Monopoly: Firearms Edition
Although Mass Shootings are estimated to be about 3%, according to the Gun Violence Archive, it is the type of gun violence that is covered by the media the most. With at least 3 incidents in the past 8 months already, the Public is looking for Congress to find an answer to solve the problem of gun violence. But none have successfully been established on a Federal level. Even though there are many different aspects to the causes of gun violence, my focus is on the amount of firearms and the financial aspect of purchasing a firearm. With competitive pricing and the Sherman Antitrust Act, prices for firearms are easier for people to purchase. A direct way to try and slow the number of firearms in the public would be to allow an exception to be made for firearm manufacturers and to allow them to monopolize their industry and collectively raise prices of firearms to lower the number of new weapons purchased which would in turn slow the increase of a risk of questionable people purchasing a firearm for reasons that would result in the harm of another human being.
Our antitrust laws are initially designed to prevent larger firms from limiting supply in order to raise local product prices (Clayton). 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 monopoly by itself is a kind of gun control by reducing the quantity of guns sold in order to raise prices. The AR-15 rifle 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 former competitors could band together and raise the price toward what a monopolist would charge. 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.
Banning bump stocks or high capacity magazines would 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. The idea that government might act as a monopoly ringmaster, allowing private collusion among the manufacturers of firearms might seem far-fetched, but Congress already has explicitly exempted baseball and insurance from parts of the Sherman Act. The 1997 multi-state tobacco settlement effectively reduced harm by facilitating a huge price increase on tobacco products. Under this deal, manufacturers had to pay “damages” of 35 cents a pack on future sales but the settlement exempted a substantial amount of sales from the damages formula. The settlement quickly led to an across the board price increase with the manufacturers earning an extra 35 cents a pack on all of the exempted sales (Tobacco). The multi-state cigarette settlement is a clear lesson in how government was willing to sacrifice the interests of consumers in order to simultaneously secure higher producer profits and advance public health.
This obscure strategy applied to gun safety drives a wedge between gun consumers and gun producers. It would help tease out how much of the political support for guns right is driven by passionate purchasers of firearms and how much stems from producers trying to maximize profits. Immunizing manufacturers from antitrust liability might be better for consumers than current laws that immunize them from many types of product liability. The recent tragedy in Florida has sparked a growing tide of support for gun control legislation. We’ve seen the same increase of support after mass shootings in the past only to have the prospect of meaningful reform disappear because of the heavy influence of the gun lobby. One example would be S.2009 Background Check Expansion Act introduced in October of 2017, which has yet to be voted on (Murphy). Instead of outrage at the influence of the gun industry, it is time to use their own self-interest to help advance the interest of public safety rather than to thwart it. “More profits, fewer guns” should be a slogan that can attract substantial support from all sides and may be the only way to overcome the gun lobby’s opposition to gun control.
In summation, real action to prevent major gun violence would only come with the cooperation of both Congress and firearm manufacturers. The most direct way would be to exempt the manufacturers from the laws of the Sherman and Clayton anti-trust laws, allowing them to collectively raise the price to purchase firearms. This would in turn slow the demand of firearms which would begin to lessen the number of firearms in the hands of the public and decrease the likelihood of a firearm being purchased for non-recreational reasons.
“Clayton Antitrust Act.” Infoplease, Infoplease, Oct. 2015, www.infoplease.com/encyclopedia/history/united-states-canada-and-greenland/us-history/clayton-antitrust-act.
“Master Settlement Agreement of 1987” https://web.archive.org/web/20080625084126/http://www.naag.org/backpages/naag/tobacco/msa/msa-pdf/1109185724_1032468605_cigmsa.pdf
Murphy, and Christopher. “Text – S.2009 – 115th Congress (2017-2018): Background Check Expansion Act.” Congress.gov, 25 Oct. 2017, www.congress.gov/bill/115th-congress/senate-bill/2009/text.
“Past Summary Ledgers.” Gun Violence Archive, 8 May 2018, www.gunviolencearchive.org/past-tolls