Want To Message About Gun Violence? Do’t Forget The Gun.

Following the October, 2015 mass shooting at Umpqua Community College in Oregon, MoveOn.org announced a petition drive asking gun-owning members of the organization to ‘push for common-sense gun control measures;’ an activity which netted support from more  than 32,000 gun-owning MoveOn members within one month.  Practically speaking, the petition went nowhere, but at least it demonstrated that not every politically-minded gun guy supports the NRA.

ruger             And this is good news for the gun violence prevention (GVP) movement, because it runs counter to the usual assumption that the basic fault line dividing Gun-nut Nation from Gun-sense Nation is the ownership of guns.  Not that 32,000 gun-owning MoveOn members compares to the alleged 4 million gun-toters who line up for NRA.  But it’s enough of a base to convince other MoveOn members to get involved, which can’t but help grow the strength of the mainline gun-sense organizations like Shannon’s Moms, Everytown, Violence Policy Center, and the Brady Campaign.

I’m not optimistic about the chances of national gun regulations moving forward in the Age of Trump, but if The Donald gets on his high horse and starts ranting about the 2nd Amendment (a subject that has yielded a curious silence from the 26th Floor of since he ended his campaign,) there’s nothing that gets the opposition more worked up than being able to identify a threat from the other side.  But if Gun-sense Nation wants to mobilize a wider swath of active supporters, particularly folks who largely sit on the sidelines today, they are going to have to come up with a message that reaches beyond simply reminding people about the number of people killed with guns.

And this is where the activities of public service organizations like MADD and the anti-smoking groups aren’t such a good fit. Because everyone drives a car and everyone knows someone else who smokes.  But as an important article published today in The Trace points out, even in cities with high (and increasing) gun-violence rates, like Chicago, Milwaukee and St. Lou, there are many neighborhoods where gun violence remains at historically low levels, and it’s in these more affluent areas, both within the cities and the suburbs, where folks who need to be motivated about gun violence tend to live.

So coming up with a message to which people not directly affected by gun violence will understand is not such a simple or obvious thing. And if the GVP community thinks they can adopt or own a phrase that promotes ‘responsible’ gun ownership, the gun industry itself has been using that exact messaging for over thirty years, and I know they have no interest in sharing idea with the other side. Now I’m not talking about the NRA’s phony Eddie Eagle safety campaign whose effectiveness has never (read: never) been evaluated at all.  I’m talking about the gun industry itself and the basic message that has been promoted by the world’s largest manufacturer of small arms – Sturm, Ruger & Co. – for the last thirty years.

Back in the 1980s, America’s most iconic gun designer, Bill Ruger, adopted the slogan ‘Gun Makers For Responsible Citizens’ to go with the unique heraldic eagle logo that had originally been designed by his partner, Alexander Sturm.  Ruger considered himself a designer and manufacturer of sporting arms, his first hunting rifle to incorporate military-style engineering, the Mini-14, shipped from the factory with a 5-shot mag. In the run-up to the 1994 assault weapons ban, Ruger endorsed not a gun ban but a ban on hi-cap mags, a stance he then quietly abandoned when talk about a company boycott started to spread around.

In recent years, Sturm, Ruger has moved into promoting small, concealable hi-caliber pistols, a product shift which gives GVP an opportunity to push its own definition of responsible gun ownership focusing not on the behavior of gun owners but on the guns themselves.  A 9mm pistol no bigger than a droid simply isn’t a sporting arm. And that’s what causes gun violence – it’s the gun, stupid, it’s the gun.

 

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It’s Not Just Keeping Guns Out Of The Wrong Hands, It’s Keeping The Wrong Guns Out Of Everyone’s Hands.

My first introduction to the gun business was 1965 in North Carolina working for my Uncle Ben.  Like all my immigrant relatives, Ben had been in the iron-mongering business back in the Old Country, so when he came to America he opened a junk yard where he traded scrap metal this for scrap metal that. At some point he started manufacturing a small, 22-caliber revolver which he sold to pawn shops for $15 bucks; the pawnbrokers then resold this little piece of junk for $24.95. This gun was a quintessential ‘Saturday Night Special,’ which might fire one or two shots before it broke.

 

            Glock 43

Glock 43

So here we are, fifty years later, and Uncle Ben’s cheap, little piece of junk for $24.95 has been replaced by, among other models, the Glock 43, which retails for somewhere around five hundred bucks.  But the Glock 43, which is actually smaller and more concealable than Uncle Ben’s crummy, little gun, isn’t a 22-caliber revolver with a capacity of six shots.  It’s an extremely-lethal 9mm pistol which holds seven rounds and with a magazine extension the capacity goes up to nine. If you’re not enamored with Glock, other gun companies like Ruger and Kahr make 9mm pistols which are basically the same capacity and size.

What has happened to the gun business over the last half century is the guns have gotten smaller, lighter, more concealable and much more lethal.  When Franklin Zimring did a study of the calibers found in 1,115 gun attacks in Chicago in 1970, he found that gun attacks with 38-caliber weapons were more than twice as fatal as attacks committed with 22-caliber guns.  When the California Department of Justice published a list of calibers that caused gun injuries in 2009, five times as many guns were used in high-powered calibers like 9mm, 40 S&W and 45 acp than guns chambered for the 22.  You simply can’t compare the damage to human tissue caused by a 9mm round as opposed to a 22-caliber shell. The latter can be lethal if, and only if the shooter is either extremely lucky or is a very good shot.  As for a 9mm or a 40 round, if it hits you anywhere except in your earlobe, you’re going down.

Back in 1968 and again 1994, we passed gun-control laws based on the idea that we could reduce gun violence by keeping guns out of the ‘wrong’ hands.  Which meant keeping guns away from people whose background and behavior indicated that they might represent a threat to public safety or themselves if they could get their hands on a gun.  The current effort to extend background checks to secondary sales is an effort to strengthen our ability to identify more ‘wrong’ hands, as are the strategies designed to tighten the regulatory environment in which gun dealers operate so as to keep ‘bad apple’ dealers from selling guns to people with ‘wrong hands.’

I happen to believe that this approach, while necessary, actually doesn’t respond to the primary cause of gun violence, namely, the degree to which most guns sold today are capable of being used to commit a much higher level of gun violence than ever before.  There is a bill before Congress that recognizes the lethality of assault rifles and is an effort to revive the assault-weapons ban that expired in 2004.  But while this law reflects concerns about the lethality of the AR-style gun, pro-gun advocates are not wrong when they say that, mass shootings notwithstanding, injuries caused by AR-15’s are relatively few and far between.

Know what causes most of the 115,000+ fatal and non-fatal gun injuries each year? It’s those small but powerful handguns which are increasingly the weapons of choice for most Americans who own guns. So instead of spending all our time, energy and money trying to keep guns out of the wrong hands, shouldn’t we also be trying to figure out how to keep the wrong guns out of everyone’s hands?

 

Does The Gun Vote Still Swing Elections? Maybe It Swings Them Against Guns.

I knew that Marco Rubio was unfit to be President (as if the current Republican candidate could pass a fitness test) when he visited the Ruger gun factory back in January and declared that he believed in the 2nd Amendment because a gun was the only thing that stood between our safety and an imminent ISIS attack. Ruger then presented Rubio with a Hawkeye bolt-action hunting rifle that would be about as effective for defending against a terror attack as me using my pen knife against Godzilla or King Kong.

voting           Rubio’s back on the gun beat again, announcing a bill that would allegedly keep terrorists from getting their hands on guns. Rubio’s bill allows the government, following a Court hearing, to deny the purchase of a gun to anyone who has been the ‘subject of a terrorism investigation’ during the previous ten years.  The NSA, for example, tracks millions of electronic communications each year, many of them made by American citizens. Does this activity constitute an ‘investigation’ and, if so, to whom would the NSA turn over all those names?

Be that as it may, the gun issue is now beginning to move downstream to Senate races, and while there has been a lot of talk about how Kelly Ayotte’s refusal to vote for Manchin-Toomey back in 2012 might cost her a reelection in New Hampshire, the truth is that she’s up against a pretty tough competitor in Maggie Hassan, who would give her a run for her money, gun issues or not.

In Missouri, on the other hand, which is truly a gun-rich state, a GOP veteran, Roy Blunt, finds himself in a surprisingly tight race against a relative newcomer, Jason Kander, who has just released what I think is the most original political ad with a gun theme in the entire 2016 campaign.  The ad shows Kander, who served in Afghanistan with a National Guard infantry unit, assembling an AR-15 while he’s blindfolded and challenging Blunt to do the same.  The ad also makes clear that Kander, as opposed to Blunt, favors an expansion of background checks to secondary sales. The ad is a response to a completely-discredited NRA attack ad against Kander which accused him of voting against a bill that would have made it easier to use a gun against an attacker inside someone’s home, when in fact the actual bill, which Kander supported, expanded the right to use a gun outside the home.

Let’s get something straight.  Nobody who is perceived as being anti-gun in Missouri gets elected to anything.  That’s just the way things are.  But the fact that the NRA has put up more than $650,000 in television ads dissing Kander during this campaign tells you two things: first, it says something about the potency of expanded background checks as a campaign issue not just in Missouri but other states as well; second, it validates Hillary’s decision to ignore warnings about the strength of the ‘gun vote’ in deciding to make gun violence a centerpiece of her campaign.

We won’t know until the votes are counted on November 8th and the exit polls appear whether the blue team has been helped or hurt by coming out so strongly against violence caused by guns. But the fact that in the Gunshine State an incumbent like Marco Rubio in a tight campaign for reelection files a totally meaningless bill to prevent ‘terrorists’ from buying guns is another straw in the wind regarding how the gun issue has come into its own.

Until this year it was assumed that in gun-rich states you had to be pro-gun in order to get to the finish line with any chance of beating the other side. And this is still true to a certain extent.  But it’s the word ‘certain’ that may now start to be redefined.  And I’m not sure that I would take the short odds on redefining that word in favor of guns.

 

Why Don’t We Make The 2016 Election A National Plebiscite On Guns?

So Hillary’s beginning to look around for a VP and, not without good reason, the names of some other women have come into view, the most prominent of course being Liz Warren. I say ‘of course’ because this trial balloon is probably being floated by the folks who want to make sure that Bernie’s most ardent supporters don’t bolt and run during the Fall election.  Like where are they going to go?  To Ralph Nader?

hillary            Anyway, I think with all due respect to the gender warriors (said positively, btw) that what Hillary really needs to do is forget about balancing her ticket by using the traditional methodologies like geography, class, so on and so forth, and instead think about issues, in particular the one issue which gave her campaign a real boost, namely, the issue of guns.  Because you may recall that when Hillary raised the gun issue in no uncertain terms, the media (as well as her campaign) described the move as an attempt to exploit a chink in Bernie’s alleged left-wing view of things, but I saw it as something else.

And what I saw it as was the very first response by any Democrat to what had been, and continues to be an endless barrage of “I Love The 2nd Amendment” crap from Trump and the other Republican presidential phonies all the way down the line. This nonsense started the day after two television journalists were killed in Virginia on August 26, 2015 when the Shlump said that it “wasn’t a gun problem” and went on to support the notion that armed civilians made Americans safe from crime.  He then began working the most strident calls for 2nd Amendment ‘rights’ into all his KKK rallies and issued a white paper extolling the virtues of law-abiding gun owners, whereupon all the other Republican presidential weasels followed suit. Remember when Marco Rubio picked up a free gun at Ruger?

Hillary’s decision to go big-time on the gun issue started in the aftermath of the Umpqua shooting on October 1, 2015. And she took it right to the Republicans the very next day in a Florida speech when she said “we need to build a movement” to counter the strength of the NRA.  She made it clear that she was going to attack Republicans on this issue, and she has continued to push a strong GVP agenda ever since.  To quote from her website: “comprehensive background checks, cracking down on illegal gun traffickers, holding dealers and manufacturers accountable when they endanger Americans, and keeping guns out of the hands of domestic abusers and stalkers.” Not a bad list.

And not only is it a good list, but all those issues happen to be supported by an overwhelming majority of Americans, support which cuts across all demographic lines and includes gun owners as well. It also turns out, incidentally, that in all surveys that ask people whether they feel safer with a gun, women consistently score higher than men in believing that gun access puts people at risk.  Women also score higher than men on wanting more gun regulations, with the most recent Pew poll showing 57% of women expressing the need for more gun regulations, as opposed to only 37% of males.

So here we have a significant gender difference on the issue which most clearly differentiates Hillary from the ‘presumptive’ Republican nominee, and one which I believe could be best exploited by bringing to the Democratic ticket another woman whose experience, crowd appeal and media savvy would dramatically overwhelm any Trump-ish attempt to further exploit NRA-engendered fears about the loss of 2nd-Amendment ‘rights.’  Because the truth is that what I want to see is a national plebiscite that will really test, once and for all, the alleged American love affair with guns.  So I got an idea. We need a woman who can drive home the GVP message.  I haven’t discussed this with her, but why don’t we draft Shannon Watts?

Want To Make A Million In The Gun Business? Start With Two Million.

If you think I’m kidding about losing your rear end in the gun business, I can tell you that if I had been holding one million shares of S&W stock three weeks ago I would have been worth roughly $30 million bucks and the same pile of shares today would fetch about $8 million less.  Meanwhile, the financial media is abuzz with the idea that the great run-up of gun sales thanks to you-know-who in the White House has finally come to an end. On the other hand, according to FBI-NICS, the number of background checks is at an all-time high. So what’s really going on?

First of all, we need to remember that most of the guns manufactured in the United States come from companies that are still in private hands.  The only publicly-owned companies that provide detailed numbers are Smith & Wesson and Ruger, which together account for roughly 20% of all guns made each year in the US, but because of imports to the US market, their overall share of the gun business is somewhat less.

As for FBI-NICS background checks, these numbers are also not quite what they seem.  The gun industry would like you to believe that NICS checks are continuing to zoom upward, but the report issued by the FBI each month counts every time the telephone rings at the NICS call center in West Virginia, whether it’s for a gun transfer or not.  And in fact, roughly half the background checks each month are for reasons that have nothing to do with gun transfers at all, namely, to check the validity of gun licenses, pawn redemptions, etc.

The reason why several stock analysts downgraded S&W stock was because handgun transfers dropped 13% from February to March, with the decline in long gun transfers also noticeable but not quite as severe. And while the sell-through numbers posted in Ruger’s latest 10K report indicates that products aren’t piling up on anyone’s shelves, the bottom line is that gun sales simply haven’t been all that strong since the post-Sandy Hook gun-control furor died down.

Before I get into the NICS numbers in more detail, first, NICS doesn’t distinguish between new and used guns, which means, to begin with, that using NICS to judge the health of gun-making companies isn’t such a bright idea. Second, since NICS covers transfers, not the number of guns transferred, the monthly numbers for handguns and long guns are certainly undercounted, but nobody knows by how much.  On the other hand, NICS data is a good measure of gun transfer trends, which obviously reflects the health of the industry as a whole.

With that in mind, let’s look at monthly NICS transfers for March and start back in 2005.  Total gun transfers that March were 580,000, which climbed to 675,000 in March, 2008.  The number went to 900,000 in Obama’s first March (2009) and remained right around that figure each March through 2012.  Then we had Sandy Hook and a noisy argument about expanding background checks – the 2013 number was 1.4 million, but in 2014 it slipped down 17% to 1.1 million and remained at that same level the following year.

Here’s the bottom line.  Despite all the hue and cry from Gun Nation about how ‘everyone’ is getting into guns, the NICS numbers have been basically unchanged since the Democrats stopped trying to regulate guns.  And nobody is going to tell me that the 40% increase in NICS directly after Sandy Hook reflected a sudden upswell of interest by new buyers who wanted to purchase guns. So the gun market will continue to drift downward until the Clintons reclaim their love nest at 1600 Pennsylvania Avenue.  Unless the unthinkable happens in November and we elect someone who just ‘loves’ the 2nd Amendment.  In which case you can start off with however much money you want and you’ll still wind up with bupkis when all is said and done.

Who Wins When Harvard University Goes Up Against Ruger? Neither One.

You know the gun business is a serious business when someone writes about it in the Harvard Business Review.  And thanks to my friend Shaun Dakin, I just finished reading an article about the gun business published in the latest issue of HBR whose author, Robert Dolan, is a member of the Harvard Business School faculty.

Actually, the article is basically an update of a business school case study that Dolan published in 2013 which, although Dolan claims makes him someone who has studied the gun industry “in depth from a management perspective,” is actually an analysis of one company, Ruger, whose CEO, Michael Fifer, happens to hold a Harvard MBA degree.

Dolan’s article argues that gun companies should redefine their business practices to go beyond concerns for the bottom line and move from ‘management’ to ‘leadership’ by taking a more active role in making sure that company products are only used in safe and lawful ways.  Rather than just complying with gun laws, Ruger and other companies should take some of their profits and bring ’smart guns’ to market, expand programs that curtail straw sales and more closely monitor gun dealers who let their guns get into the ‘wrong hands.’

Even though Dolan attempts to validate his approach by invoking the legendary Peter Drucker (as if you can publish a Harvard case study without mentioning Drucker) there’s little here that can’t be found in many other calls for more gun industry responsibility, beginning with President Obama and moving on down. The Clinton Administration tried to get the gun industry to adopt all those ideas in 1998, and what they got for their efforts was a boycott of Smith & Wesson and then a law protecting the industry from class-action torts that was signed by George W. Bush in 2005.

To understand how the gun industry views Dolan’s argument for transitioning from management to leadership, you can find a response just below his comment from none other than Larry Keane, who happens to be the Senior Vice President of the NSSF. Keane begins his response by noting that “there is so much wrong in [Dolan’s] piece that it is hard to know where to begin.”  Actually, Dolan’s case study on Ruger contains more errors than his op-ed (including the extraordinary claims that the value of Ruger stock increased by more than ten times between 2008 and 2013), but Keane wants to make sure that everyone understands the basic idea that either you know the truth about the gun business or you don’t; and if you say anything negative about the gun business, you don’t.

Keane argues that policing the gun industry should be done by the police; i.e., law enforcement agencies like the ATF.  It’s a disingenuous argument at best, a wholesale fabrication at worst.  The Tiahart Amendment that severely curtails the ability of law enforcement to track illegal guns was not, as he claims, based on misrepresentation of gun-trace data by GVP advocates; it was nothing more than a successful effort to hamper government’s effort to regulate the gun industry through stricter enforcement of the distribution chain.

On the other hand, Professor Dolan is engaging in his own brand of wishful thinking by assuming that the gun industry is ready, willing or able to regulate itself.  Detroit didn’t begin installing seatbelts until the Federal Government mandated their use; the money spent by the gun industry to lobby against government regulations is a trifle compared to what the tobacco industry spends to stave off more government rules on cigarette sales.  If Dolan wants to write an interesting case study on the gun business, perhaps he should examine how and why the gun business has kept the regulators under control.

The GVP community rightfully takes umbrage at the degree to which the gun business has insulated itself from government mandates or controls, but the industry is just doing what comes naturally – no business owner wants the government to tell him what to do.

Is Investing In Gun Companies A Safe Bet? I Don’t Think So But Some Might Disagree.

I love when The New York Times, the so-called newspaper of record, publishes an interview with a quick-buck artist who bought shares of Smith & Wesson after the massacre at Sandy Hook and tells us that “some” Wall Street investors see gun companies as a good buy. Meanwhile, if you bother to read Julie Creswell’s entire article, you quickly learn that the real Wall Street money – institutional funds – are staying as far away from gun investments as they can.  And the reason for this is very simple, namely, that putting money into a publicly-owned gun company represents an investment in an enterprise whose value has little or nothing to do with the health and business prospects of the enterprise at all.

nyt logo              I recall that in September, 2012, there wasn’t a Republican who didn’t believe that all the polls showing Obama beating Romney had to be wrong.  After all, how could a President get re-elected with an unemployment rate that was holding at 8%? It’s the economy, stupid.  Remember that?  Meanwhile when voters went to the polls in 1992, the unemployment rate was 7%, so no way Obama was going to go back to the White House again. And there wasn’t a retail dealer in the country, including myself, who could figure out what to do with all the inventory that was sitting on our shelves, because we knew that if Romney got elected, gun sales would collapse.

Well Romney didn’t get elected and several weeks later we had the awful shooting at Sandy Hook.  And the result of that massacre was a spike in gun sales, and another spike when Obama started pushing a gun-control bill, and now another spike because Obama’s promoting his own gun-control initiatives regardless of whether Congress wants to go along or not.  Even the NRA, which has been peddling a paranoid vision of Obama doing something drastic in his lame-duck term, admitted that the proposals were fairly mild and didn’t add up to all that much.

But let’s go back to the NYT article and focus on the data used by Julie Creswell to drive her argument home.  The article contains a graphic showing how the stock prices of Smith & Wesson and Ruger have climbed over the last several years. Note that the S&W share price was around $16 in mid-2014 and then fell like a rock to under $10 at the beginning of 2015.  During roughly the same period, Ruger stock dropped from $75 a share to $35.  Both stocks began climbing again in the 2nd quarter of last year, but the price that is now attracting traders like Louis Navellier isn’t s reflection of the gun industry’s long-term health, it’s a classic bubble which, like all bubbles, will soon burst and the stock will die.

Why do I say that?  Because the collapse of those stock prices back in 2014 was the result of the gun industry discovering that even after Sandy Hook and Aurora, the ability of the gun market to absorb new inventory could only go so far.  It took gun makers a year to ramp up production once it began to look like a gun-control effort would succeed, but by the time all that additional product got through wholesale distribution and onto retail shelves, the mad rush into gun shops had slowed down.

The gun industry can talk all it wants about how fears of terrorist and/or criminal violence are creating a new customer base.  They can have Colion Noir pitching to the inner-city market and Dana Loesch speaking on behalf of ‘America’s Moms,’ but it just doesn’t work.  The only folks who remain convinced that you can protect yourself from gun violence by responding with gun violence are the folks who keep buying guns whenever they believe they won’t be able to buy guns.  The truth is that investors who put their money into gun companies aren’t really investing in the gun industry, they’re investing in fears that the industry won’t survive another Sandy Hook.  Maybe it won’t.