Some people don't seem to know the difference between patents and copyright. You don't need to patent software to protect it: copyright does that. Anyone with any programming experience knows that it's actually implementing the algorithm that takes the hard work, and that's the bit that copyright protects.

The US Patent Office hands out patents for trivial ideas. Microsoft has a patent (never enforced) on the idea of downloading upgrades for software. They also issue patents without checking for prior art.

The system of patenting algorithms in the USA doesn't protect anyone. If you create a program incorporating a new idea, it's almost impossible to write it without infringing some patents that should never have been granted. Their owner then offers a deal to swap patent rights, so they get your good idea and you get their trivial ones.

The US courts, especially in red-neck areas with elected judges and semi-literate juries, are totally inadequate for handling such matters. Even a Supreme Court justice recently called eastern Texas a 'rogue jurisdiction'.

It always makes me laugh when I see tea-party types hailing the USA as the champion of property rights. In the world of publishing, they didn't accept international copyright until after I was born. Look at the Beatrix Potter scans in Google books: all of shoddy pirate editions in American libraries!

There are other rewards apart from money.
If everyone thought like you (ie. money focus), we wouldn't now be using most of the programs/distros. If a skilled developer thinks the FOSS model is flawed, they are free to abandon it and join MS/Apple, etc.

I think you're making it more complicated than it should be. I don't see any problem with the existing model. Having said that, I'm not a developer so I might not see some underlying problems.

//offtopic
According to my experience if programming is your job(or "main skill"), then you should not work for free - it is extremely unhealthy.

Let's say you wrote a new software from scratch and decided to make it opensource. As far as I know, there is no reliable way to make any profit from writing software alone - you'll have to slap advertising onto website, provide paid support or sell manuals/merchandise, and anybody will be able to hijack your business at any moment (there's an interesting story about how paint.net became closedsource). With proprietary license you can sell actual software and focus on actually improving it. With opensource the only way to profit from it is to sell something that is not actual software you wrote. I.e. programming skill goes unrewarded.

And there lies the exact problem. It isn't about protecting investment, its about calling dibs on simple ideas then using the legal system ( I hesitate to call it the justice system) to screw people over.

I thought the whole world understood by now that rules only applies to the Americans when they want them to.

I think a lot of FOSS developers have other jobs which pay the bills. Additionally, AFAIK, bigger FOSS projects often have some commercial support. I know that it might be difficult if your FOSS project is your only source of income, but I still think that a lot of developers wouldn't get into FOSS if they:
a) didn't have a plan how to earn money on it.
b) didn't do it out of passion (not really focused on making money out of FOSS)

btw, Here are some ways of making money from FOSS projects. I think one of the ways mentioned there is similar to your idea of double licensing.

Which is the reason why FOSS is not "the way of future" and will be replaced by something else.

Dual-licensing is selling proprietary software. The rest is selling something other than original software.

You've got a point here but selling something other than original software is a viable option. Red Hat is a good example. I don't think they are complaining about their financial situation.