The rootless world of the super-rich

[MikeWB]

http://www.telegraph.co.uk/culture/cult ... -rich.html

The rootless world of the super-rich
 
Mark Palmer
Published: 12:01AM BST 07 Jun 2006

Roman Abramovich's yacht Pelorus
Once, very wealthy people owned big estates in the country. Now they have homes all over the world and flit to and fro in private jets, yachts - or even submarines. Mark Palmer reports
Even before rumours began to circulate that it was haunted, David and Victoria Beckham had never slept a night in Domaine St-Vincent, the estate in Var-Provence they bought three years ago for £1.5 million. This might seem odd for those of us who can only fantasise about a second home in the South of France, but to the money-bags crowd there's nothing unusual about it at all.
 
In 2006, the super-rich - that exclusive group - like to see themselves as citizens of the world. They flit from one continent to the next, wheeling and dealing at 30,000 ft, always a few hundred miles ahead of the tax man but only a couple of clicks away from their PAs, solicitors, financial advisers, accountants, wives, mistresses and children.
"I was at an amazingly swanky wedding in Paris recently," says Stephen Bayley, the style guru and art historian. "With my pitiable suburban reflexes, I asked another guest where he was from. He said: 'I've just flown in from Ibiza. I have a flat here in Paris, but my real home is Rio. Anyway, tomorrow I'm going to my apartment in New York.' Then he added, and this is the interesting bit, 'In this milieu, we don't commit adultery, we travel'."
Once upon a time, the rich were rooted. They had big estates in the country. They were chairmen of local charities; they hosted the summer fête. Today, they are rootless - international nomads forever in search of fertile ground in which to sow the seeds of another bumper financial harvest.
Wander down the Bishop's Avenue in north London - which boasts Britain's highest concentration of multi-million pound homes - and you'll find the place practically deserted.
"That's one of the problems we have," says Trevor Abrahmsohn, head of Glentree International, a firm of estate agents that specialises in upscale houses in the area. "For a lot of people, this is their third or fourth home and sometimes they lose interest. They can't be bothered to live here and they can't be bothered to sell."
So, where are they? Well, they're everywhere and nowhere. Some follow the sun while others follow their business investments - and the best chance of seeing them in the same room is likely to be at art sales in London or New York. Never has the phrase "jet set" been quite so appropriate to describe this tribe, were it not for the fact that if you want to buy a plane with room for five passengers, there is a two-year waiting list.
And never has the gap between the super-rich and the middle classes been so wide. According to figures compiled by HM Revenues and Customs, the number of people in Britain with annual incomes in excess of £1 million rose eightfold between 1995 to 2005. Between 2002 and 2004, Britons with more than £5 million in liquid assets (money held in cash, bank and building society deposits, shares, bonds and unit trusts) had increased by more than 60 per cent from 1997. Since 1990, the number of billionaires in this country has more than tripled, while those worth in excess of £100 million have increased fivefold.
"Many of the new rich don't consider that they belong anywhere in particular," says Stephen Haseler, author of The Super Rich: The Unjust New World of Global Capitalism. "And the great new borderless world has made it easier than ever to move wealth around. In the old days, social responsibility came with money, and the rich had a genuine identification with the country where they lived."
Today's globe-trotters almost always have a base in Britain of one extravagant kind or another - because non-domiciled residents born outside the country pay no taxes on income earned overseas as long as they spend fewer than 183 days in Britain and abide by certain rules on property ownership. And British-born billionaires are adept at proving to the tax inspector that their main home is abroad (it is estimated that almost a third of the population of Monaco is now British).
Of course, moving around and staying in touch has never been easier. The virtual office, e-mails and mobiles have made a nonsense of time and distance, and instant gratification is a given.
Unfortunately, there are just not enough toys to go round. Jets are in short supply as are yachts, so submarines are proving popular. Roman Abramovich, Chelsea FC's sugar-daddy, has one attached to his £72 million yacht Pelorus, one of three that he owns, which is manned by a crew of 40, including several ex-SAS soldiers who know how to operate the sophisticated missiledetector system.
Abramovich also owns a Boeing 737, a bomb-proof Mercedes-Benz - and homes in Russia, Nice, St Tropez and Austria - in addition to his West Sussex estate, once owned by the late media magnate Kerry Packer, and his London pad in The Boltons.
In his book, Rich Britain: The Rise and Rise of the New Super-Wealthy, Stewart Lansley, distinguishes between what he calls the "deserving new rich" and the "undeserving new rich". Broadly, he puts the likes of Sir Richard Branson, J K Rowling and James Dyson, in the first group, and City brokers, investment managers, corporate financiers and certain chairmen of plcs (once known as fat cats) in the other.
"No fewer than nine current or former partners of the American investment bank Goldman Sachs are worth between £80 million and £150 million each," says Lansley. "I call this 'undeserving wealth' because they are moving money around, rather than increasing the size of the cake, creating jobs and benefiting society as a whole."
What really bothers Lansley is how the middle classes are being squeezed by the super-rich, particularly when it comes to paying taxes. "Many of today's fortunes have been swollen still further by a burgeoning, lucrative and largely unchecked legal tax avoidance industry," he says.
"The middle classes, who can't afford to be domiciled abroad, are the ones who have to pick up the tax slack."
In their defence, the super rich can argue that because they rarely subject themselves to real life - particularly when it comes to the National Health Service, state schools, public transport - there is no need for them to feel guilty.
One day, there may be a backlash against the super-rich. For now, they are a developing species, providing amusement and bafflement in equal measures. They might eventually settle down, as their predecessors used to do - but not yet.