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So how did you spend your weekend?
Perhaps you drove your Volvo or Jaguar into town to spend your hard-earned money at Boots or Topshop, then on to a pub to watch the Chelsea game over a pint of Stella Artois or maybe home to have a nice cup of Tetley tea.
An unremarkable chain of events? Well, not quite. All of those brands have one thing in common — they are owned by billionaires who have no shareholders, no national loyalty and whose business tactics are, to say the least, ruthless.
It’s well known that the Russian oligarch Roman Abramovich owns Chelsea FC, while Topshop is in the hands of Sir Philip Green, a retail colossus who controls an astonishing 12 per cent of Britain’s High Street. But what about the others?
Volvo is in the hands of Chinese billionaire Li Shufu; Jaguar and Tetley were snapped up by the Indian oligarch Ratan Tata; Stella belongs to the Brazilian financier Jorge Paulo Lemann; while Boots is controlled by the secretive Italian billionaire Stefano Pessina.
More and more of our lives are in the hands of a small band of super-rich individuals. And they’re getting richer all the time.
According to figures published at the weekend, the collective wealth of Britain’s 1,000 richest individuals increased by £77billion in the past year — a jump of 30 per cent at a time when most of us have seen any savings or pensions hit hard by the recession and Gordon Brown’s stealth taxes.
Small wonder that, according to a report last month, London has become the most unequal city in the Western world, with the gulf between the super-rich and the poor creating a wealth gap not seen since the days of a slave-owning elite.
This takeover by the super-rich seems so different from the world I grew up in, where public limited companies reported to their shareholders every three months, shares were largely owned by pension funds we effectively financed, and a democratic government was not in thrall to a new class of international and unaccountable tycoons.
It was only when I began researching a book on the subject that I discovered just how widespread — and pernicious — the influence of the global ultra-rich has become.
Over the past ten years, billionaires have been arriving in Britain by the private jet-load. They’re here because the world turned on its axis at the start of the Nineties.
In a few short years, the tectonic plates of the global economy began to shift as the Soviet Union disintegrated, China opened up its markets and ‘second world’ countries such as India and Brazil liberalised their economies.
In each country it was the same story: an entrepreneurial group of insiders lobbied and bribed officials for government contracts, tax exemptions, subsidies and protection from foreign competitors to become very rich, very quickly.
The result was that by 2008 a third of the world’s new billionaires came from Russia, China and India.
Many of them made their money from unfashionable industries that the West was moving away from: Indian billionaire Lakshmi Mittal from steel; Russian magnate Oleg Deripaska from aluminium; and Chinese tycoon Li Ka-shing from shipping.
Many chose to make their homes in Britain, where the generous tax regime afforded to ‘non-doms’ proved an attractive proposition.
Far from being wary of these international oligarchs and their dubious business models, the Government welcomed them in, reassuring any who dared question the wisdom of such a policy that the new global super-rich were wealth creators who would bring jobs to Britain and thus boost our domestic economy.
Labour, it seemed, was even prepared to lobby on behalf of their new uber-rich friends.
In 2001, Tony Blair wrote a letter to Adrian Nastase, the Romanian Prime Minister, congratulating him on granting a contract to a company owned by Lakshmi Mittal (even though it employed only 100 people in Britain).
Could the letter have anything to do with the fact that Mittal had given a £125,000 donation to the Labour Party just before the 2001 election?
Absolutely not, Blair replied, dismissing the allegations as ‘Garbage-gate’.
There is a pattern, however. Of the £188million raised by British political parties between 2001 and 2008, £17.5million came from overseas billionaires.
Early last year, I met a senior civil servant attached to No 10 Downing Street, who had become alarmed by the number of high net worth individuals ‘in the constant orbit of the Government’.
‘Key individuals with key contacts can pretty much walk into the rooms they want,’ he said.
‘The trend picked up under the Blair administration and it has continued under Brown.’
Of course, there’s nothing new in ministers keeping in touch with industrialists.
But the civil servant felt something had changed significantly about the type of businessman our leaders are cosying up to — and what they are contributing to Britain in return. It’s not clear, for example, why Philip Green was knighted in 2007 for ‘services to the retail industry’.
Yes, he may employ thousands of British workers, but that year, the BBC’s Money Programme calculated that Green and his family had saved themselves £300million in tax by living part of the year in Monaco.
On the other hand, Green has been a good friend to Labour. In 2003, he paid £18,000 for a game of tennis with Tony Blair.
And on July 13, 2006, Lord Levy, the chief political fundraiser for the Labour Party, was arrested by police investigating the ‘cash for peerages’ scandal just as he was preparing to meet Green.
Green has insisted: ‘I don’t do politics, as such.’ A strange claim for a man who, with Labour third in the polls, has just pledged his allegiance to David Cameron.
Some believe that the increasing political influence of the super-rich is unavoidable. The simple truth is that a small number of rich individuals are more powerful than entire countries.
Bill Gates’ wealth outstrips the GDP of Lithuania, Sri Lanka or Kenya; Lakshmi Mittal’s fortune is ahead of the GDP of Jordan or Cameroon; while Chinese billionaire Li Ka- shing’s tops that of Zambia, Jamaica or Uganda.
The fear is that the tighter their grip on national economies, the more the super-rich will be tempted to use it as a form of weapon to threaten governments, dictate policy and secure their own agenda.
We are already witnessing that in the way hedge fund tycoons and other ultra-wealthy individuals have threatened to pull their businesses out of Britain if they are asked to pay a greater share of taxation by any of the three political parties.
Witness, too, how desperate and powerless the Government was when India’s Tata steel (controlled by the eponymous tycoon Ratan Tata) decided to mothball the Corus steel plant in Teesside.
Despite Lord Mandelson’s direct intervention, the plant was shut down.
Imagine if Russian oligarchs threatened to hold Britain to ransom over gas supplies — as the Kremlin did when it shut off supplies to Ukraine, leaving 18 European nations reporting shortages — and you will see why there is mounting concern in security circles about the rising power of the super-rich.
This fear drenches a recent report from the Ministry of Defence, entitled Global Strategic Trends, 2007-2036, which warns of growing unrest and instability fuelled by the increasing economic stranglehold of ‘a small number of highly visible super-rich individuals’.
So what can be done? If we accept that owning 20 per cent of the steel industry, the High Street or the computer software market bestows too much power in the hands of individuals, then governments must be prepared to act.
For in this uncertain future, one thing is for sure: if we fail to challenge their power, the super-rich will grow stronger and stronger — and less and less accountable.
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