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January 7, 2009

Clear Off! We Want Our Houses Back

By Spear's

The upstart owners of London’s best properties are being driven away by the recession. About time, says Anthony Rufus-Isaacs

The upstart owners of London’s best properties are being driven away by the recession. About time, says Anthony Rufus-Isaacs

In 55 BC Cicero wrote: “The budget should be balanced, the Treasury should be refilled, public debt should be reduced, the arrogance of officialdom should be tempered and controlled, and the assistance to foreign lands should be curtailed lest Rome become bankrupt. People must again learn to work, instead of living on public assistance.”

This should have been said by Gordon Brown this week rather than his febrile attack on the Tories for their ‘do nothing’ thinking about the economy rather than Cicero 2064 years ago. So what have we learned in over two thousand years about how to handle an economic crisis?

Very little, it would seem. In many ways, the situation in London is even worse than in America. I came back from LA several years ago having spent 22 years there so have an unusually clear perspective on just how much Britain – in particular London – has changed under New Labour and its self-anointed emperors of the imperial socialist guard.

In short, Brown has wrecked the economy, destroyed the pound, sold off our gold reserves, fuelled an unsustainable debt based economy and – above all – is chiefly responsible for making London lose its crown as the new financial capital of the world.

Once Obama is in the White House, watch how New York – largely thanks to Bernie Madoff – revamps the authority of the SEC and grabs back the crown of being the global capital of the world.

Frankly, I’ll be hugely relieved when all the hedgies, private equity types and bankers clear off to New York, Geneva, Lucerne or Singapore.

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The first problem with London today – or at least the London created by Brown until the credit crunch exploded the property market – is that Londoners can no longer afford to live in central London.

From the moment I arrived back London and began walking down the Kings Road, my old stomping ground, you immediately saw the difference. No one really spoke English any more. You heard Russian, Ukrainian, Japanese, Italian and Arabic more frequently than English.

I have no problem with wealthy foreigners living here in London so long as they are not just taking advantage of our tax system. Most seem to think that London is just an off-shoot of Monte Carlo which was once famously described by Somerset Maugham as ‘a sunny place for shady people’.

No phrase could better describe London today. These rich foreigners seemed to be happy to pay anything for the smart London house because they were non-doms who boasted of avoiding paying UK taxes so their ill gotten gains were worth more than our money – simply as they did not pay UK taxes.

The English people have been kicked out to Putney and the far marshes of Clapham as Chelsea and Belgravia became ghost towns, where the houses are simply numbers in some fat cat’s portfolio. They do not actually live there… Otherwise they would have to pay taxes…

I personally happen to be thrilled that my friend Bernie Madoff has made off with huge moolah. Poor dears. I don’t know anyone who cares one dot if these greedy fat cats are all hollering that their friend has stolen all their money. The only reason to invest in Madoff was greed.

Why was he so popular? Because he showed a better return than most hedge funds and he also paid a larger commission fee to the broker who got the business – so it was a pyramid of greed and a vicious circle of unregulated American financial services in a Caligula-like fiscal orgy.

We should not care if the City of London has a bit of a correction – or perhaps another Madoff comes out of the woodwork – as I am sure they will.

This will mean that all these non-doms and city types have to sell up and let us buy our houses back now that the property market has blown up. The really good news is that they have spent a fortune on most of these properties and when we get then back they will be cheap and in far better state than when they were sold.

Like many of my friends, nothing gives me greater pleasure today than seeing a new raft of ‘For Sale’ signs decorating London’s most fashionable squares. Every new sign is a source of joy.

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