Make Britain safer: bring back handguns

We live in peaceful times – at least compared to the past thousand-ish years. Crime, especially personal violence, has been reduced significantly since the 13th century (though not always continuously). The drop looks something like this:

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What explains the drastic decline in violent crime, specifically between 1500 and 1900? Why has crime spiked up (moderately) from 1900 – 2010? The widely preferred explanation for the fall in crime – particularly homicide – is referred to as the “civilizing process”, which claims that criminal breaking points can be attributed to the growth of centralised power (i.e. state power), which created more structure and stability in regional areas.

The conventional wisdom…attributes the decline in personal violence to the “civilizing process” first suggested by Elias (1939) who hypothesized that the primary cause was the transformation of Europe from a large number of fiefdoms in the Middle Ages to a small number of large, centralized nation states under a single monarch. The centralised state instituted and enforced a monopoly on violence, known as the king’s peace.

To this day, the ‘civilizing process’ remains the longest-running, widely accepted theory and continues to shape crime and policing policy. But, despite its acceptance, there are some very notable flaws in the theory, including the fact that much of the evidence shapes up to disprove the thesis:

Belgium and the Netherlands were at the forefront of the decline, yet they lacked strong centralized governments. When Sweden joined the trend, it wasn’t on the heels of an expansion in state power either. Conversely, the Italian states were in the rearguard of the decline in violence, yet their governments wielded an enormous bureaucracy and police force…

…the civilizing process theory is not consistent with the rise in violence between 1200 and 1500, it does not explain the sudden and precipitous decline and reversal of trend that occurred in the 16th and 17th centuries, and it is not consistent with the 1793 reversal of trend.

A new paper from Carlisle E. Moody published last month provides an alternative theory last century’s decline in violence. The paper, “Firearms and the Decline of Violence in Europe: 1200-2010”, finds that the sudden historical drops in crime are consistent with the “invention and proliferation of compact, concealable, ready-to-use firearms” which “caused potential assailants to recalculate the probability of a successful assault and seek alternatives to violence.”

And unlike the civilizing process theory, Moody’s firearms theory remains consistent with the evidence and breaks in violence. As concealed weapons became more available historically, crime rate dropped radically. (Bolded mine.)

Homicide was increasing before the invention of concealable firearms and decreasing after. While there may be many other theories, the sudden and spectacular decline in violence around 1505 and again around 1610-1621 is consistent with the theory that the invention and proliferation of concealable firearms was responsible, at least in part, for the decline in homicide. The landscape of personal violence was suddenly and permanently altered by the introduction of a new technology. The handgun was the ultimate equalizer. The physically strong could no longer feel confident of domination over the weak.

Some of these arguments may sound familiar; they’re the ones those crazies over the States tend to go on about - guns ‘equalize’ the playing field regardless of physical strength and ‘psyche out’ violent perpetrators who might be more willing to attack their victims if they knew they were unarmed.

But according to the report, those crazies have some strong points. The report cites several studies which found that the possibility that a victim might be armed deters criminals from acting:

Even in the United States today, criminals are reluctant to encounter armed victims. In 1981 Wright and Rossi interviewed 1874 incarcerated felons in ten states. Eighty-one percent agreed with the statement, “A smart criminal always tries to find out if his potential victim is armed.” Thirty-four percent report being, “scared off, shot at, wounded or captured by an armed victim. (Wright and Rossi 1986, pp. 132-155) Using the same data, Kleck found that, among criminals who had committed violent crimes or burglaries, 42 percent had been deterred during an attack by an armed victim and 56 percent agreed that, “most criminals are more worried about meeting an armed victim than they are about running into the police.”(Kleck 1997, p. 180)

Perhaps, then, we might admit (based on evidence, consistency and lack of other credible theories) that firearms reduced violence historically; but in the modern era, guns cause more violence than they deter. But that’s not the case either:

The government in England has been placing increasingly stringent controls on guns especially handguns, since 1920, reducing both the actual and the effective supply of firearms. (Malcolm 2002) The homicide rate in England in 1920 was 0.84 and the assault rate was 2.39. In 1999, the corresponding rates were 1.44 and 419.29. Thus both the homicide and assault rates increased as the effective supply of handguns declined.

That’s a 17,544% increase in England’s assault crime over the past 100 years. In truth, there is no explicit correlation between gun control laws and murder rates between countries (Switzerland and Israel “have rates of homicide that are low despite rates of home firearm ownership that are at least as high as those in the United States.”) It is the case that handguns used in crimes in the UK have doubled since they were banned in 1997. Guns can’t account fully for the drop in crime throughout the 20th century, nor can they account fully for the rise in violent crime over the past 100 years, but there is no doubt that accessibility to firearms has worked as a successful deterrence against criminals in progressive societies and that bans have ensured that any handguns in England are only falling into criminal hands.

Should we proliferate handguns around England tomorrow? Probably not. (Obviously we should begin with firearm training sessions – safety first!)  But liberalizing gun laws should not be off the table. Historically, they’ve earned it.

Let’s have a Hayekian welfare state

Screen Shot 2015-02-06 at 16.30.31The latest issue of Econ Journal Watch discusses the correlation between support for economic regulation and welfare state redistribution among economists. Why, Daniel Klein asks in the issue’s opening chapter, is an economist who supports a lot of economic regulation so likely to support a lot of income redistribution as well?

How are issues of progressive taxation, redistribution, and universal government provision so much like, say, the issues of public utility regulation, antitrust, consumer protection, workplace safety and labor standards, environmental protection, financial regulation, insurance regulation, land-use controls, housing regulation, agricultural regulation, healthcare regulation, transportation regulation, energy regulation, and so on?

A good question. He suggests that economists are motivated at a basic level by their feelings about ‘governmentalization’ – a general preference for or against using the government to solve problems that face society.

But like Andreas Bergh, another contributor, I am not convinced that at least one other configuration is so unlikely. Bergh argues that a ‘Hayekian welfare state’ is possible and may be more attractive than Klein suggests. I agree.

Probably the strongest general argument against regulation is given by Hayek, who argues that in a complex world our actions often have unexpected consequences. A ‘spontaneous order’ is a non-random system that has come about from individually-chosen actions, not from the design of a central planner. A language that does not have a central designing body might be an example, as might a free market economy.

In Adam Ferguson’s words, these are the result of human action but not of human design. Hayek’s argument is that because events in these orders have been shaped by the individuals’ choices within them, what may appear to an outside observer to be an inefficiency or failing may have a hidden logic to it.

Central planners or rule-makers often lack the information they would need to make good regulations, and in situations where people’s tastes or innovations may change over time, they may not ever be able to make regulations that achieve their own goals.

This argument has been added to by more recent work that has emphasised the value of feedback loops in learning (which markets have, but regulators usually don’t), and the dangers of imposing the same error across an entire system. If we think that the future is basically unknowable in a complex world, and so most plans are wrong, but that we can learn from our mistakes and successes, then we should want as many different experiments as possible, with as many different mistakes to learn from.

In practical terms, that means that we should have a predisposition against regulation, even regulation that appears to solve problems, if it holds people back from experiments. There are also serious examples of regulations leading to bad things that are even worse because everyone has been forced to make the same mistake, which strengthens this predisposition even more. The more complex a system is is, the more we should value pluralism.

All of this has to do with having limited knowledge in a complex world, not incentives, though of course there may be good incentives-based arguments to be made on a case-by-case basis against certain regulations.

But this doesn’t tell us very much about the distribution of wealth in a society. To use Bergh’s terminology, redistribution may be something that can be done with relatively low amounts of knowledge. That doesn’t mean that it can’t fail – clearly it can, very easily, if the level of redistribution is set too high (or too low) – or that the system itself be badly designed.

The particular distribution of wealth in an economy may be an efficient reflection of who is most productive, and interventions that try to correct for that are likely to fail for the same reasons that other interventions designed at improving market efficiency will fail.

But we may have non-economic concerns about the distribution of wealth as well. An economy in which everyone is paid according to their productivity may be very brutal for people who are not very productive and cannot change that. We may wish to redistribute income for their welfare.

We might also want to redistribute money to encourage the sort of experimentation that drives innovation, above. Or, as Ben has argued, to make the market focus more on satisfying the wants of unproductive (ie, poor) people than it currently does.

A good argument against this would be that we don’t need the state to redistribute – that, left alone, private charity will be enough. There is some evidence for this position but not enough, yet. Maybe some day there will be and I will change my mind.

Until then, I am with Bergh. A ‘Hayekian welfare state’ would do almost no regulation of the economy, but redistribute quite a bit of money for welfare reasons. This looks not just possible, but very desirable.

It usually begins with Ayn Rand

Ayn Rand was born on this day in 1905. “It usually begins with Ayn Rand,” said author Jerome Tuccille of this Russian-American thinker, novelist and screenwriter. An amazing number of people have come to support a free society and a free-market economy through reading her novels, especially The Fountainhead (1935) and Atlas Shrugged (1957), in their student years.

Those novels may not be works of great literature. The characters are little nuanced, more mouthpieces for Rand’s political and philosophical views. But decades on, they remain hugely influential, because they have what young people – and others looking for some purpose in life – actually want. Their weaknesses are the obverse of their strengths. Her heroes are role models: ambitious, purposive, independent and strong; ruthlessly self-interested and yet deeply moral. These are stories with a message, a coherent worldview that conquers all: the morality of rational self-interest. Atlas Shrugged, for instance, describes a world in which industry leaders overcome the stifling controls of over-mighty governments by closing down production and creating an alternate order based on freedom and strict respect for personal property. Unlikely, for sure: but it makes you think.

No surprise, then, that many of the world’s leading businesspeople have been influenced by this twentieth-century Russian émigré to America, whose fiction and philosophy has sold 25 million copies. One, Lars Seier Christensen, founder and CEO of the hugely successful online investment broker Saxo Bank, gave the Adam Smith Institute’s annual Ayn Rand Lecture in London last year. Even though Rand died in 1982, he observed, her robust individualist approach to economic and social life is needed more now than ever.

Rand held that the key thing that makes human beings unique is their reason. We betray our species and our selves if we do not use it. But to act rationally, we need a long-term view of the world. It might sound good to tax the wealthy and spend the money on education, welfare and much else. But there is no free lunch. Those short-term benefits come at a long-term cost, because taxation depresses risk-taking and enterprise. As in Atlas Shrugged, the majority cannot exploit the minority and expect them to put up with it forever.

The long-term view reveals that most regulation is irrational. Minimum wage laws, for example, might boost the wages of poorer workers; but by making it too costly for employers to hire unskilled or untested applicants, they deny hundreds of thousands of young people jobs and consign them to the welfare rolls. American regulations that forced banks to lend to poorer people gave families ‘affordable housing’ but created the sub-prime crisis and the crash.

It is the same in business. Rational self-interest means long-term self-interest, not short-term greed. Greed comes back to haunt you, as certain bankers will testify. It is interesting that about the only American bank to come out of the financial crash unscathed was BB&T, run by John Allison – an adherent of Ayn Rand’s principles and another past Ayn Rand Lecturer. There are only two stable relationships, he insists: win-win or lose-lose. You don’t need self-sacrifice or even altruism. You benefit yourself by benefiting others.

Money is not the end. Happiness is. If people in a business – from the CEO to the cleaners in the works canteen – know that they are part of an enterprise that makes a positive difference to others, they will have purpose and self-esteem. That will make it a better business – and will make them happier, more complete human beings.

The divorce of theology from modern social science and public policy

In modern discourse, talk of God, divinity, spirituality and so on is forcibly divorced from the sciences (considered in the broadest sense). Contemporary mainstream moral philosophy, political economy, political science, economics (not to mention the natural sciences) rarely, if at all, discuss the consequences of the nature of God for the questions they all address.

Consider this: God, by definition, is omnipotent, omnipresent and omniscient. Now, without introducing any metaphysical complications, we can say that either God exists or God doesn’t exist (my opinion is that the former is true). If God doesn’t exist, then we can continue working within and articulating the scientific paradigms that currently permeate throughout society. However, as soon as we presume God’s existence, theology becomes fundamental for understanding any other form of knowledge whatsoever. It becomes a primary concern of metaphysics, epistemology and logic. This then feeds through to the sciences that we practice, albeit imperfectly, in modern society. Depending on the presumed conception of God, methodologies and their employment as well as theories and their applications will differ accordingly.

In Plato’s Republic, Socrates considers the nature of the Gods whilst describing his grand, centrally planned society. In India, the caste system is said to have had divine origins (though its interpretation and enforcement became increasingly skewed with time) and this has exerted a profound impact on the socioeconomic organisation of the subcontinent that continues to this day. One of the most famous miracles of Jesus Christ was feeding the multitude with one loaf of bread – to put it simply, divinity can deal with the fundamental economic problem of scarcity for the welfare of all.

Benedict de Spinoza, like many other philosophers and theologians of his age and the preceding ones, offers his readers an account that includes both a proof and a description of the nature of God; to put one of the main conclusions in Spinoza’s Ethics crudely; everything that comes naturally and feels right is good because it has its origins in God and God is good. Now, that which comes naturally is done freely and, intuitively, freedom feels right.

So all this talk of free markets and a free society has a natural resonance with humanity. There is something undoubtedly divine about free will, freedom and a free society.

Wikipedia: Another answer to the tragedy of the commons

The tragedy of the commons is an oft-cited theoretical example by those who advocate government intervention. It postulates that, without regulation and intervention, public goods that everyone has an interest in using will actually not be provided (or at least not efficiently or to an optimal quantity) if contributions are voluntary. The logic is that everyone’s dominant course of action is to essentially just refrain from contributing because, if one contributes and others don’t, then the public good is not provided and their payoff is worse than if they don’t contribute and the public good is not provided. Additionally, if they don’t contribute and the public good is provided, the individual’s payoff is higher than if they do contribute and the public good is provided. In this sense, a society full of rational, self-interested individuals (as this scenario represents it) could actually lead to a harmful or sub-optimal outcome for society in the long run.

However, Wikipedia is a prominent, empirical illustration of how the tragedy of the commons does not always hold since the website runs purely on private donations. Periodically, the site’s owners ask for donations to maintain it and keep it running ad-free. They claim that if everyone who read their plea paid £3, then fundraising would be over within an hour – nice in principle but not everyone pays up in practice. Some, inevitably, end up contributing more than others and many don’t contribute monetarily at all.

The following chart lists the percentage of donators corresponding to each reason for donating to Wikipedia, according to Wikipedia.

Wikipedia1

Conversely, here are the reasons cited for not donating:

Wikipedia2

Of course, one might argue that the knowledge found on Wikipedia is unreliable. However, a study published in Nature found that Wikipedia “is about as accurate on science as the Encyclopaedia Britannica”. Of course, Encyclopaedia Britannica attempted to refute the study. Access to a vast store of monitored, reviewed information via Wikipedia is an incredible asset to humanity and this asset is made possible entirely through voluntary contributions (whether this be in terms of time spent editing or money contributed) rather than through the coercive dictates that people are so often subject to.

Furthermore, it’s interesting to note that if you were to, hypothetically, replace “donating to Wikipedia” with “tax” in the second bar chart, you might find a lot of people agreeing with the affordability, with unwillingness to pay tax based on principle or their belief that it would not be used properly. Similarly, people may want to contribute time to society rather than pay money to preserve it.

In our rapidly changing world, voluntary contributions to fund public goods may become feasible sooner rather than later.