Memorials?

 

We may not have a monument to Margaret Thatcher but we do have a monument to “Thatcherism”. It is the Grenfell Tower.

The foundation of Thatcherism is the minimisation of the state. It plans and proceeds to reduce government regulation and suppress its spending. It does this without the guidance of long term consequence and human cost.

Tower blocks, like Grenfell, lack sprinkler systems, alarms and secondary exit routes which, before the “bonfire of red-tape”, were the norm. They have been mandatory in New York since 1967. Grenfell proves that they are necessary and yet HMG has not yet withdrawn a press release of 03/04/2016, entitled “Government going to further cut red tape by £10 billion”. It has not reviewed or withdrawn its doctrinaire and dangerously unspecific “One-in, Three-out policy” under which three regulations must be removed every time a new one is introduced.

As well as its economic and social consequences, Thatcherism has affected attitudes, behaviours, relationships and language.

Consider Sir Eric Pickles, Communities and Local Government Secretary who received the relevant parliamentary group’s urgent appeal to address their concerns over fire safety in March 2014 and did nothing. Interviewed after the Grenfell holocaust “he unashamedly blustered that the government judged it a sounder policy to encourage manufacturers to promote the product (less/non inflammable cladding) rather than go down the dangerous route of state regulation.” Those who threw babies out of high rise windows and heard and saw friends and neighbours being cremated alive would have a different understanding of the word “dangerous”.

Consider the economic relationships between parts of the UK itself, and between parts of the UK and our nearest and most comparable neighbours in Northern Europe. We think of ourselves as having a similar standard of living. The reality, due to our being much more unequal, is disturbingly different. The richest area in Northern Europe is Inner London, of which the richest borough is Kensington and Chelsea which was and is responsible for the Grenfell Tower. The next nine richest areas are in continental Northern Europe which has only one of the ten poorest areas, Hainault in Belgium. It comes ninth in the list of the ten poorest areas. All the other nine are in the UK. (Northern Ireland is eighth poorest and may get out of the unprosperous ten, courtesy of Mrs May.)

The tragedy and the sadness is that Thatcherism aka Fiscal Consolidation aka Austerity does not work.

Even the IMF says so! “In practice, episodes of fiscal consolidation have been followed, on average, by drops rather than by expansions in output.” It adds, “The evidence of the economic damage from inequality suggests that policymakers should be more open to redistribution than they are.” It recommends policies to supplement redistribution such as increased spending on education and training and the minimization of “the adverse impact on low-income groups.”

It is a theory widely accepted and powerful which seriously misleads with its metaphor of household management. When a government spends more than it gets back in taxation this boosts the amount of money in circulation and finances private sector activity. Nations create their own money: households cannot and so do not. (See ‘Can we avoid another financial crisis‘ by Steve Keen, and ‘”J” is for Junk Economics’ by Michael Hudson)

Too much money brings the danger of excessive inflation. Too little money in the “real economy” results in skilled and needed sections of society such as nurses surviving on debt and charity.

Similarly the belief that public service costs caused the national debt problem is mistaken. It was the “bailing out” of the banks which had taken advantage of “light touch” regulation’. (2007-36% of GDP going down: 2008-60% going up)

Mistaken and misapplied policies harm and kill.

Some form of permanent Grenfell memorial might help us to remember this.

* Steve Trevathan is chairperson of Lyme Regis and Marshwood Vale Liberal Democrats.

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12 Comments

  • I think you are mixing an ideological problem (market fundamentalism, hatred of regulations and continually pushing things just that little bit further) with a fiscal management issue (austerity, wealth re-distribution) .

    If you are right about austerity (and to a certain extent I think you are right), it leads to low growth and sub-optimal outcomes. If you are right about market fundamentalism and anti-regulationism (and I suspect you are) it has lead to people throwing babies out of high rise windows and hearing neighbours being cremated alive.

    There’s a bit of a difference.

    My worry is that if we mix the two we risk missing the actions we need to take in regulating markets. We risk thinking that we are making progress because we’ve given the nurses a pay rise, or that we’ve solved the problem because something is now in public hands (the Kings Cross fire occurred in the public sector).

  • Our thoughts are with those that lost friends and loved ones in this horrendous tradegy. But wikipedia says Grenfell was built in 1974 so factually some of the issues such as having more exits predate thatcherism.

    Sometimes the media wrongly rush to judgement but it seems that the cladding was the major problem. Again factually it seems the problem was not so much having the red tape itself but its application so that it became easy for cladding that was not fire proof enough to be approved for installation.

    In general life is safer today than it has ever been but Grenfell is a sharp reminder that red tape does exist for a reason.

  • Joseph Bourke 17th Jul '17 - 6:09pm

    Steve,

    I think the important issue in the aftermath of tradgedies like Grenfell Tower is to take effective action to ensure there can be no repeat. This new scientist article https://www.newscientist.com/article/2134814-how-did-london-tower-block-fire-spread-so-fast-and-kill-so-many/reviews some of the issues and concludes:

    “In truth, most old buildings do not conform to the latest guidelines for fire safety design, so it is imperative to update them by installing sprinklers, fire alarms and extra fire evacuation staircases. While those affected may have to wait for some time before the causes of this tragedy become clear and responsibility is taken, landlords and local councils can act now to help prevent another disaster of this scale from happening again.”

    This disaster, coming as it did days after the election, has been politicised to a great extent, but its not clear just how useful that might be to improving fire safety of tower blocks in the UK. There are certainly very serious questions to be answered and potential manslaughter charges under consideration. The Kensington and Chelsea tenant management organisation http://www.kctmo.org.uk/ is, I understand, the largest TMO in England managing over 10,000 properties in the borough.

    The policies of the Thatcher era in selling off and not replacing council housing stock have undoubtedly left us with a major social housing problem, but she left office 27 years ago. We have had 13 years under Blair/Brown and five years of coalition since then, so I am not sure we can lay the blame for this event or current fire safety regulations and standards in general, on the ghost of Thatcher.

  • Lorenzo Cherin 17th Jul '17 - 11:00pm

    Joseph gets to the heart of this horrible disaster more than Steve. I think we need to wait for the enquiry. Everything said about a legacy of cuts and laissez faire should stand of itself , not link to this to be of valid criticism of a society that has got lost.

    We need far more emphasis on the real health and safety of our people , not the tick box culture we have.

    The recent years have seen more not less regulation by governments at the same time corporations get away with doing things on the sly.

    Much money was spent on a refreshed block that was all it seems pointless or far more dangerous.

    That implies a loss of sanity and or common sense in a mad surreal world of pretence , more than death by a thousand cuts.

  • The fridge freezer or whatever it was that started the fire was not made in 1974. If the tower was built in 1974, why doesnt London have fire appliances that can deliver water to that height? Why werent heat sensors and an integrated alarm not fitted as part of the refit. Or proper fire doors.

  • Sue Sutherland 18th Jul '17 - 3:08pm

    I think the reasons for the Grenfell tower disaster are to do with both austerity and and market fundamentalism Tony. The Tories in particular seek to reduce the powers of the state, which leads to cutting back on all public sector expenditure and also to deregulation. Austerity and balancing the books has exacerbated the effects of this. Talking about Elf and Safety is a Tory joke which derides powers that safeguard workers and consumers.
    From my time as a councillor I thought that councils just had to take the cheapest option when going out to tender but from a discussion about this on Facebook I gather that other requirements can be taken into account.
    I was glad to see a new Lib Dem MP Wera Hobhouse talking about this disaster in parliament but disgusted that quite a few Labour members had turned up, not to have a debate but to do everything they could to put her off speaking. This is shameful and I think the video coverage of this episode should be widely shared by the Torch so people can see how they behave and the disrespect they show to everyone who has been killed, injured or damaged by traumatic stress as a result of this terrible event.

  • Steve Trevethan 18th Jul '17 - 3:17pm

    Thank you for the comments!
    Can anyone name a public enquiry which did other than “kick the matter into the long grass?”
    Do we need a public enquiry into public enquiries so that they might become prompt and “have teeth.”?
    Perhaps other relevant questions include:
    Upon which theories of money creation, storage and distribution do we base our economic policies, actual and as understood by the General public?

  • David Evershed 18th Jul '17 - 3:22pm

    Steve has obviously decided that he is an expert, knows best and that there is no need for a public inquiry when he can guess the problems and the solutions from afar.

    A commendable effort to save public money by not having an inquiry but I think the rest of us prefer to spend the money on a public inquiry to discover the evidence, derive the issues and then propose solutions.

  • Eddie Sammon 18th Jul '17 - 4:21pm

    Money creation is not a big problem. People against the banks “creating” money are basically against banks lending money from deposits. The only sustainable alternative is to add fees onto all bank accounts. Banks would return to their original purpose: acting as a vault. It’s an idea, but don’t think it doesn’t have significant drawbacks too.

    Thatcherism had its benefits as well as its drawbacks. It didn’t just appear out of thin air, the country voted for her in three general elections on the run.

    When people talk about putting money into the “real economy” what they are usually criticising is money going to banks, and whilst I agree that too much has gone to banks, without banks we would be in a lot of trouble indeed.

  • Nonconformistradical 18th Jul '17 - 6:03pm

    @Eddie Sammon
    “When people talk about putting money into the “real economy” what they are usually criticising is money going to banks, and whilst I agree that too much has gone to banks, without banks we would be in a lot of trouble indeed.”

    It all depends on what the banks do with the money doesn’t it? They have the power to make or break businesses.

  • Robert Irwin 18th Jul '17 - 7:20pm

    Speaking as a HS professional, I can tell you that there has been no “bonfire of red tape”. Approved Document B (that relating to dwellinghouses) of The Building Regulations was last updated in 2010. The current legislative requirement for thorough fire risk assessment (incorporating ignition sources, type and volume of combustibles, means of fire spread, fire detection and firefighting systems, and means of escape) has been in place since 2005.

    While no doubt there are Tories who would deregulate as a matter of dogma, the Institute of Occupational Health and Safety (IOSH) and the Royal Society for the Prevention of Accidents (RoSPA) are lobbying them not to take such a course.

  • Steve Trevethan 19th Jul '17 - 3:39pm

    Thanks again!

    “Rather than banks receiving deposits when households save and then lending them out, bank lending creates deposits”
    {Mc Leay et al.2014 p.1: Quoted in KEEN book detailed above]

    “The public [unrealistically]treats bank debt as morally equivalent to debts between individuals, where failure to pay forces a genuine loss on the lender. This mis-identification is aided and abetted by the mainstream model of banks, which ignores their role as “money factories” which can and do periodically create too much debt, and instead pretends that they are “money warehouses” that only lends out what the public deposits with them.”

    “Money is borrowed into existence in order to be spent.” “Total demand in the economy is thus the sum of the turnover of existing money, plus credit.”
    [Also from Keen]

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