All in the Family

It takes a special kind of ability to make us feel sorry for an a global media mogul, but the idiot at the Select Committee hearing, on Tuesday last, with the fake custard pie may just have done it. This is quite a remarkable turn of events, at least for people here in the UK. Since Rupert Murdoch first expanded his newsprint holdings into the UK in 1969, with his acquisition of the News of the World, the English-speaking world’s biggest selling newspaper (a title that it still held when it was closed down two weeks ago), he has achieved a place as a hate – figure for the left that few others have been able to match. I’m sure that I cannot have been the only one to have watched his faltering performance before the Select Committee hearings this week to have thought “is that the great media tycoon ?”. Still, looking on the bright side – I doubt that there is a single heterosexual man of my age or older that dosnt envy him for his choice of wife.

It wasn’t always that way. In his heyday he had a famously complete control of his brief – a man who could strike terror into the heart of even the most hardened Fleet Street editor by always seeming to know more about their newspaper than they did themselves. He first burned into the consciousness of the British Public in the 1980’s when he tried to modernise the four titles (News of the World, Sun, The Times and Sunday Times) on Fleet Street that he owned by demanding an end to the union’s closed shop and the introduction of new technology. Despite the introduction of computer controlled electronic typesetting and offset-litho printing, with Journalists entering their copy directly into a computer system, in many other parts of the world, the UK still used the old fashioned hot metal and linotype system – slow, cumbersome and very labour intensive. His attempts to introduce the new technology in 1986 led to a showdown with the famously powerful, and famously militant, print unions who went on strike in protest. In a dramatic move, he switched production of all four of his titles away from Fleet Street to new premises in Wapping and sacked 6,000 of the striking workers. This led to the infamous “Battle of Wapping” as the sacked workers, and other sympathisers from the British left, picketed the new plant leading to violent confrontations. The strike finally ended a year later, with many of the strikers having gone a whole year without pay – a complete victory for Murdoch’s News International. Within a year, virtually every major UK national newspaper had copied Murdoch’s example and abandoned their traditional home on Fleet Street.

His reputation for right –leaning politics is also part of the legend, but this part is less well deserved. That might seem a strange thing to say for a man who took who famously cosied up to Thatcher during both the print workers and miner’s strikes. A businessman who’s first action on acquiring the Sun in 1971 was to convert it from a Labour supporting broadsheet into a Conservative supporting tabloid and who, of course, gave us the right wing US TV channel Fox News. The reality however, is more complex. Murdoch, in fact, has no strict political affiliations – his only true loyalties are to his family and his business interests. In the 1960’s and 1970’s in Australia he was most closely associated with the Labour government of Gough Whitlam, lending him considerable support. Similarly in the UK, although was once a supporter of Thatcher he switched to Labour in 1997, throwing the weight of his titles behind Tony Blair, before switching back to the Tories when Gordon Brown’s premiership became unpopular. He also switched the Scottish edition of the Sun away from the Tories and turned it into a pro – independence paper. Had he suddenly become a Scottish Nationalist ? Hardly. What he really is, more than anything, is an opportunist. Very early on in his publishing career, he discovered that affiliation to a popular political movement was a powerful marketing opportunity for a newspaper. He consistently shows an ability to identify gaps in the media market where a significant strata of opinion in society feels under-represented and then fills that gap by giving them what they want. He used that tactic to great effect in the 1990’s by giving right – wing opinion in America, which had long regarded the traditional media as too left wing, its own TV channel – Fox News. Hated with avengeance by the American left, it is nonetheless one of the most popular and commercially successful channels on US cable TV.

Times change however, and people change with them. At eighty years of age, Rupert Murdoch is plainly no longer at the height of his powers. True, having to answer questions before a parliamentary select committee is not an experience that he is used to, and one that I am sure that he won’t care to repeat. Even so, when he said that it was the most humbling day of his life, I for one, was inclined to believe him. Although still both the chairman and the CEO of News Corporation, he is obviously no longer the power in the company that he once was. There is also some truth to his statement before the Select Committee that the UK media market is no longer the significant part of his empire that it once was. It is his television and film interests in the USA that are the real bedrock of News Corporation’s business and it is that that attracts most of his attention. It was clear from watching the Select Committee hearings that the game plan had been for James to do most of the talking, but this was derailed right at the start by Tom Watson’s insistence on making the CEO, Rupert Murdoch, answer the corporate governance questions. It was the lack of knowledge of some pretty fundamental parts of the affair that was perhaps the most telling part of his testimony.

His son James, by contrast, had plainly been the most briefed and, to be fair, gave an effective and polished performance. Having spent my entire working life in large government and corporate organisations, I recognise his type of executive. A slick corporate operator, he is used to high pressure meetings and performed well, the committee barely landed a glove on him – apart that is from the at end, when Labour MP Tom Watson, the real hero of this affair, finally managed to get under his skin and put him under pressure to give undertakings to lift confidentiality clauses and allow certain parties to speak freely. James plainly looked uncomfortable, and had no slick answer prepared.

Although a corporation (or a PLC as we say here in the UK), News Corp is very much a family business. On the face of it, Rupert Murdoch and his immediate family are only minority shareholders on the board, holding just 13% of the total available stock. However, due to a complex arrangement where most of the remaining stock consists of non – voting shares he has managed to engineer a situation where, in fact, he and his close family members are able control the board with the shares that they have. The Financial Times reported weeks ago that it rated the effectiveness of the News Corp board as “F”, the lowest rating possible – and it only got that because there is no lower mark available. In other words, News Corp is completely the creature of the Murdoch family, a family business no matter what its status as Corporation may say legally. And therein lies a major problem – there is a temptation for a family business to be run as if it were one big family. If you are running a corner shop or a small haulage company with a few trucks where everybody really is related to everybody else, then that trust based model can work. In a vast global corporation with many diverse interests, and critically, with political connections something more than trust is required – it is in such companies that strong effective corporate governance matters more than anywhere else.

And now we can begin to see why it is the current situation has got as bad as it has. The British press is some of the freest in the world, operating in one of the most cut-throat markets in the world where the pressure for scoops is at its most intense and the temptation to bend the rules is at its greatest. Add that to a company with a weak culture of oversight and corporate governance and you have the makings of a disaster waiting to happen – with middle managers breaking the law, UK level executives trying to cover it up, including lying to Parliament, and the News Corp level executives in the USA belatedly learning of the true facts and fighting to keep the lid on the whole thing.

There are clear signs now that a tipping point is rapidly approaching. Now that Mulcair has had payment of legal fees stopped, he may be a lot more willing to reveal just who ordered him to carry out the phone hacking and who else knew about it. Don’t get me wrong – it would not have been Rebekah Brooks or Andy Coulson who ordered that, it would have been a middle – manager who did. But once their names are revealed, they may be much more willing to give up more senior executives who, the suspicion is, tried to cover it up afterwards. Also, the law firm Harbottle and Lewis who have been holding the results of a 2007 inquiry by News International, but have been prevented from revealing its contents by client confidentiality, have now been freed to talk. They have been bursting to do this for some months, since they are a reputable firm (their clients include Prince Charles) and have been accused of incompetence in not coming forward before; remember that the former DPP Lord McDonald, when he examined the files, said that they contained “blindingly obvious evidence of Police corruption”. Those files are now with the Police.

Finally, and most damningly, former News International executives have all but accused James Murdoch of lying to the Select Committee by saying that he didn’t know of further evidence of phone hacking when he signed off the inflated damages paid to Gordon Taylor, a payment that is widely believed to have been made to make him keep quiet about what he knew.

I dont have any privileged information on this subject, but my gut is telling me that, with former senior colleagues now apparently starting to turn on each other and other parties now free (or freer) to speak out than they were before, that we may see a rush of fresh revelations over the next few days. My gut is also telling me that we have been given far from the full story on exactly why it was that Les Hinton (the former CEO of News International, before he moved to Dow Jones in New York) resigned when he did, and for that matter we may start to wonder whether Sir Ian Blair really did resign from the Met in 2009 just because of a spat with Boris Johnson.

News International, the British Enron ? Watch this space.

Copyright ©Savereo John 2011

“That was for Gerald”

There have been many images of the 2011 UK phone hacking scandal that have entered the public consciousness, and I am certain that there will be many more to come as the Pandora’s Box of revelations linking illegal journalistic practice, police corruption and the incestuous manage-a-tois of politicians, senior police and media executives spreads like a chemical weapon over the twitching form of the British Establishment. For me however, with my life-long distaste for the tabloid media in general, and the British variant of it above all, the images that persist are those of former employees of the News of the Screws cast themselves, for once, into the centre of a media scrum desperately batting off shouted questions as they make a dash for the temporary safety of a waiting car. Whether it be Rebekah Brooks denying knowing anything about anything to the Select Committee or Paul McMullan facing the eloquent fury of Steve Coogan on BBC Newsnight.

I’ve searched my knowledge base of historical references for an appropriate metaphor and, after much deliberation, have come up with the perfect one ….. Lavrentiy Beria. For those of you who don’t know him he was the most feared of Stalin’s henchmen, head of the NKVD during the second world war, responsible for sending countless thousands to their deaths or to the gulags on the flimsiest of grounds and architect of the Katyn massacre. Stalin died in 1953 and, in one of the great ironies of history, Beria became Deputy First Premier and reacted against the excesses of the same Bolshevism that he had so fanatically defended, attempting to introduce an early form of Perestroika, arguing for de-Bolshevisation, economic liberalisation and normalisation of relations with the USA. But he had simply made too many enemies, most of them relatives of his victims, and he was publicly denounced by the new Soviet leader Nikita Khrushchev; then arrested, tried on a trumped up charge of being a British spy, found guilty and shot on the same day – his last moments spent on his knees pathetically begging for mercy. In a final posthumous humiliation he was further denounced in the official Soviet press as a rapist and sexual pervert – something he had done to many of his victims – the only difference being that in Beria’s case it happened to be true.

Now fast forward to a pub in London in the late 1980’s and an author of gothic horror fiction; not the ersatz junk of Dennis Wheatly, but an altogether more thoughtful and well researched variety, by a Cambridge scholar, and a teacher at a prestigious public school; he was also an acknowledged authority on the life and works of Aleister Crowley. In addition he had published works of nonfiction on military history as well as a History of World Heavyweight Boxing Championship. He was approached by a rather charming and affable young man (not the one depicted above – I said charming and affable) who professed an interest in the esoteric. Being an open – hearted and generous man, the scholar sat down for a drink with him and did his best to answer his questions. There was just one problem – the young man was not what he seemed; in reality he was a reporter for the News of the Screws and was on the lookout for an instant scandalous story. The scholar told him nothing of any great import, in fact nothing at all that you couldn’t have read in any of his books. If only he had known how that innocent-seeming conversation would turn out.

Some weeks later an article appeared in that toilet roll masquerading as a newspaper that filled him with real horror. The gentle scholar, the worst of whom could be said was that he was a harmless eccentric, was now depicted as a “An Evil Black Magic Wizard”. “Have you ever drunk human blood ?” the young man had asked “Of course not !” the scholar replied, before adding jokingly “but I tried Mead in Scandinavia, that sometimes has blood in it”. This appeared in the article as “He gorges himself on human blood !!!”. “Do you take drugs ?” he asked “No, but I once tried cannabis at Cambridge and wondered what all the fuss was about” – this was trumpeted in the article as “I advocate the use of drugs !!!”. The result was predictable enough; the scholar was dismissed from his post and was never able to teach again. He lost everything – his home, his career his marriage. Naturally enough, he sued and won easily – settled out of court for £90,000 – but that took two years and came far too late to put the right the damage that had been done.

Yet this story has, to coin a phrase used by Coogan in that excellent Newsnight broadcast, “one small victory for decency”. The journo died in a car crash seven years later. “Couldn’t have happened to a nicer man”, as the scholar put it to me shortly after he received the news as we shared a drink at his flat; a pleasing metaphor for the fate most recently suffered by the publication itself. And thus let me add an addition to the many “laws” that the press have proposed (Megan’s law, Sarah’s Law etc). I call it “Gerald’s Law” of Journalism and it should be carved on the tombstone of the News of the Screws – it’s quite simply this – “Never Fuck With An Occultist”.

Which finally brings me to the title of this piece and to beg your indulgence for the venom that I have put into these words with an image from popular culture – The Wire, Season 5, final episode. With Stringer, Omar and Proposition Joe dead, Avon in gaol and Marlo neutralised, the remaining gangsters are gathered to do a deal ….. “That was for Joe”

Copyright ©Savereo John 2011