Mandatory Gun Insurance: Idea Whose Time Has Finally Come?
Sounds like the rest of the establishment is finally catching up with my kid's idea about mandatory gun insurance that I first wrote about in 2011. I really do think it's a rational idea, and I'd love to see it become reality -- right after Congress reinstates liability for gun manufacturers, of course.
All kinds of proposals to reduce gun violence have been floated recently. One idea that has gotten the attention of economists is liability insurance. Most states require car owners to have liability insurance to cover damages their vehicles cause to others; some economists think we should require the same of gun owners.
We reached out to a few economists to get their thoughts.
Justin Wolfers, professor of economics and public policy at the University of Michigan, wrote:
The real problem with gun ownership is that they involve "externalities," which is economist-speak for the fact that your gun may be used to hurt others. For instance, when Nancy Lanza purchased her Bushmaster AR-15, she probably weighed the benefits of owning the gun — the joy of ownership — with the price (about $800). But it's unlikely she considered the loss, pain and grief that might follow if it were used by her son to kill 26 innocents. When people fail to consider the broader social costs of choices like buying a gun, they're more likely to do them, and society suffers.
The economic answer is simple: Make potential gun owners take account of these potential social costs. One way to do this would be to charge an annual license fee for each gun you keep. Research by economists Phil Cook and Jens Ludwig suggests that the typical social cost of one more gun-owning household is somewhere between $100 and $1,800 per year. While that's a wide range, if we set a gun ownership license fee this high, it would force gun owners to face the true social costs of their choices, which would lead many fewer to buy guns.
Another even more powerful approach is to recognize that the problem isn't guns per se, but gun violence. Thus, instead of taxing guns, we should tax gun violence. Basically, this is the same as saying that we should make gun owners liable for any damage their guns do. Not only would this discourage some people from buying guns, it would lead those who do keep guns to be more careful with how they're stored. Indeed, greater care would surely have kept Adam Lanza out of his mother's cache. The problem, though, is that Nancy Lanza is neither with us to pay the damages her gun caused, nor could she afford to pay for the enormous damage her gun wrought in Newtown. And so the only way this solution works is if guns required mandatory liability insurance, much as we force car owners to buy insurance for the damage their machines wreak.
