Wall Street Giant Dumps Gun Maker
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Move over, National Rifle Association: another powerful player is (literally) invested in the gun industry--so much so that they’re helping to block reform. Wall Street private equity firms are the latest roadblock gun safety advocates have to go up against.
The New York Times’ Dealbook blog takes a look at the private equity firms invested in gun manufacturers. Due to their investments, as Andrew Ross Sorkin notes in the piece, the private equity industry is “expected to play a central role in pushing back against any [gun] reform effort.”
But one private equity firm is already feeling the heat. After The New York Times article was published, private equity firm Cerberus Capital Management announced it was selling its stake in Freedom Group, which manufactured the Bushmaster semiautomatic rifle used by Adam Lanza during the massacre in Newtown, Connecticut.
Another example is Colt Defense, which is owned by Sciens Capital Management and Credit Suisse.
It’s no surprise that in the wake of the Sandy Hook shooting, these Wall Street behemoths are not saying a word. Their investments in the gun industry make a profit, and they clearly don’t want to do much to harm their bottom line. As Sorkin reports, “since the killings on Friday, the Freedom Group and other notable gun manufacturers have not commented on the tragedy — not even a basic, ‘We condemn such violence and pray for the families of Newtown.’”
But while Wall Street and the gun companies private equity owns means that powerful forces are blocking gun safety reform, not all is lost. Writing in Slate magazine, former New York attorney general Eliot Spitzer called for pressure on these private equity companies. “While Cerberus, whose array of holdings is vast, is generally immune to public pressure and the opprobrium of trafficking in products that while legal may be marketed in a loathsome way, Cerberus would not be immune to pressure brought by its own investors,” Spitzer wrote. “Every student at a university should ask the university if it is invested in Cerberus. Every member of a union should ask their pension-fund managers if they are invested. Information is the key first step. From there, action will quickly follow.”