Audit Notes: Murdoch Minister Edition

The Murdoch scandal heated (hotted?) up yet again today with James Murdoch’s testimony to the Leveson Inquiry, and it now threatens to bring down a key member of the prime minister’s cabinet—or more.

Emails detail an awfully close relationship and perhaps an illegal back-and-forth, sometimes twelve messages a day, between James Murdoch and Jeremy Hunt. The problem is Hunt was acting as a sort of regulator/judge overseeing News Corporation’s bid to consolidate its grip on British by buying the rest of the BSkyB satellite network.

The Guardian:

What made this busy back channel particularly remarkable was that the culture secretary was constantly claiming no such relationship existed. Hunt told the Commons on 30 June: “I am deciding this deal on a quasi-judicial basis, but I have not met Rupert Murdoch or James Murdoch in recent weeks, and all the meetings I have had with them have been minuted and done through official channels.”

Here’s one of the most damning emails:

The following day, an email sent at 3.21pm shows Murdoch being supplied with the wording of Hunt’s crucial, and market-sensitive, official statement, due to be delivered the next day.

“Confidential: managed to get some infos [sic] on the plans for tomorrow (although absolutely illegal!). Press statement at 7.30am … Lots of legal issues around the statement so he has tried to get a version which helps us … JH will announce … that he wishes to look at any undertakings that have the potential to prevent the potential threats of media plurality.”

Tomorrow Rupert Murdoch is going to testify. Pass the popcorn, but leave your foam pies at home.

The Guardian’s Nick Davies, who broke this scandal, writes about what the news means, and what it could come to mean:

Now we come to the dark heart of this strange affair.

Critics of the Murdochs have often suspected that they have exploited their position as newspaper owners to win secret favours from governments - and the Murdochs and the politicians alike have denied it. Now, for the first time, courtesy of the volatile chain-reaction of the phone-hacking scandal, we have compelling evidence…

At a time when Hunt was required to act in the legal role of a judge overseeing Ofcom’s inquiry into the bid, this evidence suggests he was secretly supplying News Corp with information about his confidential dealings with Ofcom, advising them on how to pick holes in Ofcom’s arguments, allowing their adviser to help him prepare a public statement, offering to “share the political heat” with them, and repeatedly pledging his support for their position.

If proved, this pushes Hunt’s political career to the edge of destruction. It cannot help him that his website currently displays an interview describing him as a cheerleader for Rupert Murdoch. But the pressure may not stop there. The question now is whether Lord Justice Leveson will order the disclosure of more emails or other evidence that could conceivably see the prime minister and his government pushed out to the edge as well.

— Simon Kelner, the former editor of The Independent, recalls the bizarre episode when James Murdoch and Rebekah Brooks stormed into the paper’s newsrooms to scream at him for an ad campaign that said, “Rupert Murdoch won’t decide this election. You Will”. Kelman writes that it showed how the Murdochs do business:

Brooks said very little, but, when her boss’s rage blew itself out, chipped in with: “We thought you were our friend”. Their use of language and the threatening nature of their approach came straight from the “Mafioso for Beginners” handbook.

Murdoch referred to “my family” constantly, something he echoed in his Leveson evidence today. Referring to this exchange, he said that I had been the beneficiary “of my family’s hospitality for a number of years”. Set in the context of his many dissemblings and obfuscations over recent months, the fact that this is a bald-faced lie is neither here nor there, just a casual slur despatched with little regard for the facts. (For the record, I went to Elisabeth Murdoch’s 40th birthday party in September 2008, the only time I can be accused of “availing myself” of Murdoch hospitality.)

His statement does, however, reveal a much wider and more significant truth: the Murdoch way of doing business. If you come to our parties, if you join us on our yachts, if you are at our cosily-arranged dinner table, we might expect something in return, but we certainly don’t expect you act in a way contrary to our interests. And if our largest-selling newspaper supports your political party … well, it’s not difficult to guess the rest.

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Ryan Chittum is a former Wall Street Journal reporter, and deputy editor of The Audit, CJR's business section. If you see notable business journalism, give him a heads-up at Follow him on Twitter at @ryanchittum. Tags: , , , ,