CONFLICTS OF INTEREST?

05.05.12

Rupert Murdoch’s Political Trap

Key figures in the U.K.’s conservative coalition are on the defensive about their ties to Rupert’s empire. Here’s the problem—News Corp.’s monopoly has reached nearly every corner of the nation.

While the commercial and legal fallout of from the Parliamentary Select Committee’s verdict on Rupert Murdoch—“not a fit person to exercise the stewardship of a major international company”—continues to drift across the Atlantic, the political uproar back in Britain threatens to revert back to tribal party lines.

In the days since the devastating judgement of the lawmakers, Louise Mensch, the most vocal Conservative member of the committee, has taken to airwaves complaining that the “not fit” amendment—voted through in 6-to-4 split—went beyond the committee’s remit and had discredited the whole report. On Thursday, Mensch was involved in a public Twitter-spat with Tom Watson, the campaigning Labour M.P. who pushed for the strong language. Watson offered to publish: all the amendments to the original draft, together with committee members’ contacts with News Corp. “The only way to resolve the @LouiseMensch allegations is publish the original draft of the report, all tabled amendments + list hospitality.”

The “hospitality” reference highlights new evidence, submitted to the Leveson Inquiry by Rupert Murdoch last week, which notes regular contacts between News Corp. executives and members of the Department of Culture, Media and Sport committee during their inquiry into phone hacking. As The Daily Beast revealed before the parliamentary report was published, the contacts appeared to be exclusively with Conservative members of the committee, most of whom rejected the more damning conclusions of the report.

In an increasingly politicized atmosphere after bad midterm polls for the ruling coalition, the Labour Party leader Ed Miliband is capitalizing on the Conservatives’ apparent discomfort over their links to the Murdoch media empire. Last week a special advisor to the culture minister, Jeremy Hunt, resigned over “inappropriate” contacts with a News Corp. lobbyist. Next Friday Rebekah Brooks is scheduled to testify at the Leveson Inquiry. Currently bailed after being arrested on suspicion of phone hacking, bribing police, and perverting the course of justice, the former CEO of News International was close friends with the Prime Minister David Cameron.

This Manichean division between “pro- and anti-” Murdoch is destined to create more crises.

The Sunday Times (a News International title) reported Brooks was planning to submit  her private text messages from the prime minister to the Leveson Inquiry, and the Daily Telegraph yesterday alleged that the prime minister sent Brooks up to a dozen text message a day. . In a provocative column titled, “The Murdoch and News Corporation scandal wasn’t about Conservative Party sleaze—but it is now,” the Conservative commentator Peter Oborne added: “Politicians can now be divided into two categories: those who bought into the News International culture and methodology, and those who did not….”

This Manichean division between “pro- and anti-” Murdoch is destined to create more crises among the political and media classes in Britain as the Leveson Inquiry proceeds to investigate the relations between politicians and the press over the next two months. So toxic has association with News International become that the government applied for “core participant” status in an unexpected development yesterday, which would give it advance sight of evidence—such as Rebekah Brooks's text messages. Lord Justice Leveson refused to grant the status to the whole government, but did grant it to Cameron and seven other senior cabinet members.

Part of the problem lies in the extensive interests that News Corp. has in the U.K., especially in publishing and television. William Hague, the foreign secretary, went on BBC Radio in the wake of the “not fit” report to praise Rupert and James Murdoch as “great business people.”  While in opposition, Hague was commissioned to write a column for the now shuttered News of the World for $400,000 a year by then editor Andy Coulson (who is also under investigation for suspicion of phone hacking and police bribes). Over the same time Hague also received two substantial book commissions from the News Corp. publishing subsidiary Harper Collins.

Hague’s books were well-written and well-received, and would have easily found a home with another publisher, but the appearance of a conflict of interest could still be damaging for senior Tory members of the cabinet. The education secretary, Michael Gove, who was praised for his intelligence by Rupert Murdoch both on Twitter and during the Leveson Inquiry, also received an annual salary of over $100,000 from News International for his newspaper columns in The Times, where his wife is a fashion editor. Harper Collins also paid him an undisclosed sum for a political biography in 2004, which was never delivered. The same publisher also publishes the romantic comedies of Tilly Bagshawe, Louise Mensch’s sister.

However, the assumption that anyone who has worked for Rupert Murdoch is somehow compromised in their judgement would fly in the face of the facts. Over the years, many of Murdoch’s sternest critics have been former employees such as Harold Evans (former Times editor) Andrew Neil (former Sunday Times editor) or David Yelland (former Sun editor)—all three of whom took a tongue lashing from the 81-year-old media mogul in front of  Lord Justice Leveson last week. (Editor’s note: Evans is married to Tina Brown, the editor in chief of Newsweek and The Daily Beast.)

For David Aaronvitch, who worked as a political editor for the BBC and as a columnist at the Independent and the Guardian, these accusations of taking the “Murdoch shilling” are nothing new.  He told The Daily Beast that since he moved to The Times seven years ago, “not a week has gone by since I went on Twitter without someone reminding me of it.” While Aaronovitch has never defended phone hacking or the criminality alleged at News International, he is suspicious of some of the wilder claims about News Corp.’s political influence.

With criminal charges looming for 16 or so senior editors and executives from News International’s tabloid stable looming, there is a danger of guilt by association, and that the understandable anger against some of News International’s actions could spill over into a generalized witch-hunt.

The reality is that, over the 40 years News Corp. has operated within the U.K., the chances that a writer or commentator has worked at some point for the company are inordinately high. (Full disclosure: this author worked as a freelancer for a now closed News Corp. subsidiary for several months in the mid-1990s.) Now with 43 per cent of Britain’s newspaper readership, the country’s largest book publisher, and a controlling share in Britain’s most lucrative Pay-TV channel, BSkyB, News Corp. has effective monopolies in several media markets, as well as dominance in sports and movie rights in the UK.

As Claire Enders of Enders Analysis told The Daily Beast: “I don’t think Murdoch owns more than 10 per cent of any U.S. market, where there are stable oligopolies in most media markets. But in the U.K. it is very different. The BBC is very big. BSkyB is dominant in sports and movies…. Any creator of a work has a limited choice of outlets which talented people obviously gravitate towards.”

Once the dust has settled from the current scandal, rather than revert to some kind of McCartheyesque hunt—“Are you, or have you ever been, a Murdoch employee?”—Britain might do better to reflect more soberly on inevitable economic and social problems that flow from monopolies.