How Expensive Are Riots?
Protests and riots have always been a part of society as an extreme measure for the people to display their disapproval. On certain occasions they depict a shift in the mindset of the public and may be accompanied by violence. An early example being The French Revolution which was brought upon due to the extreme dissatisfaction of the people with their situation and the apathy of the ruling class. The events leading up to the French Revolution show the growing desperation of the people as they battled a drought, ever increasing tax and high prices of essential goods and the visible negligence on the part of the nobility. While it was not a perfect revolution and did in particular instances devolve into a bloodbath, The French Revolution portrayed the power that the people held and their ability to exercise that power. A revolution that started largely due to the economic anguish facing the French population.
Today, the world is in a state of undeniable chaos. Amidst a pandemic that is sufficiently
global reaction with petitions, online outcries and protests in various parts of the world, the epicenter being the USA. The movement started in a manner similar to that of The Rodney King
riots of 1992, where a video of police brutality against Rodney King was viewed and condemned globally. Further, the ‘not guilty’ verdict against the officers responsible provoked the masses. Source: Independent.ie
While the economy currently isn’t a priority to most nations and governments, it is important to understand the impact the ongoing crises will have on it. The immediate impact of riots includes the damage to property and businesses. The current situation however, is unique. We must not just consider the physical losses that are immediately perceptible but also take into account the possibility of COVID-19 cases rising, causing further damage to the economy. The COVID-19 pandemic itself had stunted economic growth significantly and estimates suggest that global economic growth is projected to see a sharp decline for the foreseeable future, affecting key sectors such as construction, education, travel and tourism, hospitality and automobiles. Additionally, investments are expected to plummet due to the instability of the situation. All of this is to be considered before we even attempt to gauge the impact of the riots.
Perhaps what’s more concerning is the fact that prior to the pandemic as well, the global
economy was looking at a slowdown.
The riots add to the dire situation by increasing the uncertainty and clearly displaying the
dissatisfaction of the people with the system in place. As seen in the Hong Kong riots of 2019, the economy is likely to see a temporary hit. The Delhi riots that took place in early 2020 also demonstrate the same. Riots add to the already precarious situation, further contributing to the uncertainty, creating an environment that discourages investments and burdens governments. While that had already been taken into consideration owing to the covid-19 pandemic this is likely to only add to the complexity of the situation. Added political and social instability, paired with public discontent does not bode well for economic growth.
However, in the long run, the riots will likely have a greater socio-political impact than an
economic one. A comparison can be drawn between the current riots and The Stonewall riots of 1969, another civil rights movement that took place during an economic slowdown and is looked back upon as a turning point in history, not for its economic impact, but for the changes that it managed to bring about.
In conclusion, riots and protests are an extreme step generally taken by a disgruntled population and the powers that be would be well advised to give heed to those issues that bring normally peaceful citizens on the streets. The economy is an important aspect of any riot and does, in the short term lead to economic disruption, however, when examined on a longer time horizon it becomes clear that such upheavals represent a churn in a sociological perspective and signal a societal change,