Why 'Londongrad' Has Become So Attractive

London will be expecting throngs of visitors this summer. Not only did it mark Queen Elizabeth's diamond jubilee, but it is also preparing itself for the biggest event on the sporting calendar, the Olympic Games.

Preparation has taken almost seven years, and almost £10 billion ($4.5 billion) has been spent, not only to build new stadiums but also to improve infrastructure and regenerate previously neglected parts of the city. With only nine days to go until the games officially begin, the finishing touches are being added as London awaits the arrival of hundreds of thousands of tourists and, of course, the world's elite.

Yet over recent months, Britain has been getting more than it expected. As the European financial markets have teetered on the brink of collapse over the past 18 months, London has become a financial safe haven for many Europeans. Britain's decision not to join the euro has made the British pound one of the world's most stable currencies.

As European politicians and financiers have struggled to find a long-term solution to the crisis, businesses and depositors have slowly been moving their investments to London. For instance, in 2011 Italian investors spent £408 million ($185 million) in London real estate alone, an increase of more than 120 percent from the previous year.

London is becoming a safe haven not only for financial markets but for a generation of young Europeans looking for work. In April, Spain, the latest country to become embroiled in the financial crisis, announced figures that youth employment exceeded 50 percent Even wealthy French may be tempted to cross the Channel if Socialist President Francois Hollande raises taxes.

Yet only a few years ago, the city was associated with the wealth of Russian political dissidents. Russian billionaires bought up mansions and real estate in some of the city's most sought-after districts. Twenty years after the end of the Cold War, estimates count almost 400,000 Russian expats calling London home. So many, in fact, that the city was jokingly christened Moscow-on-Thames. British newspapers readily run stories regarding the size of Russian billionaires and their yachts.

Famous British institutions have been bought up by wealthy Russians. The Independent and London Evening Standard newspapers were bought by financier Alexander Lebedev, and Chelsea football club was bought in 2003 by Roman Abramovich. Late last year, Abramovich was taken to court in London by another Russian billionaire businessman, Boris Berezovsky, over allegations of breach of trust. And last week, Michael Cherney brought a lawsuit against rival oligarch Oleg Deripaska. The city could easily be the set of a Russian soap opera.

So is this a downward trend and an expectation of things to come? Should Londoners expect fewer influential Russians around Mayfair and Knightsbridge and more Greeks and Italians?

The answer is probably no. Despite this new influx, economists believe the movement of cash from southern Europe is most likely to be a short-term trend. Investment from Moscow and beyond is here for the distance, and it is moving beyond the auction and art houses.

The news that President Vladimir Putin is sending Prime Minister Dmitry Medvedev to the opening of the Olympics perhaps is an indicator of things to come. Relations between the Kremlin and Downing Street have been frosty since the 2006 killing of Alexander Litvinenko, which many believe was committed by Federal Security Service agents on British soil. British Prime Minister David Cameron talked about rebuilding the relationship during his visit to Russia last year, but the re-election of Putin is unlikely to see relations thaw any time soon.

U.S. economists Nouriel Roubini and Ian Bremmer's damning analysis of the Russian economy can only suggest that London may be seeing more Russian emigration and capital flows. Endemic corruption and poor social care make the possibilities of a future in Russia unlikely for many. According to a June VTsIOM survey, 20 percent of Russians are considering emigrating, their likely destinations being the United States, Canada and the European Union.

Yet it is not only a brain drain. Figures from Russia's Central Bank show that capital flight is expected to exceed $80 billion in 2012. These figures apparently accelerated on the news of Putin's re-election.

So why do so many Russians choose London? Despite the fact that Britain's economy is also suffering from the global slowdown, London has managed to retain its AAA rating from international credit agencies. In addition, economic and tax factors are favorable, and immigration laws are slightly looser than they are in other Western financial centers.

What's more, high-net-worth Russians are increasingly branching out beyond London's city limits. The leafy and affluent areas of Surrey and Berkshire, with their mansions, huge gardens and private schools, are now seen as just as attractive as Belgravia and Sloane Square. "Londongrad" is quickly expanding, and Britain will happily take its tax revenue.

During the upcoming Olympic Games, when Yelena Isinbayeva competes for gold in the pole vault, she may be in a foreign city, but she may well have the home-crowd advantage.

This article first appeared in the Moscow Times.

In the Police I trust.

The public sector and local government will be bracing itself for the forthcoming budget given by George Osborne. If the coalition government’s plans to wipe out the fiscal deficit within this Parliament are to materialise then savings bringing spending to around 40% of GDP will be the main target for Treasury officials. It is on these occasions that public services feel the pinch and try to demonstrate their worth and mitigate any government cuts. Perhaps the most difficult, particularly from the Conservative’s perspective, is a reduction to the policing budget. Tough crime and penal policies have always been part of a Tory’s diet and a cut in police numbers would appear to be contrary to party beliefs. Under Mrs Thatcher, police recruitment increased by around 30% and was vital in her battles against striking miners.

David Cameron met recently with the former Los Angeles Police Commissioner, William Bratton, to discuss crime and policing strategy. Bratton worked for the Boston Police Department (BPD), the New York Police Department (NYPD) and, until recently, the Los Angeles Police Department (LAPD). In all three posts he has managed to reduce crime in cities notorious with high drug and violent crime rates. His experience and judgements are intelligible and his justifications would make any politician stupid to ignore him.

For many years New York was ravaged by violent organised crime syndicates that disrupted the lives of its population. Bratton’s ideas were based on a criminology paper by George Kelly and Ray Wilson called the ‘Broken Window Theory’. Kelly and Wilson placed a brand new car in a rough neighbourhood and left it for 24 hours, when they returned they found there had been no damage at all. The next time, they broke a window and again left it for 24 hours. When they returned they found the car had been vandalised to the extent that nothing was retrievable, even the tyres had been stolen. The theory was that if the Police were ignoring minor crimes, and targeting serious criminals, then these petty crooks will be undeterred by the law and eventually fall into a life of tougher crime.

The ‘Broken Window’ was evident in many cities across America in the 1970s. In New York police didn’t stop drinking on the streets, gambling, graffiti or the infamous squeegee men that cleaned car windows at traffic lights. Statistics found that of the three million people travelling on the subway each day, 200,000 people were evading the fare. Bratton set out his taskforce to root out such delinquency by finding the source and stopping it in its track. As he stated, by stopping people from drinking on the streets you are stopping a potential fight or stabbing later on in the evening.

People were very critical of this style of policing because evidence suggested that ‘zero-tolerance’ policing was pushing crime to outskirts of the city. It is also seen as very authoritarian and suspicious of human behaviour. As Bratton put it, this style of policing is in the wider interest of society. The Police did not have a good reputation within ethnic areas of cities, and the violence directed at people like Rodney King did not help ameliorate such relationships. He suggests that Police need to control the behaviour of society because crime itself is only caused by one thing; human nature. These are influenced by the economy, demographics and racism but it ultimately derives from the individual. By placing Police on the beat it was repairing relationships in places historically deemed as no-go areas. Cops on the dots not only created compassionate policing but it helped to stop the source of crime.

Ideological lines are always drawn involving crime and punishment. Liberals despise the thought of giving up certain liberties for the good of everyone, but these theories have shown that they have been effective in driving down all types of crime in cities with unhealthy pasts. Putting people in prison is in fact a good thing for society. It not only removes certain people from society but endorses a combination of policing and the criminal justice system i.e. juries.

This is the dilemma Mr Cameron has. Crime is known to rise during recessions, particularly low level, but by cutting Police numbers he could be doing more damage than he wishes. Policing has evolved immensely in terms of technology and statistics, but these alone will not see people stop their errant ways.

A black boy got shot.

I heard an interesting interview this week that included England’s football captain Rio Ferdinand. However, it had nothing to do with football or his role in tackling racism. Last week, Rio MacFarlane, an 18-year old black teenager was murdered on the streets of Peckham. Rio was gunned down after a case of mistaken identity. Rio was not part of a gang, nor had he ever wanted to be. He was a promising young footballer who was studying sports science at college. Ferdinand, who grew up in Peckham and is a family friend, was doing his bit to ask for witnesses to come forward and find the culprit of this horrible act.

We need to remember that gun and knife crime is not defined as a crime linked to black people. We should understand though that carrying such weapons is becoming more common in such neighbourhoods and the assassins are becoming younger and younger. The thing that struck me, when I listened, was the flood of texts from the black community about the notion of being a grass. As you may know, I am not black, nor do I have any contact to these neighbourhoods; but I found some of the responses astonishing. The lack of respect and acceptance for the Police appears hollow. There is no reason to believe that impunity and murders should be accepted as the norm. After the surge of killings in 2008, the media lens highlighted the glamour and pervasive nature of gang culture. The language brazenly adopts a military intonation, but they aren’t fallen soldiers – they are sons, brothers, cousins and friends.

Hopefully Rio’s legacy will be lasting, not just another black boy who was shot.