in ways that may surprise some of

210
00:11:23,760 --> 00:11:26,320
Speaker 1: your listeners. UM. So one of the so when you

211
00:11:26,360 --> 00:11:28,960
Speaker 1: stay my home ismand castle. If you own a home

212
00:11:29,240 --> 00:11:30,760
Speaker 1: but you have as a sheet of paper, it's a

213
00:11:30,800 --> 00:11:35,240
Speaker 1: two dimensional deeds um, which doesn't necessarily mean anything that

214
00:11:35,320 --> 00:11:38,360
Speaker 1: is attached to your home, like how much airspace above

215
00:11:38,440 --> 00:11:42,000
Speaker 1: is attached, what resources below are attached, how much out

216
00:11:42,040 --> 00:11:44,880
Speaker 1: from the side do you have? All of those questions

217
00:11:44,920 --> 00:11:47,439
Speaker 1: are very much up for grasped. A hundred years ago,

218
00:11:47,480 --> 00:11:50,880
Speaker 1: when we first had air flights, UM, landowners would send

219
00:11:50,880 --> 00:11:53,120
Speaker 1: bills to the plane companies and say, hey, you're your

220
00:11:53,120 --> 00:11:56,400
Speaker 1: trust passing over my land by flying up over overhead,

221
00:11:56,960 --> 00:11:59,040
Speaker 1: and early on in America, we desired that at the

222
00:11:59,200 --> 00:12:03,080
Speaker 1: flight of that's the level of airplanes that wasn't part

223
00:12:03,080 --> 00:12:07,040
Speaker 1: of it was attached to your land. That attachment only

224
00:12:07,080 --> 00:12:10,599
Speaker 1: worked a certain ways up. But today we have the

225
00:12:10,679 --> 00:12:13,559
Speaker 1: question about drone. So, for example, can symbody fly a

226
00:12:13,640 --> 00:12:16,240
Speaker 1: drone above your land? And that's very much a line

227
00:12:16,320 --> 00:12:18,680
Speaker 1: question because potentially they have cameras a book down on you,

228
00:12:19,640 --> 00:12:22,240
Speaker 1: and potentially they also serve, you know, to deliver pizza

229
00:12:22,400 --> 00:12:25,400
Speaker 1: or Amazon boxes. So we're at a moment where, like

230
00:12:25,520 --> 00:12:29,079
Speaker 1: any new resource, ownership of it is up for wraps.

231
00:12:29,120 --> 00:12:31,360
Speaker 1: The ownership of the airspace above your house at the

232
00:12:31,440 --> 00:12:34,760
Speaker 1: drone level, the so called drone away is very much

233
00:12:34,800 --> 00:12:38,840
Speaker 1: contected today and there's no natural or correct or right answer.

234
00:12:39,160 --> 00:12:41,880
Speaker 1: All that you have is the six simple stories of

235
00:12:41,920 --> 00:12:45,640
Speaker 1: ownerships that everyone uses to fight about everything. And it's

236
00:12:45,679 --> 00:12:48,599
Speaker 1: not just the airspace above, it's also all the resources

237
00:12:48,600 --> 00:12:51,600
Speaker 1: below your lands of water, the oil, the gap, um

238
00:12:51,640 --> 00:12:54,480
Speaker 1: do those belong to you? What if your neighbor puts

239
00:12:54,480 --> 00:12:56,560
Speaker 1: a drools a zeper well, it's puts in a more

240
00:12:56,600 --> 00:12:59,320
Speaker 1: powerful pump and sucks the water away from your well?

241
00:12:59,640 --> 00:13:03,560
Speaker 1: Can do that? And the answer is again up prograbed. Uh.

242
00:13:03,760 --> 00:13:05,840
Speaker 1: The specific answer for the well is much in much

243
00:13:05,880 --> 00:13:09,800
Speaker 1: of America, absolutely they can do You have all these

244
00:13:10,080 --> 00:13:14,240
Speaker 1: wild examples in the book what's your favorite? But my

245
00:13:14,360 --> 00:13:17,439
Speaker 1: favorite example actually is I motivated us to write the books.

246
00:13:17,720 --> 00:13:20,480
Speaker 1: Was flying on an airplane working in my laptop and

247
00:13:20,600 --> 00:13:22,640
Speaker 1: the person in front of me leaned back and squished

248
00:13:22,679 --> 00:13:25,640
Speaker 1: my laptop, and I realized that that wedge of space

249
00:13:25,800 --> 00:13:29,280
Speaker 1: behind the seat was an ownership story isn't governed by law,

250
00:13:29,440 --> 00:13:33,000
Speaker 1: but it's very much up programs. Does that space belong

251
00:13:33,080 --> 00:13:35,080
Speaker 1: to the person in front? Do you have a right

252
00:13:35,120 --> 00:13:38,000
Speaker 1: to recline? Is a space attached to the seat because

253
00:13:38,040 --> 00:13:41,040
Speaker 1: the button controls the space? Or does the space belong

254
00:13:41,080 --> 00:13:43,400
Speaker 1: to the person and back for their needs? And from

255
00:13:43,440 --> 00:13:46,360
Speaker 1: my laptop? So my story is possession. I possessed the

256
00:13:46,400 --> 00:13:49,840
Speaker 1: space or first. I was there first, And what I

257
00:13:49,920 --> 00:13:53,400
Speaker 1: realized was that that wedge of space was outside the law,

258
00:13:53,679 --> 00:13:55,880
Speaker 1: but it was a compliment each of us go through

259
00:13:55,920 --> 00:13:58,680
Speaker 1: all the time whenever we fly. If we and what

260
00:13:58,800 --> 00:14:01,040
Speaker 1: happens is we all try to work it out. We

261
00:14:01,160 --> 00:14:03,880
Speaker 1: try to be politely, try to use good manners, and

262
00:14:04,120 --> 00:14:08,199
Speaker 1: the hidden ownership story there is that what we're experiencing

263
00:14:08,200 --> 00:14:11,120
Speaker 1: a personal conflict. But I was experiencing to someone leaning

264
00:14:11,120 --> 00:14:14,319
Speaker 1: into my lap. Turns out to be a highly engineered

265
00:14:14,360 --> 00:14:18,240
Speaker 1: form of ownership that the airlines are using for their profits.

266
00:14:18,679 --> 00:14:21,760
Speaker 1: In the same way that HBO was using tolerated sets

267
00:14:22,600 --> 00:14:27,760
Speaker 1: to build customers, airlines use a different, very advanced tools

268
00:14:27,840 --> 00:14:32,040
Speaker 1: of ownership design, which we call strategic ambiguity str Teachic

269
00:14:32,080 --> 00:14:36,280
Speaker 1: ambiguity is present much more often in your life than

270
00:14:36,320 --> 00:14:39,040
Speaker 1: you realize. And the way the airlines use ambiguity in

271
00:14:39,080 --> 00:14:42,960
Speaker 1: that context is they deliberately keep it unclear who owns

272
00:14:43,000 --> 00:14:46,560
Speaker 1: who controls that wedge of space. They know that we're

273
00:14:46,600 --> 00:14:49,680
Speaker 1: going to all fall back on politeness and good manners

274
00:14:49,680 --> 00:14:52,400
Speaker 1: to story it out and one when that happens. But

275
00:14:52,520 --> 00:14:55,280
Speaker 1: it does is it left them sell that relegis space

276
00:14:55,440 --> 00:14:59,360
Speaker 1: twice on every seat on every flight for you to

277
00:14:59,440 --> 00:15:03,480
Speaker 1: recline and for my needs. So it's extremely profitable for

278
00:15:03,520 --> 00:15:06,520
Speaker 1: the airline. And the reason that these the complicts are

279
00:15:06,560 --> 00:15:09,240
Speaker 1: breaking out today over that wedge of space, the stories

280
00:15:09,280 --> 00:15:12,880
Speaker 1: of planes getting grounded, the viral video, some of your

281
00:15:12,880 --> 00:15:15,920
Speaker 1: listeners may have seen a fight on up in the air.

282
00:15:16,360 --> 00:15:18,680
Speaker 1: So what the airlines are done is they squeeze the pitch,

283
00:15:18,960 --> 00:15:22,400
Speaker 1: the distance between seats down from thirty five inches down

284
00:15:22,440 --> 00:15:26,080
Speaker 1: to just on some planes today, they've made that wedge

285
00:15:26,080 --> 00:15:29,600
Speaker 1: of space a more valuable resource. And whenever any resource

286
00:15:29,680 --> 00:15:33,280
Speaker 1: becomes more valuable, ownership is up for wrapped and they

287
00:15:33,320 --> 00:15:36,120
Speaker 1: realize that you by using ambiguity, they could sell that

288
00:15:36,160 --> 00:15:40,120
Speaker 1: space twice and they can make the business class these

289
00:15:40,240 --> 00:15:42,960
Speaker 1: up front more valuable. They create a market for business

290
00:15:42,960 --> 00:15:50,520
Speaker 1: class by making economy economy of space officially unpleasant. So

291
00:15:50,600 --> 00:15:53,360
Speaker 1: for me, it was that experience of flying that made

292
00:15:53,360 --> 00:15:57,040
Speaker 1: me realize how powerful these ownership stories are in shaping

293
00:15:57,840 --> 00:16:01,080
Speaker 1: every minute of our lives. Every day, all day long,

294
00:16:01,400 --> 00:16:03,920
Speaker 1: we're engaging in these ownership battles and we just don't

295
00:16:03,920 --> 00:16:07,040
Speaker 1: see it. So for me, the AHA moment was seeing

296
00:16:07,400 --> 00:16:10,360
Speaker 1: that that process I was having on the airplane was

297
00:16:10,440 --> 00:16:13,320
Speaker 1: actually an ownership battle. And it turns out of actually

298
00:16:13,400 --> 00:16:15,800
Speaker 1: the simple solution actually news you can use for your listeners,

299
00:16:16,080 --> 00:16:17,600
Speaker 1: which is if you try to pay the person in

300
00:16:17,680 --> 00:16:20,440
Speaker 1: front of you twenty bucks that usually not to recline.

301
00:16:20,840 --> 00:16:23,920
Speaker 1: That often won't work, And if you say just please

302
00:16:23,960 --> 00:16:26,880
Speaker 1: don't recline, that won't work either. But what works three

303
00:16:26,960 --> 00:16:29,320
Speaker 1: quarters of the time, according to one study, is if

304
00:16:29,320 --> 00:16:31,840
Speaker 1: you offer to buy them a snack or a drink,

305
00:16:32,280 --> 00:16:34,520
Speaker 1: they won't recline because then you guys are in it together.

306
00:16:34,920 --> 00:16:37,520
Speaker 1: You're part of a community, and neither of you are

307
00:16:37,520 --> 00:16:41,440
Speaker 1: realizing if the airlines are basically property from that deal.

308
00:16:42,320 --> 00:16:45,520
Speaker 1: But that is actually a practical way to solve the problem.

309
00:16:45,720 --> 00:16:48,400
Speaker 1: From your book, we see that your ownership rules seem

310
00:16:48,480 --> 00:16:51,440
Speaker 1: to be changing at different times. Is there any advice

311
00:16:51,480 --> 00:16:53,720
Speaker 1: you can give to the average person about how to

312
00:16:53,800 --> 00:16:58,320
Speaker 1: make ownership rules work for them? Absolutely? So the key

313
00:16:58,320 --> 00:17:01,480
Speaker 1: first is to understand that it's that ownership is not

314
00:17:01,520 --> 00:17:04,879
Speaker 1: something distant and fancy and something to a lawyer. This

315
00:17:04,960 --> 00:17:07,680
Speaker 1: is such an important piece of what I actually try

316
00:17:07,680 --> 00:17:09,880
Speaker 1: to tell my law students as well. And I said

317
00:17:09,920 --> 00:17:13,280
Speaker 1: this earlier in our conversation. Law is overrated. Ownership is

318
00:17:13,359 --> 00:17:16,360
Speaker 1: up for grabs in your life all day long. It's

319
00:17:16,400 --> 00:17:18,959
Speaker 1: the stories that kids are telling on the playground when

320
00:17:19,000 --> 00:17:22,040
Speaker 1: they're playing over the swing. It's nothing fancier for you

321
00:17:22,119 --> 00:17:24,320
Speaker 1: as a grown up. And this is true not just

322
00:17:24,440 --> 00:17:27,000
Speaker 1: for really big issues like climate change, which we haven't

323
00:17:27,000 --> 00:17:30,080
Speaker 1: talked about, which is an ownership battle, or wealth inequality,

324
00:17:30,080 --> 00:17:33,960
Speaker 1: which more transparently is, but it's very true on sort

325
00:17:33,960 --> 00:17:37,679
Speaker 1: of the employment on what control you have over your jobs. So,

326
00:17:37,760 --> 00:17:40,359
Speaker 1: for example, a lot of people have nondisclosure and noncompete

327
00:17:40,359 --> 00:17:44,080
Speaker 1: agreements in their in their in their contracts people don't

328
00:17:44,119 --> 00:17:47,160
Speaker 1: realize are not enforceable. But once you start to examine,

329
00:17:47,160 --> 00:17:50,560
Speaker 1: like every piece of your life, like, how is it that, um,

330
00:17:50,720 --> 00:17:52,399
Speaker 1: you know people walk around you to the front of

331
00:17:52,440 --> 00:17:55,240
Speaker 1: the Starbucks line, uh to pick up their drinks? Well,

332
00:17:55,280 --> 00:17:59,080
Speaker 1: they have the app. So Starbucks is engineered line waiting

333
00:17:59,760 --> 00:18:02,240
Speaker 1: to basically two different visions of whose first in time

334
00:18:02,359 --> 00:18:05,520
Speaker 1: people simply line up and wait people who use the app,

335
00:18:06,119 --> 00:18:09,080
Speaker 1: and that engineering of lines was on all around you.

336
00:18:09,280 --> 00:18:12,440
Speaker 1: Next time you're standing in line, but it's a long line. Um,

337
00:18:12,440 --> 00:18:14,640
Speaker 1: this may well be an entrepreneur who is actually being

338
00:18:14,680 --> 00:18:18,840
Speaker 1: paid to wait in front of you. So free every day,

339
00:18:18,880 --> 00:18:20,720
Speaker 1: every minute as you go through your day. Once you

340
00:18:20,760 --> 00:18:24,880
Speaker 1: start to notice that, it's very hard, you'll see, um,

341
00:18:24,920 --> 00:18:26,800
Speaker 1: the world in a very different way. And once you

342
00:18:26,880 --> 00:18:29,879
Speaker 1: see it, it's hard to un see it. Once you

343
00:18:30,119 --> 00:18:33,880
Speaker 1: see how ownership really works. My hope is that your

344
00:18:33,880 --> 00:18:37,240
Speaker 1: listeners is that that's part of what empowers them to

345
00:18:37,280 --> 00:18:40,200
Speaker 1: have the tools to be more effective advocates, as as parents,

346
00:18:41,119 --> 00:18:44,080
Speaker 1: but as and as consumers, and also I think that

347
00:18:44,240 --> 00:18:47,440
Speaker 1: citizens Okay works at all those levels. Thanks Michael. That's

348
00:18:47,440 --> 00:18:51,399
Speaker 1: Professor Michael Heller of Columbia Law School. The book is Mine,

349
00:18:51,840 --> 00:18:55,400
Speaker 1: How the Hidden rules of Ownership control our lives. And

350
00:18:55,440 --> 00:18:57,639
Speaker 1: that's it for this edition of the Bloomberg Law Show.

351
00:18:57,920 --> 00:19:00,280
Speaker 1: I'm June Grosso. Thanks so much for listen and eight.

352
00:19:00,400 --> 00:19:02,919
Speaker 1: Please tune into The Bloomberg Long Show every week night

353
00:19:03,000 --> 00:19:05,760
Speaker 1: at ten pm Stern right here on Bloomberg Radio