Читать книгу Alpha City - Rowland Atkinson - Страница 9
ОглавлениеThe alpha city is to the rich what bones are to the human body. It is here that the rich are supported by fine homes, clubs, power networks and a diverse cast of assistants. The close-knit presence and availability of the alpha city’s support system means that the rich are clustered in its finest and most luxurious districts. There is something about such places, an almost indefinable aura that attracts the super-rich to the city’s fine streets and homes but also to its multiplying social potentiality. These qualities leaven an almost globally unique mix of heritage, prestige and culture. All of this combines to create a city to live in, but also one to be seen in by the right people at key moments in the social calendar. While the patrician circuits of court and nobility have faded, it remains the case that in order to find a position among the world’s global elite one must find a place in the city.
As a destination for international capital investment, London is a place in which fortunes are made. But it is also a place where those with massive personal wealth seek to make and enrich themselves still further, socially and financially. This is a diverse and international group, originating from around the globe and in particular from the new and booming segments of national economies around it. Of course, London has long been a wealthy city that has attracted the world’s rich, but where in the past they could be found clustered almost exclusively in the West End, today the geography of super-affluent enclaves extends to the city’s North and South and to numerous areas beyond its formal boundaries.
What binds these networks and wealthy quarters together is the dependence of the super-rich on proximity to the social and economic life of the city proper. The key circuits of social life, deal making and political connections have been extended by luxurious and rapid modes of transport that effectively expand the geographical limits of the formal city to take in new suburbs, wealthy towns, and villages with mega-homes. But within all of this the city itself remains critical to the functioning and daily life of the rich and to attracting a global flow of new and visible wealth.
Who are London’s rich and where have they come from? Why are they so attracted to this particular city? The core argument underlying the analysis offered here is that London is critical to the creation of a group identity among the rich, even if there are clear divides and sub-networks within the ranks of the rich themselves. This group forms a kind of congregation; we can see them in the city out in force, but there is no clear sense of community among them due to their increasingly diverse national, economic and political backgrounds. The city also operates as a kind of theatre in which money is translated into social and cultural resources that are sought out by new money (and which old money believes it already knows).
A new nouveau riche, today’s super-wealthy arrivals have come to London as one of only a very few possible locations. They come to do business but also to be received within the city’s existing power networks and those domains that confer status. This kind of access begins with residence in the city’s established luxury districts, its alphahoods, joining its notable clubs, and connecting with others in less formal settings where dusty codes and prejudices can be circumvented in new and often highly dynamic private circuits. If much of London was originally constructed to woo the wealthy from its rural hinterlands, today it plays the same role on a global scale.
A theatre of riches
Much of the city that today we so closely associate with the wealthy elite was already well in place over two hundred years ago. At the beginning of the nineteenth century, the West End was already the focus of new residential developments for the wealthy, speculatively built by the owners of landed estates to accommodate aristocrats, merchants enriched by their imperial adventures, and the bourgeois owners of new industries who came to rent leasehold properties in these prestigious enclaves. The history of the alpha city begins with this space and its key role in acting as a melting pot that brought together British and international wealth elites. In this sense the city still acts as this point of social confluence and processer of people and capital, a place in which new social alloys and class compounds are forged and mixed over time.
An important outcome of the work of this machine has historically been its production of a sense of common identity, consciousness and solidarity among its elites, generated by shared residence in these immaculate districts. From this has also flowed the sense of new money jostling to be accommodated within the ranks of the long-term national elite. The historic city and its established alphahoods have long been the critical ingredients of a process through which rich and powerful groups have been formed. Proximity allowed networks to be built and lifestyles enjoyed that were advantaged by access to an exciting range of services, institutions and social opportunities. Underlying these social changes and the formation of a more urban and self-conscious elite lay strong economic incentives.
The story of the building of the West End was one of speculation by large landholding estates, creating the kind of fine streets, homes and semi-rural squares necessary to lure the growing numbers of the rich. The West End helped them to be close to each other but also to the key institutions of court, the economic institutions of the City, and the rounds of events that brought access to ‘Society’. The city of today, now chasing global cash and new ranks of the rich, continues the patterns of association and class formation generated in this formative period.
The social geography of areas like Mayfair and Knightsbridge was the result of building large and thus expensive homes that only the elite could afford. Such homes required a large entourage of staff, and to shops and services with supply chains for luxury items and fresh food that were necessarily short. Living at the right address was critical to securing a position in society, and historians have noted that careful geographical placement in the city was key to being considered part of the right crowd. As a result, more often than not, the residences of the wealthy and the nobility were almost never south of the river. During the seventeenth century, the Earls of Bedford (Covent Garden), Leicester (Leicester Square) and Southampton (Bloomsbury) created the new swathes of the early West End, a geography that pushed further west in the eighteenth century as the Earl of Scarborough (Hanover Square), Earl of Oxford (Cavendish Square), Lord Berkeley (Berkeley Square) and the Grosvenor family (Grosvenor Square) created the cornerstones of today’s alphahoods.
Aesthetically and physically, the arrival of new money gave rise to new urban districts that spoke of the power of this wealth, embodied by massive mansions and palaces and, later on, hotels and clubs. All appeared on a grand scale, often using international styles, such as French-inspired, gothic and classical architecture.
The West End estates were frequently built with a focal point, a central square, with a mansion associated with the estate owner. This would then be surrounded by the houses of new residents and tenants. A degree of town planning ensured more or less self-sufficient neighbourhood units through the inclusion of churches, markets and public houses. Unlike today, servants and other service staff also lived within the West End, making and supplying the goods and services the various households needed. Though elite areas, they were necessarily diverse because of a reliance on ‘help’ of various kinds. It has been estimated that even in these super-rich districts only around 10 per cent of the population were ‘upper class’, while the rest were servants, shopkeepers, publicans and smaller manufacturers.
Some areas of the West End were strongly associated with particular political affiliations: Hanover Square (1717), for example, was apparently built by and for people with Whig and military links, while Cavendish Square (1724) was seen as a Conservative enclave. Despite all the networking and sense of proximity, the West End was never a community in the sense of a connected group of individuals living in a locality. It was in reality a very large yet ‘part-time’ area, as many large townhouses were only occupied during the ‘season’ for a few months before the rich returned to their rural residences. These patterns have some resemblance to what we see of the life of these areas today.
Estimates have been made of the size of the elite occupying this area: in terms of the titled elite, there were around 5,500 in London in 1800; by 1900, due to urbanisation and the conferment of new peerages, the number had risen to 21,700. Among the earliest wealthy groups that returned to London were the so-called Nabobs, who made their fortunes in India in the mid eighteenth century as employees of the East India Company, as well as the families that had made their fortunes in the Jamaican sugar trade. One of the great anxieties about the Nabobs was not only their massive wealth but their use of it to demand, and allegedly purchase, seats in Parliament. This threat of money power to city, nation and society was perhaps inevitable and irresistible, but the establishment attempted to hold on by reducing the powers and scale of the East India Company.
New money, always somehow outside and representing a threat to existing elites, has arrived at the gates of the city for hundreds of years, seeking to integrate with its existing corporate, political and cultural worlds. Newly rich individuals and families looked to sit alongside and be absorbed into long-standing estates and aristocratic circles through education, emulating good taste, seeking political favour and using strategic marriage as a means of entering the upper social echelons, helping to access and reproduce new and dynastic wealth. This could not be done from a distance and without proximity to the kinds of connections and institutions that were only to be found in London.
Admittance to the upper circles was also pursued through membership of the city’s increasing numbers of private clubs (there were around twenty-five in 1837, and ninety-eight by 1900), many of which were connected to political parties. Most clubs were clustered within St James’s and Piccadilly, because these districts were historically adjacent to St James’s Palace, which remained the royal court even after Queen Victoria took up residence close by at Buckingham Palace in 1837. While today there are clubs devoted to the arts, media, universities and sports, many are still focused on politics or have strong military connections or aristocratic ties (such as the Reform, home to the Tory Party, Turf Club, White’s and Pratts – where all male staff are called George to avoid confusion). With changes in taste and society over the century, clubs devoted to the arts emerged, such as the Athenaeum, Garrick, Savage, Arts and Savile.
A key route to transformation was the use of honours to transform money capital into political and social standing. By 1890 it was estimated that a quarter of business and commercial families had a peerage. Between 1886 and 1914, two hundred new peers were created,1 highlighting the way in which money was increasingly being admitted to society in what some saw as a kind of ‘bourgeoisification’ of the gentry. The role of the then existing city establishment, formed primarily of the landed wealthy, oscillated between gatekeeping access to good taste and ‘breeding’, on the one hand, and, on the other, slowly admitting new wealth by enrolling it into the ways and codes of the long-standing elite. Up until the late nineteenth century the acquisition of a rural estate was still considered the critical means by which the tastes and power of the landed gentry could be emulated. In fact it is estimated that between 1835 and 1889, 500 new major country homes were built. From the early twentieth century onwards, however, most looked to London’s milieu as the key space in which to do business and engage with others of a similar background. Here access could also be gained to the annual round of Society functions, the ‘season’ that ran from May to September in the city.
London’s changing wealth elite
How might we begin to unpick the groups and individuals that make up the rich of today’s alpha city? One way into this question is to think of them in terms of three more or less distinct blocs. The first consists of the established rich, whose forebears we met in the preceding section. This group includes those with dynastic wealth and the more modest patrician elite who are anchored in the city’s established alphahoods. A second key group is today’s equivalent of the nouveaux riche of the late nineteenth and early twentieth centuries. This bloc includes the various industrial, tech, finance, commodities, energy and utility barons. In the third group are the enablers, those who play the role of factotums to capital and the super-wealthy. These are the agents and managers who, in many cases, have become rich themselves, often by growing and deploying other people’s money. This group is critical to the story of the alpha city because it is they who have helped to create the kind of environment conducive to attracting the flows of mobile global capital and ensuring the influence of new money on the city more broadly. The enablers include key figures working in banking, the managers or CEOs of large firms, financiers, hedge fund managers, some politicians, and those working in real estate including developers and builders.
London’s wealthy are by no means a unified establishment, with fractions among the rich who have differing backgrounds, interests and roles. Wealth overlaps with, and has become integrated into, a number of other key domains in complex ways – including politics, finance, the aristocracy and the media. The sense of a capture of the city by the rich is multifaceted, involving the planning of the enablers to bring capital investment to the city as much as any strategic set of actions by the rich themselves. Across the three groups of the old, the new and the enabling rich, there are thousands of individuals drawn from diverse nationalities, working in various sectors, including those whose fortunes are ‘self-made’ and those who have inherited wealth.
Most of London’s resident rich are also residents elsewhere, which adds some dynamism to their relationship to the city and to other places that compete for their wealth by offering more or less open regulatory regimes, preferential tax arrangements, rapid transport networks and low taxes on property. The alpha city’s super-rich include British aristocratic families and estates, media moguls, apparent geniuses from the world of new media, captains of commerce and industry, Russian oligarchs, individuals linked to organised criminal networks, oil barons and other resource magnates, as well as a slew of others linked to old (steel, diamonds) and newer (rare metals, chemicals, pharmaceuticals) commodities that underpin global capital markets today.
A Whirling Social Circuit
The single common denominator of the wealth elite is, of course, their command of personal wealth that has arisen as a result of accidental, strategic or aggressive control of capital. What tends to bind the group is an interest in enlarging or at least maintaining their financial position, an interest which brings with it political alignments connected to the pursuit of low taxes, economic stability and the privileging of finance and open capital borders. Here we also need to consider the enablers, because they are the skilled engineers and mechanics who maintain the magic machineries of capital, looking to ensure that the needs of the rich are met. They are defenders of the rich because their own wealth depends on them, hence their efforts to capture potentially easy money through the lure of the city’s offer.
To some extent we have already encountered London’s established rich. In many ways this group is very much of the city; they are embedded in its everyday life and have been here, in some cases, for decades or even hundreds of years. While their more obvious power, as political and law lords and land-holders, has waned, they remain an important part of the story of the development of the alpha city. We have seen how the use of peerages greatly expanded the ranks of the landed wealthy as honours were used to bring members of the bourgeoisie and international plutocrats into the ranks of the city’s power brokers and political parties. The city’s old money today is formed of the really old money, exemplified by the key estates which still own large areas of central London – Grosvenor (300 acres), Portman (110), Cadogan (93), de Walden (92) and Bedford (20 acres covering Bloomsbury) – and whose collective wealth is estimated at around £22bn. The ‘old’ rich includes the descendants of the ‘new’ families that had emerged in the nineteenth and twentieth centuries, such as the Rothschilds or Sebag-Montefiores. Yet very few of the richest families of even the 1970s are anywhere to be seen among the ranks of the city’s super-rich today.
The patrician wealthy have a strong attachment to place and its use as a social asset. Of course many in the House of Lords were and still are drawn from this group. Here the traditional image is perhaps the Wodehousian archetype of fusty and eccentric landowners eschewing the material trappings of modern life. The former Duke of Westminster was renowned for not being interested in material things, which is easy to say when you own swathes of Britain. While the sense of patrician responsibility has something going for it in a world of tidal money, we must remember that the accretion of luck, land and rents generated a group whose money power is also entwined with forms of political power and more subtle forms of influence. These connections and interests continue to block action on issues like land reform, transparency of property ownership, more progressive wealth taxes and more concerted challenges to money laundering and offshore investment, because many among the wealthy (in London and beyond) are linked to these systems.
The estates are now businesses that have often been taken out of the hands of their respective families. Many have branched out into land and property investments in other cities and nations. Grosvenor, for example, is today run as a Trust and owns property in more than sixty cities around the world. Now as in the past this group maintains its wealth by drawing payments (rents) for land and leasehold properties, but diversification of their portfolios has also been seen as an important element of survival. As a result, long-standing ownership means that this group is active in planning and shaping the look and feel of many of London’s alphahood areas that continue to draw in the world’s new rich.
Today the city still sees other sedimentary displays of patronage and older class and power structures, whether it be the Lord Mayor London’s annual parade, the fading circuit of the royal court, or proms and debutante balls. The annual ‘season’ has been in decline since the 1960s, as has its role in underwriting the boundaries of Society membership. But the city’s richest long-standing families, and of course royalty itself, continue to play a part in the everyday life of the city. Here, land and social position come together, carefully sustained and managed over generations through long-term estate management and succession planning. In 2017 the new Duke of Westminster, inheriting one of the largest wealth dynasties in the UK and indeed the world, paid almost no inheritance tax as the estate was passed to him in a trust. Even so, times and fortunes change, and in 2018 it was estimated that the royal family of Abu Dhabi were now the second largest landholder in Mayfair, while a string of sovereign wealth funds had snapped up enormous amounts of land and assets in the city. The city’s largest residential home after Buckingham Palace was now owned by a Russian oligarch, and a billionaire former owner of a mobile phone empire was building a massive mansion in the heart of Mayfair.
The established rich also include quite large numbers of households that are wealthy if not spectacularly so. Many have lived in London’s alphahoods for several generations, sit well within the 1 per cent in terms of wealth, and resent many of the changes brought about by new money. This is a privileged group bordering the upper-middle and upper class, often having bought property in the 1960s and ’70s, and for whom the massive tide of wealth arriving in the city represents both a symbolic and real challenge to their quiet enjoyment of the city. For this group the major anxieties are the increasing cost of property, the excessive noise pollution from cars and parties, and the question of why the new wealth elite don’t seek to become more integrated in the everyday life of the neighbourhood. A frequent complaint of this patrician elite is that areas which were once relatively diverse and lively urban communities now have the feel of ghost neighbourhoods. This is a group that has been and still is privileged, but which now feels threatened by new money and the sense of an overdevelopment of the city exemplified by its new high-rise and luxury developments.
The ‘new’ new rich
The alpha city has seen its traditionally wealthy groups joined by those who have grown rich in a time of global financialisation, kleptocratic capitalism and the use of new financial instruments and rent-seeking tech platforms as effective methods for making massive personal fortunes. London has been keen to lure this group and, more particularly, their cash.
Changes in the sources of the wealth among the city’s rich offer a barometer of changes in the global economy. Those changes, from the dominance of coal, steel and cotton in the nineteenth century to the role played by finance, tech and media today, can be mapped onto the city’s alphahoods and the architecture of new waves of development that show distinctive contemporary displays of taste and untrammelled money power. Over time these displays and the rich themselves appear to have become more privately oriented, whereas many among the wealthy of a hundred or so years ago would signal their standing through social and political contributions.
The idea that a crusty, outmoded and undemocratic elite has given way to the benefit of ‘self-made’ (the scare quotes are important!) money belies the many contributory factors such as good fortune, selection processes in major corporate outfits (based on schooling or social networks), the use of leverage from monopoly rentier positions, or indeed criminal acts that help to game or infiltrate the system. The rich often occupy a structural position that must be filled while believing no one else capable of doing what they do. Many of them come from a kind of vampiric cluster whose wealth is primarily generated by their ability to draw massive income from their control over capital, property and intellectual property. This group is unchallenged, untaxed and over here. A small coterie of alpha cities are engaged in a competition to attract them, driven by a number of enabling political and economic groups and key individuals.
How might the social location of London’s new money be best described? The traditional class types – working, middle and upper – feel increasingly quaint and unsuited to making sense of the long tail of riches that now extends celestially upwards. Certainly any sense of class or identity founded on traditional measures of occupation, political affiliation or income will not get us far in understanding the gulf between the social top and bottom, and, critically, the ways in which massive advantage and money power are becoming concentrated among the rich. One way to gain some purchase here is simply to follow the money, looking at the sources and systems that deliver such pronounced benefits to such a small group.
Dead Space
This means tackling two key issues head on: first, the question of power captured in the idea of an elite itself; second, how we understand its influence on the urban settings in which it is located. Clearly there are numerous overlaps here, as money connects with other affiliations, institutions, identities and industry sectors. None of this answers the question of whether an upper or ruling class, or an establishment, still exists, or if it does whether it remains influential. However, we can see is that in many cases old money has become adjunct and facilitator to the new capitalists. In some respects the landscape of established groups and interests has been circumvented by the way that new money has again bulldozed to one side the closed doors of class.
While the idea of an establishment is not redundant, it has in many ways been refashioned by the presence of a newer, internationalised and cosmopolitan group whose wealth is akin to that wielded by the belle epoque capitalists of the late nineteenth and early twentieth centuries. The wealth of those groups was eroded and straitened over the last century by massive wars and the partial triumph of labour and social democratic governments. But a resurgence of class and capital interests can be observed in the way that London in particular has been managed as part of a strategy to restore and maintain power among the wealthy. This restoration and the growth in numbers of the rich themselves have been enabled by a deregulated land and labour market, cuts to the public sector, fewer border constraints or taxes on capital, as well as an enabling environment for international investors and buyers of property. These regulatory aspects of the city, designed to lure the rich, have been supplemented with what amounts to a kind of recorded welcome message from a series of mayors (such as Boris Johnson’s claim that London is to billionaires what the jungles of Sumatra were to orang-utans) and other influencers that is played to anyone with bags of cash looking to invest or live in the city.
The key formations seeking to attract the rich are embodied by central and London government (including the thirty-two London boroughs, many of which either by choice or necessity have welcomed international capital) and the City, which sits at the centre of massive corporate flows (including enormous illicit wealth channels) and has sucked in capital via the post-colonial development of the world of offshore finance. Whether during apparent booms or periods of economic crisis, the power of finance has been assured through the ingestion of the logic of money by government.
One important means by which wealth has been retained by potentially footloose wealthy individuals is known as the non-domicile, or non-dom, tax rule. Where trusts have proved useful as a key vehicle for protecting old money, money from overseas or inherited wealth (the tax code can be inherited) was encouraged on the promise that it would remain largely untaxed. It remains possible to live in Britain and hold enormous wealth overseas, with only a very partial tax applied to income brought to the UK. This can get very complicated very quickly. The non-dom tax rule itself goes back to 1799, when the measure was brought in to help rebuild state resources following a series of wars and enormous losses. At the time many wealthy British citizens were living abroad and the question arose of how to tax their foreign holdings of estates, wealth and business operations without putting them off from returning to the UK. To encourage their return the government proposed that so called non-doms be exempt from paying tax on their assets and foreign income.
The rules changed in 2017 when non-doms were asked to pay income tax on their earnings in the UK, but they could still avoid paying any tax on their foreign assets and income as long as these were not paid back to them in the UK. The point here is that one might choose to retain operations overseas and build up a war chest that could be accessed by, say, retiring to France, Bermuda or wherever. The rules also create a series of inheritance tax, business investment and other tax reliefs that UK citizens cannot access. An added complication is that it is possible to pay a charge (the ‘remittance basis charge’) on income and gains held overseas.
The latest figures show that there are 52,900 non-doms registered in London (2019 HMRC data). This is a group that, somewhat curiously, reside in the city but don’t live there (to reduce their tax burden); they are the Schrodinger’s cats of the tax world. For wealthy ‘non-doms’ the city is defined in law as a kind of incomplete home, despite its clearly being their preferred location to live. London non-doms paid £5.3bn in income tax in 2018 (roughly 80 per cent of the total amount paid by all of the UK’s 90,000 non-doms). This sounds like a decent enough contribution until we divide it by the total number of non-doms, which then gives us an average take of £100,000 per head. This may still sound like a lot, but then an average school head teacher earning £55,000 would pay around £16,000 in income tax, while a ‘low’ paid university vice chancellor earning £170,000 would pay a comparable amount of tax (£70,000), this is also equal to the level of pay that a quarter of a million Londoners earn. Since we know little or nothing about the scale of the non-doms’ offshore holdings, it is not possible to estimate how much tax is lost by these arrangements. Many think the UK government’s tax inspectors should do much more. It is also worth remembering that this group does not include the numerous wealthy ‘onshore’ citizens who have used offshore savings and investment funds to evade or reduce their tax bill.
The existence of the non-doms is the source of much heated debate. We know very little about who these people are, with the exception of some well-known individuals – such as Mark Carney, the former Governor of the Bank of England, Roman Abramovich, Lewis Hamilton, Sigrid Rausing, Viscount Rothermere (owner of the Daily Mail who inherited the exemption from his father) and Lakshmi Mittal – many of whom are among the richest in London. The list also includes entrepreneurs like James Caan, private equity and finance managers, resource and retail magnates and numerous CEOs of major global corporations including a string of UK banks and pharmaceutical and insurance companies.
The non-doms have become a serious point of contention since many have lived for years in London and clearly benefit from living here. The non-dom issue highlights rules that are a legacy of empire and landed interests that permeate through to the life of the contemporary city. This is another good example of the many ways in which capital finds all manner of schemes by which its demands to escape the rules placed on the little people are enabled by a compliant state.
The general impression is of a rotten colonial legacy that serves the interests of the rich, who are able to run rings around tax collection agencies. The fear often peddled by some commentators is that imposing a greater tax burden on them might drive away important contributors to the UK economy. Yet it seems unlikely that long-term residents of the alpha city would be put off living there by a levelling of the tax playing field.
It is clear that London retains a powerful hold on the imaginations, wallets and lives of the global super-rich. In this sense there is reason to be confident that fair and transparent tax rules might not see a significant exodus of the city’s rich because they would not be able to access the host of desirable aspects of living there, even if they do so only for part of the year. An obvious dividend of introducing such measures would be the clear message that tax rules applied fairly to all, with the extra revenue used to address problems like the availability of affordable housing in the city.
The new rich of the alpha city are exemplified by wealthy individuals like Evgeny Lebedev (owner of the Evening Standard), Sir Cameron Macintosh (entertainment), Dickson Poon (owner via an investment company of Harvey Nichols), Michael Bloomberg (politics and media), Anthony ‘Yachtie’ Bamford (heavy plant), Anne-Marie Graff (diamonds), Bernard Lewis (retail), Charlene de Carvalho-Heineken (brewing), Ashok Hinduja (steel), Richard Desmond (media), Bernie Ecclestone (sport), Duncan Bannatyne (leisure) and Christian Candy (real estate). Banking and finance also figure prominently. Perhaps the most interesting thing about the lists of London’s wealthiest is the unrecognisability of the bulk of their names – those with enormous wealth are for the most part obscure, anonymous individuals.
Also significant are those who provide opportunistic processing and investment of other people’s money, the fund managers such as Crispin Odey, Ken Griffin (who spent nearly £200m on two homes in London), Michael Platt and John Beckwith among many others. Among this group, proximity to the City is important, but so too is the key hedge fund district of Mayfair, which has long been deemed a more comfortable and sociable base for those working in high-end finance. The idea that proximity is no longer important in finance is inaccurate – personal deal making, face-to-face meetings to build trust, and the soft infrastructure of watering holes and restaurants are also crucial elements here.
Over the last twenty years or so the internationalisation of the city’s wealthy has become increasing evident; this has included groups like the Russians, Turks, Nigerians and Chinese, alongside the longer-term presence of Americans, Hong Kongers, Arabs and the French. Many of the new rich live in the wonderful homes and massive mansions that were built on earlier waves of wealth. They include Lakshmi Mittal, who lives in what is known as the Taj Mittal on Kensington Palace Gardens, Roman Abramovich, Leonard Blavatnik, Alisher Usmanov, China’s richest businessman Wang Jianlin, the Sultan of Brunei, Tamara Ecclestone and John Hunt, who owns the elite estate agency Foxtons. Next to Regent’s Park live the Sultan of Oman, the Prince of Brunei and members of the Saudi royal family, in the enormous ‘lodges’ and terraces created by the Prince Regent’s architect John Nash in the early nineteenth century.
In areas like Highgate and Hampstead many of the mansions built by people who made their fortunes in soap, coal and brewing have been bought by wealthy Russians, who tend to live much more privately than did the patrician but ultimately short-lived wealth dynasties that built the residential landscape on the ridge. Athlone House, which was originally built by a financier, became a care home between 1955 and 2003, when it was sold to the Kuwaiti royal family. It was recently bought for £65m by the head of the private investment company Alfa, Mikhail Fridman, who started out as a construction engineer. Like many homes in the key alphahoods, the property was purchased from offshore. Adjacent to Athlone is Beechwood House – one of at least two residences in and around London belonging to billionaire Alisher Usmanov (metals and mining, a stake in Arsenal, with another home in Surrey at Sutton Place). It was previously owned by members of the Saudi and then Qatari royal families.
Perhaps the key home here is Witanhurst. With its sixty-five rooms it is the second largest home in England after Buckingham Palace, yet still apparently not large enough for Andrei Guriev (fertilisers), who bought the property using a company (Safran Holdings) registered in the British Virgin Islands, and then reportedly expanded the building to include underground car parking and a massive indoor pool and cinema.
London has become a world increasingly made by and for the new rich. Yet few of them are fully or even mostly resident in the city. Today, instead of retreating to a rural pile as their forebears did, they are more likely to be found in other tax-efficient cities, such as Geneva, Dubai or Monaco, or in homelands around the world such as India, the UAE, Pakistan, Nigeria, Lebanon or Israel. While the city’s new rich are a hyper-mobile group who circulate between many places critical to their tastes and needs, many of them still see London as the key place to engage with others in the wealth bloc – building alliances, advancing business opportunities, and drawing on its uplifting arrangements and configurations of people, places and experiences that London alchemically brings together.
If the nineteenth-century bourgeoisie initially struggled to join the ranks of society, their co-opting of and co-presence in the city eventually became a means of bypassing the strategies of class closure or rejection on the part of the ruling elites. Similar processes have occurred in more recent decades. In the 1970s, when London was on its knees, money talked louder than social networks, while snobbery regarding who was part of society faded by necessity, as new entrants like the oil-rich Arabs came to take up residence in areas like Knightsbridge and Mayfair.
The Clermont Club, a gambling house set up by the middle-class entrepreneur John Aspinall, was the setting for what some have identified as the kind of no-rules capitalism that pervaded the city in the 1980s, and in which new players could enter and vie for power outside of the establishment rules. The Mayfair ‘set’ offer an interesting case study of the changing power structures as London shifted away from being an imperial force in the post-war period. Key figures like James Goldsmith, Jim Slater, Tiny Roland and the founder of the SAS, David Stirling, adopted a vision of the UK as a fading imperial power whose gentlemanly capitalism and establishment were being undermined by complacency and adherence to rules. In this context, shareholder seizures of company control and asset stripping proved an effective means of wresting power and generating remarkable if sometimes short-lived fortunes. The group appeared to be anti-establishment while adopting a kind of retrotopic vision of Britain as a nation that could restore its economic pre-eminence at least for those prepared to risk their own and others’ capital. The story bears some relationship to the contemporary impression of new money and anti-establishment elites who, in order to usurp power, have sought to use Brexit as a means to construct a narrative of a country in decline.
Today’s alpha rich are not a mono-form power bloc. Identifiable sub-groups are clustered by nationality (the British, of which there are still many; Russians, Hong Kongers, Emiratis and so on), source of wealth (commodities, energy, food and brewing, media), and industry sector (finance, development, industry). Most of the new money has emerged in recent decades, rather than being dynastic. Where some proclaim a more porous and meritocratic corporate world rewarding a new generation of go-getters and innovators, others have charted shifts in the scale, intensity and asymmetrical reward systems of the global economy. These changes have had the effect of producing many new entrants to the wealth elite, often with relatively little effort on their part, facilitated by state monopoly positions, tax evasion, offshore finance and, in some cases, dubious or criminal trade.
A portrait of London’s wealthiest can be painted in miniature by examining media reports of the owners of apartments at One Hyde Park, the epitome of the city’s contemporary wealth elite and the destination of the spoils from many mineral and energy-rich countries.2 This development, in which apartments are frequently purchased via an offshore company, transformed the fortunes of the Candy Brothers, Nick and Christian, one of whom himself owns an apartment in what has been described as the only ultra-prime development in the city. From a variety of sources we can learn something of what others have described as the ‘shadowy’ residents of the development. There are eighty apartments in this opulent, semi-fortified block that sits a stone’s throw from Harvey Nichols, perhaps two from Harrods.
The wealth of One Hyde Park’s residents appears to be based almost solely on new money, made from privatised energy fields, from the monopoly control of telecommunications, real estate, pharmaceuticals, oil, property, gambling, and, allegedly in some cases, from organised criminal involvement. The list of nationalities is long, including Russians and those from Lebanon, Malaysia, Australia, Qatar, Nigeria and Taiwan, among others. Only one UK national has been reported to live there, other than Christian Candy, who bought duplex penthouse D for an estimated $270m.
One Hyde Park represents the top tier, the billionaire metropolis in miniature. Across the city, the estimated number of such masters of the universe is almost a hundred. This is a small number of singularly powerful individuals who have a high impact in social, economic and political terms. Among London’s billionaires are Brits like Jim Ratcliffe, James Dyson and Philip Green. In addition, Russians such as Roman Abramovich, Oleg Deripaska and Alisher Usmanov are a significant group, as are those from the Middle East and East Asia. They are courted by politicians but often avoided by journalists, who have become fearful of litigation. Such figures are able to construct a world for themselves, a city whose social order and economic underpinnings are designed to place no obstacles in their way.
Many will point out that the alpha rich are also notable for their demonstrations of largesse. Certainly the use of personal foundations and charitable giving has become significant, but this remains paltry when compared with the scale of personal wealth. It is also the case that the British super-rich are significantly less generous than their US equivalents, though some have managed to make a mark on the apparently public world of the city’s galleries and museums. For example, Lord Ashcroft reportedly has the largest collection of Victoria Cross medals in the world, estimated to be worth more than £30 million, and paid the £5m needed to build the Ashcroft wing at the Imperial War Museum, in which they could be housed. He is also Chancellor of Anglia Ruskin University. Anthony Bamford has given millions to the Conservative Party and some tens of thousands to charity.
New and international wealth seeks a place in the city by selective giving in order to build reputation and acceptability. In a recent profile of Len Blavatnik, the Financial Times reported that he paid £41m for his mansion in Kensington Palace Gardens in order to assist his entry into the London elite. In the process he reputedly purchased the advice of a lord and a knight. Blavatnik has given around £75m to the School of Government at the University of Oxford, £50m to Tate Modern for the Blavatnik building, and a further £5m to the Victoria and Albert Museum in 2018, which renamed its Exhibition Road entrance after him.
The Sackler family (pharma money) have financed a gallery at the Serpentine, and there is a Sackler Studio at the Globe theatre, a Sackler Hall at the British Museum and even a Sackler Bridge in Kew Gardens. Idan Ofer has given £25m to cheerleaders of the capitalist world order at the London Business School to help fund their Marylebone Town Hall campus, while Lakshmi Mittal gifted £47m to the National Gallery (which was also expanded through Sainsbury family money in 1991) and a wing at Great Ormond Street Hospital. This naming of public spaces and facilities continues the practice of the earlier super-rich who helped create the Tate Gallery, the British Museum and the Courtauld Gallery.
At this point we need to look at the goalkeeper and avoid being distracted by the fancy footwork of the new centre forwards. New money may grab the attention, but it is the deeper structures of the city and its social order that we need to focus on to see how the interests and influence of capital shape the city’s daily operation – the factotums, or enablers, of capital and the super-rich. London today is, if nothing else, the physical expression of the kind of steroidal capitalism that emerged from the crisis of a decade ago. In this phase of the city’s development, more elusive and complex methods of wealth creation have been supported by an increasingly affluent class of enablers (directors, financiers, hedge fund managers), politicians deeply aligned with an expansive market-orientation, and those working in the real estate sector (developers, builders, elite realtors).
We can and should look to the richest of the rich as points of influence and symbols of inequality, but the story of the city also heavily involves those agents and institutions employed and deployed by the super-rich and the managers at the helm of large corporations. Many bankers play with other people’s money and are not necessarily super-rich in the terms we have been describing; there are nearly 700,000 who work in finance and banking in the alpha city. However, it is also true that those who are dependent on and work for capital more broadly have a clear interest in the perpetuation and thriving of sectors and mechanisms that are advantageous to them. The enablers are a well-networked mediating class, consciously aware of their role in facilitating capital flows and capitalists because their business depends on them. This is a group that we shall keep returning to in later chapters.
The reinforcement of money and power by place
