Economics · Modern Times

Grenfell Tower.

Well, it’s been all over the news. The inferno that engulfed a tower block was on the front pages from Bild Zeitung to The Times Of India. I’ve read several interesting posts regarding this incident and one brought me a snippet of news that really made me realize what a parlous state the British economy is in today.

Bill40 spoke of how the costs saved on the renovation job was £5,000. And he put this in bold numbers because the sum was so tiny. I know five grand is a lot to many people, but in terms of building, it’s the equivalent of one euro cent. That is to say, you can’t buy anything with that kind of money.

Not in building renovation, at least. The scaffolding for that job would have cost in excess of £30,000. Five grand is peanuts.

So what was all the fuss about? The contractors saved some money and in saving money were able to offer a lower price for the job and bingo, the council awarded them the contract.

No doubt those contractors used a lot of Polish workers too, because the Poles are hard workers and are very cheap. They aren’t particularly good workers, but if you’ve shown them what to do, they’ll do a reasonable job. Not brilliant, but then, in most cases, you don’t need brilliance. You just need it doing. And the British tradesman is twice as expensive… it helps keep the costs down.

And British chippies on the dole.

Today, some 50% of the workers in the building industry in London are now Polish. They’d better get their British citizenship quick, or the building industry in London is going to hit the buffers if they have to go home after Brexit is finalized!

The real point of this post is about penny pinching. Not just penny pinching, because every modern form of accountancy is about pinching pennies. And that’s right across the planet. It’s more the way the British manage to pinch pennies and fuck things up at the same time.

The British simply don’t do regulation. If there’s a regulation, it’s probably being waived. It’s what keeps their economy going: the banks looking the other way when it comes to sensible business. In our day and age, sensible business doesn’t make you money – and it certainly doesn’t get you a contract from a cash-strapped housing association! Banks, like housing associations, are responsible for saving money and that means cutting costs. It means profits are incrementally higher, and in the banking world, that increment is the difference between a sensible share price and a bank run.

The British Safety Valve.

Thankfully the building industry in Britain is largely self-regulating: British tradesmen are notorious for doing good work. It’s in their genes, as it were. They’re too proud to do a bodge – not that bodges don’t happen in Britain, because they do. But they don’t happen from a skilled man, they happen from those who aren’t. The Brit will think for themselves and sort out any mess they make.

The Germans aren’t like that at all. My ex, Brian, worked in a factory in Germany and if he was assigned to a job, he’d be given everything he needed to do the work. That is to say the plans, and all the tools he’d need to do it. Everything, right down to the last, tiny drill bit. He could walk back to his lathe, the materials would be on a pallet drawn up next to it and he would be able to do the job from beginning to end without any more ado. Everything was thought out for him.

The Brits are much more gung-ho. Many lathe turners have their own favourite tools that they swear by if you’re going to achieve something – and that simply doesn’t exist in Germany. The Germans are very good at doing what they’re told, and the British are notorious for not. In each case this means the resulting product is high quality. In Germany it means they’ve obeyed the boss… and in Britain it’s because they haven’t.

Here in the Netherlands, the workers obey the boss and the result is a complete balls up. The Dutch seem to be the worst of both the Anglo and the Saxon worlds. Don’t mention the Fyra. That’s for an upcoming post.

Germans toe the line. For anyone who has had anything to do with German regulations, you’ll know that they are truly Byzantine. When the Germans complain about them, you know they’re trouble. The difference between Germany and Britain becomes obvious when you start asking a German bureaucrat about them. He leans back in his chair and takes down the appropriate folder and talks you through the areas of the regulations that you actually need. Because he understands his area of the regulations like the back of his hand.

I’m not going into detail right now, suffice it to say that they have all corners covered – and the way the Germans live means that they are kept covered. There really isn’t much the Americans can do to screw it up.

But that is for a forthcoming post on Nordstream2. Never heard of it? Well, that’s what the media’s for…

Cultural Differences.

The British simply couldn’t work with German regulations: it would drive the Brit mad. The British have enough regulation as it is, and they can’t cope with what they have… but then, if you’ve got responsible workers on the ground, they’ll sort out the details for you and the result will be as watertight as the German. The problem arises when the British managers force British workers to do as they’re told – put better, tell Polish workers to do as they’re told. They don’t care in the way a Brit does (and please don’t tell me I’m being racist, I’ve worked with Poles and they really don’t cut the mustard like the Brits). Give a Pole something to do and he will do it. The problem is that he won’t argue back, and that’s where the British system goes wrong: the British system is designed for British people, not Polish people. My experience of the British is that they will complain if something isn’t being done properly – that they’re not listened to cannot be put at their door.

Using non-fireproof cladding is a case in point. The contractors chose to shave a fraction of a penny from the cost and they used a cheaper insulation material. It wasn’t fit for purpose and the regulations backed it up. The problem was that nobody cared… the British bosses didn’t give a fuck, nor did anybody else. They were only doing their job in a way that meant they’d have a job tomorrow.

Which is where the problems really start. Because in saving five grand – that is to say, five thousand pounds – they actually cost themselves rather more. People who cut corners so that they can have their job today are not the kind of people who are laying the foundations of a sensible and long lasting business. That is always based on serving clients and not just handing them a piece of paper with a smaller number after the pound sign. It doesn’t take any intelligence to be cheaper, it takes a lot of brains to make clients truly happy.

Paying The Price For Cutting Corners.

The real problem with having cut a corner of this kind was that Grenfell Tower was an accident waiting to happen. Okay, so it wasn’t the only one… and that really was the problem. Each and every one of them could have gone up in smoke in the way Grenfell Tower did, and each and every one of them could have taken a hundred lives. With the persistent flouting of regulations it was simply a matter of time before it all went tits up.

And when it does go wrong, that means something has to be done. That “something” being the stripping of the cladding and its replacement with something fit for purpose. The cost of which is likely to be between 150 and 300% of the original cost. What’s the old saying? “A stitch in time saves nine”? Perhaps in our day and age it should read “A penny pinched now means you’ll spend ten grand later”?

No wonder Britain has a national debt that careered beyond £3,5 trillion two years ago…

It wouldn’t be so bad if it was an isolated case. But with the banks in Britain flouting the regulations in the way they do, when those costs come home to roost, Britain’s economy is going to be very sick indeed.

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8 thoughts on “Grenfell Tower.

  1. The expression you are looking for is “Penny wise, Pound foolish”, sums up the British to a tee. Another British trait is snobbery, the people living in those flats were poor so nobody cares.
    The cladding used was fire resistant not fireproof. So trying to set it alight with matches wouldn’t work but a fridge fire certainly did. I’ll do another post on Grenfell soon, something doesn’t smell right.

    Liked by 1 person

    1. Thanks for the information on the cladding; my point still remains in that it was not fit for purpose.

      Every country has its snobbery in one form or another – albeit less easy to spot. It just happens that the British way of snobbing happens to derail their economic performance at the same time. That’s why so little smells right in Britain.

      As to things “not smelling right” did you see my post on why the US took down VW?
      https://gemmasponderings.wordpress.com/2017/02/21/what-a-mistake-to-make/

      They’re at it again with Barclays, wanting tens of billions – whilst one of the main offenders, Morgan Stanley was fined a mere 4bn.

      Liked by 1 person

      1. That is the problem with Britain in a nutshell: discrimination of the wrong kind.

        I’ll tell you this: the one thing the Brits are taken aback by in Germany is being treated as equals when they expect to be treated as the Untermensch. Only the American funded Nazis did that, and they were as un-German as they come, they were more like the British than any German ever was.

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  2. It is interesting, your take on Polish workers being cheap, that may well have been the case when they first started to come over here, but now, having established themselves and in some areas gotten a very big slice of the action ie plumbing, they most certainly are not cheap.
    And as with electricians many are working to different standards and regs so all is not as rosy as it first appears, and I had experience of this a couple of years back.
    On penny saved pound foolish there are so many examples in this country a book is not big enough, anyone coming back from the continent sees the inferior road structure the pot hole filling, motorway patching all of which is returned to annually and more in some cases all that expense and the claims for car damage would have paid for the job to be done properly in the first place, but somehow we stagger on with ever increasing crumbling infrastructure.

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    1. Thankyou for your observations; I wasn’t aware that the Poles in Britain had increased their prices. Here in NL they certainly haven’t, and live by undercutting legitimate tradesmen – mind you, the Dutch aren’t any better than the Poles in my estimation.

      “And as with electricians many are working to different standards and regs so all is not as rosy as it first appears” The British employer is taking a serious risk here, because they are directly responsible for the installation, irrespective of who installed it.

      As to Britain’s infrastructure, what can the government do when they’ve got a hole in their budget that you could run a double decker bus through? The situation you describe is how the DDR looked before the Wall came down. It’s already taken a generation of repairs from their Western brothers to put that mess right; who’s going to nanny Britain when it all falls apart???

      The Brits have missed the boat, in the way the Americans did.

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    1. I’m not on Twitter, I gave that up years ago along with Linkedin. I’ve got a book to write, and Facebook took up enough of my time…

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