I don't buy the claim that copyright law amounts to a subsidy. Copyright law is an enforced monopoly, which is not the same thing.

Of course, you're not focused on the specific works (which is what copyright grants a monopoly on) but on the industry as a whole. So perhaps monopoly on specifics amounts to a subsidy on generalities? But copyright law doesn't have the same effects as a subsidy overall. A subsidy should lead to a higher quantity at a lower price, but copyright law surely leads to a higher price.

(Defenders of copyright usually argue that it also leads to a higher quantity, and I entirely agree with your scepticism that this would actually be a good thing. It's obvious to me that copyright law is bad through and through, regardless of its effect on quantity. Still, anti-copyright activists have a valid point that it's not obvious that copyright actually increases quantity either, since it makes distribution and derivative works harder.)

Some responses.

The more I think about it, the harder I find justifying any subsidy.

No disagreement.

But higher production isn't always good; production can be misguided or wasted

But if something is wasted what matters is not that there was too much of it, but that an opportunity to produce something else was lost. You're focused on there being too much literature - when the relevant complaint is that there is too little of other things. An unread book does no harm. A year spent writing the book when something else could have been done with that year represents a lost opportunity. Maybe this is the focus of your concern, but it does not seem to be.

Suppose we all have 100 apples. Our lives do not revolve around apples, though we like them well enough. But still, 100 is too many

Indeed, most of these apples will be wasted if not sold, and this represents an opportunity lost to produce something else with the soil, but I think the analogy to novels is weak, as I will argue.

Now, can we apply this analogy? I don't have 100 apples, but perhaps I have - 100 novels.

There are various ways in which 100 novels is not like 100 apples. For one thing, 100 novels is like 100 varieties of apple. You may prefer one variety of apple; your neighbor may prefer another. The novel Twilight, for example, appeals to many people and does not appeal to me. There are, meanwhile, novels that appeal to me but would probably not appeal to a typical fan of Twilight.

For another, creativity requires variation as well as selection. The vast majority of the variants are not selected, but that does not mean that they are wasted, because a reduction in variation reduces the raw material on which selection can act. In particular, in order that one brilliant writer be found, many must make the attempt. Reduce the number attempting, and you may well reduce the number of great writers found.

In short, if 1000 novels are written and only one is widely read and preserved, that does not necessarily mean the other 999 were wasted. They made up the variation that selection acted upon.

If the industry had imploded before Mistborn was published, I would have read Long Sun instead.

Sure, you can always manufacture hypothetical scenarios, and cherrypick real ones, in which the work of selection is already done, in which the superior variant and only the superior variant is produced in the first place. But that's simply fantasy. In reality, variation is needed as raw material for selection.

The connection to other aspects of modern life and akrasia is apparent: there's a Gresham's Law whereby cheap yet unsatisfying works will push out more satisfying but more demanding entertainment. Humans suffer from hyperbolic discounting; we may know that in the long run, Mistborn will be forgotten when Long Sun is remembered, and that once we get started, we will enjoy it more - yet when the moment comes to choose, we prefer the choice of immediate pleasure.

I believe you have misapplied both Gresham's law and hyperbolic discounting. For instance, there's an important reason that Gresham's law applies to money, and novels aren't money.

Any field over a century old has built up a stock of masterpieces that could fill a lifetime.

This could be said at almost any point in history. You seem to be using it to imply that new works are unnecessary. But it would be equally good as an argument that Beethoven need not bother writing his masterpieces, since, after all, Bach had already written enough to fill a lifetime. But anyone who has listened to Beethoven knows that, even though Bach had already written enough to fill a lifetime, we are nevertheless enriched for having Beethoven, even though Beethoven necessarily displaces Bach to some extent.

Generalizing: even though we are already filled to capacity with art, literature, and music to spend all our lives on, we are nevertheless further enriched by new creation.

Society ought to discourage economically inefficient activities.

Yes, but efficiency is relative to what people want, which is difficult to discover except by observing their choices. And we see that they overwhelmingly choose contemporary fiction. My theory is that contemporary fiction really and truly does give the audience that chooses it greater satisfaction than most great old fiction, even though future generations will find most of it wanting. See for example that often Shakespeare will be updated in certain respects (such as setting - West Side Story, Ran, Forbidden Planet) for a new audience, and Shakespeare himself updated older stories for his own audience. For another example, the movie Clueless is an update of the Austen novel Emma. The novel Twilight takes place in contemporary America; in a hundred years it will be hopelessly out of date, but for much of its audience, Dracula by Bram Stoker, classic that it is, is not contemporary enough.

Because of this, there is a never-ending demand for contemporary fiction and for updates of old fiction, and this will keep writers in business indefinitely. You may judge this wrong by certain standards which you offer, but efficiency depends on what people want, and this is what they want. You don't get to make the concept of efficiency mean something different.

Consumers of new art would be equally satisfied by existing art.

Evidently not. I see you argue against this, but I find your argument completely unpersuasive. What we have in front of us as evidence is consumer behavior. We see the choices people make. Against this you present hypotheticals and a couple of quotes from people. For example, someone whose grandson happens to be into old music at the moment.

Meanwhile we see that updates of classics, such as Clueless and West Side Story, do very well in the market. This validates the choice that the movie producers made, which choice is based in part on the assumption that there is a significant audience for an update - i.e., people who would in fact not be equally satisfied by the originals without update.

I think the major way fiction is subsidized is people producing fiction in spite of it not being at all lucrative for most of them.

What are you planning on doing about fan fiction?

No, the status quo is heavy subsidization

I wasn't talking about subsidization, I was talking about taxation. The logic of the discussion was as follows: (1) Johnicolas said there should be an art tax; (2) I said "how would you do that?"; (3) wedrifid said "subject art to standard sales taxes"; (4) I pointed out that art already is subject to standard sales taxes -- so far as I know it isn't specifically exempt; hence wedrifid's response doesn't work as an answer.

The part of wedrifid's comment that I quoted defined the scope of my remark, which you misunderstood.