Grenfell, groupthink, greed and impossibly complex systems
A simple question – asked at the right time and then acted on – could have averted the Grenfell catastrophe.
Remember when there was a campaign against the appointment of Sir Martin Moore-Bick as chair of the public inquiry into the Grenfell disaster? In 2017, David Lammy, now Foreign Secretary, criticised the choice of a “white, upper middle class man.”
The then government’s preference for a retired High Court judge, someone assumed to be automatically out of touch by dint of his colour and social class, was deeply worrying according to campaigners who saw this in terms of identity politics.
On Sky News, Lammy said seven years ago of the appointment: “It’s a shame that we couldn’t find a woman or an ethnic minority to lead the inquiry in 2017, and I think the victims will also say themselves, when push comes to shove there are some powerful people here – contractors, sub-contractors, local authorities, governments – and they look like this judge. Whose side will he be on?”
Well, it turns out Sir Martin was all along on the side of the truth. His report, published this week, is beyond damning. In forensic detail, it lays out the chain of disastrous misjudgments, arrogant behaviour, greed and confusion across both the public and private sector that led to 72 people losing their lives inside a tower block in west London on that fateful summer night.
You can read the report in full here.
The criticism of Sir Martin seems to have faded away, now he has delivered such an impressive report. Perhaps that will give those who criticised his appointment on the grounds of his colour and class cause for reflection. I doubt it, somehow.
What nagged at me reading the findings was a simple question, so simple it sounds almost stupid. Namely, why on earth did no-one in authority in a position to avert the disaster not halt the chain of calamity and ask the following: “What? Run that past me again. We cannot really be proposing to put onto the facade of high rise tower blocks material that is flammable?”
And from there declare: “Stop. It is so obviously wrong and immoral that it is impossible to believe it is even being suggested. You cannot be serious.”
In every disaster of this kind there are such moments when the key intervention goes missing. This is a familiar story throughout history – blending hubris, overconfidence, incompetence and greed.
During the building and testing of the Titanic, it was clear there were insufficient lifeboats on board, and yet no-one asked what would happen if the guarantees of unsinkability turned out to be wrong. The sinking was a product of a fatal failure of imagination.
In the run up to the epic financial crisis of 2008 – the central event of our times, a crisis that still shapes our economics and politics to this day – very few people in positions of authority inside banks, on boards, in the regulators and in government stopped to ask the simple, stupid questions, often for fear of looking stupid.
Why is that number so big?
Who understands how that financial product really works and what if they have got it wrong?
What happens if the music stops and we are still dancing?
My main conclusion – although there are others – when I wrote my book on the financial crisis and the collapse of RBS was about the extraordinary power of basic “stupid” questions. So-called “stupid” questions in an organisation are the best questions to ask when we are trying to avoid hubris.
On Grenfell, a simple, stupid question, asked at the right time and then acted on – are we sure that the cladding we are putting on the side of that building is safe and not going to catch fire? – could have averted catastrophe.
The Grenfell report makes it pretty clear greed was a factor in the corner-cutting. A wave of regeneration of the UK’s local authority housing stock started in the 1990s (a good news story at the time) and old blocks were restored. Some were knocked down instead.
The authors of the Grenfell report say: “We conclude that the fire at Grenfell Tower was the culmination of decades of failure by central government and other bodies in positions of responsibility in the construction industry to look carefully into the danger of incorporating combustible materials into the external walls of high-rise residential buildings and to act on the information available to them.”
But after the financial crisis, when the country ran out of money, it got worse. Local authorities faced cuts from central government, which made an existing problem worse. At that point, councils needed the work done more cost effectively and some of the private sector contractors needed to find the cheapest possible way. Corners were cut, lies were told, cheap products were deployed, ultimately to protect the margin. Bish, bash, bosh, the stuff could also be used on many of those fancy, ugly, expensive blocks of luxury flats that were going up at the same time in Britain’s largest cities.
Groupthink and greed led over many years, one step at a time, to a construction firm run by human beings attaching flammable cladding to the side of Grenfell Tower, a building occupied by their fellow human beings.
Some of this comes up on the latest edition of the podcast Not Another One – the weekly conversation between Steve Richards, Miranda Green, Tim Montgomerie and me. You can listen to it here.
On the podcast, Steve is kind about my financial crisis book and I confess I don’t know much if anything about housing regulation, but reading the Grenfell report I was struck by the similarities, or the read across via groupthink, greed, hubris, excessive complexity and a lack of curiosity.
Ostensibly, our podcast discussion this week was about whether or not Britain is broken. Personally, I don’t think it is, though we headed off in other directions and I failed to say that Sir Keir Starmer’s description of a diseased society is daft, monstrous even. Britain has problems. But is our society peculiarly diseased and Germany, France, Italy or Sweden are not?
There is a bigger point about Grenfell and the failures of the modern regulatory state and business when it fails. It becomes apparent that so much of what we’re facing today is best understood as a manifestation of ever increasing complexity.
In banks, in government, in companies, systems of delivery and control are so complex in the digital age that it is beyond the capacity of any single person to understand every aspect of the system. This is very different from government or a business in, say, 1824 or 1894. A factory owner or manager or minister back then could understand every part of an operation or process. Now it is impossible for a bank or company CEO or minister to understand everything and the software on which it all depends.
In Neil Lawrence’s new book – The Atomic Human – he traces this process to D-Day in 1944 and the exceptionally intricate planning needed to construct amphibious operations and the air operation at that scale. Calculating machines were by then starting to become central to marshalling the information and data required to move and resupply such large forces.
Simultaneously in the US, the theories of physicists and the father of modern computing Alan Turing were being put to work creating the calculations and systems required to build an atomic bomb. From this came the computer revolution in the decades after the War.
Ever since then this digitised process has expanded endlessly in all directions, across business and government. AI will likely accelerate it again. Complexity upon complexity. On and on forever.
In this world of ever increasing complexity, when we can’t go back, where we rely too much on digitised systems so we are all but enslaved unless we resist, what are we to do?
Those simple, stupid, perceptive human questions are going to be our best defence against future disasters.
Sanctions and oil prize squeeze Russia
The narrative in the West is that the Russian wartime economy is weathering infuriatingly well. Last year, growth was 3.6% and this year the latest IMF forecast suggests it will come in at 3.2%, much faster than the US, the UK, the EU or a stagnating Germany.
How can this be? In his brutal effort to crush Ukraine, Putin has surged defence production, which increases growth, albeit temporarily, and he has managed to carry on selling oil and some gas. There has still been disruption, with the Kremlin’s state revenues from oil and gas down 24% in 2024 compared to the previous year. The reason is that Russia has been selling at a discount in Asia and Gazprom is cut off from selling directly into the European market.
The Atlantic Council’s Vladimir Milov explained the situation in his recent report, Oil, gas, and war, detailing the effect of sanctions on the Russian energy industry.
Now there are two signs Russia is being squeezed some more.
Business and consumers are finding it increasingly impossible to import and trade, thanks to sanctions.
Live in Russia and want to buy a cheap Chinese router and have it delivered from China to Moscow? This is becoming impossible with loopholes being shut. Even Chinese banks have been warned off handling transactions for companies with Russian links, thanks to US threats of secondary sanctions. That’s the message of the latest piece from CEPA – the Center for European Policy Analysis. In The Slow Strangulation of Russia Sanctions, Andrei Soldatov and Irina Borogan explain how it is working.
And there is another pressure on Putin – the global oil price is down at a 14 month low and may come down further. There are doubts over demand in the world’s two biggest economies – the US and China. That means Russia risks getting even less for its oil, adding to the squeeze on state revenues.
This increases the pressure on Putin, and may help explain why he is going flat out now trying to gain more territory in Ukraine, raining down hell on civilians in cities and throwing tens of thousands of conscripts to creep forward in the east.
The autocrat faces a time pressure dictated by the US elections. If Trump wins, the theory is that there will be peace talks imposed at his behest, so it is in Putin’s interests to gain as much territory by the time they start.
If Harris wins, who knows? It seems likely the US commitment to Ukraine would be maintained. Indeed, the emphasis Harris puts on freedom at home and abroad makes it likely she will increase that commitment and even go “all in” on victory. Why would a new president, with reputation and reelection in mind, cave to Putin?
Accordingly, Putin is up against the clock and so are the brave Ukrainians.
Those of us who want Ukraine to win always need to remember that Russia, famously, has a capacity to endure epic amounts of pain, sometimes inflicted by an external aggressor and sometimes by its own bloody-minded autocratic leaders.
Still, Russia is being squeezed. It is not all going Putin’s way,
What I’m reading
Wanting two books for a trip to visit dear friends in Corfu this weekend, what did I go for? I’m such a British cliché. The new Robert Harris novel, Precipice, obviously. And Craig Brown’s A Voyage Around the Queen, a follow up to his acclaimed works on Princess Margaret and the Beatles. The style is highly eccentric biography of the subject, with a great deal of social history, personal stuff and historical fragments. It works, by somehow combining humour, intelligent insight and poignant observations about the late Queen.
Have a good weekend.
Iain Martin,
Editor, Reaction