Events are moving so fast this is already out of date: first the resignation of resignation of Rebecca Brooks as head of News International. For a small personal vignette of my encounter here, you can read the whole thing here.
But it’s the US where Newscorp is based, and both Rupert and James are US citizens, and this is where the scandal will finally engulf him I believe. As Carl Bernstein said earlier this week, making the explicit comparison with Watergate these revelation “are the beginning, not the end, of the seismic event.” He also stresses how important this US is to Murdoch
Murdoch associates, present and former-and his biographers-have said that one of his greatest long-term ambitions has been to replicate that political and cultural power in the United States. For a long time his vehicle was the New York Post-not profitable, but useful for increasing his eminence and working a wholesale change not only in American journalism but in the broader culture as well.., Then came the unfair and imbalanced politicized “news” of the Fox News Channel-showing (again) Murdoch’s genius at building an empire on the basis of an ever-descending lowest journalistic denominator…. And finally, in 2007 The Wall Street Journal‘s squabbling family owners succumbed to his acumen, willpower, and money, fulfilling Murdoch’s dream of owning an American newspaper to match the influence and prestige of his U.K. holding, The Times of London-one that really mattered, at the topmost tier of journalism.
Between the Post, Fox News, and the Journal, it’s hard to think of any other individual who has had a greater impact on American political and media culture in the past half century.
If we live in an information economy, then Newscorp is the Standard Oil of the 21st Century. Murdoch built up both horizontal and vertical monopoly power in the UK and Australia, leading to vast inefficiencies, corruption and unaccountable political power.
That was his aim in the US also: so it’s crucial to strike at the pillars of his power while they are beginning to crumble.
Now Rebekah Wade has gone (she “fucked the company” according to Elizabeth Murdoch), and her predecessor at News International, Les Hinton, has resigned as CEO of the Dow Jones (‘Les is no more’ as someone brilliantly put it)….
…the firewalls between the public outrage and the Murdoch family itself have fallen:
THREE DOWN; ONE TO GO
Les Hinton (left), Andy Coulson, Rupert Murdoch and Rebekah Brooks (nee Wade) appearing before the 2007 House of Commons Select Committee
Yes, so far, the Murdoch Family itself has remained immune, despite their clear control over their news empire. But how long can this last?
So these are the three crucial weaknesses in terms of breaking Murdoch’s grip:
1. The FBI Investigation into Hacking of 9/11 Victims: as I diaried four days ago, this is the most emotive example of Murdoch’s abuse of power – but in legal terms it is also the weakest link. So far all we have is an unnamed former policeman saying he was approached to provide victim’s numbers. There is currently – unlike the UK – multiple sources, written proof, or named victims. As Ericlewis0 points out this morning, Eric Holder has confirmed the DOJ is conducting multiple investigations. This particular strand may well play out…. but it could be a long wait. It took 4 years after it was initially suppressed for the truth of the UK industrial scale phone hacking to be exposed.
2. Les Hinton oversaw that previous investigation/coverup in 2006/7. As the New York Times is reporting on its front page, Hinton is Murdoch’s closest aide, an employee for 50 years, and now CEO of Dow Jones, and publisher of The Wall Street Journal. He is directly in the line for the previous cover-up as its inconceivable that Senior News International executives did not know about the sources of their major stories, especially given how famously hands on Rupert is with his editors.
UPDATE; strike that. Murdoch’s ally of 50 years, Les Hinton has resigned. Results pouring in thick and fast. Now onto point three….
3. The Culture of Kompromat and Fear at Fox News and New York Post: I believe this is going to be the major source of forthcoming stories. We’ve already seen Fox New’s comic inability to report on the biggest story of the moment, and the fawning obeisance of the channel’s apparatchiks.
The Soviet Communist analogy is apt because for all his free market buccaneering bullshit, Murdoch is an apologist for the authoritarian regime in China, booted the BBC from his satellite broadcasting there for its impartial coverage, and as Howard Kurtz makes clear in the Daily Beast, he suppressed stories for his Chinese friends.
In a 2007 affidavit, Spiegelman said “accepting freebies, graft and other favors was not only condoned by the company but encouraged as a way to decrease the newspaper’s out-of-pocket expenses…and that News Corp. attorneys had been instructed to ‘look the other way.'” There was a policy of “favor banking,” the affidavit said, “practiced on a much larger scale by Rupert Murdoch.” In 2001, Spiegelman said in the document, “I was ordered to kill a Page Six story about a Chinese diplomat and a strip club that would have angered the Communist regime and endangered Murdoch’s broadcasting privileges” as he was trying to get Beijing’s approval for his satellite-television service.
The whole article is worth a full read because it shows that the culture of bribery, favour banking, and Kompromat – the publication/withholding of damaging material on rivals or allies – was rife in The New York Post.
This is exactly the modus operandi of News International in the UK, and it has created a culture of fear among celebrities, public figures,
commercial rivals, politicians even senior Anti Terrorist officers. But mafia-style, that culture of fear only exists in the darkness, and once broken, collapses entirely, as the credibility of Murdoch’s various news organs is completely shattered.
This is the moment to explode Murdoch’s corrupt culture of fear, and keep pushing for more information, more coverups and lies…. As even Anne Applebaum has said It is in America that Rupert Murdoch faces ruin
In the end, though, it is not Murdoch’s American properties that are most threatened by this scandal, it is his control of his publicly owned company.
News Corp’s stock is in freefall: a massive American shareholder revolt may not be far off. One group of shareholders has sued the company in a Delaware court, arguing that the company board “provides no effective review or oversight”.
(snip)
Words such as “nepotism” and “cronyism” are in the air. As are “corruption” and “mismanagement”. They will be given extra weight if this story takes on any deeper political significance.
Shareholders and their lawyers are as likely to be members of the liberal establishment as anyone else: in America, the world’s most litigious country, they are unlikely to keep their views to themselves.
As a result, News Corp’s American properties will survive this scandal – but the Murdoch family’s control of News Corp may not.
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