This is Russia???

How the other half live.

The Sunday Times (UK)May 4, 2008The future ruling class of RussiaHow long before the offspring of Russia's super-rich drown in their own excesses?By Mark FranchettiIt's 3am on a Friday along a narrow Moscow canal behind the House on the Embankment, the sprawling apartment block built under Stalin for the Communist party nomenklatura, where the purges began. Chauffeur-driven black Hummers, BMWs with tinted windows and at least one Lamborghini crawl along the canal, past guards in dark suits and earpieces to reach the entrance of Rai ­ Paradise ­ a popular nightclub among Moscow's wealthy teenagers.Inside, the scene is one of pure hedonism ­ Moscow style ­ brash, unabashed, gaudy and ostentatious. Long-legged models covered in body paint pose topless next to a Formula One car on show for the night, a few steps from a dozen oversized Fabergé eggs on sale for £2,000 a piece. Perfectly sculpted dancing girls covered only in baby oil and tiny bikinis gyrate on the bar overlooking a packed dance floor.Rising above are the club's private lodges. The cheapest ­ a cramped cubicle for six ­ costs £1,200 for the night. The VIP, a kitsch affair with its own back room and shower, can be hired for £5,500 ­ drinks included. On this night, all lodges are taken ­ one by Andrei, the son of a wealthy businessman, who is celebrating his 17th birthday with friends; his driver and bodyguard kill time watching a DVD in a Mercedes outside.In the midst of a haze of smoke, bright laser beams and sparkler sticks, Andrei and his school mates are puffing on water pipes and knocking back vodka shots and mojitos. One of his girlfriends, who looks barely 18 and is wearing a see-through top, fishnet tights and diamond earrings, is drinking champagne and picking strawberries from a giant fruit platter. "Life is great," shouts Andrei over the loud music, as a throng of very young women and older men dance below. "Look at this! It's Rai! What better place to be than in Moscow? We have it all. It's the best place in the world to party. If you have money, of course. But that's not a problem."As if on cue, a Russian pop song with the lyrics zhizni udalas (life's worked out well) comes on. The crowd goes so wild that security has to remove two young girls. But it's later, by the bar, that I find an even more poignant way to sum up the Moscow of the zolotoya molodezh (the golden youth). An attractive young blonde, sipping a cocktail, wears a white T-shirt with a warning emblazoned across her cleavage: "No yacht. No plane. No money. No chance."Moscow is booming. According to the Russian edition of Forbes, there are now 110 dollar billionaires in Russia, with more in Moscow than in any other city in the world. When it comes to private fortunes, only America has more tycoons than Russia. Add over 100,000 multimillionaires and you get a sense of the wealth that has been accumulated in Russia ­ all in little over 16 years since the collapse of communism. Arguably, no other country has ever given birth to such private riches in so short a time.The oligarchs, the hungry young Soviet men who first set out in the treacherous world of post-communist business and built multi-billion-dollar empires, have long come of age. Most have children, and this being a country where people marry ­ and often divorce ­ earlier, as a rule their offspring are no toddlers. Take Roman Abramovich, the owner of Chelsea FC and Russia's third richest man, who is said to be worth over £12 billion. At 41 he has five children ­ the eldest is in her mid-teens.Twenty years after Abramovich first set out in business selling rubber ducks, Russia is experiencing a new social phenomenon in its post-tsarist history ­ the growth of its first generation to have been born or raised rich.These children live far more opulent, secluded and bizarre lives than moneyed kids in other countries. This is not only because such private fabulous wealth is new to Russia since the Bolsheviks murdered its aristocracy in 1917, but also because, for now at least, money means little in Russia unless it is shamelessly flaunted.With the credo of communism long defunct, the brash and swift accumulation of wealth is the new ideology, the new value system, the new religion. Despised and denounced for 70 years as the root of all evil, capitalism has been embraced in Russia with the fervent passion of the neophyte. But the dramatic shift is now leading to some disquiet about the wellbeing of Russia's zolotoya molodezh. Privileged, fantastically wealthy and well connected, are these rich kids the future ruling class of Russia? And if so, how will they differ from their Soviet-born parents?"The question we should be asking is whether we are turning our children into spineless, fragile creatures who live in a fantasy world that has nothing to do with reality, with the Russia beyond our walled compounds," said the wife of a multimillionaire businessman, mother of two and rare voice of dissent among the rich, who is also a successful entrepreneur in her own right."I have little doubt that many rich kids will either be in rehab or addicted to a shrink by the time they reach their mid-twenties. I do all I can to make sure mine won't; ultimately, the parents are to blame. If you give a child everything one could possibly imagine, how can it learn to fight for anything, to be ambitious, to have drive?"For Russia's fast-growing community of nouveaux riches, sending their children to an English boarding school is becoming as essential as owning a villa in Sardinia and a yacht in the Caribbean. But for most, the road to Eton, Harrow and Winchester begins at the Moscow Economic School (Mes).Founded only 15 years ago, Mes is the most elite primary and secondary school in Russia. It may not be the best, but it is by far the most popular among Moscow's ruling classes. To send a child there is to make a statement. To get a place is to be accepted in a club. After all, this is where Abramovich's children went to school, as did Mikhail Khodorkovsky's, once Russia's richest man, who is now serving a lengthy jail sentence in Siberia as a punishment for angering the Kremlin. The offspring of Pyotr Aven, one of Russia's first oligarch bankers, who are now in England, are also former students.Oleg Deripaska, Russia's richest man ­ worth about £14 billion ­ who turned 40 in January, has a child at Mes, as does Tatyana Dyachenko, daughter of the late Boris Yeltsin. The list, which includes children of top Kremlin officials, is long. Entry costs £25,000, although parents are said to pay far more to get their child in. Average yearly fees are around £7,000 ­ a pittance for any self-respecting wealthy Russian and a fraction of what it later costs to send them to Britain. The key here, say parents of Mes children, is connections, as getting a place without the right recommendation is all but impossible.September 1 marks the beginning of the school year in Russia. Known as the Day of Knowledge, it is an important date in the country's calendar, when parents, teachers and children come together to celebrate education.As in Soviet times, children wear their best outfit and bring teachers flowers. Girls wear colourful ribbons in their hair and carry balloons. Teachers make warm speeches in front of parents armed with cameras and camcorders. The climax comes when a pupil is chosen to ring the year's first school bell.A special occasion in every Russian school, September 1 is quite a spectacle at Mes. A traffic jam worth millions of dollars stretches for several hundred yards around the school, as Porsche Cayenne after Maserati after BMW limo roll up, 4WD chase cars with bodyguards in tow, to deliver their precious little cargos. Burly security men, some armed with guns, others just with umbrellas to protect their masters from the drizzle, jump out as car doors are swung open to allow school children as young as seven to make their entrance. Some carry presents, others struggle with oversized flower arrangements.All are immaculately dressed in designer clothes. For girls, the larger the ribbon, the better.As a chauffeur-driven car with smoked windows and the blue flashing lights reserved for government officials drives off, there is a slight moment of panic as a child realises that she has left her balloons behind. Her father dispatches a bodyguard, who seconds later sprints back into the school, pistol strapped to his side, balloons in hand. As the last children enter the school, bodyguards and drivers mingle outside and settle in for a long wait."Once during the festivities teachers lined up the year's new entries on stage and asked them to introduce themselves in front of everyone on a microphone," recalls Alina Pavlova, whose nine-year-old goes to Mes and is now spending a week in the Maldives."Then they asked each child to tell us how they'd spent the summer holidays. One said Sardinia, another St Tropez, a third the Caribbean, on private yachts of course. I must say that it sounded a bit strange, coming from the mouths of a bunch of seven-year-olds."To find out more about Mes I meet Masha, the 13-year-old daughter of a government official who, like most high-ranking Russian state bureaucrats, also has his own lucrative business on the side. Far from being a typical spoilt rich kid, she is shy, soft-spoken and well mannered, but it quickly becomes apparent that despite her young age, privilege and fabulous luxury have long become second nature.She tells me that the next morning, the start of her spring break, she is to be taken to the airport in a chauffeur-driven car to fly off to a large yacht in the Bahamas with a school friend and her parents. "Will you fly first class?" I ask naively. "Oh no, by private plane," she says with the nonchalance my daughter would reserve to describe an afternoon at her local playground.Masha's friend, the daughter of a Russian industrialist, once threw a tantrum because she did not like a private jet her parents hired to go on holiday. I'm told it was a phase she has grown out of, with the help of a child psychologist.At Mes since she turned seven, Masha explained that the most common aspiration among her school girlfriends is to marry a multimillionaire, a marked change from Soviet times when officially girls wanted to become a doctor or an engineer but secretly dreamt of being an actress, then the epitome of glamour.Of course, not every child at Mes flaunts Daddy's wealth, and many behave like ordinary children. But, as Masha explained, every class has its own clique of kids na pantkah (show-offs). "There are strict rules if you want to be accepted by them," said Masha. "The first must is expensive designer clothes. At school it's absolutely normal for a 13-year-old to carry a Gucci or Prada handbag, wear high-heels and make-up. A watch studded with precious stones is also imperative. Most kids have credit cards and at least a couple of e100 bills in their wallet. And of course, everyone has a mobile, preferably an iPhone. A private nanny, bodyguards and a bulletproof car are also very common."To celebrate his son's 14th birthday two years ago, a Ukrainian tycoon dispatched his private jet to Moscow, boarded his son's whole Mes class and flew them to Kiev for the weekend. They stayed in suites in the city's most expensive five-star hotel and took a cruise down the Dnieper river on a private yacht. The boy's father could not join them as he was in jail at the time.Under pressure to impress each other with ever more extravagant shows of wealth, parents can pay tens of thousands of pounds for a child's birthday party, for instance by hiring an entire circus company for entertainment. Typically these families live off Rublyovo-Uspenskoye Shosse, a road that snakes westwards out of Moscow through forests of silver birches and pines. Known as Rublyovka, the area is Moscow's Beverly Hills, home to the gated compounds of oligarchs, government ministers, Kremlin officials, the Russian president, Vladimir Putin, and, from this week, his successor, Dmitry Medvedev. Along the road, stretches of forest are boxed in behind 16ft-high metal fences surveilled by CCTV cameras and patrolled day and night by private security guards.Where once open countryside stretched, dotted with crumbling dachas, now rises the Barvikha Luxury Village, an elite shopping complex just down the road from Putin's dacha. Lamborghini and Ferrari have a showroom. The Bentley dealership is said to sell a car a day. Gucci, Prada and Armani are there, as is Dolce & Gabbana, with a VIP fitting room decorated in mink. Close by is an upmarket restaurant from where Arianna, a 15-year-old Rublyovka child, used to have sushi delivered daily to her school because she didn't like the canteen food.Further down, where the road reaches Moscow, I once saw two small children gently cruising down the pavement in their own pedal cars ­ a Ferrari and a Porsche ­ two bodyguards in dark suits and a nanny walking briskly behind.According to Boris Arkhipov, a professor of child psychology, the lavish lifestyle is causing Russia's rich kids to be susceptible to a number of psychological problems. Arkhipov worked as a consultant for about 10 years at Mes and other elite high schools, meeting and observing the children of some of Russia's richest oligarchs."The problem is that in many cases the parents have little culture other than the culture of money," said Arkhipov. "Children learn from the parents. If their father swears at his staff, why shouldn't they do the same with their nanny and bodyguard? Discipline for many is a problem. They don't accept authority. They live in a gilded cage, with staff but often without enough love from their parents who are too busy running their business empires and having a good time. They have a different sense of what reality is."But the greatest and most common problem is that they have little drive. What's the point of striving to achieve something when you are born with a silver spoon in your mouth and everything is served for you on a golden platter?"Other sociologists describe the Rublyovka's little residents as "the children from behind the fences". They warn that the lavishness and seclusion of their lives means they will find it hard to adapt to the real world with its problems, as they have little or no contact with children from different backgrounds.Arkhipov said that at school children often play on their mobile or Game Boy during classes, and complain to their powerful parents when the gadgets are confiscated by teachers. To illustrate the manipulative behaviour of some of the children he came across, he recalled one incident at Mes when a teenage schoolgirl threw herself into the arms of a teacher who gave her poor marks while a friend captured the moment on his phone. He said that the compromising frame led to a complaint and the teacher's sacking."Once, the mother of a girl who was starting out at Mes demanded to know the names of the boys in her daughter's class because, as she put it, she wanted to make sure she found herself a rich husband early on," said Arkhipov. "The biggest problems are often among the children of the less wealthy. They're rich but not oligarchs. They feel greater pressure to fit in, to catch up with the kids whose daddy has a private jet."Pressure or not, there is little doubt that off and around Rublyovka, parents take great pride in teaching their children to develop expensive tastes from very early on. Recently attending a private dinner of well-heeled Russians, I saw the toddler daughter of one of Russia's 10 richest billionaires being spoon-fed black caviar ­ which, to be fair, is much cheaper here than in London.Another time, I was struck by the acute fashion sense of a friend's eight-year-old who lives in a compound off Rublyovka when she politely asked her mother if she could borrow her black Prada handbag to go to a musical premiere in the Kremlin. On another special occasion I saw her wearing a Chanel pearl necklace. I recently came across pictures of a gold-plated child's swing.Abramovich's children must have become accustomed to holidaying on Pelorus, the tycoon's 377ft yacht ­ and according to reports he is soon to add the 550ft Eclipse to his fleet of big yachts. With an estimated price tag of £200m, Eclipse, which is said to have two helipads and to be nearing its first sea trial, will hold the record as the world's largest private yacht.Abramovich and his family also fly in style. The billionaire's largest private plane is a converted Boeing 737, originally designed to seat 360 people. The contrast between the tycoon's childhood and that of his offspring could not be greater, as Abramovich was orphaned as a toddler and raised by an uncle in the inhospitable Siberian region of Komi, known only for its natural resources and Soviet-era gulags.The same goes for Mikhail Fridman, now Russia's seventh richest man (£10.4 billion) and father of two daughters, who as a student barely had enough money to buy clothes ­ when, as he once recalled, the height of glamour was a video machine smuggled into the Soviet Union by the well-connected father of a fellow student.Mikhail Khodorkovsky's first business venture was a dingy student cafe at Moscow University, and Oleg Deripaska, who grew up with his grandparents after his mother handed him over to them at an early age, saw their home seized by the state when they died. They are not exceptions: many Russian billionaires tell fabulous rags-to-riches stories. Children of the Soviet nomenklatura, of course, lived privileged existences, in spacious apartments and dachas far away from the communal flats of the proletariat, fed on goods their parents bought in shops reserved exclusively for the great and good of the party, and attending the best schools. But one has to hark back to tsarist times to find anything like the lavish xcesses of today's zolotoya molodezh.If there is one common trait among most of Russia's 110 billionaires and their poorer multimillionaires, it must be icy determination. Unlike their children who inherited their wealth, these are people who built their fortunes during the ruthless and deadly dangerous times of Russia's early "biziness", when rivals were taken care of by contract killers and only the smartest, most cunning and best connected came out on top.Since fortunes were built in record time, often through shady deals born out of the absence of law, one can insinuate much about Russia's tycoons ­ but not that they lack drive or vision ­ two traits many of their children may find hard to fine-tune from their Rublyovka cocoons. Take Dmitry, the wealthy former boyfriend of Olga, an aspiring fashion journalist who is part of the rich kids' toussovka ­ as Moscovites call the in-crowd. "He was just 17 when I was going out with him," she said. "Whenever he wanted to see a film, he'd hire an entire cinema theatre, just for the two of us, because he didn't want other people there. I once asked him what he aspired to. The latest Mercedes is all he could answer."Or think of one of Olga's girlfriends, who at 17 does not know how to wash and style her hair because she always goes to the hairdresser. And another friend, whose father rented the Rai club for £40,000 to celebrate her 18th birthday, an occasion she marked by wearing a specially made £60,000 dress covered in precious stones.Most of Olga's friends, she explains, have been clients of Moscow's beauty salons since the age of 13 ­ boys too, who apparently are keen on facials and manicures. They are chauffeured around town in the latest Land Rover or, as in the case of one friend, a Bentley. They recently expressed relief at the introduction of the 5,000-ruble note (£100) as it has blessed them with more wallet space. They think Gucci and Dolce & Gabbana are cool, but not as cool as Brioni, the Italian fashion house whose custom-tailored suits can cost up to £15,000, or Bottega Veneta, where a handbag can set you back £10,000.They ski in Courchevel and swim off yachts in Sardinia and St Tropez, have never been in the Moscow metro, and rent out an entire mansion for the weekend if they feel like throwing a party. Oh, and some young girls Olga knows believe snorting cocaine is a good way to keep thin."The rich kids I have as friends are all good people," said Olga. "They're kind and generous and open-hearted. But they're full of problems and periodically suffer bouts of depression and severe apathy. The reason is simple. They have everything but haven't achieved anything. And they are sufficiently intelligent to know what that means. They have no goal in life and that's enough to make anyone unhappy. I call them the dyetiovoshi, the vegetable kids."As I leave Rai, walking away from the line of flash cars heading for the club, I tell myself that, as with many other things in Russia, after the dramatic social, political and economic changes of the past 20 years, it will take at least a generation for things to settle, fall into place and become less extreme.Friends say that already some smart billionaire parents are expressing serious concerns about their children's upbringing and are introducing stricter boundaries. And other rich parents I've met have not turned their children into brats even though they raise them in luxury.As I reach the end of the canal, I can't imagine a more unlikely backdrop to the hedonism of Rai than the House on the Embankment. This was once the top address for Stalin's elites and their families and consequently the place from where they began to vanish, headed for Siberia, when his paranoia reached fever pitch; the building where generals and party leaders who knew their time had come would go to bed in their shoes, ready to be taken away by the secret police in the latest night-time arrests.Seventy years later, as Moscow's rich kids party hard into the wee hours of the morning, it is clear that some will one day go on to lead the world of Russian business and politics while others are almost certainly destined for luxury rehab clinics. Either way, however, they are highly unlikely to share the fate of many of their once-privileged forefathers who lived down the road. So, after all, some things do change.