The Smart Money: The economics of gun control

Posted Tuesday, December 18, 2012 in Analysis

The Smart Money: The economics of gun control

Visitors lay flowers at a memorial to the children and adults who died at Sandy Hook Elementary School in Newtown, Connecticut.

by Gina Hamilton

In the wake of the Sandy Hook Elementary School mass murders, a particular gun came under special scrutiny.  It is the AR-15, originally made for the military (where it is known as the M-16), but eventually the design was sold to Colt, a civilian rifle manufacturer.  Even so, it's a military weapon, a lightweight, magazine-fed, semi-automatic rifle.  Since 1963, when Colt got the design, they've allowed other manufacturers to make the gun as well, and the one that was used in the mass shootings, the Bushmaster 233, was manufactured by a company that, until 2011, had a factory in Windham.

The Bushmaster 233 is the most popular AR-type rifle in the world.  (AR stands for 'auto reloading', meaning the gun holds at least 30 rounds before it must be reloaded, and the Bushmaster also has a 100-round barrel clip available for sale.)

The guns are virtually useless for hunting and aren't for self-defense.  People who use them ... legally anyway ... tend to go to shooting ranges and rip up paper targets. They were desiged during the assault weapons ban (which covered most auto reloading rifles) which expired in 2004.  AR weapons have been used in almost all mass shootings since the ban fell, primarily because they are so easy to get.

Until the Newtown shootings, Walmart sold Bushmaster AR rifles; so did Dick's Sporting Goods and Bass Pro Shops.  All have pulled the weapons from their shelves and websites, at least temporarily.  But Cabela's is still selling the weapon.

Since the Newtown shootings,  fear that assault rifles will once again be banned has driven up demand, according to many gun shop owners.  Robert Caselnova, who owns a Connecticut gun shop located less than 10 minutes from Sandy Hook Elementary School, said firearms sold briskly over the weekend, with multiple requests for AR-15 style rifles.  Other independent gun shop owners across the country report the same phenomenon.

So what would the economic impact of a potential 'assault weapon' ban be in the U.S.?

Gun sales of particular models would plummet.  No doubt this would have an an impact on the initial economics of a gun ban.  It would stand to reason that any new legislation for assault weapon bans would be different from the ban from the 90s, which gave manufacturers a virtual blueprint of how to change their weapons slightly to make them 'legal'. The Bushmaster 233 was created during the ban.  This time, the ban would likely be much more general.  While the specifics haven't been provided yet, in general, potential gun owners should expect:

1. Stronger background/mental health checks and an extension of background checks to private sales and gun show sales.

2.  A limit on high-capacity magazines. 

3.  A limit on certain types of ammunition, and a requirement, not unlike cold medicines, to register your purchase so you don't buy mass quantities of ammunition at different sellers within a certain period of time.

4.  A ban on certain types of weapons, including auto reloading rifles and handguns.

Last year, 16 million guns were sold in the U.S., about half of those the type of weapon that would be affected under such a ban.  At an average price of $400 per weapon, we're looking at a potential loss to the consumer economy of $3.2 billion.

So, it would definitely be a hit to the manufacturers and gun dealers.  Jobs would be lost, no doubt.  Some small businesspeople would probably have to close up shop.

But let's look at the flip side of the economic question.

This year, like every other year, approximately 30,000 Americans will die of gun deaths.  A little more than half of those are suicides, another third are homicides, and the rest are accidents.  Only about 480 are justifiable homicides, either a homeowner defending himself or a police shooting or someone moving to stop a gunman from committing mass slaughter.

Well, that's never happened, except for police.

But at a loss to the economy for each life estimated at $200,000, in terms of lost productivity, police and judicial time, medical care and medical examiner costs, final expenses, and so on, the hit to the economy each year from gun deaths is approximately $6 trillion.  If half of that number is not lost because of an assault weapons ban (and the estimate from the Brady Foundation is that the 1994 ban cut the gun murder rate by 45 percent), that $3 trillion would far outweigh the loss to the economy caused by the ban of only $3.2 billion.

Economically, assault gun control makes good sense.

But then, this isn't really an economic issue, is it? Anyone who watched even a few minutes of television since Friday knows that the Sandy Hook shootings opened up holes in everyone's hearts.  Reporters couldn't tell the story without welling up.  The President cried.  Parents and family members are utterly desolated. 

The gun lobbies have been remarkably silent, and even lawmakers who support unfettered gun rights refused to go on the Sunday talk shows and justify their positions.

This may be the moment when Americans decide their kids matter more than their guns.  And if that happens, the society will be a better, safer, more civil one.

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