Analysis: The London laundry
By Matthew Engel
Published: March 11 2011 23:19 | Last updated: March 11 2011 23:19
The Statue of Liberty has welcomed migrants to New York for a century and a quarter. It is time for Britain to acquire its own equivalent. It would probably be sited in an extremely private room somewhere in the bowels of Heathrow.
“Yearning to breathe free of your huddled masses?” it could say. “Give me your tanned, your rich. We won’t refuse.” The Statue of Bleedin’ Liberties, the locals might call it – if they ever got to hear about it.
EDITOR’S CHOICE
Lombard: Oligarch quality control - Jan-11
London was attracting rich foreigners a millennium before New York was invented. But the modern era may be said to have started in 1998, when Peter – now, Lord – Mandelson, a leading figure in Britain’s then shiny-new Blairite Labour government, told Californian computer executives: “We are intensely relaxed about people getting filthy rich.”
His coda, “as long as they pay their taxes”, was rapidly forgotten, arguably by the supposedly left-of-centre government itself. And Lord Mandelson did not say Britain was relaxed about people getting rich filthily. But the version that passed into folk memory was the signal that the UK could be seen as a safe haven even when the ex-socialists were in power. Not many questions asked.
The country that famously lost an empire but had yet to find a role had finally found one: a full-service bolt-hole and pit stop for the mega-rich, however their gains were gotten.
Only within the past week, when the extent of Prince Andrew’s links to assorted oligarchs, despots and dubious tycoons became general knowledge, have the British started to realise just what a haven they are offering.
“Good schools, Harrods, and a co-operative attitude to the reputationally challenged: for the recently retired Mr and Mrs Dictator in a hurry, there’s still nowhere like London,” says one private banker with a mildly subversive view of his own high-net-worth clients. (He spoke on the condition of anonymity.)
Curiously, this process occurred as Britain became ever more wary of other newcomers. The phrases “economic migrant” and “asylum-seeker” have become terms of abuse in the popular press. Britain’s refusal to sign the European Union’s Schengen agreement on unrestricted travel across the continent made the country almost unique in Europe for its dusty welcome to tourists, and indeed its own citizens.
But the rich are different. And Britain was determined not to put them off. London has always been an unusually dominant capital, with an economy far more vibrant and resilient than that of Britain’s provinces. Now, however, a third economy has developed, seemingly oblivious to the buffetings of global events and markets. So the newest addition to the UK’s fabled class system, the superclass, flourishes: for better or for worse; for richer or for even richer.
Why here? The language is a huge plus, as English has become the modern Esperanto. For the footloose, geography gives London the edge over New York. Also, children brought up in the US inevitably become Americans, whereas top-end British education offers many options to turn one’s heirs into well-connected citizens of the world.
“No other global centre can claim to have perfected London’s social, intellectual, business, finance, lifestyle and property offering,” says Liam Bailey of Knight Frank, an estate agency serving the top end of the market.
Advice is always close at hand. The UK now manages a quarter of the world’s offshore wealth. And while the press can be disobliging at times, the law can be very helpful in such cases. “The UK is an attractive place for the wealthy to protect their reputation through the courts,” says Keith Ashby, partner at law firm Sheridans.
London is already known as the libel capital of the world. Other more cunning weapons include the press-gagging “super-injunction” whose very existence, if one is imposed, is itself a secret.
And no one else can match Britain’s ultimate prize: an “in” to the royal family. But this game has its pitfalls. The players do not always recognise that, in certain British circles, royalty is considered a bit vulgar (this week, especially). Just like the newcomers.
Copyright The Financial Times Limited 2011.
Comments