Sunday, 22 July 2018

Taken to the cleaners?

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SwissInvest strategist Anthony Peters leaps to the defence of London.

A COUPLE OF weeks ago – I missed it at the time – our transatlantic cousins were treated to an op-ed in the New York Times titled “London’s Laundry Business” in which the writer, one Ben Judah, puts the City of London in the stocks for its deep connections with Russian finance.

Mr Judah postulates that the City has sold out to the oligarchs, that it lives on not much more than laundering dirty money and that we London-based bankers are now no more than, in his words, “hirelings”.

I am the last person on earth who would object to a jolly good polemic (especially when it comes to the less savoury aspects of our industry) but I have to draw the line when it comes to bending facts. It is a journalist’s right to have any opinion he or she might choose, but the price of that right is the duty to get the facts right – and to stick to them.

He opens with: “The City has changed. The buses are still dirty, the people are still passive-aggressive, but something about London has changed.”

I was taught in early life – by a Greek no less – that democracy isn’t about being allowed to do what one wants to do, but about respecting one’s neighbour’s opinions. If quietly letting other people get on with what they are doing while minding our own business is passive-aggressive, then that is what we are. And so far as the buses being dirty is concerned, I’m afraid Mr Judah might be thinking of New York.

He goes on: “England’s establishment is not what it was; the old imperial elite has become crude and mercenary.” Again I must take issue with him. The old imperial elite, as he calls it, has long departed the Square Mile. The City succumbed many moons ago to what the radical American sociologist James Burnham called the Managerial Revolution.

In his book of the same name, Burnham – formerly a dedicated Trotskyist – concludes that the forces of imperialism will lose control over the means of production to an elite of highly trained managers who will, in time, emasculate the owners.

London might have the largest chunk of the cash, but should we really be surprised?

THE CITY HAS, truth be told, few of the “old imperial elite” left in power. It is run by a multinational Babel of professionals from all corners of the earth for whom London and the UK are nothing but a well-located platform from which to trade. The old imperial elite, bless its memory, is still sitting on staggering losses from the Lloyds asbestos fiasco and piles of near-worthless shares in the once-grand banks and is, with a few exceptions, no longer instrumental in running of the country. Even Eton, once the preserve of the English plutocracy, has become a largely foreign-dominated academic meritocracy.

Is the London property market full of bent Russians and unspeakable Qataris, as Mr Judah suggests? It is – but then so are the property markets in Paris, New York, Monaco, Cannes, Vienna, Verbier and wherever else these characters choose to spend their time and their money. London might have the largest chunk of the cash, but being far and away the largest city and financial hub in Europe, should we really be surprised?

“London has changed,” writes Mr Judah. “And the Shard – the Qatari-owned, 72-floor skyscraper above the grotty Southwark riverside – is a symbol of that change. The Shard encapsulates the new hierarchy of the city. On the top floors, ‘ultra high net worth individuals’ entertain escorts in luxury apartments. By day, on floors below, investment bankers trade incomprehensible derivatives.” Really? Facts, Mr Judah, facts!

The Shard, incidentally, stands cheek by jowl with Guy’s Hospital, one of the finest medical institutions in the country, but if that is his idea of what constitutes “grotty”, so be it. As suggested above, opinions can neither be right nor wrong. One can merely disagree with them.

I am not quite sure what Mr Judah aimed to achieve in penning this piece. Had he added a bit of fog and maybe a stray dog or two he might have ended up in Dickensian London, maybe even re-writing Oliver Twist with thousands of bankers cast in the role of Fagin.

I AM TRULY no great fan of the so-called oligarchs, these modern robber barons who ruthlessly plundered Mother Russia and who have learnt the hard way that not sucking up to Vladimir Putin and his merry men is bad for their physical and financial health. I too have been priced out of Central London by them and have decided in future to avoid the Croisette in Cannes and the Farm Club in Verbier.

But to declare as an irrefutable truth that the whole of London, both the City and Westminster, dances to their tune is unfair and disingenuous. Mr Judah might care to consider where all the Russians would be based, were New York to be a shorter flight away from Moscow than is London.

Anyhow, what is wrong with the government wondering what stance to take vis-a-vis Russia while considering the best interests of its citizens and taxpayers?

Perhaps he should read the government papers concerning the actions taken by “the old imperial elite” during that fateful summer 100 years ago when “doing the right thing” ended up costing the lives of millions. I wouldn’t have had Mr Judah as a “guns before butter” type of guy.

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