The “Gun-Show” “Loophole” and Tort Law

The “gun-show loophole” is the popular name for the idea that people who wouldn’t be able to buy guns from federally licensed firearms dealers can go to gun shows and buy guns without background checks from non-FFLs.

I’ve been to several gunshows, and haven’t seen more than a handful of guns for sale by non-FFLs. The loophole—if it is a loophole—is, more accurately, a private-transfer loophole.

“Loophole” is a value-laden word; the rule allowing private citizens to transfer guns to each other without background checks is more accurately an exception—an exception that allows gifts between family members as well as sales between strangers.

How significant is the private-sale exception? The New York Times asserts that “Nearly 40 percent of all gun sales are exempt from the system.” I find that surprising, and would have to see the source of the statistics. Any interstate gun sale, even from one non-FFL to another, must pass through an FFL (and so requires a background check). I hunch that intrastate individual-to-individual sales don’t make up 10% of gun sales.

Why does it matter how big the private-sale exception is? Because any new rule has hidden costs, including opportunity costs. When we are rational, we don’t do “whatever it takes” to address our fears; instead we evaluate the costs and benefits of a new rule. For a new rule to be justified, the benefits have to outweigh the costs. If we are merely assuming benefits, we shouldn’t make the rule (even if the costs are also a hunch). The use of misleading labels suggests that there is no sound basis to the rhetoric.

So show me the numbers.

If the gun-show exception is not significant or of small significance, perhaps there is no problem, or maybe there are other solutions to the problem than the use of state violence—for example, tort law. Right now if I had a gun and I wanted to sell it I couldn’t do a background check through NICS—only FFLs have access to the system. Give gun sellers access to the system, and most of them will use it. If they don’t, and if they guns they sell wind up being used to commit mayhem, let the plantiffs’ lawyers at ‘em to hold them responsible for their negligence. It won’t take many kajillion-dollar verdicts to make background checks the de facto rule in private gun transfers.

About Mark Bennett

Mark Bennett got his letter of marque from the Supreme Court of Texas in May 1995. He is famous for having no sense of humor when it comes to totalitarianism.
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14 Responses to The “Gun-Show” “Loophole” and Tort Law

  1. Sebastian Good says:

    I suppose the good news in the recent executive orders is that there is a directive to start researching these sorts of statistics. The 40% figure is old, and was an estimate even then. I have no doubt that much of the research will be hijacked or condemned by those with agendas on both sides of the issue, but presumably some understanding of where guns actually come from and go would help ground policy decisions on all sides.

  2. Ron in Houston says:

    Tort law has been fairly emasculated for some time now. However, I also don’t think it’s fair to require John Q. Public to jump through a bunch of hoops to sell their gun to a neighbor or relative.

    The problem as I see it is that there are a number of people that really are gun dealers but they avoid the licensing and regulation by not keep a fixed place of business and doing their dealing at gun shows.

    I don’t know how you fix that. What comes to my mind is a limit on the number of unregulated transfers per year. Even that becomes problematic for someone with a number of guns who dies and wants to transfer them to heirs.

    Then again, I have noticed that I’m a hell of a lot better at identifying problems than solving them.

    • Mark Bennett says:

      The problem as I see it is that there are a number of people that really are gun dealers but they avoid the licensing and regulation by not keep a fixed place of business and doing their dealing at gun shows.

      In my (admittedly limited) experience with gun shows, I haven’t seen any evidence that this is true.

      • Ross says:

        There are any number of people who will tell you that ATF agents are at every gun show looking for people selling firearms in quantities that ought to require a license. In other words, if you show up at a bunch of shows with a different pile of firearms for sale and no license, you will likely get a visit from the Feds. They love it when they can nail someone for a minor transgression.

        For a fictional account of some of this, I highly recommend the book “Unintended Consequences” by John Ross.

      • Ron in Houston says:

        I’d be interested in knowing the number of transactions that make you a dealer. I suppose part of this is a personal bias. I just have a hard time believing that the number of weapons some of these folks display are merely personal collections. Although given what I know about some of my friends, maybe I need to rethink that issue.

      • Ross says:

        This is a case of “you know it when you see it”. The basic rule is you need a license if you are “engaged in the business”. Here’s the ATF FAQ on that topic http://www.atf.gov/firearms/faq/curios-relics.html#business-definition

        I know folks with hundreds of guns. Gun shows are good places to dispose of the excess, but I would be leery of someone who is buying as many guns as they are selling.

  3. Unless that’s paired with mandatory insurance, it doesn’t do a lot of good except create a lot of worthless cases against judgment-proof defendants.

    • Mark Bennett says:

      Does you require coercive state action as a solution to every problem?

      • Ross says:

        Isn’t coercive state action the only solution to a problem? That’s what my liberal friends seem to think. They are horrified at the thought that someone, somewhere, is doing something without permission from the appropriate bureaucrat.)

  4. Nicholas Weaver says:

    The real advantage of forcing all private party transfers to go through a dealer (California does, BTW) is that it makes it much easier to criminally prosecute straw buyers and unlicensed dealers.

    Criminals are not necessarily going to gun shows (although gun show sellers are notoriously bad when stung), but there is strong evidence that the problem is straw purchasers (table 2 and table 3 in this ATF report from 2000): http://www.mayorsagainstillegalguns.org/downloads/pdf/Following_the_Gun%202000.pdf . True, its being hosted by anti-gun types, but the report itself is useful: Its “all the guns the ATF was asked to trace in 1999″).

    46% of investigations were straw buyers, 20% were unlicensed sellers, 14% were gun shows/flea markets, 10% stolen…

    And most of the volume was straw purchasers, unlicensed sellers, gun shows, and corrupt licensed dealers.

    If all transactions have to go through a licensed dealer (who thus records things), it becomes much easier to prosecute these straw purchasers and unlicensed sellers. As is, in most states, since it is legal to resell a gun, the straw purchaser can say “uh, how was I supposed to know that Mr Pinkman was a meth-producing felon?”, and the prosecutor has to prove otherwise.

  5. Jay Cohen says:

    I have been to several gun shows and have seen very few, if any, private sales. The shows in Houston are predominately licensed gun dealers. They usually have two or three people per booth on the phone conducting background checks for each buyer. I’m with you Mark, show me the data.

  6. Michael Stuart says:

    The 40% figure always struck me as WILDLY overblown.
    I think I’ve been to ten gun shows, usually in the mood to buy. I don’t like registering–which the NICS check almost is in that they know you have one…just not specifically WHICH one.

    But I don’t see many private guns for sale; the occasional person walking around with a “For Sale” sign stuck in the barrel…but it’s a rarity and outnumbered a thousand to one by the gun dealers’ guns.

    So I gave up on private sales and let Leviathan know I’m packing. Molon Labe–Come and Take It.

  7. Michael Stuart says:

    tagging for follow-up…

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