Gun Control from an Economist’s Perspective

Firearms have the capacity to do harm to others. So along with the right to own weapons comes the responsibility to help ensure that they are not used for that purpose. There are, of course, valid reasons for using for them, like when there is a threat to one’s life, that of the members of the household or one’s property, or for hunting and recreational purposes.

The essence of this proposal is to acknowledge the right of anyone to bear arms as long as they are competent to do so. Along with that right, however, comes their role and responsibility to attempt to ensure the arms do not do harm to others and if they do, to compensate those who were injured. The following proposed program are designed to accomplish those ends.

Currently the real and financial burden of gun violence falls on those who are injured and their families, on non-gun owners, and on taxpayers. It also requires additional funding to to cover the costs of the police, other first responders and others who provide help and of the resources required to recover from the harm done by gun violence.

The proposed program has three components:

• The first is a registry that identifies all gun owners and the firearms they own and provides for a background check to ensure that they are competent to own those weapons. As a first step the flaws in the current system that make accomplishing those objective harder must be corrected.

• The second is to establish a pool to compensate those who are harmed by the illegal use of those weapons.

• The third is a gun buyback program to create the incentive for gun owners to give up their weapons, especially those that can be used in mass murders.

If no guns were in private hands there would be no need for these programs. Rather than placing the burden of the cost of gun violence on the victims and taxpayers, the objective of these programs is to transfer some of the costs to those who elect to own guns and the suppliers of firearms and their paraphernalia.The purpose is to make gun violence less likely and to compensate those who are harmed by it.

If no guns were in private hands there would be no need for these programs. Rather than placing the burden of the cost of gun violence on the victims and taxpayers, the objective of these programs is to transfer some of the costs to those who elect to own guns and the suppliers of firearms and their paraphernalia.

An important principle in our approach relies on the willingness of those affected to cover the cost of the programs designed to make holding firearms safer and compensating those who are harmed by them. The programs are funded by those who want to hold guns, those who benefit from their insistence on that right and those who benefit when they are willing to forego it. They are not funded out of general tax revenue. Even if they result in an expansion of public programs and services, they do not require additional tax revenue because they are funded by the users and beneficiaries of the programs.

While the proposals appear to increase the role of government, they don’t necessarily. Some of the functions can be performed by private sector organizations, either NGOs or firms. Regardless of who performs them, however, they will not contribute to government expenditures. Instead, the funds will come from those who those who legitimately insist on their right to own weapons and their suppliers. If a potential gun owner can afford to buy a gun, they can afford to contribute to a fund to compensate those that are harmed by their type of weapon. The gun buyback program will be funded by non-gun owners who think they will benefit from it. The proposal will not add to government tax bill since any additional expenditures will be covered by an increase in revenue from the responsible parties. It will not contribute to the national debt.

What we are offering is a comprehensive review and integration of existing gun control programs along with some new elements and a different approach to funding them. It is useful to recognize that the proposed program is similar to successful programs and laws that are on the books in other areas. They include the requirements for owning and driving vehicles — a drivers license, vehicle registration, a VIN number, automobile liability insurance and an annual automobile tax. Another example is the prescription monitoring program that helps prevent illegal quantities of addictive drugs from getting into the wrong hands.

Let us take a closer look at what this firearms control program would involve.

I. Licensing and registry

  • The first component is a comprehensive registry. It includes:
  • The names and addresses of all licensed gun owners along with each of their firearms,
  • To be entitled to own firearms and included in the registry they must have passed a background check and continue to adhere to its provisions.
  • Each firearm must have a serial number that specifies its type and characteristics.

The objective is to guarantee that the gun owner has the capacity to use the weapon wisely and is not likely to use it in the commission of a crime. That is the reason for a background check. While not infallible, it is an important first step. Consequently, anyone who insists on their right to bear arms should be willing to identify themselves and submit to it. The background check is designed to ensure that they are knowledgeable, capable of handling the weapon, guarantee it will be maintained in a secure place and have no intention of harming others.

Another important element is identifying the weapon, being able to ensure that it remains in the hands of the original licensed owner and being able to track any transfer of ownership. That can easily be done by having an engraved serial number on each weapon. That number would identify the type and attributes of it and uniquely identify it. An integral part is establishing a database that keeps a record of each weapon and its owner. Any sale or transfer of the weapon must be recorded, identifying the new owner and ensuring that they too have passed the  background check.

A. Licensing

The license would identify the owner and the firearm they are entitled to own. It is also proof they have met the necessary requirements to do so. A separate license will be issued for each weapon. The license would contain a picture ID, just like a driver’s license. That information is then entered into the database. In order to purchase the weapon identified on it or any paraphernalia — like clips or ammunition — the owner would be required to present the license. That information would be recorded on the sales receipt and entered into the database. If the seller fails to do that their own license would be revoked.

B. Background check

Anyone who wishes to own a gun should be subject to a background check to ensure that they are qualified to do so. The background check includes the owner’s prior history. The rules for owning and possessing a firearm must be established and published. The consequences for the subsequent violation of any of those rules are discussed below. The background checks must be provided by a federal government agency since no other government has necessary jurisdictional authority. The funds required to pay for the background checks would be paid for by those who desire to own the firearms. If potential gun owners are open and transparent about their right, they should be willing to identify themselves and submit to the check.

C. Registry

Every gun will have an engraved serial number. That is what was done historically. The unique serial number will also identify the type of weapon and its unique characteristics. Putting it on every new one will be the responsibility of the manufacturer, importer or dealer. When obtaining a license, the owner of a firearm without a serial number must have it engraved on it. The firearm and its owner can then be entered into the database. The identification number and the registry could be developed and maintained by a government agency, NGO or a private company. The characteristics of the registry would be determined in consultation with gun owners and users of the database. For the system to work well it is important that it be readily accessible and be able to identify and keep track of all gun owners and their firearms. The approach would be similar to the development and use of the Universal Product Code. Its history provides insights into some of the likely issues involved. (See Wikipedia)

D. Financing of those services

The basic principle is that the cost of developing, maintaining and operating the system falls on the gun owners and the manufacturers, importers and dealers of firearms. There would be no need for the system if no one chose to own a gun. As part of their contribution manufacturers, importers and dealers of firearms and any others who profit from their sales should be charged a fixed percent of the sales price of each weapon they sell. For those weapons that do not already have an identification number the engraving charges are covered by the current owner. The cost of the background checks should fall on those who want to bear on arms.To help cover those costs they would be charged a fee when they attempt to purchase the weapon. The initial licensing and registration fee helps cover that part of the process. In addition, an annual fee on all license holders — like the tax on owners of vehicles — provides the additional funds necessary for maintaining and operating the system. Weapons that are more elaborate and have a greater capacity of doing harm might well be charged higher fees.

E. Penalties

As long as the owner of the weapon uses it in accordance with the law and does not violate any of the provisions of the background check, no additional issues arise. If any conditions of the background check are subsequently violated the license would automatically be revoked. Furthermore, all weapons in their possession would be immediately confiscated and destroyed. Failure to maintain control over the weapons and failure to make sure that they do not get into the hands of any unauthorized person results in the same penalties.

Any gun used in violation of the law would be confiscated and destroyed along with any other guns in their possession — even those with serial numbers. That includes firearms without a serial number or ones owners are not licensed to have. Those provisions apply to dealers as well as gun owners. Ensuring that every weapon has an identifying serial number is every gun owner’s responsibility. If they violate this provision they will also be subject to financial penalties.

During an interim period before the proposal goes into effect there will be a window — like a tax free holiday — where anyone choosing to can turn in any functioning firearms no questions asked. To encourage them to do so there will be an award — say, $100 for handguns, shotguns and rifles and $500 for assault type rifles because they are capable of doing greater harm. It would be financed by contributions from non-gun owners and is similar to the gun buyback program. (See below)

The licensed owner of any weapon is also responsible for any injury, harm or damage it may cause. It is their responsibility to ensure that the weapon is under their control and does not come into the hands of an unauthorized user. If the unauthorized transfer of a weapon is not reported immediately, the same penalties described above will be imposed on the licensed owner. If the gun is stolen or lost it must be reported immediately in order to avoid personal responsibility for its use. Furthermore, the licensed owner will be responsible and accountable for any injury or harm caused by it.

Failure to comply with the regulations will subject the owner or possessor to significant penalties. Any transfer of a gun, rifle, assault rifle or any predesignated firearm, clip or appliance will be subject to the same requirements. Any dealer who does not adhere to the regulations, including ensuring that the weapon is properly identified on the sales receipt and the entered into the database will have their license revoked.

F. Improvements in the current system

Two comprehensive articles in the New York Times discuss significant problems associated with the current system for background checks and the federal registry of gun transactions. It is important that they be addressed and corrected and that the organizations are provided with adequate funding to have a well-functioning system. (See Gaps in F.B.I. Data Undercut Background   Checks for Guns by Michael S. Schmidt and Charlie Savage, and  Legal Curbs Said to Hamper A.T.F. in Gun Inquiries by Erica Goode and Sheryl Gay Stolberg.)

III. Reimbursement fund

A. Introduction

As the Sandy Hook Elementary experience shows, there is no way of holding Adam Lanza, or his mother, Nancy — the licensed owner of the weapons — accountable for the harm caused. They are no longer alive and it is unlikely that the value of Nancy’s estate is anywhere near large enough to compensate the victims or pay for the extra cost of the first responders and others who became involved. Who should bear the burden of that loss? Who should cover the extra costs of the responders and the other resources required because of the deplorable incident? Should it be just the victims themselves, their families and the taxpayers? That is where the real and financial costs of the shooting ultimately fell. Certainly, to put it mildly, they had little control over what happened. Yet, they are the ones who bore those costs. Moreover, the twenty six and seven year olds were not gun owners. Some of the six adults may not have been either.

True enough, other licensed gun holders were not directly involved in the incident. And, certainly, they regret the incident as much as the non-gun owners among us. Nonetheless, it is their insistence on the right to bear arms that contributes to the increased likelihood that this incident and others like Sandy Hook Elementary happen.

We acknowledge an individual’s private right to own firearms as long as it is done within the law. There is an additional problem however. Some gun owners, licensed or unlicensed, use those weapons to do harm to others — as at Columbinethe Aurora theaterthe Sikh templeSandy Hook Elementary, etc. and in individual shootings. Those actions harm the individuals involved. They should be reimbursed for the disability, pain and suffering they incur. That illegal activity also places an additional burden on local, state and federal law enforcement and other government agencies.

Those who insist on their right to own guns are not directly responsible. Yet their insistence on that right makes the harm caused by guns possible and more likely. To reimburse anyone harmed by the inappropriate use of the weapons, the owners, members of gun holders groups and firms that benefit from the sale of firearms and paraphernalia should be prepared to contribute to a fund that will be used to reimburse anyone harmed by them.

B. The Fund

A fund will be set up to reimburse the victims of gun violence and help cover the additional expenses caused by it. It is like an insurance pool. The fund will be administered by an organization that keeps track of the nature and extent of the damage caused by the illegal use of firearms. Since the extent of the damages depend on the type of weapon used, separate funds should be established for handguns, rifles, assault weapons, etc. The size of the fund should be based on the data of the damage caused by that type of weapon. It will depend on the frequency and severity of the incidents caused by each type and by the amounts of the damages caused by it. The organization will be responsible for administering the fund and collecting the data. The amount in the fund can be revised annually to reflect changes in the year-to-year experience.

Gun owners who only choose to have handguns or rifles should not have to pay for the harm done by assault weapons. Consequently they should be required to pay into the pool that reimburses those harmed by the use of handguns, the one where rifles, or the one where shotguns are used. They do not contribute the pool set up to compensate those harmed by assault type weapons.

C. Financing

Each year the agency or organization responsible for administering the pools will determine the expected amount required, the cost of administering the funds and the amount needed to collect and analyze the data. The annual fees — like an annual insurance premium — for covering those expenses will be paid by the gun owners and the manufacturers, importers and dealers of each of the types of weapons and their related paraphernalia. Any improvement in the ability to reduce gun violence and the harm caused by it will be reflected in the year end surplus in each of the funds. It will be carried over into the next year and reduce that year’s fees.

IV. The Gun Buyback Program

Gun buyback programs have been around for a while. One must say they have not been very successful in getting firearms out of circulation. Typically they offer a fixed fee, like $100, and often ensured the anonymity of the seller.{See Wikipedia) Nonetheless every gun that is purchased and destroyed is one less out there to do harm. We think that it could be included and, in fact, expanded as part of the gun-control program.

A. The Program

Here’s how it would work. A fund would be set up to pay for the purchase of firearms and to operate the program. Buying back weapons at or near market price creates an incentive for gun owners to give up their weapons. Since those purchased will be destroyed, they cannot do harm. While the program would purchase any weapons that were offered, its initial focus would be on those that could do the most harm, like high-capacity assault style rifles and their magazines.

There is an active market in firearms — both new and used — through dealers and at gun shows. Consequently, the price for weapons is easy to determine. In fact, the program might offer a bonus over and above that price as an added incentive.

In fact, the organization could consider having undercover buyer-agents on staff. They would purchase weapons from dealers and at gun shows at market price. They could serve the additional purpose of ensuring that the sales were in compliance with gun control regulations. If the guns that were sold did not have a serial number, were unlicensed or if the seller did not require a background check, for example, the seller would be held accountable. So would the seller and the license owner if the firearm turned out to be stolen and was not previously reported.

B. Funding

As we indicated earlier the funds for the program would be provided by non-owners, or gun owners if they chose to participate, who decided that it was important enough to get firearms out of circulation that they voluntarily paid into the program. Some of the funds could come from significant individual contributions, like the San Francisco experience. Others through a checkoff system on the income tax form.  It would make it possible for them to add, say $25, or perhaps a variable amount, to their tax to support of the program.The gun buyback program would not be funded out of general tax revenues.

V. Summary

It is fine to insist on one’s right to bear arms. However, along with that right comes the obligations of ownership. The responsibilities include ensuring that the weapon does not inflict harm on others. It also includes developing and paying for a system that makes that less likely and another program whereby if harm comes to others they are reimbursed. In that way the advocates of gun ownership would be accepting responsibility not only for themselves but for the burden and costs that their exercise of the right to bear firearms places on others.

Anyone insisting on their right to bear arms should be open, honest and transparent about it. They should be willing to identify themselves, submit to the check and pay the fees for it. If they are unwilling to participate, they forfeit the privilege of gun ownership. Anyone possessing a weapon they are not licensed to own would be subject to penalties and that weapon and all others in their possession would be confiscated and destroyed.

If this program is adopted the price of gun ownership would go up. The higher prices would help cover the social costs — that is, those costs currently borne by the victims of gun violence and non-gun owners. Those who are unwilling to pay the fees or higher price, can always turn in their weapons and they will be financially compensated. Furthermore, this approach will not contribute to the deficit since gun owners and the manufacturers, importers and dealers who profit from the sale of the weapons and the paraphernalia will be covering its costs in return for the privilege of owning and selling them.

With programs that are new and have not been tried before, there is no way of knowing beforehand whether they will be effective in accomplishing the desired objective or how much they will cost. That is especially true when the details of the legislation are unknown and when it can include provisions that favor private interests. It also depends on the way in which laws are interpreted, monitored and enforced. That ultimately determines how effective the program is and how much it costs. Furthermore, once passed, the stakeholders will challenge it and make adjustments to it for their own benefit. In addition the success of the program depends on compliance and the ability to enforce its provisions. Under those circumstances, perhaps a mandatory review by an independent group — like Simpson-Bowles or the National Institutes of Health — say ten years after it is passed, should be included in the initial legislation. The review would attempt to determine whether the program meets its objectives and whether it is cost/effective. Mandatory termination of the program would follow an significantly unsatisfactory review.


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