Bending to Power

How Rupert Murdoch built his empire, and how he uses it
July 5, 2007

“There might be other buyers more palatable to them. But who’s to say Rupert Murdoch is all that bad?”
Brian Rogers of T. Rowe Price, advising the Bancrofts to sell The Wall Street Journal.

The answer to this question depends on what you mean by bad—or good—and on who is a credible witness. Robert Thomson, editor of The Times of London, testifies for good. He says Rupert Murdoch’s control of The Times doesn’t distort its reporting, which is admirable if true. But Mr. Thomson is a Murdoch employee, and there’s some evidence that he is talking through his hat.

For Mr. Rogers, making money is generally “good,” but there are particulars in News Corp. that might trouble him. For instance, making money at newspapers like The Wall Street Journal is something Murdoch has been notably bad at. (The Times is a prime example.) We must estimate, since News Corp. doesn’t publish results for its individual titles. (There are about 175 of them, the best-known being the New York Post, in America; The Times, the Sunday Times, The Sun, and the News of the World, in Britain: The Australian, The Herald Sun, The Daily Telegraph, and The Mercury, in Australia). Media companies are often secretive, and News Corp. outstandingly so. If due diligence meant as much as Wall Street pretends it does, the Bancroft advisers would require disclosure before talking business.

Revenue aside, whether a journalism outlet is bad or good comes down to net effect. We know every police force contains villains, but if it catches more than it employs, society profits. We also know that every media group does some good. The Murdoch operation exposes numberless sexual peccadilloes, and much lesser crime—but not dud military campaigns or Enronesque frauds. There’s a good case that the world would be better off without News Corp. There’s certainly a good case that he should not own The Wall Street Journal.

And indeed we would be without News Corp. but for the kisses of life that have been applied to the corporation though the years by state power in various forms. And these kisses are applied not because of any journalstic excellence but the opposite—because journalistic incompetence gives News Corp. the unique ability to comfort officeholders. Thus the space it occupies is not altogether decided by the subjective preference of consumers. Market distortion, politically determined, is much involved.

If Mr. Rogers wants a serious answer to his question about Murdoch there are a number of books he could read. (See the sidebar, “A Rupert Reader,” for a decent list, which includes my own 2003 effort, The Murdoch Archipelago.) Meanwhile, there’s room here to illustrate essential principles. Let’s start at the tabloid end, for Murdoch’s business and political charisma largely consists in notions that the popular zeitgeist is his to command, making him the master-drummer of circulations.

When Murdoch, building from his father’s Australia-based media company, acquired his first big asset, the British News of the World, in 1968, it was selling 6 million copies. Today, the Sunday tabloid struggles to sell half that, though Britain’s population is 20% larger and much richer. It still pumps abundant profit but like its celebrated daily companion, The Sun, it is a property in decline.

Sign up for CJR's daily email

As the best way to a small fortune is to start with a large one, the best way to a modest circulation is to start with something immense, like the British popular papers possessed in pre-Murdoch days. A universal—as against middle-class—appetite for news arrived in Britain later than in Australia and America. It fed on dramatic events of anti-Nazi warfare and social revolution, with stimulus from a rail network covering the entire nation overnight. “You cannot beat news in a newspaper,” ruled Arthur Christiansen, taking the Daily Express past four million — soon to be overtaken by The Daily Mirror passing five.

By the mid-sixties, intelligent people saw incipient decay, but Fleet Street executive ranks didn’t included many. (An Express director notoriously was fired just for raising the issue of declining sales at a board meeting.) These papers grew obsolescent each in its own way, but the News of the World story is encapsulated in its nickname, the News of the Screws. It lived by decocting vicarious spectacle from the output of repressive legal and social frameworks then clamped around criminal justice, sexual activity, marital failure, addiction, and lesser eccentricities. Liberation has both reduced the raw material, and made vicarious experience increasingly redundant, thus boring. Goodbye zeitgeist.

The popular papers (now called tabloid) might have stayed popular. The Daily Mail actually did so, and while the News of the World fell 50% the Daily Mail gained a similar amount. The Mail’s fierce right-wing politics offend some liberals more than Murdoch’s do, maybe because unlike his they never change. But thirty years of development by strong, independent editors has given the Mail real capacity to handle complex issues as well as celebrity antics. If politics don’t interfere, the Mail’s account of a financial crisis may compare well with one in the Financial Times.

The media circus contains some spectators who can’t believe the decline of The Sun: how could Murdoch’s international flagship fail? In fact it follows logically from the story of the Sun’s rise, which was due to the epic failure of a mighty rival, the Daily Mirror, once king of Fleet Street beasts–a failure that Murdoch exploited.

At its peak, the Mirror seemed to defy Christiansen’s Rule of News. In September 1957, for example, most of the world’s front pages showed Elizabeth Eckford and the troopers at Little Rock. Mirror readers got the sub-Monroe Jayne Mansfield, headlined: HAS THE BUST HAD IT?
The Mirror’s own executives grasped that the paper, which had truly inspired wartime soldiers (many had never before read a paper), looked by the end of the 1960s like a lazy adult comic. Their research said something must be done if the Mirror’s market was to develop. But what?

From a tale of teeming follies that followed, the Murdoch-relevant parts may be briefly extracted: Mirror executives launched a sizable current-affairs section with no newsgathering resources to support it, and with a crude pedagogic tone. Instead of investing money, they raised the price to boost cash flow, cut the number of pages, and eliminated promotion. The Mirror’s attempt at a Mail-style up-market trajectory thus exploded far below orbital height, never to be relaunched. They were abolishing their brand.

But there was worse. The power-struggles among Mirror people might have intrigued Tacitus (they called their pub The Stab In the Back) and in 1968 the chief sub-editor, Larry Lamb, was unseated. Chief sub means chief editorial technician; Lamb was talented, and knew the paper uniquely well.

Meanwhile, Murdoch’s News of the World, being a Sunday paper, had presses with no weekday task, and he had acquired in 1969 a derelict left-wing daily, The Sun, to occupy them. Murdoch hired Larry Lamb to be The Sun’s new editor, and he proceeded to recreate it as a minutely detailed copy of the old Daily Mirror, giving more pages for less money than the ‘new’ one. It was heavily promoted too.

Thus Murdoch and Lamb pulled off one of the greatest of news-business coups, depicted in this graph. They took over the Mirror without buying the company. Economists couldn’t ask for a neater instance of substitution (‘rip-off’ was Fleet Street’s term). Murdoch’s Wall Street fans may say it makes him their ideal media-asset manager. But they must not call it creative. Note in the chart what happens after the Sun climbs past the Mirror in 1978-9. The two papers then decline jointly—and have done so ever since.

Perhaps Britain’s pop tabloids hardly matter. They had a chance to modernize and (barring the Mail) blew it. Once they’ve gone, News Corp. will just have to find other cash cows. But the Sun story, told in Stick It Up Your Punter: the Story of the Sun, by Peter Chippindale and Chris Horrie, has points relevant to the Journal’s future, which certainly matters.

It shows Murdoch incessantly invading Lamb’s editorial role—crushing or promoting stories, and terrorizing staff (Andrew Neil, later a Sunday Times editor, used the term “terorism.”) There was no ethical complaint: simply dismay at the boss’s ineptitude. His ideas were impractical and “wooden-headed,” Lamb found. Fearing to challenge the autocracy Murdoch imposed, they had to laboriously circumvent it.

Punter shows a Lamb-Murdoch operation able to steal the Mirror’s market, but unable to stem its own decay. The point is not that Murdoch interfered—there nobody expected otherwise—but that he didn’t know when it was counterproductive. Lamb succeeded with his Mirror recreation but a reader of the story can hardly imagine anything new developing. Continuing after Lamb’s departure, Punter records the Sun’s decline into the “bigoted, foul-mouthed fantasy factory” (as BBC media commentator Raymond Snoddy put it) that is visible today.

Though it may cause surprise, this lack of a populist technique is credibly documented. But does the Murdoch Touch apply better to quality papers (“Un-populars,” as Lamb once called them)? There is evidence from Murdoch’s Australian homeland.

Murdoch’s father, Sir Keith (1885-1952), was an Australian media owner and a pioneer in favor trading between newspaper controllers and politicians: swift to see the new dimension in broadcasting licences. His career lifted off during World War I, as an agent conducting intrigues on behalf of Prime Minister Billy Hughes, while appearing to the world as simply as a journalist. He was a clandestine spin-doctor before spin was a term of art. For decades legend presented him as brave, maverick war correspondent, but in 1982 Geoffrey Serle’s biography of the great soldier John Monash (John Monash: A Life, 1990) exposed him finally as the opposite. Sir Keith was astonishingly ready to put journalism at the service of state power.

Keith’s newspaper and radio properties passed to Rupert in 1952 via a trust, which had to certify him as an appropriate successor. Some of us growing up in Australian journalism during the following years hoped Rupert might supersede the father’s philosophy. But his loyalty to Sir Keith’s methods soon grew clear.

They brought Rupert substance enough—generated largely from broadcasting licences—to make the News of the World bid. But the bid required political favors, earned by a revealingly dirty editorial trick.

The instrument was Murdoch’s first attempt at a serious paper, The Australian. Launched in 1964, it was legendary for chaotic incompetence—within weeks its 250,000 launch sale fell to nearly 50,000—and for its part in a savage succession battle after the death of Prime Minister Harold Holt in 1967.

Murdoch’s close ally was Deputy Prime Minister ‘Black Jack’ McEwen, who had a special relationship with the Australian Security Intelligence Organisation (ASIO)—and used it to develop “evidence” that his enemy Billy McMahon, federal Treasurer, was influenced by foreign agents. The allegations were grossly spurious even by standards of Joe McCarthy, but Murdoch’s Australian front-paged them two days running. And in a frantic political atmosphere Black Jack’s succession candidate, John Gorton, outmaneuvered McMahon.

In its gross partisanship, the incident seriously reduced The Australian’s already shaky credit, but many inner details were unknown until 2000, when some secret files came to light in the Australian Record Office. ASIO’s boss, Charles ‘The Scorpion’ Spry, was a good butt-covering bureaucrat: he carefully noted that everything had been done at McEwen’s command, and that McEwen had personally handed the phoney dossier to Murdoch.

A first point is that McEwen could never have run the conspiracy via a competent, honest newspaper. The true story—abuse of state-security powers in political vendetta—would automatically cancel the gross fake and terminate Black Jack’s career. Second, though unusually reckless, Murdoch’s behaviour was characteristic of his editorial attitude. The record of wheeling, dealing, and dismissals is too long to set out here, but there are books that amply document it.

When Murdoch departed for London to command the News of the World he left behind a moribund Australian, and local management were allowed put Adrian Deamer in charge. That he turned the Australian around was no total shock, because people remembered Deamer’s father, Syd, saving two papers for Sir Keith. (And departing after a ferocious row: probably because Syd loathed intrigue as deeply as Keith loved it.) And the 1970s were a turnround opportunity. The economy was booming, Australia was in conflict over Vietnam (its army was engaged), over feminism, over sporting racism (sport being akin to religion), and over aboriginal land rights.

Deamer’s gift was organizing limpid, precise coverage however disorderly the news. It was the first paper in years to get educated Australians enthusiastic. Sales nearly trebled in two years, and everyone was happy.

Bar Murdoch.

Whenever Murdoch flew in to see Deamer, it seemed that the paper’s workings puzzled him. Riffling through editions, he would take an arbitrary item and ask, more or less: ‘What’s that doing?’ This drew answers in the general form: “Christ, Rupert, I don’t know. If you stick around while we’re getting the paper out you’ll find out these kind of things.”

Two notions of control collided. Some tabloids are pure confection. Their editors locate every piece of glazed fruit consciously. But in a real news machine, trying to keep simultaneous tab on every moving part actually induces the chaos from which Deamer had extracted The Australian. Like most great editors he set some principles, chose people, told them not to waste time, and practiced a peculiar talent for incessant refocussing without distraction or exhaustion. He expected many things in the paper to surprise him.

Unfriendly debate continued until Murdoch said: “You’re not producing the sort of paper I want.” Deamer said: “Rupert, I don’t think you know what sort of paper you want. So until you do I’ll go on producing the paper I want.”

That ended it, apart from the mechanics of isolating the editor from supportive colleagues and gathering-up disgruntled ones. Then it became clear what sort of paper Murdoch wanted: one which could turn into a propaganda machine for electing a Labor government in 1972—and three years later for removing it. Under Deamer it couldn’t have. Some things do run in families.

News Corp. as global phenomenon is the product of Murdoch’s wheeler-dealer trek, 1979-1997, through Reagan, Thatcher, and Blair territory, giving him Fox, the London Times group, and Sky satellite television. The key relationship was with Thatcher, and ironically the support she had from News Corp. contributed much to her regime’s demise.

Murdoch’s British papers ran clamorous campaigns for Thatcher in 1979, his U.S. ones for Reagan in 1980. It was lawful (if berserk) partisanship. The political affection that resulted was such that News Corp. was able to trash the laws of media competition in both Britain and the United States.
As people have noted—but rarely in proper detail—the Times Newspapers case is the one bearing most closely on the Wall Street Journal bid.

Times Newspapers was Fleet Street’s Lord (Roy) Thomson’s management company for two separately acquired assets: the highly prosperous Sunday Times, and The Times, a loss-producing daily, descendant of the Victorian “Thunderer.” By 1980, Ken Thomson, Roy’s heir, despaired of profitably combining these ill-matched products, and desired frantically to sell.
Murdoch desired the Sunday Times. And Mrs. Thatcher’s closest advisers (“my people,” as she called them) desired political dominion over British news media. Woodrow Wyatt, who had spent some time on the Murdoch payroll, was a principal among these “people.” (He didn’t reveal that in his political writings. Nor were Thatcher or Murdoch aware of the diaries he was keeping (The Journals of Woodrow Wyatt, three volumes, 1998-2000), now a vital source on News Corp. history.

Law blocked Murdoch’s desires for the Sunday Times. The purchase of an economically viable title by anyone already controlling newspapers (Murdoch, obviously) had to be investigated by the competition authorities. And proscribed, should the new owner’s record show disregard for “accurate presentation of news and free expression of opinion.” Murdoch’s record manifested both. His bid was unlikely to survive statutory, independent scrutiny.

Thus it was necesssary, in Wyatt’s words, to have “all the rules bent for him.” And so they were. Murdoch and Thomson declared Times Newspapers insolvent—unviable—and pointed out that competition law doesn’t apply to valueless assets. Certainly The Times was then unprofitable (it still is, under Murdoch). But the Sunday Times was almost invincibly profitable—even at the apex of Thomson misfortunes. A fraud of worthlessness was created by treating Times Newspapers as a single publication, and pouring Times losses onto the Sunday Times. Wyatt knew well this was a deception, for the law referred to real newspapers, not to corporate veils swirling around them. But it was a deception that Thatcher accepted. As Murdoch knew, she liked his current politics, and in January1981 she secured Cabinet approval, in spite of some ministerial unease.

It was still a near thing, for the rule bending was gross, and a lawsuit was swiftly prepared by Sunday Times journalists to make the government obey the law. (It was modelled on an Australian action that had terminated similar Murdoch veil-dancing with television assets.)
Murdoch persuaded key Times executives and journalists to drop the suit by a charm-show very much like that now mounted for the Bancroft family, owners of The Wall Street Journal: journalism in the family bloodline; integrity, treasured; commercial help, need of; legal undertakings to leave editorial executives unharassed–these to be enforced by a board of incorruptible sages. Such presentations come with considerable self-deprecating charm—doubtless natural, for the earliest victims mention it. One of Camus’s characters defines charm as “a way of getting the answer yes without having asked any clear question.” This was not borne in mind enough at the Sunday Times, particularly by the editor, Harold Evans. He now says that endorsing Murdoch’s takeover—through which he became editor of The Times—was the greatest error of his professional life. As there was no greater editor during the twentieth century, and few equal, it was a drastic move indeed.

The Sunday Times that Evans left in 1981 was largely his own modern construction, on a platform newly laid by the first Lord Thomson. Among other things, he installed solid “Chinese walls” between editors and commercial management. Evans’s Sunday paper was nonpartisan, but its investigative firepower seriously enhanced media capacity to challenge illusions generated by state power (something that had been neglected by The Times since Victoria’s reign).

That Murdoch could seduce the Sunday Times people was sad, but not a total surprise. I had left the paper in 1976, thinking that professional fire might be be burning low. But under Evans it quickly began rekindling. Only for Murdoch to douse it, as he had done with Deamer’s Australian. To quote Yogi Berra: deja vu all over again.

Murdoch’s desire, of course, had been for the Sunday Times alone, but the bending required a package deal. Naturally, he did not want the package remaining unprofitable, and so he ordered a total reform of Times Newspapers management and production systems. A czar was appointed with sweeping powers—which wholly failed, compelling tactical withdrawal.

But the political alliance with the powers that be couldn’t be withdrawn, and was imperiled by Evans’s editorial firelighting. As at The Australian, the rush of news gave the editor a turnaround opportunity: in 1981, President Reagan and the Pope were shot; the space shuttle program threatened to disintegrate; and British society at times looked it would follow. Christiansen’s Rule applies specially when news is abundant, and an editor good enough to catch its flow may raise the dead. The Times began 1981 moribund, with a 15% annual sales loss that continued to accelerate. By summer this had turned into a rising trend, quite without promotion or price cuts.

But much of the news, clearly, was about effects of the Thatcher regime. Argument persists over whether the administration was stirring reform, vandalism, or a blend—but certainly Rupert and Margaret wanted their doings covered as triumphal progress. And that cannot happen if a paper is successfully capturing volatile reality.

Murdoch seemed to be in something like agony, especially when a Times reporter found that the Prime Minister’s husband had used Downing Street letterhead in seeking an official hurry-up for his private business. Evans’s position was that turning a serious newspaper around could not be done while putting political filters on its output. (This is a point we shall briefly revisit.)

And on such terms, Murdoch didn’t want it done. He removed certain of Evans’s colleagues, and then the editor himself—after claiming that the Times staff was demanding it. Evans cited the guarantees elaborated during the charm-show. “Not worth the paper they’re written on,” Murdoch told him, perfectly sensibly.

Evans couldn’t be fired for refusing to bias news in government’s favor; that would have been plain unlawful. So hazier offenses were cited: Evans had disorganized the office and demoralized the staff, and meanwhile editorials had become random, depriving The Times of a consistent line. The final claim was false to casual inspection, but had a fine theological ring. Altogether, they were trumped-up and easy to put-down in court–except for anyone under the time constraints of a daily newspaper editor.

Once ejected from The Times, Evans had leisure to write a book demolishing the Murdoch charges (Good Times, Bad Times, 1994): Professor Roy Greenslade (experienced editor turned respected media professor, City University of London) finds it convincing, and so do I. Those who don’t are mostly working for Murdoch.

Most Murdoch-watchers know Margaret Thatcher was crucial to his Times coup. Her contribution to his acquisition of the Fox network is by contrast, obscure.

This owes something to a heroic myth about Sir Rupert’s great Battle of Wapping in 1986, when he rode out against the British print unions to free the printed word from their grasp. This, his admirers claim, enabled the launch of a new competitor for The Times, The Independent, and so was victory not for News Corp. alone, but for newspapers altogether. We’ll come to editorial competition in a moment—but in the business sense the printed word was looking after itself in the matter of the Independent launch. Its production system was set up, in unionized plants, before News Corp. spectacularly dismissed all its own printers.

The Australian financial journalist Neil Chenoweth showed in his book, Virtual Murdoch, that Wapping essentially was about getting the Fox project past the FCC.

Fox assembly commenced in 1985, during the afterglow of Murdoch’s pro-Reagan press campaigns of 1980 and 1984. In those days he controlled the Chicago Sun-Times, and the Boston Herald, but it was work of Fleet Street aces imported for the New York Post that generated the most awe—as in Congressman Jack Kemp’s remark that the Post used “the editorial page and every other page necessary to elect Ronald Reagan president.” Quaint U.S. notions about objective news coverage were blown away.

But the project of welding the hulk of the 20th Century Fox movie studio onto a national TV network needed lots of political afterglow, as it contradicted a regulatory system designed to limit concentrations of power. Networks could swell their audience by distributing programming to affiliates, but couldn’t have direct financial interest in the material produced. The Murdoch scheme reversed that principle. It was about concentrating production profitably in the old movie facilities.

His route around the impasse was characteristic. The first few Fox stations (acquired from Metromedia) would start as a “mini-network,” doing no more than fifteen weekly hours of network broadcasting—at which level financial-interest regulations didn’t apply. Later the FCC would find it difficult to stop network hours expanding—that is, if it desired to. Ronald Reagan appointed Mark Fowler as FCC chairman in 1981, and Fowler thought Murdoch a man of “enormous vision.” Republican doctrine was that a Fox network would be new competition. Its production system would, compared with existing ones, be controlled by very few hands; indeed, essentially by two, Rupert Murdoch’s.

Other barriers had to be razed. To get its licence a network had to show itself as (a) controlled by U.S. citizens and (b) financially stable. The democratic rationale is simple: news media should be controlled within the constituencies they act on, and should need no favors from corporate or official power.
To get around this, Murdoch the man could readily become American. (The broadcasting officials in Sydney to whom he had sworn he was unalterably Australian would simply have to get over it.) But just then News Corp. the company could not afford to be American.

Debt towered over equity even before the company began borrowing to pay for the Twentieth Century-Fox assets. So to qualify as a properly capitalized network operator, News Corp. had to put forward Australian propositions about the nature of capital. As a start, its balance-sheet, and borrowing capacity, were improved by revaluing the “goodwill” of News Corp. newspaper titles. Starting in 1985, $1.5 billion was added. American law prohibits such acts of value-creation by decree.

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.

Nonetheless, Fox would have to show American control. So the network business was put into a company with 99% of its capital held by News Corp.—as non-voting shares. The remaining sliver of voting paper was held by Rupert Murdoch and Barry Diller (Murdoch’s ally at the time), both Americans by then. News Corporation of Adelaide, South Australia was then described as an Australian-controlled company. Of course in the actual world—not the world of virtual entities—the American Rupert Murdoch was in command.

Rule bending of this kind could hardly have succeeded had the Republican administration not seen an enormous vision impending—that of a partisan right-wing network, which of course has been since realized. But Reagan’s people had no more to do than be complaisant. Of the British, something more vigorous was required.

The Fox project created huge interest bills, but News Corp. calculated that it could meet them by pulling another $150 million annual profit out of its London papers. And the basic means for doing so had been in discussion for several years—a move from their decrepit plant into a state-of-the-art facility at Wapping, in London’s East End. Planning had begun early in the 1980s but discussions with the unions stalled.

Each side claims, in retrospect, that the other dawdled years away. However that may be, Murdoch’s interest late in 1985 became visibly galvanic.

The News Corp. version is that much patience went into negotiating, but the unions took no serious interest, and recklessly called a strike at the old plant. Murdoch then dismissed the whole workforce and immediately shifted production to the new plant, with a new workforce, which he had trained and ready. The dismissed workers tried to blockade the new plant and a huge police presence was deployed against them. The Battle of Wapping devolved into ugly street violence, in which the printers eventually suffered total defeat.

The Wyatt Diaries again provide the insider’s account, detracting somewhat from notions of forbearance meeting simple recalcitrance. Wyatt states bluntly that Murdoch wanted the unions to strike—so that their members could be fired. Negotiations over the reduction and replacement of a long-serving and still active work force could only end with large compensation payments, which would imperil the prospects of paying off the Milken “shareholders” (actually creditors). Wyatt makes very plain the high-noon mood within News Corp.—and also explains its link to an unexpected, simultaneous and desperate crisis within the Thatcher government.

The dominance over British media planned by Thatcher’s “people” was, by 1986, prospering greatly under Bernard Ingham, her chief spin-doctor. The four News Corp. papers—to the disgust of some staff members—fed from Ingham’s hand. The Mail and Telegraph groups, though less subservient, shared the government’s ideological outlook (and Telegraph tradition shuns the investigative mode). The Guardian, and its Sunday companion the Observer, raised questions—for instance, about the business interests of the Prime Minister’s son—but with the press mostly on his side, Ingham could make them feel lonely indeed.
Then, as Wapping’s battle raged, a constitutional crisis exploded in the Cabinet, sparked by overly loyal Sun participation in quarrels over a defense contractor, Westland Helicopters.

One of the few certainties in a story that remains opaque today is that the Thatcher administration came near death. On the afternoon of January 24, Thatcher told colleagues that by 6p.m. she might not be Prime Minister. We can’t follow here the whole serpentine plot, but a remarkable point is that the Sunday Times, the nation’s strongest investigative paper, declared the story was one for ‘the so-what files’: a contretemps which once would have been calmed by ministers refreshing themselves in a Continental spa. Only the Observer made substantial investigations; its reporters had the novel experience of tackling a national crisis without hot competition from the Sunday Times.

The politico-financial question was whether Sikorsky of the U.S. should acquire Britain’s sole builder of military helicopters. The Observer was able to establish that false and price-sensitive matter published in the Sun–and helpful to Sikorsky because it undermined investor confidence in Westland–had leaked from Thatcher’s office. The constitutional questions were first, the degree of Prime Ministerial responsibility for unlawful disinformation, and second, how the matter should be officially investigated. While Westland’s shares oscillated, the Observer investigated.

As to seriousness, Murdoch privately agreed with the Observer— “It’s looking very bad,” he told Wyatt, according to the diaries. But he had no similar intent to enlighten the public. “We’ve got to get her out of this somehow,” Murdoch said.

Best, he thought, would be other investors jumping in to help Sikorsky swiftly gain control. With trading greatly diminished once Sikorsky had that control, and publicity reduced, the government might fend off the pressure for an inquiry. The Observer discovered that such a strategy existed, but could only suspect that Murdoch was among those seeking secretly to promote it. Today we have the confirmation from Wyatt–though he gives no details of investments and does not suggest Murdoch made any himself.

Nothing, in fact, suggests Murdoch acted illegally, but Wyatt’s account shows that amid a national crisis over false government leaks that undermined a British company’s share price—the Defense Secretary, Michael Heseltine, resigned in protest—the grand aim of the Britain’s greatest media boss was to insulate the government against investigation (“We’ve got to get her out of this somehow.”)

And the government meanwhile was insulating Murdoch against business disaster. The London police force then was directly under Cabinet control, and its commitment of thousands of policemen to Wapping’s security was without precedent. It was defended as commitment against union intimidation—and with justice—but the workers being stripped of their livelihood also had something of a case. Even based on what was public at the time, some ministers were dubious about open-ended state support for a private firm that might be working to provoke the strike. According to Wyatt’s account, it was doing just that—but two decades were to pass before that saw the light of day.

In any event, the unions were crushed—with many cops injured—and in the end the Milken debts were paid off and Fox secured. Sikorsky got Westland; the Observer’s lone investigation into government manipulation of the deal was brushed aside. And, amid exchanges of admiration between Thatcher and Murdoch, her government survived. But not as long as she hoped it would.

Many of Murdoch’s best journalists were sick of getting political direction from Downing Street, and departed for the new Independent as soon as it opened for business in 1986.
But supposing nonetheless that their media dominance was invincible, Thatcher and Ingham grew overweening. Moderate, competent Conservatives were defenestrated, and a grossly regressive poll tax imposed. Attempts to collect it caused riots of a character quite new to modern Britain. Ingham responded with the absurd TINA mantra (There Is No Alternative), and spoon-fed a News Corp.-dominated press with assertions that Thatcher’s party was unanimous in support of the tax. Tony Bevins of The Independent (ex Times), in a prize-winning feat of shoe-leather reporting, showed that numerous Tory lawmakers loathed the poll tax and wanted a change of direction. In 1990, dissidents forced a leadership election and ended Mrs Thatcher’s regime.

But during her last days in office she had a visit from Murdoch— in deep travail again.

Two satellite television systems were then covering Britain: Murdoch’s Sky and British Satellite Broadcasting. Both had been launched with deficient business models—lacking systems for revenue-collection—and were bleeding money. Joining-up as a monopoly under News Corp. control offered prospects of survival. Much parliamentary opinion, however, wanted to risk well-deserved bankruptcy for both, and meanwhile ask the competition authorities to devise a non-monopolistic framework for satellite television.

Thatcher’s people just then were furious with the terrestrial channels for having reported Bevins’s Independent disclosures about the poll tax crisis. Sky News had ignored them—perhaps fortuitously, but Thatcher was delighted. She greeted Murdoch as producer of “the only unbiased news in the UK.” Accepting the compliment, he said her swift aid was essential for the salvation of such news. To live, Sky must take over its equally feeble rival; if exposed to any more competition both would expire. Among her last official acts the Prime Minister decreed that the competition authorities would not prevent Sky from becoming a monopoly.

And it continues as such today, though far more lucrative—causing some analysts to suggest its license should be modified to help competitors emerge. News Corp. dislikes the idea, as was made clear to Tony Blair in the 1990s, while Murdoch re-examined his interests in the politics of the democratic left—and the right’s poor prospects of retaining office.

This turnabout was painful for the diarist Wyatt, still loyal to the Tory cause. Writing on December 1, 1995, he fears Blair has agreed to leave Sky untouched, and that Murdoch’s gratitude for the Times Newspapers coup has faded. Then on March 17, 1997:

“Rupert has behaved like a swine and a pig. He doesn’t like backing losers . . . the Sun is backing Blair and there’ll be huge headlines across the front page tomorrow . . .”

That Wyatt and others should consider Murdoch an electoral rainmaker is a plain enough danger to democracy. But there are subtler dangers, concerning Murdoch’s basic attitude toward government, which emerge clearly in his dealings with China, where democracy doesn’t complicate the issue.
He has often denounced government in libertarian terms, but mostly the real target of such rhetoric is the regulatory activity of democratic states–designed to sustain competitive diversity, and apt therefore to inhibit News Corp.’s desire for monopoly and uniformity. Many times he has persuaded the political masters of such states to bend rules in his favor—by feeding, in some form, their appetite for electoral support.

By the early 1990s, his triumphs were so many and his tone so triumphalist as to make him sound—even, perhaps, to himself—like the kind of libertarian who resists government power on principle. In September 1993, he made a remarkable speech prophesying that authoritarian governments of every kind would soon fall before the liberating technologies deployed by News Corp. Particularly this meant satellite systems, enabling “residents of many closed societies to bypass state controlled television channels.” He had just taken control of Star TV, broadcasting from Hong Kong—then British territory — with a large potential audience in mainland China.

Exactly this kind of cross-border challenge had been posed frequently in Europe. But Chinese regulators had no Western inhibitions to control the aim of dish aerials. They simply announced that mainland reception would cease unless Star TV’s content received their approval. And they could not be deterred, as their masters cared nothing for News Corp.’s basic currency—electoral support.

Murdoch immediately set out to “make peace with the Chinese government,” as he told Forbes magazine. His most notorious gesture was dumping the BBC’s high-quality World Service Television channel—which drew Western criticism because it gave Beijing censorship powers over free audiences in Taiwan and Hong Kong. Murdoch apparently empathised with official Chinese dislike of the World Service. Its references to the Tiananmen massacres of 1989 were “driving them nuts.” Perhaps his most astonishing conciliation was putting $5.4 million into People’s Daily, the centerpiece of Beijing’s vast system thought-control system. To many, this was humiliation, but not to Murdoch. He called his earlier libertarian rhetoric “standard clichés” (which hasn’t stopped him recycling it subsequently) and said authoritarianism possibly wasn’t all bad.

What this shows is a Murdoch attitude toward governments that is essentially the same whether they are democratic or authoritarian. If possible they will be seduced or bullied. If not, the recourse is obedience. Lacking dominance, News Corp. truckles.

And for a democratic government no worse disservice exists. Most politicians and journalists know this—uneasily, because honest but critical interaction is mutually arduous. In the crucible politicians inhabit, particularly during an emergency, loyal critics in news media are an indispensable link in self-correcting processes. Implicitly the Constitution says so, but it hardly suggests it can be easy for anyone concerned (or that “critical” equals “correct”).

An alternative view is that in war and kindred cases the media must support national leaders without questions that weary the homeland and refresh enemies. That idea has numerous supporters (who often think it will guarantee victory). As a first general point, they are very far from a democratic majority. Second, News Corp. is the particular here, and a glance at Fox News shows it already offers what that persuasion wants. The question is whether it can also match the American way as normally defined.

Murdoch knows China hurts him, for there was other appeasement: a book by Chris Patten, Britain’s last Hong Kong proconsul, cancelled; also curious gaps in coverage by The Times. It helps to have Robert Thomson saying he hasn’t been censored since his appointment in 2002. The proposition is that Rupert is reformed, and that News Corp. has been clean for several years. Against this, the adverse record is very long, and so far from improving in retrospect, it develops new blemishes. The Wyatt diaries in Britain and the Scorpion files in Australia only appeared after decades of amnesia, to show that what had been known was barely the half of it.

And what we know about Iraq is already bad enough.

Properly, the politics of the War on Terror are distinct from the issues of editorial practice we are discuussing here. But readers may prefer to know the basic stance of anyone claiming to separate journalism from propaganda. To my mind, invading Afghanistan was a fitting response to Taliban complicity in 9/11. Risk was high, but the aim of a stable, even prospering Afghanistan seemed not impossible given long concentrated effort. Iraq was a reversal: the primary justifications—the bizarre weapons, the 9/11 involvement—were plainly spurious; the corollary—prompt replacement of dictatorship with democracy–utopian.

Many honest and varied views exist. But increasingly it’s common ground that Coalition actions have been built on group-illusion, and dressed in vain propaganda. And that news media, alarmingly, meekly retailed that stuff. Consequently, public anger and disarray run deep; a recent, detailed study on this topic by Professor W. Lance Bennett of the University of Washington, When The Press Fails, makes grim reading for any serious journalist.

But as Professor Bennett says, his team isn’t in principle describing a normal processes: rather, an anomalous episode, now in decline. Generally, American journalists have a record—if imperfect—of challenging power. To this News Corp. is a major exception: uncritical service to official propaganda is a Murdoch family tradition. (The Murdoch Archipelago traces this story across a hundred years.)

Both The New York Times and The Washington Post have apologized for disservice to their readers on the runnup to the Iraq war. But not News Corp., which far outdid them in fantasy. Its aim, said New York Post editor Col Allan was to avoid people being “confused.” Well, perhaps no Anglophone audience is more confused than News Corp.’s. Among Fox News users, 80% believe one or more of the war’s exploded myths (typically Saddam’s 9/11 involvement).

Initially, the Iraq project was propelled by a hot tide, flowing strongest in America, the target of the worst jihadist blow. But even then most major organizations—including the Pentagon—showed some independent thought. Exceptions were the White House—natural behavior in a political stronghold — and News Corp., displaying unanimity not remotely natural to a media group.

There are about 175 titles in the worldwide News Corp. system, and when Professor Roy Greenslade of City University London made a detailed survey in February 2003, he could not find one News Corp. paper that expressed doubt about the imminent war, or questioned Washington’s gung-ho prognosis. And this is something curious to see in democratic nations. Put a major issue to media professionals, and normally there will be disagreement, often strenuous–it is in fact their job. Not in News Corp. All Greenslade found within the company was a very slight muting of the ferocious tone of the company’s U.S. and British assets in Australia and New Zealand (where opposition to the war was as high as 75%, among people not poor in military virtue).

That so many editors should be of a mind astounded Greenslade, and he wanted to discuss it with them. But none of his calls were returned.

And Murdoch’s unanimous journalists saw little honor in anyone who wasn’t in full support of the war: such people were “wobblers,” “weasels,” “appeasers,” and “traitors.” One Times expert thought U.N. arms inspector Hans Blix was betraying the world, and, as the headline put it, he should “turn the smoking gun to his own head” when the weapons inevitably turned up.

News Corp.’s great sychronized display may be forgotten. But Murdoch’s spokesmen of serious journalism, such as Robert Thomson of The Times surely ought to explain the mechanism before The Wall Street Journal joins the system which produced it. We are told it’s not a system of censorship or interference. Can any paper that took part be described as editorially independent in any meaningful way? And perhaps the lawyers trying to produce a separate constitution for the Journal need help: how can they create safeguards against a collective process that hasn’t been explained? (To remind them: under democracy, the diversity of news media is no more a luxury than is academic freedom or rule of law itself.)

Today’s context is a complex one in which to sum up the impact of Murdoch’s Journal bid. Since the launch of the War on Terror, American, British, and Australian news media have been subject to massive official spin campaigns, and only two or three outfits have been tough enough to keep their vision consistently clear.

And we are in a situation in which the newspaper business model is changing—disintegrating, some say, as online culture expands. Yet the newspaper and its derivatives in high-quality television are still our only practical model of an organization capable of criticizing society’s daily processes (the university, no less necessary, works on a slower schedule).

“Organization” may be the key word: a newspaper is a diverse group of people, not necessarily large, with a shared awareness of techniques, moral principles, successes and failures–all of which enables them on occasion to uncover necessary truths. The concept is not necessarily confined to any particular technology.

But it is linked to the history of a few great newspapers, The Wall Street Journal being a prime example. The argument for Murdoch’s qualification to control the Journal seems to be predicated on his stewardship of another great newspaper, The Times.

But The Times is only the ghost of a great newspaper, which died decades ago, and which has not come back to life after a quarter century in Murdoch’s hands. It did try to revive itself, under a great editor, just after he bought it. And as we’ve seen it that was quickly suppressed, for fear of offending the politicians in power. (A similar reflex showed itself when the Australian showed signs of greatness.) There is a good case for arguing that the remnants of The Times’s soul migrated to the Independent in 1986. But that paper has had a very hard time competing against a multi-sectioned, low-price Times, which is permitted to lose as much as $40 million a year (not noticeable money to News Corp.). Still, The Independent survives, and probably no paper in the world has done better for its readers when it comes to stripping off the propaganda surrounding the War on Terror.

During its period in clear Murdoch control, The Times has managed various extended periods of tolerable mediocrity. But it has been distinguished only for disgraceful episodes––kowtowing to Downing Street and Beijing, and joining the witless WMD consensus. Sometimes its performance has been simply weird, as when in 1999 it accused the Tory Party treasurer of massive tax evasion, only to apologize in a deal that was put together by Murdoch in person.

The Times’s principal competitive weapon has been price-cutting, which is seriously damaging to rivals (The Guardian, The Independent, The Telegraph) that belong to smaller groups and can’t afford the same large losses, but of no real benefit to itself. This market distortion would be an excellent subject for inquiry by the Competition Commission but this idea never appealed to Tony Blair, recipient of lavish praise in News Corp. papers throughout his service as prime minister.

The Sunday Times was an extremely strong newspaper when Murdoch took it over, and it is still capable of good work. But under Murdoch there have been cases of massively discreditable naivete: promotion of the fraudulent “Hitler Diaries”; claiming that a senior British politician, Michael Foot, might be a KGB agent (wild and untrue); portraying AIDS–with cruel, ignorant persistence–as a homosexual affliction not caused by HIV. There seems to be in Murdoch himself a strain of gullibility, which may come from from his excessive respect for power, and it too often seeps into his newspapers.

The Sunday Times also has more taste for official versions than any strong newspaper ought to have. For example, when eyewitnesses raised some legitimate questions about the killing of IRA members in 1988, the government tried to bully them into silence and the Sunday Times helped out with some savage character assassination, which only failed because of its incompetence. The Sunday Times, admirably, uncovered the “Downing Street memorandum,” which suggested Anglo-American intelligence on Iraq might be fixed. But it didn’t go on to challenge seriously the official version of the war.

We said that News Corp.’s secretiveness makes definitive statements about the Times business difficult. But most analysts in London would probably agree that full access to the books would be unlikely to show in two decades any period in of solid circulation growth unassisted by price-cutting or promotion. Martin Wolf of The Financial Times wrote recently that Murdoch has never created a great and profitable newspaper. I think the reason is contained in the story outlined here. Newspapers for Murdoch are not unpredictable engines of discovery, but pieces of wampum, essential in trading for associated goods, and so they have to be deliverable.

The Murdoch influence runs to hysterical tabloids and to ‘respectable papers’ papers that are mostly tedious except for moments (like HIV-denial) when tabloidism grips them. Of course, the position of Robert Thomson is that Murdoch’s control isn’t visible in The Times.

Most of the time, most newspapers are concerned with routine events and the differences between them are matters of tone. However, media scholars do measure these differences by analyzing of large areas of text over time, as Professor Bennett and his team did for When The Press Fails. In one example, they look at use of words in coverage of the Abu Ghraib scandals. They show that White House officials stuck rigidly to the word ‘abuse’ when discussing what happened. If questioned about “torture,” their answer dealt with “abuse.”

On known evidence, there is a case for saying that conditions at Abuu Ghraib involved torture as well as abuse. But if the T-word is never used– a basic form of spin–the discussion and debate is intrinsically one-sided. Bennett’s researchers also looked at the language used by U.S. media in news reports on Abu Ghraib and related issues, and found it following the official pattern—“abuse” being the dominant term, with “torture” rarely used, and almost never on its own. They don’t suggest “that torture was the only correct label, but simply that there were adequate grounds for presenting torture policy as a debateworthy perspective,” and that without “counterperspective . . . the daily news stream may constitute a single-message environment that produces a compliant rather than an informed public, and emboldens government officials to pursue ill-considered policies in the absence of public accountability.”

Most troubling, the choice of the word “abuse” rather than “torture” does not look like independent thought in America because the pattern is much the same in newspapers across the country, whether their reporting of Abu Ghraib was extensive or intermittent. Of course, America was the target on 9-11, which accounts for some of this, along with the fiercely controlled official language.

It was in the overseas press that large variations in language about torture and abuse were found, and these of course were in places where official influence was highly variable—never as consistently powerful as in the U.S. The researchers examined the Star and the Sun of Toronto; The Guardian, The Times, and other British papers; the BBC; and abstracts of European news sources. On average, these were more likely than American papers to use “torture” as well as abuse, and some carried a number of stories referring to ‘”torture” exclusively.

With one exception: the only News Corp. paper in the study. Outside the U.S., only The Times followed the American—or White House—pattern, in which the word “abuse” entirely dominated “torture.”

And to repeat, this is not a matter of one term being right or wrong, but of full and even-handed reporting on a serious debate. In this, The Times seems to have failed, and the likeliest explanation is the influence of Rupert Murdoch.

Bruce Page is the author and co-author of several books, including The Murdoch Archiplelago, published by Simon & Schuster in Great Britain in 2003. He has worked for several newspapers, including the pre-Murdoch Sunday Times of London, where he led the paper’s investigative teams. He was editor of the magazine New Statesman between 1978 and 1982.