Comparing Presidents, Murder

This post looks at homicide rates over time, and as a bonus I’ll throw in a relationship between murders and guns. So here’s the homicide rate going back to the Ike administration, courtesy of the FBI.

It seems that early in the sample, the homicide rate rose. It bounced around until the Clinton administration, and then dropped, before bottoming out in the GW administration. (There’s my Bush Derangement Syndrome again!)

Here’s a summary…

Clinton did best, followed by Reagan, and (so far) GW. Carter and LBJ/JFK did the worst. Hmmmm… seems to resemble the pattern of spending on administering justice from my post yesterday… So let’s see what the data says….

Table 3 above seems to indicate that the spending on justice is inversely correlated with the murder rate. More prevention and enforcement, and more punishment = less crime. (Note… from the graph, I would guess this relationship may not hold for the entire period… there’s probably a structural break somewhere around the Carter era.) But it doesn’t seem that either pattern particularly leads the other. In other words… crime doesn’t have a memory, and neither does enforcement. It seems that if you want to cut the crime rate… then spend money on enforcement now.

Now… what about guns? Well, we all heard the adage… guns don’t kill people, people kill people. So obviously guns have nothing to do with the murder rate. But I’m a skeptic. I check anything I can. So I went looking for data on guns. Wow… if there’s something hard to find, its time series data on gun ownership from a reputable source. My guess… the gun lobby really, truly doesn’t believe its own story-line, because if they did they’d make sure this data was out there. But I digress… lack of data, so I have to call it quits, right?

Well, maybe not. It occurs to me that to increase the number of guns out there, someone has to make and sell those guns, because as we all know from school, the gun fairy died after having been sat on by a tapir in 1808. So… why not find data on how well gun companies are doing? But what if they’re doing well because they’re selling a lot of guns abroad, or to the military? Problem. So I sniffed around, looking for a company that doesn’t rely much on sales to the military or to any of them (God forbid!) foreigners. And I stumbled on Sturm Ruger & Co Inc. From their 2005 10-K

The Company’s design and manufacturing operations are located in the United States. Substantially all sales are domestic… The Company’s firearms are sold through a select number of independent wholesale distributors, principally to the commercial sporting market.

The sporting market… yup, that’s the euphemism I’m looking for. Excellent. I note that law enforcement types will sometimes buy their guns as well, but its not their main market. And it won’t matter, as we will see below.

As my measure of how well the company is doing, I went with stock price – its easiest to pull. But the price could rise or fall with the market. So I took the price divided by the S&P 500. And the price I used was the adjusted price (courtesy of Yahoo’s finance page) – to take into account dividends and buybacks and whatnot of both Sturm, Ruger & Co and the S&P 500. Additionally, because the homicide rate is yearly, I used the ratio of Sturm, Ruger & Co adjusted close to S&P 500 adjusted close for the last trading day of the year. Note… data only goes back to 1990.

Table 3 below shows the correlation.

Unless I made a mistake somewhere (and I did this in quite a hurry so if anyone feels an urge to check it please do), it seems there’s a positive correlation between how good of an investment Sturm, Ruger & Co. stock has turned out to be in a given year and the murder rate. How surprising. And there’s a much stronger positive correlation between how good of an investment Sturm, Ruger & Co stock has turned out to be the previous year and this year’s murder rate. Put another way… the more guns being sold, the more murders get committed the next year.

I can’t possibly imagine how this might be. Wait, wait… let me think. Hmmmm… If we multiply by seven and carry the two… perhaps take a cube root and… Eureka! Its so obvious! Law abiding gun buyers can see the future. When they (including a few law enforcement types) realize the world is about to get more dangerous, they stock up on guns, not to mention the super duper high margin t-shirts, key chains and water bottles that purveyors of fine weaponry like Sturm, Ruger and its competitors manufacture and sell! Simple, really. Why the gun lobby doesn’t want this kind of data out there I have no idea.

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Next Presidential comparison… arrests and convictions of public officials for corruption. Note… this isn’t quite the data I was looking for… it includes judges and others that are not quite administration members. If anyone has a pointer for members of each administration that were arrested and/or convicted please let me know.

And one more plea for data… data on guns is really hard to find. Anyone have a link to a credible source showing gun ownership or gun sales?

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