This article actually argues against parody being included under the fair use clause, saying that the treatment should be very narrow and should not include my definition of satire (or works that parody others to attack a third). Posner claims that use should only be fair when the costs of transacting with the copyright owner over permission to use the copyrighted work would exceed the benefits of transacting. Posner argues three specific points:
1. Fair use should only provide a defense to infrigement if the work is a parody, not a satire.
2. The parodist should not be allowed to take so large a fraction of the copyrighted features as to make the parody a substitute for the original work.
3. The fact that a parodist appropriates a small amount should not be relevant to fair use.
Interestingly, Posner writes: "If all but one form of intellectual property is priced, dumping the remaining form into the public domain, where it can be used without being paid for, may cause the priced forms to be even more underutilized from a social standpoint. Underutilized and also underproduced, as potential buyers of this intellectual property switch to its free competitor."
However, if parody can be protected by fair use and satire cannot, Posner's argument suggests that everyone will switch to parody rather than risk or pay for satire.