The Tokugawa gun control plan

Japanese musketeers, 16th century

Early firearms were heavily used in Japan in the civil wars of the 16th century, including by the Tokugawa faction that came out on top in 1600 and established the shogunate that lasted until the Meiji restoration of 1868. The Tokugawa ideal was a rigidly stratified and static traditional society, isolated from the outside world. Guns were among the disruptive European innovations that threatened this model, and had to be tamed as part of the overall strategy. The Tokugawa plan for gun control was one of slow strangulation. Gunmakers had to move to the capital Edo and work for the court. Demand was thus steadily shifted to luxury weapons, produced in smaller numbers. Guns did not disappear, but they were successfully marginalised in a now peaceful and regimented society.

American gun control advocates have focused entirely on demand, to little effect. It’s time to take a look at supply. A comprehensive policy would have to cover manufacture, distribution and imports. Let’s start with manufacture.

The guns sold to American civilians in such startling numbers are not made in the USA by divisions of big Pentagon contractors like Lockheed (F35, Gatling minigun), but by much smaller specialists. Some like the Barrett Company that makes large-calibre and very expensive sniper rifles ($8,500 each) are privately owned boutiques. As in most industries, the great majority of new guns sold are accounted for by a few larger companies. I relied on a good Mother Jones survey plus financial googling. Leaving out the foreigners, the American firms include:

• American Outdoor Brands (AOBC) – owns Smith & Wesson brand. Sales $903m, Market cap $548m.
• Sturm Ruger (RGR) – owns Remington, Bushmaster brands. Sales $679m, market cap $830m.
• Vista Outdoor (VSTO) – Savage rifles, ammunition, other sporting goods. Sales $2.08 bn, market cap $988m.
• Remington Outdoor Company (privately owned, in Chapter 11). Sales $865m (2016), net income $19m, debt ca. $950m. It could probably be bought for the face value of the debt.
• O.F. Mossberg – privately owned, makes pump-action shotguns. Estimated global sales $185m. Valued at the Ruger ratio, approximate value $233m.

Have I left anybody out? Corrections welcome.

So the market value of the bulk of the American domestic gunmaking industry is about $3.5 bn. Any liberal multibillionaire (perhaps with an assist from crowdfunding) could buy the entire industry for $5bn or so. For the government, it’s pocket change.

The ownership strategy would not be profit-maximising. It would include:

1. Maintaining current sales to the military and (with less marketing effort) law enforcement;
2. Dropping all sales to civilians of semi-automatic weapons, keeping only two-shot shotguns, one-shot bolt-action hunting rifles, and revolvers;
3. Selling only through retailers committing to an enforceable code of practice including full background checks;
4. Setting up an attack-dog legal department to protect patent and trademark IP very aggressively, to discourage new entrants;
5. Dropping all connection with the NRA or other gun advocacy organisations.

For a few years, the gunmakers would lose money. So you have to add maybe another $1bn for restructuring costs. These would never be recovered, and represent the permanent net cost of the operation.

Nationalisation is clearly the first choice. It would mark a return to the early days of gunmaking, when as a critical industry for dynastic or national security it was typically carried out in state arsenals. Coercive nationalisation is the only way of making the takeover comprehensive. The liberal billionaire has no way of forcing say Ronnie Barrett to stop selling upmarket sniper rifles to the few civilians capable of using them, or others from starting new firms.

But it’s not likely that this would be a major problem. The trade has very high regulatory and reputational risks, and would be unattractive to most venture capitalists. Money talks, and the boutiques could still sell to the military and law enforcement. Their products would be expensive from the small scale of production. (According to the website of the famous London gunmaker Purdey, a second-hand shotgun can be had for £89,000, and a new single-shot hunting rifle for a mere £25,000. Ieyasu would have bought both.) Hardly any money would find its way to the NRA, breaking the cash and ideological nexus between gunmakers and gun nuts.

A chokehold on supply of new domestic weapons would only be a start, but it creates a breathing space to tackle two other issues.

Imports could flood in replacing the lost domestic weapons. This could only be stopped by federal government action: bans on semi-automatics or very steep tariffs. The political point here is that Beretta, Glock, Sig-Sauer and Taurus – much less the nameless makers of cheap Saturday-night specials - have few votes in the states and little leverage in Washington. If nationalisation is politically feasible, so are import controls. It’s a bigger problem for the altruistic billionaire: the money could be wasted, and the investment would be a leap of faith in Democratic control in Washington.

The other problem is much bigger: the massive excess inventory. The USA has over 300 million firearms in civilian hands, three times the rate in the next highest rich countries, Norway, France, and Austria. Reaching this unambitious bar would still involve scrapping 200 million weapons. Guns are extremely durable with a modicum of care, so natural attrition from corrosion, damage and loss is very slow. Australia bought back banned weapons coercively. In the USA, a voluntary buyback under pressure might be  feasible. If you set a federal gun license of $100 per weapon per year, that would fund a large ongoing buyback. Another funding stream could be taxes on ammunition – say $0.5 a round. Responsible hunters don’t use much and would not be significantly affected. The second-hand market would have to be regulated, again with heavy fines and bans for violators. Breaches of other state or federal safety ordinances would lead to confiscation and destruction. One illegally modified rifle or improper gun storage, and all your weapons are taken.

BTW, this tough-nanny policy is all entirely compatible with the Second Amendment as interpreted in Scalia’s majority opinion in Heller. The US Constitution is even more protective of property rights than of the right to bear arms, and the rights of ownership include the right to refuse to sell and the power to destroy. Take that, gun socialists.