by Todd Daigneault

Created on: August 11, 2011   Last Updated: August 18, 2011

The widespread, frightening and utterly devastating 2011 UK riots could have a significant effect on the UK economy. For starters, there is significant property damage through looting, vandalism and arson. With property damage and looting comes far less tax revenue from the loss of business transactions, which effects all aspects of the UK economy. It can also effect employees who are put out of work and have to draw on government insurance programs to help sustain themselves and their families, which further drags down an already weakened UK economy. Europe, as well as North America, is being battered by the worst economic downturn since the economic collapse of the 1930's Great Depression. Loss of taxes, employee earnings (which filter down into the economy) help exacerbate an already terrible situation.

With London, England poised to host the 2012 Summer Olympics, the UK can ill-afford a nightmare scenario of tourists and other Olympic visitors being so turned off by the riots that they refuse to come to see the games in person.  Images of the besieged capital city, with innumerable fires, and the police overwhelmed can stay seared into the collective mindset of the masses long after law and order has been restored. This would definitely turn off many, as the UK was essentially overrun very quickly by rioters, who were poorly-armed with rudimentary weapons. People considering going to London, UK for the Olympics may fear a repeat of the 2011 riots. But it could also affect tourism in its immediate aftermath and well into the 2012 Olympic year and beyond. Its greatest and most serious effects will be felt until the 2012 Summer Olympics are over.

With most of Europe drowning in debt from the effects of the Global Recession, a major European country, like the UK, can ill-afford to have its economy depressed further. There are also other serious and detrimental economic effects, such as a decline in investment in a country that may now not be viewed as being able to guarantee safety for everything on its soil.  Higher insurance rates, security and policing costs can also further weigh down the UK economy, already drowning in the tsunami of economic destruction, chaos and utter despair. Uncertainty could easily creep into all economic sectors, which like all aspects of other global economies is so inextricably linked and impacted by sudden and traumatic events.

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