February 21, 2014
Who's Really Paying for Anti-Gun Legislation?
Beretta -Moving to Tennessee from Maryland
Colt- "Expanding" manufacturing operations in Florida
Ruger- "Expanding" manufacturing in Arizona
Magpul-Moving from Colorado to Wyoming and Texas
HiViz- Moving from Colorado to Wyoming
Shield Tactical- Moving from California to Texas
Kahr- Moving from New York to Pike County, Pennsylvania
American Tactical Imports- Moving from New York to South Carolina
Stag Arms- Moving from Connecticut to Texas or South Carolina
PTR Industries (H&K)-Moving from Connecticut to South Carolina
Ithaca Gun Company- Moving "expansion" from Ithaca, New York to South Carolina
Remington Outdoor -Expansion into Huntsville, Alabama
With Remington Outdoor's announcement that they will be opening a "major expansion" facility in Huntsville, Alabama in the next 18 months, a question that's been rolling around in the back of my mind popped up again.
The question? Who's paying for all the anti-gun legislation that's causing gun companies to leave long-standing corporate facilities for new locations?
There are real costs associated with everything, despite lawmakers' apparent oblivious condition when it comes to spending "government money."
Once you consider assigning costs, you'll find yourself facing a minimum of two correct answers. I don't say "right" because I don't think anything associated with cram-down legislation is ever "right". It's force-fed, not willingly accepted.
Look at Colorado.
Legislators rushed through anti-gun legislation that has cost Colorado jobs (Magpul and others have announced their relocations), tax revenues (the companies and all their employees paid state and local taxes), and although it's harder to track, it has resulted in hunters, anglers and gun-related groups taking their business elsewhere. Personally, I'd always thought those "impact of a convention" numbers were high-until I started looking at what I pay to attend SHOT Show and other industry shows.
Other costs may have been overlooked.
Consider the cost in manpower and state resources to draft and pass laws through the legislature. Those numbers are undoubtedly significant, although tough to pin down. But they exist somewhere, although it might take an MBA or forensic accountant to ferret them out of the General and Administrative costs of doing business (legislating).
It may be my small business guy's over-simplification, but I'd make the case those numbers are really only part of the actual costs. Time spent on that legislation was time not spent dealing with real problems.
Then there are the costs associated with the special elections in which former Colorado State Senators Angela Giron and John Morse were recalled. All elections are expensive, but special elections are especially costly.
And I'm not going to assign the money contributed by former New York Mayor Michael Bloomberg to try and defeat those recalls. Or the money contributed by the NRA and average people supporting the recall initiative. That money was contributed- willingly- by both sides.
But we're talking about costs in the millions of dollars on the legislative side and hundreds of millions when we start looking at the costs of disrupting manufacturing, packing and shipping sophisticated equipment, the new construction or renovation of existing facilities, and the cost of reassembly of the manufacturing processes.
And there are significant costs associated with the workforce. If you're relocating workers, those costs include moving, home searches, and time off the job. If you're hiring a new workforce, recruitment and training isn't inexpensive-even with your new legislative bodies helping with those costs.
So who pays?
The only way a government raises revenues is through...taxes. And if tax revenues slip, the government mindset isn't shrink costs, it's normally to create new areas to tax.
And who pays taxes? You guessed it-the citizens.
If a company has significant increases in operating costs, they have two possible ways to cover those increases. One is cutting costs. The other is raising prices.
Who pays the price increases? Right again. We do.
Ultimately, average citizens -that's us-wind up footing the bill for the entire unnecessary exercise.
When companies relocate- whatever their reason- the prospects for gainful employment diminish in their former homes. That's unless the government is able to lure a quick replacement for those lost jobs into the area. Of course, there are costs associated with that process as well. In today's economic climate companies just don't relocate without incentive packages.
As jobs shrink, the entire economy suffers. That's not economics voodo, it's simple fact. Less money into an economy means less money to spend.
If a company moves into an area, things are exactly the opposite. New jobs are created, new money pours into the economy and the outlook brightens.
In the Civil War, a major reason for the South's defeat was the lack of manufacturing capabilities. Theirs was primarily an agrarian society. The Union was a bustling manufacturing climate with the means to either make, grow, or acquire whatever it needed.
There's no inference a civil war's ahead. But it would be unrealistic not to recognize a new economic reality: the south of today is the center of high-tech manufacturing and is still blessed with the ability to feed its citizens.
Or, as one businessman whispered during the Remington press conference in Huntsville earlier this week: "pretty soon we won't have to worry about New York, Washington, Chicago or any other liberal place where they can outvote everyone else. We'll stop selling them our guns, and we'll keep our cars, our equipment and our food at home."
As an astute political observer wrote: "It's the economy, stupid."