The biggest retailer in the US decided to end all handgun ammunition sales, and the four largest automakers announced a private deal with California on emissions. Is this good news?
In the last few weeks, we’ve seen two examples of seeming corporate self-regulation.
One is Walmart’s decision to end all handgun ammunition sales, and the other is the four largest automakers going around the Trump administration’s less stringent fuel emission standards to cut a private deal with California that is closer to Obama era-emission standards.
There’s an important overarching question to these two stories. Should companies really be taking it upon themselves to address issues when the government doesn’t do a good job policing? Should these businesses be punished, or praised?
These are the topics Kate Waldock and Luigi Zingales discuss in the new episode of their podcast, Capitalisn’t.
Capitalisn’t is a Stigler Center and Chicago Booth Review podcast.
Walmart CEO Doug McMillon announced a few days ago that the retailer would stop selling ammunition for assault-style rifles. He also pledged that customers would be discouraged from carrying guns in stores even in states where it is legal. The company said that it would ask Congress to tighten background checks and reimpose a ban on assault weapons.
Last month I wrote an open letter to the CEO of @Walmart about ending gun violence. I got an email that day from @LEVIS CEO Chip Bergh that it got him “thinking” about what more could be done. Today, he got 145 CEOs to do this: https://t.co/HA8uEgWDIo
— Andrew Ross Sorkin (@andrewrsorkin) September 12, 2019
The decision arrived less than a month after the shooting at a Walmart store in El Paso, Texas, which claimed the lives of 22 people.
In the new Capitalisn’t episode, Zingales quotes the astonishing results of a recent survey conducted by Edelman, the largest PR company in the US.
According to the survey, a large majority of Americans are in favor of some sort of gun control: 86 percent of the respondents “strongly support” or “somewhat support” requiring background checks for gun purchases at gun shows or other private sales.
More than two-thirds of respondents said that they would be more favorable about a company if the CEO pushes for background checks of gun purchases at gun shows (68 percent) and universal background checks for all gun buyers (68 percent). And there is broad support for increased funding for education on safe use/storage of guns (63 percent) and requiring individuals to obtain a license before being able to buy a gun (63 percent).
There is much less support for banning sales of guns and ammunition (32 percent) and allowing teachers to carry guns in classrooms (35 percent).
CEOs are viewed as agents of influence on legislation to promote gun safety initiatives. More than half of Americans think CEOs should use their influence to reduce gun violence in the US and there is broad-based support for companies advocating for policies such as background checks, red flag laws, and educational program funding.
Nearly seven in ten would feel more favorable toward a company whose CEO advocates for background checks for all gun buyers including the majority of Democrats (80 percent), Independents (67 percent), Republicans (57 percent), and gun owners (64 percent).
Today (Thursday), 145 companies asked the Senate to act on gun controls. A few days ago the companies’ CEOs published a letter in the New York Times to advocate the passage of two regulations that were characterized as “common-sense gun laws”:
“We urge the Senate to stand with the American public and take action on gun safety by passing a bill to require background checks on all gun sales and a strong Red Flag law that would allow courts to issue life-saving extreme risk protection orders.”
Should companies try to limit gun sales or should they just ask politicians to change the law? Is self-regulation a form of Capitalism, or of Capitalisn’t? Let’s join Kate and Luigi in the conversation.
The ProMarket blog is dedicated to discussing how competition tends to be subverted by special interests. The posts represent the opinions of their writers, not necessarily those of the University of Chicago, the Booth School of Business, or its faculty. For more information, please visit ProMarket Blog Policy.