It’s a problem that has vexed politicians, academics, the media and civilian disarmament types for decades…Americans’ embarrassing national love and support for firearm freedom. More specifically, they can’t figure out what to do about our terribly inconvenient affinity for the nation’s most popular rifle, the AR-15 . . .
Gun controllers have tried passing laws, advocating for repealing the right to keep and bear arms, promoting and shaping a consistent message that more gun control is the “rational” solution and, well, moral suasion. Somehow, none of this has worked, particularly on a national level.
Now, along come two ivory tower academics to take another crack at the problem.
Yale’s Ian Ayres and Texas’s Abraham L. Wickelgren have put their pointy little heads together and looked at the frustratingly persistent popularity of AR-15 rifles from an economics perspective. The result: eureka! They’ve managed to come up with a gun control solution gun manufacturers can get behind!
But the problems with their incisive analysis start early and often:
One of the more daunting tasks in the current struggle to pass sensible gun control legislation is how to neutralize the political power of gun manufacturers who potentially have hundreds of millions of dollars at stake.
Here’s some news for the distinguished perfessers: among the panoply of individuals and interests that fight against restrictions on the right to keep and bear arms, gun makers and the political influence they wield play only a bit part, at most.
The reason politicians are so reluctant to impinge on Americans’ cherished right to armed self defense isn’t because Smith & Wesson, SIG SAUER, GLOCK and the rest are out there, sprinkling cash around Washington, D.C..
It’s because there are tens of millions of gun owners who are passionate about their natural, civil, and constitutional right to keep and bear arms. They’re politically aware and they vote. That’s a lesson you’d think the anti-gun left would have learned from painful past experience.
Ayres and Wickelgren are off to a rollicking start with a big, juicy false premise on which to base their prescription for getting to an “assault weapon”-free nirvana. So let’s get to the meat of their argument.
But there is a straightforward, if perverse, way to co-opt the gun industry into supporting some restrictions: Help firearm manufacturers cartelize their industry. Congress could immunize gun manufacturers from antitrust liability—making it legal for them to collude and raise gun prices.
Oh noes! Now we’re really screwed! These two have finally stumbled on the secret…the magic bullet (so to speak) aimed right at the heart of gun demand that will finally cut the number of civilian-owned firearms in this county. The one we hoped no one would would ever discover!
Ayres and Wickelgren want to use gun makers’ own greed as a weapon against the rest of us. We’ll never be able to afford to buy another AR now!
Our antitrust laws are designed to prevent firms from agreeing to limit supply in order raise prices. In most markets, this is in the service of protecting consumers and enhancing efficiency. But for products that cause harm, both the public and the producers of the product can benefit from higher prices and reduced supply. Legalizing a gun cartel by itself is a kind of gun control. Just as OPEC is the friend of any environmentalist who wants to reduce oil consumption, a gun manufacturing cartel will reduce the quantity of guns sold in order to raise prices.
Ayres and Wickelgren are apparently unfamiliar with the oil industry phenomenon that is fracking. Whether it’s oil or small arms, just like those fences and elaborate security systems put up around Jurassic Park, nature (and the market) always finds a way. Just ask Cody Wilson.
Consider, for example, the AR-15 rifle. The AR-15 isn’t a brand name sold by single manufacturer. Rather it is a genus of rifles produced by more than a dozen competitors—sometimes with prices less than $700. But protected by antitrust immunity, these erstwhile competitors could band together and raise the price toward what a monopolist would charge.
Pure genius. Since there are only a dozen or so makers of AR-15 rifles, it should be easy to cartelize the business and incent the few makers of these weapons of war to pad their bottom lines once they’re granted an antitrust exemption. Right?
Just one problem. In “researching” their seminal piece for the port-leaning boys at Brookings, Ayres and Wickelgren apparently spent all of three minutes Googling “biggest makers of AR rifles” to come up with that one, lame blog post to link.
That’s apparently the sum total of their knowledge. So in their abject ignorance of the firearms business and half-assed attempt to gain a little insight into their topic, they somehow overlooked a few other noteworthy players in the AR manufacturing game. Little companies like . . .
- Sturm, Ruger (publicly traded, largest maker of firearms of all types in the US)
- Vista Outdoor (diversified, publicly traded maker of Savage rifles)
- FN America (largest maker of the US military’s AR pattern rifles)
And then there are . . .
- Springfield Armory
- Lewis Machine and Tool
- Knight’s Armament
- Spike’s Tactical
- Midwest Industries
- Palmetto State Armory
Just to name a few. Never mind the dozens of smaller bit players that turn out thousands more guns a year.
Another six minutes of searching — or actually talking to someone who, you know, is familiar with the gun business — might have revealed to these lazy academics that AR manufacturing isn’t nearly as concentrated as they think. But Ayres and Wickelgren apparently couldn’t be bothered.
Monopolists sometimes charge prices many multiples of their cost. The demand for guns has been estimated to have a fairly high price elasticity—so even relatively small price increases of these deadly firearms might have put them beyond the means of the purchasers of the AR-15 style rifles used in the Parkland, Newtown, and Aurora mass shootings.
Right. Because with loads of manufacturing capacity, the ease of making an AR yourself and at least 10 to 20 million scary black rifles already out there in the hands of gun owners nationwide, it would be nigh on impossible for someone like a James Holmes, Nikolas Cruz or Adam Lanza’s mother to get their hands on one.
Once we realize competitive gun prices are the enemy of harm reduction, other traditional government goals will stand on their head. Under the General Agreement on Tariffs and Trade, most countries in the world are committed to multi-round negotiations to reduce trade barriers such as tariffs or quotas. But as applied to guns, raising the tariffs of foreign imports can again save lives and increase gun industry profits—by reducing the threat that new entrants will flood the American market with cheaper guns undercutting the price that domestic manufacturers can charge.
So they plan to choke off imported ARs through high tariffs. That would cut out Hecker & Koch, TAVOR (not technically an AR) and, well, just about no one else.
Indeed, seeing gun-control through the lens of industrial organization helps identify the types of legislative initiatives where the intransigence is likely to be weakest. For example, banning bump stocks or high capacity magazines would negligibly affect the industries’ overall profits. In fact, the industry should welcome efforts to reduce the stock of existing guns because this would increase the willingness to pay for new guns. As long as the package deal of an antitrust exemption and additional gun control measures results in a net increase in gun industry profits, it should have the support of the gun industry.
As Ayres and Wickelgren see it, these newly-cartelized AR makers will gladly trade corporate support for “high capacity” magazine bans, outlawing bump fire stocks and, say, raising the long gun age to 21 for the promise of new, easy profits to be had by hiking their prices.
Another of the mysterious aspects of the firearms business and America’s gun culture, about which the authors are apparently blissfully unaware, is what happened to Smith & Wesson and Ruger (to say nothing of Springfield) when those companies made common cause with politicians who would degrade or eliminate our Second Amendment rights. There’s no reason to think American gun owners would be any less forgiving now of colluding gun makers that signal support for universal background checks or a national magazine capacity limit.
Professors Ayres and Wickelgren, however, come out smelling like roses. They have one more publishing credit for their no doubt impressive CV’s. The fact that they’ve managed to publish a half-baked, minimally researched and fatally flawed article won’t matter in the least to their colleagues in the faculty lounge. They’re on the “right” side of the guns in America question and that’s all that really matters.