733, Voltaire, one of France’s greatest thinkers, wrote a series of letters on the English nation, describing some of the extraordinary going-ons he had discovered during his exile to this country. The findings scandalised many of his French readers, then a truly statist and anti-capitalist nation.
“Go into the London Stock Exchange – a more respectable place than many a court – and you will see representatives from all nations gathered together for the utility of men”, Voltaire wrote. “Here Jew, Mohammedan and Christian deal with each other as though they were all of the same faith, and only apply the word infidel to people who go bankrupt. Here the Presbyterian trusts the Anabaptist and the Anglican accepts a promise from the Quaker. On leaving…some go to the Synagogue and others for a drink, this one goes to be baptised in a great bath in the name of Father, Son and Holy Ghost …and everybody is happy.”
To 18th century French readers, such wonderful, peaceful trade-based multiculturalism was unbelievably eccentric; yet the City of London, at its best, was always an open, outward-looking marketplace. Its renaissance, especially after Big Bang in 1988, went hand in hand with an influx of foreign capital and talent. Investment banks, hedge funds, private equity and consultancies have the most diverse staff in their London offices; others, such as the accountancy and law firms, are gradually catching up.
Take Barclays Capital: of its 12-strong executive committee, around 10 are overseas-born, hailing from the US, France, Italy, Canada and Australia. There are more overseas-born bosses in FTSE 100 boardrooms than ever before – we are tapping the world’s best and brightest. In fact, the entire UK financial services industry relies on foreign-born employees: of the 3.969m employed in banking, finance, insurance and other sub-sectors, 761,000 were born overseas, says the Office for National Statistics. That proportion – 16 per cent – is higher than in any other sector.
High-end finance is even more international – but that makes it especially vulnerable to political attacks. Many City workers packed their bags once to move here; why would they not do so again to move elsewhere? Many foreigners, especially those from America, France or Australia, will be forced to reconsider their career plans if they find the 50p tax rate and the raid on bonuses too painful. It is a case, I’m afraid, of follow the money.
London holds many attractions, including the language and the cultural attractions. But speak to successful City folk from overseas and there is much that they are also dissatisfied with: property prices, school fees, the health system, the binge drinking and much more. Moving to London was always a trade-off: people would come because they knew they would be better off and this outweighed many perceived disadvantages. If the costs go on rising and the benefits are slashed, thousands will leave. It is that simple.
It is also the case that – for historical and cultural reasons – the British are far more likely to move abroad in search of better opportunities than citizens of any other rich country. Go to Mumbai, Abu Dhabi or New York and see for yourself (the stats also suggest this). Labour’s punitive new taxes will chase far more people and wealth away – over the next few years, if not immediately – than the government would have us believe. Voltaire would have been dismayed at our stupidity.