The most important economic decision facing the country isn’t about tax extenders; rather, it is about software patents. And the decision has already been made by the Supreme Court — we just have to wait until Monday to find out what the heck happened. Tim Lee offers very valuable insight into the debate over software patents and their role in (stifling) software innovation:

Virtually everyone expects the high to affirm the Federal Circuit’s rejection of Mr. Bilski’s patent, but as always the important question is what’s in the accompanying opinion. A narrow holding could simply rule out the most egregiously abstract business method patents (Mr. Bilski’s “invention” consisted entirely of mental steps) while leaving the bulk of software and business method patents untouched. But if the Supreme Court is feeling more ambitious, it may try to draw a new line that invalidates many existing business method and maybe even deal with the sotware controversy.

I’m hoping for a broad ruling, but I’m not optimistic. A standard that invalidates both business method and software patents would be good law and good public policy, but it would also mark a significant upheaval in the software industry. Firms like Microsoft, IBM and Yahoo have spent millions of dollars accumulating massive patent warchests, and they’re keen to get a return on that investment. Even if the justices become convinced convinced that traditional limits on software patents need to be reinstated, they’ll probably prefer to wait until they can hear a case that’s specifically about a software patent.

Let’s hope the Supremes go big. (No, not those Supremes.)