From Washington, DC, to Tokyo, students in over 800 cities and towns are calling for tougher gun control laws in the US, demanding an end to gun violence. The March for Our Lives in Washington is led by students from the school in Florida where 17 people were killed last month.
Meanwhile, the CEO’s of the biggest gunmakers rarely give interviews and live lives far removed from the whole issue. But they’re still profiting from the biggest unregulated gun market in the developed world.
The multibillion-dollar US firearms industry has been largely shielded by the US Constitution, which allows people the right to own a gun. But in the wake of #NeverAgain, the investment community is also waking up to its role in the weapons economy.
|The stocks of these gun manufacturers actually took a big hit in the days following his [Trump’s] election and have since come off pretty strongly. The revenues have done this as well. There doesn’t seem the political risk, the political fear that regulation will be coming down, as result, they’ve come off their heights.|
Calls have been growing for Wall Street to dump gun stocks. Fund managers including BlackRock have said they are having another look at their relationship with gunmakers. And more than a dozen companies have ended partnerships with the National Rifle Association (NRA), the pro-gun ownership lobby.
Jeffrey Moore, a senior analyst with Global Risk Insights, talks to Counting the Cost about gun economics and the future of the multibillion-dollar US gun industry under the Trump administration.
“The gun manufacturers … and retailers have a pretty sizeable economic impact overall. It’s about $50bn directly and indirectly between gun manufacturers and retailers. You’ve got about $6.5bn of taxes that are paid every year. And about 300,000 individuals employed either directly or indirectly through the gun industry … It is a long-lived and established industry that likely won’t be going anywhere anytime soon,” says Moore.
He explains that eight years of Obama administration as well as “a couple of large, highly public mass shootings and fears that gun regulations were going to come down in a very big way … drove gun sales and ammunition sales through the roof.”
“Especially after 2012, the Sandy Hook massacre, there were fears from the gun lobby and from gun owners that they may issue those regulations and some bans in cases. So the revenues and stock prices for those gun manufacturers really, really went haywire to the upside – and continued doing that through the remainder of his [Obama’s] presidency,” says Moore.
Moore believes much has changed for the gun industry since President Donald Trump was elected.
“The stocks of these gun manufacturers actually took a big hit in the days following his [Trumps’] election and have since come off pretty strongly. The revenues have done this as well. There doesn’t seem the political risk, the political fear that regulation will be coming down, as result, they’ve come off their heights.”
“You may see the gun industry enter a more natural ebb and flow of the business cycle.”
Asked about ethical investments, #NeverAgain and its effect on the gun industry, Moore confirms that the business community is reacting to calls for increased gun control.
“We had Citigroup announce that their Citibank operations for their commercial clients will no longer support commercial clients in the gun industry or the retailing industry of guns that sell guns of any kind to individuals under 21 years of age,” he says.
“So when you start having these commercial pressures from the bank and finance providers that give those services to the gun makers, the gun retailers; if they are changing policies … you will probably see a spreading effect of at least raising the age … So if things can’t get done in Washington, you’ll start to see private businesses take their own initiative to raise the age of purchasing guns.”
Source: Al Jazeera News