Things that last a long time can cause quirky economic incentives.
I junked my 1979 Ford LTD this spring, and I just replaced the upstairs toilet with a new 1.6 gallon per flush model. All three of my small LP gas cylinders have the new overfill protection devices. I still have my little Browning .32-caliber semi-automatic pistol that was made in 1901, and fortunately for my neighbors, I don’t own a power plant.
The long lives of each of these items complicates public policy. Critics complain that the United States is a throwaway society. Anyone who has lived in a developing country knows how casually Americans discard things that would be valuable to poorer people.
Yet even in this nation, some things last a long time. That complicates policy-making.
Consider motor vehicles. The United States produces about 13 million cars, vans and pickups per year. Some 130 million are on our roads. The average age of a vehicle is nearly 10 years, up three years in the last two decades.
When vehicles last so long, new vehicle safety or emissions standards take a long time to have much effect. For example, cars with computer-controlled electronic ignition and fuel injection have much more effective and durable emissions controls than do older carbureted models. Only very recently, however, do most cars fall into this category.
Still, vehicle turnover is inexorable. With the exception of a few collector vehicles, cars do wear out and get scrapped eventually.
That isn’t true for firearms, a perennially contentious product. Whenever there is a highly publicized shooting, people raise questions of how to reduce gun numbers or make them safer. But well-meaning initiatives such as buyback programs or requirements for integral locks on new guns run into the brick wall posed by the long life of guns.
We produce and import about 4.5 million guns per year. No one knows for sure how many functional guns U.S. households own, but probably more than 150 million. They can last a long time.
Cartridges for my little Browning .32 still are readily available, and the gun is as lethal today as when it left the factory. Gavrilo Princip used an improved version of the model I own to assassinate Austrian Archduke Franz Ferdinand and his wife in Sarejevo in 1914, starting World War I.
The Smith & Wesson revolver used in last week’s fatal shooting outside a Minneapolis courtroom may have been made in the 1890s. Millions of others of the same vintage still exist and are still deadly.
Some guns are lost, discarded or rendered harmless when owners don’t replace a minor broken part. A large majority, however, are kept by one owner or another. Firearms simply don’t wear out the way automobiles do. The bulk of new guns constitute a net addition to our national stock.
While there is little good information on the number of guns available in specific cities before and after well-publicized buyback programs, it is clear that these efforts have negligible effects on ownership.
One can ban the production or import of specific weapons such as “assault rifles,” but millions remain in U.S. households and their market value notches up with each new restriction. Integral locks might reduce accidents by owners of new handguns, but tens of millions of old ones exist, and will continue to exist, for decades.
Many households own a small LP gas cylinder, often for a gas grill. Safety officials decided that overfilling of such cylinders caused an undue number of injuries. A few years ago the government decreed that by 2003 all cylinders had to have a new valve designed to minimize the problem. Refilling older cylinders is illegal.
They might have depended instead on normal turnover to ensure adoption of the safer cylinders. There already was a Department of Transportation regulation that effectively banned cylinders more than seven years old. Authorities decided that would take too long.
That decision cost households some $200 million to move the replacement of the average cylinder up three years.
Preventing accidental deaths is a laudable goal, but if we took $200 million and decided where it could best be spent to save lives, we probably wouldn’t have chosen LP cylinder replacement.
The Bush administration recently caught a lot of flak from environmental groups for a proposed rule increasing the percentage of a power plant’s value that can be spent on repairs or upgrades before the plant is subjected to the emissions rules for new power plants.
Heavy equipment like power plant turbines and alternators may not last as long as firearms, but it can be serviceable for decades.
That is why existing equipment was grandfathered into the Clean Air Act. Banning plants still capable of years of useful service seemed unreasonable and would have imposed huge costs on consumers.
Lawmakers assumed that normal turnover of installed generating capacity would eventually remove high emissions plants from operation. But just as a ban on imports of assault rifles increased the value of those already in the country, so, too, the value of existing plants went up when the cost of building new ones increased with expensive emissions reduction requirements.
It suddenly became economically rational for utilities to keep existing plants in operation long after they otherwise would have been scrapped.
This perverse effect of environmental regulations keeping polluting plants in operation longer would not occur if we adopted emissions taxes or tradable emissions permits instead of the Leninist command-and-control engineering requirements that still are the cornerstone of U.S. pollution control.
Similarly, U.S. households have spent a lot of money on new “efficient” toilets. They do use less water, but we could save more water much more quickly and at less expense if we simply raised water rates wherever it is scarce.
© 2003 Edward Lotterman
Chanarambie Consulting, Inc.