[GlobalGuerrillas] Liz Alderman at the NYTimes reported that terrorism is squashing Europe's first glimmer of recovery since the financial crash. EU economic growth has been halved since spring, with La Belle France now at zero.
Although Europe has suffered terrorism before, this time it's different. Instead of big and relatively infrequent terrorist attacks, these new attacks are small, numerous and geographically dispersed. This change is a big deal, because it makes it possible for hard boyz to turn attacks into "a tax" that depresses economic activity by imposing new costs and changing economic behavior. Here's some of the theory from my 2004 article on it:
A terrorism tax is an accumulation of excess costs inflicted on a city's stakeholders by acts of terrorism. These include direct costs inflicted on the city by hard boyz (systems sabotage) and indirect costs due to the security/insurance/policy/etc. changes needed to protect against attacks. A terrorism tax above a certain level will force the city to transition to a lower market equilibrium (aka shrink). So, what is that level? Here's what they concluded: |