Rudy Giuliani Teaches Economics 101
Jacob Sullum | April 12, 2007, 3:31pm
Here is a puzzling Rudy Giuliani quote from the June 2000 radio show I mentioned in my column yesterday. Mayor Giuliani had this to say regarding gun manufacturers:
They've acted negligently by overproducing guns, way beyond the number that's necessary for hunting and for law enforcement, maybe by factors of 3 and 4 to 1. In doing that, they have knowingly made a calculation that they're selling to an illegal market, and that's negligence....In fact, it would be more in their business interest to produce less guns, because the price of guns would go up if there were less guns, just like we were talking about with OPEC, you know, Economics 101. Instead of producing less guns, they produce 6, 7 times more guns than the legal market actually would demand. Therefore they have to know that they're supplying an illegal market.
Notice, first of all, that the ratio by which gun production supposedly exceeds the legitimate market increases by 100 percent or so in the space of a few sentences. And what are we to make of Giuliani's claim that manufacturers could make more money by producing fewer guns? Presumably he imagines that gun makers have formed a cartel that can in effect dictate prices, without fear of defection by existing companies or competition from new ones. Granting this implausible scenario, why would gun makers choose not to exercise this power? By Giuliani's account, instead of producing fewer guns at higher prices, which would be in their financial interest, they are producing lots of guns at relatively low prices (almost as if they are competing against each other for customers). What could account for such seemingly irrational behavior? Either gun makers don't know their own bottom lines, or they are so determined to make sure criminals are well armed that they are willing to lose money in the process.
LarryA | April 12, 2007, 9:00pm | #
They've acted negligently by overproducing guns, way beyond the number that's necessary for hunting and for law enforcement, maybe by factors of 3 and 4 to 1.
Somewhat true. In addition to hunting and law enforcement you have all the firearms sold to target shooters, collectors, and folks interested in self-defense. I would submit that, despite Guiliani’s opinion, these are legitimate markets. Then there’s the U.S. military. Wouldn’t want our soldiers shortchanged in the arms department.
In doing that, they have knowingly made a calculation that they're selling to an illegal market, and that's negligence....
In fact, firearm manufacturers are heavily regulated to minimize illegal sales. In addition the firearm industry has for decades backed initiatives to reduce “selling to an illegal market” with programs like
Don’t lie for the other guy (http://www.dontlie.org/) aimed at straw purchases.
Reducing the availability of legal firearms would impact criminals about like reducing the availability of beer would impact drunk drivers.
In fact, it would be more in their business interest to produce less guns, because the price of guns would go up if there were less guns, just like we were talking about with OPEC, you know, Economics 101.
Half true. If gun manufacturing were greatly reduced due to the kind of gun control laws promoted by Guiliani the price of legal guns would rise acutely, particularly for law enforcement and the military. IOW it would cost us taxpayers more to
not own guns.
It would also greatly reduce the ability of U.S. arms industry to respond to crises. For instance, when the military recently ran short of 5.56mm NATO due to burning ammo in Iraq, they simply let contracts to ammo manufacturers who usually supply the civilian market. Converting machines producing .223 Remington hunting cartridges to military configuration is a matter of a few adjustments and a different bullet.
The other half is the effect on the criminal market. The current poster boy for this is Britain, where a total ban on legal possession of handguns was followed by increasing gun crime and expanded availability of illegal handguns on the black market. As well as increased popularity for choosing crime as a profession, given a disarmed pool of victims.
Instead of producing less guns, they produce 6, 7 times more guns than the legal market actually would demand. Therefore they have to know that they're supplying an illegal market.
Really? Felons make up about 4% of the U.S. population, while gun owners total at least 40%. So for every firearm a legitimate gun owner purchases, a typical felon acquires
sixty or seventy? Bullshit.
Gray Ghost, sorry, busy day. I have two concealed handgun classes coming up Friday and Saturday. Another eighteen licensees certified.
Lastly, regarding the probable forfeiture of a successfully used defensive firearm, how much is your life worth? Moreover, the cost of the lawyer(s) you'll have to retain, both for the criminal and civil litigation from any shooting, will far outweigh the value of the impounded weapon.
That’s why I have a legal services contract covering the cost of representation in criminal matters through the grand jury process, and live in a state like Texas where civil litigants can’t recover once a shooting is justified.