Buying used things is natural in this world. I don't see car manufacturers complaining about people selling used cars or asking buyers to register their car online with a code so they can use it.

That's their problem to figure out not mine.

Taking a page from my Econ class,

Trade creates wealth. The more we buy and sell games the more the industry as a whole grows. (By that I mean the gamers and the developers not just the developers.)

The way to prevent reselling of games is to create timeless classics that you keep for a long time because you'll go back to playing them again and again. Some Nintendo games come to mind.

Just spend less money on visual fidelity, and focus your efforts on quality of content and gameplay mechanics. Those elements are far more important and probably cost less.

Maybe they should just, I don't know, make the games good enough that I want to buy it day 1 full price?

Just a though.

...So those devs closed because they didn't sell well because of used games?

Isn't it more buyers of the game>>>more used copies?

Let's face it the people that are really crying about used games are not the "small devs" but the big daddys who sell millions of copies then lose out of some $$ because some of those millions are sold back to others through Gamestop.

Explain how it kills smaller devs.

To be hurt by used game sales you have to sell games in the 1st place. They are "used" for a reason, people buy them, then sell them. 

If people don't buy small dev games in the 1st place how can used games hurt them? Smaller devs are being hurt less by used games and more the staggering amount of $$ that goes into making a game.

I'm not pushing all of the blame on the developer. But I am pushing all of the blame on the industry.

Most of it actually goes to the publisher. Developers are generally most interested in making games that people will love. Publishers tend to be the ones that push for games that can be monetised to the max, that try to get as much money as they can as quickly as they can.

And since the publisher provides the money, this is generally how it all ends up working. While developers pour as much love as they can into their games, the publishers instruct them to make changes in order to best maximise profits. And of course, the publishers are all management, not game-makers, and thus they don't really understand what best maximises profits. As a result, they spend a lot of time railing against second-hand games, piracy, etc, while inserting all sorts of DRM, etc, to try to control the flow of money. And it backfires, every time. Games with DRM typically end up being pirated more than other games, for instance, because in pirating the game, they typically remove the DRM component.

It speaks volumes that, while a lot of big studios run by big publishers are failing, a lot of the small studios that are self-run are blossoming. Why? Same reason as why Ubisoft's recent Rayman Legends announcement is such a problem - because the big publishers' management tend to make decisions that don't actually make sense, in the misguided belief that it will increase profits. Meanwhile, small studios aren't subject to the idiot managers, and thus can create games that people actually love.

In the end, they don't need to "lessen the damage of second-hand", they need to learn how to lessen the frequency of it happening to begin with. Suck all of the oxygen out of the second-hand industry by making it so that games that are in high demand don't show up in the used game market until the demand has already evaporated. And you do that, like I said, by creating games that people don't want to sell back to the game store, or sell on eBay.

Pretty sure the game that sold 1 million would have a larger percentage of used game sales than the smaller game. 

You still haven't explained why a smaller dev is harmed more in a used game sale than a larger dev is. They should just make games that can profit at 500k and let the big boys do millions.