An Englishman, an Indian and an American walk into a bar. “The usual, Mr Sunak?” asks the barman.
Rishi Sunak, until very recently a rising star in British politics, within touching distance of becoming Conservative leader and prime minister, is now a source of amusement.
His popularity has crashed, and there is speculation that such is the level of opprobrium he’s receiving that the Chancellor of the Exchequer may walk away from public life completely.
Certainly, in what may be a precursor, his wife Akshata Murty and their children have moved out of Downing Street. He’s staying to try to fight back, seeking a leak inquiry into how his tax affairs reached the media, but the damage is done.
It’s difficult to see how he can recover from this and if someone as ambitious as Sunak can’t reach the very top there seems little to sustain him. Being fined over ‘Partygate’ adds to the humiliation.
Sunak’s entire life from school (head boy) to university (president of the Oxford University Investment Society) to marriage (to the daughter of one of India’s richest men) to investment banking (Goldman Sachs) to hedge funds (Chris Hohn’s TCI) to MP (William Hague’s old seat in the Yorkshire Dales) to Cabinet (effectively No 2 in government) has been marked by ascendancy.
Along the way, he even earned the approving nod of the tabloid press with the nickname Dishy Rishi.
Not any more. It’s not his policies that have ruined him. They weren’t helping, but there was a sense that he was driven by world events outside his control, that he had no choice.
No, his reputation has been shattered, ironically, by things that were entirely within his grasp.
Strangely as well, he is a calculating and cautious character, someone who cares deeply about his image and how he is perceived. Sunak has his suits made by a London tailor, who I know. They cost about £2,000 ($2,600) each. The tailor cannot mention him in any promotional material (these days, given Sunak’s crash, he would probably choose not to anyway).
This is the same Sunak who, as chancellor, head of the Inland Revenue tax collection service, thought it was perfectly acceptable for his hugely wealthy wife to be a non-dom and to pay no UK tax on her worldwide earnings. He also assumed it was all right for him to possess a green card, conferring permanent residency in the US.
It’s the same Sunak who believed it was fine to donate £100,000 to his exclusive private school alma mater, Winchester College. And the Sunak who is building a gym and swimming pool complex at his constituency manor house, one of four homes he owns, including a £5.5 million penthouse in Santa Monica, California.
But he remains bothered about the source of his suits. Why?
That's because in the Sunaks’ cross-border, high-finance set, the privileged status of a non-domicile and holding a coveted US immigration visa are regarded as entirely usual.
They are also private arrangements, known only to him, his family, perhaps their closest friends and the relevant authorities, and he must have expected them to remain that way.
Likewise, Sunak and his milieu would view it as “giving back”, to hand a six-figure sum to the school by which he’d done so well. Lots of them do it, nothing special there.
As for the extension to his constituency residence, it requires planning permission, which means the plans are public for anyone to scrutinise, so they could not be hidden.
Where possible, however, the Sunaks go to great lengths to play down their riches and to seek common approval. Their young daughters go to a local primary school, their London home is a “mews” house (sounds tiny but it’s five bedrooms, four bathrooms and two receptions), in Yorkshire they hold barbecues and garden parties and throw themselves into charity fund-raising.
He puts petrol in a car and is photographed doing so, but it’s not one of his four luxury vehicles but a Kia borrowed from a member of the public. And there is not a sniff of where he gets his well-cut suits from.
It's the hedgie in him that has proved his downfall. He failed to see why he could not do both — lead the global, super-rich lifestyle, albeit discreetly, and at the same time set Britain’s taxes. They’re non-compatible and in the present climate, amid the rising cost of living and soaring household energy bills, non-negotiable.
He did not see it like that and he is crushed. There were clues as to what was really in his head. Since becoming chancellor he has not once attacked tax havens or pledged to hunt down tax avoiders, unlike his predecessors. His previous hedge fund employers, TCI and subsequently Theleme Partners, both routed their earnings through the tax-free Cayman Islands — so presumably he approved of going to such lengths to avoid tax.
Likewise, his natural benchmarks are those of the world investment community, looking to fast-growing corporate powerhouses in the US, India and Brazil rather than companies in dear old Blighty.
He’s passionate about the potential for cryptocurrencies and how the UK can and should play a leading role. Again, music to global FinTech ears.
While the country was worrying about the coming economic storm and Sunak was planning to increase National Insurance payments, he found the time to introduce a new low-tax scheme aimed specifically at attracting overseas asset managers. One earns him wide criticism — he’s definitely Dishy no longer — while the other finds favour with his pals in international finance.
He has been quietly attempting to ride two horses. Not even the gilded Sunak could manage that; there was only ever going to be one result.