…there are three reasons why looting will only serve to hurt exactly the ordinary people for whom pro-looting advocates pretend to be champions.
One: Regular People Work at Looted Businesses
Retail stores provide jobs to ordinary working people, including those who lack formal education. What’s more, these jobs are often desirable jobs, offering a workplace that’s air conditioned, clean, and far safer that more dangerous jobs like driving a bus or working construction. This is especially true of high-end retail shops. But selling handbags and gadgets to rich clients doesn’t make the salesperson wealthy, even if it can provide a decent living.
When looters destroy these stores and remove their merchandise, among those most impacted are the ordinary staff members. Without any merchandise there’s nothing to sell. And with nothing to sell there’s no revenue that can be used to support a wage for the sales staff.
Looters may pat themselves on the back for “liberating” these workers from their “wage slavery,” but it’s unlikely the newly unemployed workers see things this way when they show up in the morning and find their place of employment torched and ransacked.
Two: Looting Victimizes Immigrant Families and Others Who Aren’t Exactly Members of the Ruling Class
Although many news stories about looting in recent weeks have focused on looting of high-end retail outlets in places like Chicago’s Magnificent Mile, the fact is looting more often occurs in neighborhoods where residents are working class or low-income.
And in these neighborhoods, the owners of the local shops and small businesses tend to be immigrant families and other ordinary small-time entrepreneurs who are hardly members of the Wall Street elite. According to a report on entrepreneurship in low-income areas by the Small Business Administration, self-employed workers in low-income areas are “less likely to be U.S. citizens and English speakers” relative to other areas, and have less formal education. Higher proportions of the self-employed are black and Hispanic relative to other areas, as well. Moreover, “The vast majority of self-employed workers in low-income areas operate a business in their area of residence.”2 These business owners tend to face hardship themselves. Part of the reason they live and work in a low-income neighborhood is because they have relatively less access to working capital and business loans than people in higher-income neighborhoods.
Lower-income neighborhoods are not entirely without advantages. Competition is often less robust in lower-income neighborhoods, as many larger firms prefer to not take on the added risk of placing their offices and stores in these areas. This leaves more room for smaller independent firms where owners are more willing to take on the risk in exchange for lower rents, and lower up-front operating costs. The downside comes from the higher potential for crime, including robberies, looting, and vandalism. But because they have few other choices, many entrepreneurs in these areas choose to take their chances. When they are successful, they bring to their neighborhoods more employment, and greater access to goods and services for residents.
But it is precisely these immigrant-owned, minority-owned and family businesses that tend to be most victimized by looters.
Three: Looting Hurts Low-Income Neighborhoods the Most
Naturally, at the level of the independent business, looting can be disastrous for a business owners. The notion that looting is “no big deal” because businesses often have insurance is tone deaf to the point of being laughable. Most businesses in lower-income areas can barely afford the premiums necessary to cover the replacement value of their businesses — if they can afford it at all. Many businesses are under-insured. Nor is the recovery process effortless. Months after businesses were torched in Minneapolis’ riots, “Just 20% of all riot-related insurance claims have been paid so far.” Moreover, insurance premiums are higher in areas where there is high risk of crime and looting. Now, premiums will be even higher following the latest round of riots and looting.
This, is why businesses often tend to shut down and leave riot-affected neighborhoods after being looted. Insurance doesn’t just make a business owner’s problems go away. Looting and rioting also signals to other businesses to stay away.
Over time, this means fewer businesses, fewer employers, and more urban blight. It’s why after the 1977 blackout and looting in New York City countless businesses packed up shop and never returned. These areas remained economically depressed for decades afterward.
Put another way, looting and riots lead to “divestment” in lower-income neighborhoods.3It’s Not “Just Property”: How Looting Destroys Lives and Low-Income Neighborhoods by Ryan McMaken
It has been noted that the BLM people organize peaceful rallies in the day, which turn to firebombing campaigns at night. This may well be great Marxist agitation tactics, but isn’t going to help urban black people have a better life.
Another way, within the bounds of the law — or at least, without violence and theft — should have been found. As it is, Black America will be demonstrably worse off in January 2021, than it was in January 2020.
(This does not even factor in the recession/depression caused by the coronavirus lockdowns. Lockdowns that may have more than a little to do with the rioting…)