Pays $250,000 for Trent Lott’s memoir just as Congress is on the verge of limiting any company from owning local television stations that reached more than 35 percent of American homes, meaning News Corp. would have had to sell some. Remember, this is in an extremely pro-business Republican Congress. (News Corp. ultimately won.)(1)


—Signs Newt Gingrich to a $4.5 million two-book advance just as News Corp. is negotiating with Congress to fend off challenges to Fox station licenses. (News Corp. won.)


—Sends a lobbyist to threaten then-FCC Chairman Reed Hundt that he wouldn’t “get a job as dog catcher” if his his agency stripped News Corp. of licenses as a result of probe into whether the company obtained some of them in violation of agency rules. (News Corp. basically won. )(1)

Does the fact that News Corp. wins means that it’s the better media company? No.

Or consider, as Bruce Page reports in his 8,000 word piece above this one on CJR.org, News Corp., among other rule-bending, took liberties with its accounting.

That was useful, but insufficient. The further step was to raise $1.5 billion via Michael Milken, the California junk-bond maven, then close to his financial zenith. “Junk bonds” had a certain glamor at the time, but even so their product could never be called stable financing. Therefore, the Milken operation was put into News Corp.’s accounts as an issue of “preference shares.” It was by any reasonable account a loan, but News Corp.’s lawyers asserted that Australian law permitted it to be called “shareholders’ funds”: thus, as Neil Chenoweth puts it, by increasing its debt, the company acquired the ability to increase it further still. News Corp. was swimming in leverage. But financially it was very un-American.

That’s putting it mildly. That kind of accounting story is right in the Wall Street Journal’s wheelhouse. You can’t have your parent company doing that, not ever.

Say what you want about Dow Jones, and I have , it wouldn’t go near this kind of behavior.

Indeed, in an interview with The Audit to be published soon, former Dow Jones executive and director James Ottaway said the controlling Bancroft family avoided even taking on debt because they didn’t want the Journal to appear beholden to financial institutions it covered and wouldn’t own TV stations because they didn’t want the company to appear before any regulator.

That’s even more ethical than The Audit would be. But that’s stewardship, maybe to a fault. You could either see it as dumb business or a well-intentioned effort to protect the long-term—century-long-term—value of an asset.

To me, improper attempts to influence government are a separate issue from the other News Corp. bad practices detailed elsewhere, including in a fine 2000 opinion piece by the Journal’s Tunku Varadarajan. These include the misuse of its own news pages and editorial prerogatives to further corporate aims: dropping the BBC and the last British governor of Hong Kong’s memoirs because the Chinese government didn’t like them; parroting the Chinese government’s line on SARS, the Dalai Lama (!) and the horribly persecuted Falun Gong.

So, too, is Murdoch’s personal dishonesty. Last month, he told the Financial Times that News Corp. ditched the BBC in “China for commercial reasons. But as Shafer points out, Murdoch confessed the opposite to his biographer, quoted in 1994:

Murdoch defended pulling the BBC plug, telling Shawcross that the Chinese leaders “hate the BBC.” Speaking of his critics, Murdoch continued, “They say it’s a cowardly way, but we said in order to get in there and get accepted, we’ll cut the BBC out.”

Likewise, he told the FT last month that he had jettisoned the memoir of Chris Patten, Britain’s last Hong Kong governor, for commercial reasons. But as Shafer writes:

In a memo to his corporate boss, HarperCollins U.K. Chairman Eddie Bell concluded that the firm would have to choose between bad PR for killing the book or Chinese ill will for publishing it. “KRM [Rupert Murdoch] has outlined to me the negative aspects of publication,” Bell wrote.

Dean Starkman Dean Starkman runs The Audit, CJR's business section, and is the author of The Watchdog That Didn't Bark: The Financial Crisis and the Disappearance of Investigative Journalism (Columbia University Press, January 2014).

Follow Dean on Twitter: @deanstarkman.