The rich in Britain have never been so rich. Those in the Sunday Times' annual ranking represent a global fortune of £414 billion [about 509 billion euros], topping the previous record set in 2008. But the longest recession of this century has dragged the others towards the bottom.

The man, who barricaded himself the other day on Tottenham Court Road in a used vehicle dealership and threated to blow himself up because he "had nothing to lose," was not only mad, he was also unemployed. His action was seen as the benchmark of a growing desperation.

It is not entirely happenstance if these events took place the day after the announcement that the United Kingdom is in recession yet again. The dreaded "double dip" – two recessions back-to-back – is a reality. The last time this happened was in 1975. Because of this, in 2012 – the year of the Queen's Jubilee and of the Olympic Games, scheduled for July and August respectively – the capital is wounded, prey to self-doubt and meanwhile the ghost of "The Winter of Discontent" of the late 1970s has reappeared.

During the Blair years and his "Cool Britannia," the stock market soared, house prices climbed and everybody got rich. At least, so it seemed. Today, the financial sector, which represents 29% of the British GDP, has fallen more than other sectors in the last two quarters. Banks are not hiring, the service sector is in low gear, construction is stagnant.

Is The City the new Babylon?

At Heathrow Airport, at passport control, the queues are getting longer and longer because of personnel cuts imposed by slashed budgets. Foreboding darkens the future. Rowen Williams has resigned as Archbishop of Canterbury. Why? He explains his move in an article published in Prospect, in which he harshly condemns the greed of London's predatory brand of capitalism. Already the Bible warned us, he says, today The City trades "in the souls of men".

The Old Testament, if the truth be told, does not refer to the wealthiest Square Mile on Earth but to a "City" of ancient times – Babylon. For Rowan Williams, London is a modern-day Babylon in which commerce and profit dominate over all other considerations. Where everything is a commodity, including one's conscious.

It is too early to be able to predict the decline of the modern-day Babylon. The tourists hurrying between Piccadilly and Trafalgar do not notice the unease caused by the crisis looming over the city. This is only because the centre of London is a theme park for the wealthy, notes Ken Livingston – known as Red Ken – who was mayor until 2008 and who is running again on the May 4th ballot. Opinion polls predict that he will lose to the conservative incumbent Boris Johnson. This isn't because Livingstone's message is not sufficiently vigorous, but because the messenger is not in a position of strength. Londoners want new faces and at 67, Ken Livingstone has done his time.

An increasingly inegalitarian city

Yet, the former mayor is not the only one to be disgusted by the image of this city divided between the 'haves' and the 'have nots'. "Between 1992 and 2008, tuition in public [private] schools has increased by 82%," says Martin Stephen, headmaster of Saint Paul's, one of the most posh schools after Eton. The annual cost reaches £26 000 or 30 000 euros. An amount which, multiplied by the number of school years leading to university, situates the cost of education for one's child at about one million euros. "I'm the son of a country doctor who was able to send his three children to good schools without going broke," admits the headmaster, "today that would no longer be possible. There is something wrong with the system."

Imagine that you are flying over London. You will not, of course, see a depressed panorama. On the banks of the Thames, The Shard, Europe's tallest skyscraper, designed by Renzo Piano, is nearing completion. North of the river, Stratford, once a city garbage dump, is getting a new life in the form of the new Olympic Park and is expected to become 'gentrified' – creating a London 2 by implanting a new neighbourhood for wealthy Londoners in the East End, until then peopled by poor immigrants.

But the model of a city that is able to be both cool and generous, the promised land of equal opportunity, which prospered during the Blair Era, has grown fuzzy. London is a city that is more and more inegalitarian and sceptical. A city preparing for the long summer of the Jubilee and of the Olympics while hoping these will not be troubled by terrorism as in 2005 or by urban riots like last summer.

London is a metropolis which, with the excuse or the justification of terrorism, is preparing to approve new laws to monitor all emails and internet activity – the greatest invasion of privacy ever attempted by a democratic State. It is a city tarred by the Downing Street 'cash-for-access' to PM David Cameron row, and by telephone hacking by Rupert Murdoch's tabloids.

"Even if I'm not elected mayor, Cameron will lose the next elections," wagers Livingstone "and [Labour Party head] Ed Milibrand will win, a real leftist leader," not an imitation as was Blair, he adds. What is certain is that after two years in power, the Tories are very low in the opinion polls. When London was "cool", the resident at 10 Downing Street was cool too.

China Mieville, a British science fiction writer and a socialist, the author of a scathing articlepublished last month in the New York Times, is perhaps right. There is an atmosphere of bitterness, of waiting for chaos and of desire for change, he says. The man who threw computers out of a window in Tottenham Court Road may be a symptom of this.

The same day, the London dailies announced that in 2011, the London branch of Goldman Sachs paid out only £4 million in taxes for profits of £2 billion. Seek no further – there is no tax fraud, just the most legal of loopholes. "We have moved from Faust to Frankenstein," warns Reverend Williams. A monster even more horrible than the devil because it was created by human hands.