by
Bill Bonner All the ancient literature has much the same theme: a great man is ruined by his own success and his own vanity. He begins to believe that he's invincible. And then, he over-reaches, tempting the gods to put him in his place. That's why humility is such an important quality. A truly humble person is less prone to the kind of exuberant excesses that plague presidents, company executives, entrepreneurs, homeland security drudges, teenagers, emperors, investors and celebrities. That is why we work in France. It humbles us. We were reminded of this great benefit yesterday, at a meeting. Three lawyers, one architect, one insurance agent and two administrators sat down with approximately a three-foot stack of documents to try to figure out what went wrong with one of your author's biggest investments – a seminar center in France. The lead lawyer was a mature man with a self-confident air. He was enjoying himself, partly because he was getting paid $400 a hour and partly because it was clearly entertaining for him to see a foreigner – an American to boot – who had let himself be ripped off in France. "Ha ha...I guess you thought you could sign the contract and that was all there was to it...ha ha... But didn't it ever occur to you to check this architect's documentation...or to make sure that he had gotten the proper permissions from the authorities...? You didn't even check his invoices. I wish we could all be so lucky as to have American clients. They'll believe anything." The renovation project began well enough. The architect in question was the friend of a friend. He spoke well. He had an answer for everything. He seemed to have good taste. And he seemed to know what he was doing. Visiting the job site, we saw nothing wrong. It was dusty...walls were broken down and rebuilt...rotten beams were taken out...concrete was poured. "When you get into an old building, you never know what you are going to find...and you always find a situation that is worse than you imagined," said the most senior of the lawyers. "And then, too, you never can tell if the people working on it know what they are doing until you get to the end and turn on the water...and plug in a hairdryer." When we visited the project, there were workers putting in pipes every which way. Wires ran hither and thither. How were we to know they were running the wrong way? The architect attending the meeting was the not the first architect on the job. Nor was he the second. Nor the third. He was the fourth. He seemed honest, competent, direct – just like the three before him. He dressed in a conventional way – with an open rust-colored shirt. The only thing that gave away an artistic streak was his eyeglasses, which were rectangular and a turquoise color. He, too, seemed to be having fun. Not merely because he had just signed a contract which would bring him thousands of dollars for doing what the previous three architects had failed to do, but also because it is always fun when you get paid to criticize others' work. "The electrical system can hardly be called a system," he explained. "We tried to make sense of it, but it is incomprehensible. Now, you'd think an electrician would instinctively connect wires together. It's not rocket science. But there are a lot of wires that aren't connected. Not to anything. And half the outlets don't work. The fire alarm system doesn't work either. Lights go on for no apparent reason and off for no apparent reason. My colleagues and I were frankly baffled. "You could, of course, go to the electrical contractor and demand that he correct his work. But I wouldn't do that if I were you. He plainly had no idea what he was doing. "You are aware, of course, that this is deemed, by law, a public building," continued our fourth architect, trying to suppress a smile. "So you are required to have exit signs and the like...not to mention a fire alarm. Well, your electrician put the signs up...but in the wrong place. He has exit signs leading into the kitchen...where the fire is likely to be." It was a long day. A stupidity followed an incompetence followed a fraud. As each one came to light the lawyers' and architect's eyes twinkled with contentment. They had before them a fool...(your humble author) and they were happy to help prove it. "You paid to have the walls of the bathrooms painted," continued the fourth architect. "But the bathroom walls are covered with tile. They are not painted. So, too, you were charged for painting some of the walls that have wallpaper on them. You also seem to have paid one contractor who did nothing at all. In fact, there is no record of his ever showing up on the job site." "I've seen a lot of this kind of thing," said the lead lawyer. "I've done a lot of work in Africa. There, you take it for granted that you are going to get ripped off. It's just their way of doing business. You build it into your budgets...it's not a big deal. But even in Africa there are acceptable limits...a code of behavior. You do a project and you expect the local architects and contractors to steal about 15% of the project costs...people get mad if they steal more than that. "You know, I had a client who told me a story. There was an African politician who came to Paris to visit a French politician. He was invited to the French politicians house. The house was beautiful...furnished with fine antiques...and valuable paintings. So the African asks: 'How can you afford all these luxuries on your salary?'
"A few years later, the Frenchman goes to Africa and visits the African politician. He discovers that the African's apartment is richly decorated too...with antiques from Paris...and paintings that looked like they came from the Louvre. So he asks: 'How can you afford all this on your salary?'
"'No...I don't see any bridge,' says the Frenchman. "'No, you don't. Because I took 100% of the contract costs.' "So you see," the lawyer continued, "we don't mind a little bit of corruption. But when people get carried away, you end up with nothing. And it looks to me as though your first architect got a little carried away." May 23, 2007 Bill Bonner [send him mail] is the author, with Addison Wiggin, of Financial Reckoning Day: Surviving the Soft Depression of The 21st Century and Empire of Debt: The Rise Of An Epic Financial Crisis. Copyright © 2007 Bill Bonner |
