What do we know about Gavyn Davies? In a nutshell: bearded, lugubrious, incredibly rich, television-friendly economist. A New Labour insider, close friend of Gordon (Brown) and Tony (Blair) and author of the eponymous report on the future funding of the BBC, Davies is tipped by many to be the next governor of the Bank of England. He works at US investment bank Goldman Sachs. And he's built himself a shamefully expensive, modernist palace for a holiday home in north Devon, where he celebrated the Millennium.
Calls himself a socialist! I ask you.
So much for the press interest. 'I did go through a bad period of not adjusting well to this,' says Davies, fiddling with his paper cup of coffee in his fifth-floor office off London's Fleet Street. He is wearing an expensively cut black suit, which sets off a little snowfall of dandruff on his left shoulder. 'It was when the Government got elected and there was all that stuff about being governor of the Bank of England. I went from being a sort of policy wonk to being a legitimate item of press interest myself. I was very naive in not realising the intensity of that switch. The press becomes a very different animal.'
He is sitting in front of the window on a cheap office sofa. I am on another sofa running perpendicular to his. We have had to swap seats because he isn't used to sitting against the wall. He always sits under the window.
It means I struggle to see his expression in the glare but, what the heck, it keeps him happy, and with his grey, cropped beard and tight helmet of hair, there's not that much expression to see anyway. At 49, Davies, now chief international economist at Goldmans, is a man who likes things just so.
'I am very rules-oriented, by the way,' he tells me, when describing what a swot he was at school. 'I don't have an ounce of rebel bone in me. Unfortunately.'
I wonder. Others say there is a lot more going on under the surface than the placid grey exterior suggests. Davies is one of those conundrums: a shy, genuine man with a lot of ambition. This throws up some intriguing contradictions. You don't rise through the City in the Tory '80s as a card-carrying Labour Party member without sharp elbows as well as considerable ability, nor do you have Davies' range of influence and contacts - his wife Sue Nye runs Gordon Brown's private office - without some aspirations.
In fact Davies' life is so full, writing hugely complicated government reports and holding down one of Goldmans' top jobs and scribbling newspaper columns and building award-winning houses and hobnobbing with New Labour, that everyone who knows him wonders how on earth he fits it all in. The term portfolio career barely does it justice. And he never breaks sweat, never gets stressed, never says no. His workmates used to joke that maybe he had cloned himself to spread the load ...
And Davies, from what I can gather after spending two hours with him, looks on all this with bemused detachment. He is not a cold man, just constantly calm, a characteristic that unnerves many in the pressure-cooker world of top City deal-making. He says he does so much because he has always been a hard worker: that's how he was brought up, the only child of academic, working-class parents, to be a high achiever - and he says it like a true economist, without vanity, more like a logical reason to explain GDP. (Gavyn Davies Productivity?)
Most of the rest, he says, is just chance and luck; some of it, he even argues, is bad luck. The recent flotation of Goldmans made him a very rich man (around pounds 40 million, according to the last Sunday Times Rich List, pounds 80 million-plus according to others) but is something he would rather have done without. Anyway, it's only paper, he can't sell his stake yet. His wife's high-profile career, however, has complicated his position.
'Sue's job has made things much more difficult here,' he sighs. 'Since 1997 I have virtually ceased to operate in the UK context deliberately.' He is paranoid, he says, about being seen to take advantage of his wife's position, and the only time he does get angry is when he is accused of doing just that.
'Basically I have taken a self-denying ordinance not to comment on the UK macro economy. The things that have really pissed me off in the press, that have made my blood boil, are when I am accused of utilising information acquired from Sue for Goldman clients. It is out of order.' So now he threatens legal action against anyone who suggests it, as at least two newspaper commentators have found out since May 1997. No point, then, asking him how he rates the Government's economic policy so far?
'No,' he says, his mouth never losing that pug-dog downturn. At moments such as this he looks like a sleeker version of film director Mike Leigh, his face a pale scoop of distant thought, and you can see why everyone calls him lugubrious.
Doesn't this rather hamstring his ability to be an economist? No, he says, as head of global economic research for Goldmans, the UK should only get about 5% weight in his job anyway. He is really looking at bigger issues, coordinating the research and advice that underpins Goldmans' own investments and those it makes for outside parties. At this level, Davies is a 'Master of the Universe', a top cog in a smoothly oiled machine, dealing with national finance chiefs and heads of international organisations. He has to see things on a worldwide scale. Little matters like his wife knowing what Gordon Brown is thinking have to be put to one side.
Although when we met he was in something of an awkward position, as he dearly wanted to know what another member of the Cabinet was thinking. Culture secretary Chris Smith had had the Davies committee report into the future funding of the BBC on his desk since the summer of 1999. The report, a labour of love for Davies, who has always been fascinated by the media, attracted considerable flak for its recommendation that the BBC should be able to levy extra cash for developing digital television channels. It also recommended that the BBC should sell off various bits and open up its accounts to the National Audit Office for scrutiny. To the horror of the BBC.
Davies smiles wryly. The fact that everyone complained about his report, he says, means that maybe it has achieved a certain sort of balance. Another who sat on the committee says that, however calm he looks now, Davies was clearly shocked by the 'arty, lovey snake pit' he walked into. He is probably not used to dealing with many snake pits in his life. But most observers thought his recommendations were pretty sensible - a key Davies characteristic.
'The report was seen by some as being anti-Sky but I don't see it as that. I have got phenomenal respect for what they have achieved,' says Davies. 'I think they have misunderstood the purpose of the digital levy, which is to generate wider national interest in digital by giving a successful public broadcaster a set of channels for the public.'
In fact, he adds, although he is a staunch defender of the concept of a state-owned, public service broadcaster, he is also - as one would expect from a New Labour insider - a tremendous admirer of Rupert Murdoch. 'I think he is entirely misunderstood and underestimated, especially in the Labour party, even now. One of the amazing things that Tony Blair has done is go out of his way to understand Murdoch and what he is doing as a businessman, in a way greatly to the advantage of both sides.'
But is that closeness appropriate for a Labour prime minister? Davies snorts. 'This idea that you shouldn't have conversations with media magnates if you are prime minister is somehow naive,' he says.
It is this sense of pragmatism that has, according to others, defined Davies' work for the past two decades. Other specialists describe his economics as 'mainstream' and 'conservative with a small c'. Davies himself says that he is always scrupulous to avoid any political bias in his economic analysis, possibly out of a sense of self-preservation instilled in him in the '80s.
Yet it is clearly the intersection of politics and economics, and in particular the effect of policy on everyday life, that motivates him intellectually.
He says he gets his love of politics from his mother, who was a committed Labour supporter, and his drive and determination from his father, who fought in the war as a Desert Rat and later became a professor. Both were teachers - Welsh, working-class, first-generation university graduates who had tried to make a new life in Rhodesia, where Davies was born, before retreating back to Britain. 'I think Dad saw what my future would be if we had stayed,' says Davies. His father found work at Southampton University and the family never moved again.
All that must have put considerable pressure on a lonely, 12-year-old boy to succeed. 'I was a swot, so I never had any problems,' says Davies.
He learnt as much at home from his parents' coaching as he did at grammar school, not least, how to excel in the art of exam taking, which became something of a forte. He had no doubt that his father in particular wanted him to become an Oxbridge don. 'He was very ambitious for me. I think, frankly, he was more intelligent than his eventual achievements in terms of academic success and I think he wanted me to fulfil his potential.'
But despite studying at both Cambridge and Oxford, Davies never stayed.
In 1974 an extraordinary twist of fate propelled his career. Harold Wilson, the newly elected prime minister, invited Andrew Graham, then Davies' don at Oxford, to work at Number 10 as economic adviser in a newly formed policy unit. Graham in turn persuaded his bright young protege to join him as his assistant. 'Even then,' remembers Graham, 'he had this extraordinary ability to think and articulate thoughts so quickly and clearly.' So at 24, Davies was suddenly thrust into one of the great economic dramas of the post-war period: Labour's decline and fall at the hands of the trade unions.
The experience clarified his centrist politics. 'I was impressed by James Callaghan and very, very impressed with Denis Healey,' says Davies. He describes the left-wing of the party then as 'insane maniacs'. Those sentiments have stayed with him ever since, even to the extent of making him implacably opposed to the miners' strikes in the early '80s, a lonely position for a Labour supporter.
He shrugs. 'I was rooting for Mrs T, I was so anti-Scargill,' he says.
Then he looks worried and adds, 'I felt sorry for the miners, of course, that was a different matter.' Most importantly, he stayed with the party and befriended the modernisers, rather than leap into the arms of the SDP or the Liberals.
How did he end up in the City? After Thatcher was elected, he was surprised to be offered a job as an economist by an old contact at stockbrokers Phillips & Drew, a firm he had got to know while at Number 10. He made the jump, and enjoyed the work - so much so that, partnering another economist, David Morrison, he swiftly started topping City polls. Looking for more interesting work, they moved to Simon & Coates and then Goldmans.
Morrison, who now works at Paribas, says Davies used to drive him crazy with his left-leaning principles but he is still the best economist the City has.
'He's not just academically hugely able, he can also talk people through stuff so that they can understand it.' This client-cuddly approach has always set Davies apart. It has also made him a valued adviser to friends such as Brown, Blair and Peter Mandelson.
Yet how did a Labour supporter survive in the City in the Thatcherite '80s? Didn't he feel uncomfortable? 'No, I was quite open about it,' says Davies. 'Anyway, I wasn't ever sympathetic to the bits of the Labour Party that the City was concerned about.'
However, on a personal level, many in the Square Mile still can't make him out. One minute he's an ardent football fan in a replica shirt watching his beloved Southampton, the next he's a polished plutocrat off playing golf at Wentworth. And then there's his unpredictable obduracy. Morrison remembers trying to negotiate a pay rise for them at Simon & Coates when, to his consternation, Davies said to their boss, 'Actually, I think I get paid too much.' Morrison's reaction? 'I was lying on the ground in shock. I asked him later, 'Gavyn, why did you do it?' and he said that that was what his mum had told him!'
It was Morrison who chivvied Davies into joining Goldmans, after spotting its global ambitions. The move proved to be a brilliant one for both men, who swiftly rose to become Goldman partners. Morrison left in 1994 to join the hedge fund Tiger. Davies says the parting was like a professional divorce, 'very difficult to go through'.
Since then he has thought about going into academia but stayed in the City, he says, because he likes his job. Part of him, clearly, is still that driven, unrebellious schoolkid: he loves getting set tough tasks, pleasing his bosses by doing the impossible and being driven by events.
'The last four years in global economics have been fascinating,' he says.
'It is a real intellectual challenge, there are things you would never have predicted: the continuing strength of the US economy, the crises, the development of technology. These have been utterly compelling.' And Davies has a front row seat on it all, something he would miss if he were an academic.
And it is a seat he would keep if, as many predict, he is asked to replace Eddie George as the next governor of the Bank of England. There was a flurry of speculation in 1997 that he would get the job, starting as deputy, but he says he was never offered it. It may be up for grabs again in three years' time. Would he be interested then? 'Jobs of that sort are unique opportunities, it is not sensible to plan your life around them,' he says, choosing his words carefully. 'But if anybody ever offered me a job like that, it would be hard to turn down.' The only hitch, of course, is that if Britain does join the euro, there might not be much of a Bank of England left to govern.
Such a move, however, might fit nicely with the tie-in period on his Goldmans equity. He cannot sell the shares, which he gained in Goldmans' flotation earlier this year, for 'a three- to five-year period', according to Davies. Despite the personal benefits, it doesn't sound as if he is a great fan of the flotation. It was inevitable, he says, as the partnership's capital structure was becoming a negative.
'But there's not a single partner that doesn't regret some of the cultural loss.'
Is the personal wealth embarrassing? 'I wouldn't say it was embarrassing,' he replies. 'What was written about it is a pain in the arse.'
Others who know him well detect more inner doubt than he will admit to.
'Gavyn is deeply committed to people who are less well off than him and there's a real struggle still going on in there,' says one friend. 'I think he has been through a much more difficult period than even he realises.'
There are plus points. Goldmans seems willing to allow him to run his office to his own timetable. So he gets time off to write Government reports, and he juggles his commitments so he can see as much as possible of his three young children. He lives only a mile from his office, in Clerkenwell, so he can get in early, work hard, get home to put the kids to bed, then go out to meet clients. Having kids late, he says, has given him the chance to see the mistakes others have made. 'We work so hard but if there was any doubt about seeing the kids I would just quit.' It helps, he adds, that his wife is a formidable organiser, so everything runs like clockwork.
He first met Sue Nye at Number 10 back in the Callaghan days. 'She was living with the lead singer of Eddie and the Hot Rods but she rapidly decided he was not sufficiently exciting for her relative to me, so she swapped,' he says, drolly. They have been together since 1981, and Nye has worked for both Neil Kinnock and Gordon Brown.
The relationship tends to dominate the media's view of Davies - he seems to be a little too close to the corridors of power now for his, and everyone else's, comfort.
It was Nye, too, who pushed forward the plans to build a dream holiday home outside Barnstaple in north Devon in the mid-90s. The cliff-top house, designed by their architect friend Anthony Hudson, rises above the rocks at Baggy Point like the villain's lair in a James Bond movie and is the height of contemporary chic: limestone floors, maple columns, copper canopies, wooden decking, floor-to-ceiling windows that slide slowly into the ground at the touch of a button. The house won the Royal Fine Art Commission/Sunday Times building of the year award in 1995, and seems an unlikely home-from-home for a man who prides himself on driving a Ford Fiesta.
Davies acknowledges that the project (plus the fact that he has another holiday home in France's Alp Maritime) provides easy ammunition to those Tories who see him as a Tony-crony fat cat. Was it the right decision to build it? 'No,' he says, laughing uneasily. 'I think we should have built a less conspicuous house.
But Sue is very good at this sort of thing and I don't really regret having done it.'
All in all, you get the impression that fate has performed a funny flip for Davies. Just as everything has fallen into place - the top job, the money, the new government, the dream homes, the sniff of real power to come - so the press' depiction of him as Labour's favourite toady have slightly soured the scenario. It's unfair, of course, for Davies is anything but a sycophant. 'Actually, he is not afraid of upsetting anyone,' says one who has worked with him recently.
But he is now sensitive to how others see him (when I ask if he has a strong public service ethic, he replies tartly, 'I don't think you can claim to have an ethic of public service and be a partner at Goldmans').
Perhaps that sensitivity is his weakness, one to console those envious critics.
'To hell with them,' he says, with uncharacteristic passion. 'I am going to continue living my life the way I want to live it, be honest, upright and open, and if they don't like it, tough shit.'
He has a point, but it is clear he is feeling the pressure. I am sympathetic up to the moment when he tells me, rather shamefacedly, that he has season tickets at two Premiership football grounds, The Dell in Southampton - which is so small that many of the locals gave up trying to get in long ago - and Arsenal's Highbury. His nine-year-old daughter, it transpires, plays for Arsenal girls and is an ardent fan.
But surely this is taking New Labour's love affair with football too far? How can he be in two places at once? Then I remembered: unfairly or not, many think that has always been Davies' real talent.
DAVIES IN A MINUTE
1950: Born 27 November, Bulawayo, Rhodesia. Educated in Southampton, St John's, Cambridge and Balliol, Oxford
1974: Appointed assistant to Andrew Graham, economic adviser, Number 10 Downing Street policy office
1980: Economist, Phillips & Drew
1983: Economist, Goldman Sachs
1986: Partner, Goldman Sachs
1993: Appointed one of Chancellor's 'seven wise men' to advise on economic policy under John Major's government
1999: Chairman of committee looking into future funding of the BBC for Tony Blair's government.