the audit

Also Exposed by The Guardian: Murdoch’s Grip on U.K.’s Elites

And it isn’t pretty
July 7, 2011

A lot of powerful people in the UK have suddenly found their spines in the last few days.

That’s perhaps the most remarkable impact The Guardian‘s Milly Dowler scoop has had. As Editor Alan Rusbridger put it, “The palpably intimidating spectre of an apparently untouchable media player has been burst.”

And he would know.

This scandal has a larger meaning even beyond the rampant illegality at News of the World, the violations of murder victims and the families of dead soldiers, and the coverups of all this within News Corporation. It has shown more clearly than anything before it just how much power Rupert Murdoch, who, forgive me for repeating myself over and over, is not a Briton, has accumulated over British government and society. This scandal has laid bare, where it was previously just suspected, exactly how corrupting that power really is.

Rusbridger’s succinct account of his paper’s lonely years uncovering this story is as good a place as any to start to see the craven behavior of British institutions, including the press, have been when it comes to all things Murdoch. You should read the whole column—it’s a profile in journalistic courage—but here he is on Nick Davies, his reporter who has dominated the story:

Nick’s first story on the full extent of the phone-hacking scandal was published almost exactly two years ago – on 8 July 2009. It was – or should have been – explosive. It reported that a major global media company – News International – had paid out £1m secretly to settle legal cases which revealed criminality within their business.

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Instead of going back to parliament or the regulator to admit that they had been misled, the company’s chairman, James Murdoch, signed a large cheque to stop the truth coming out.

With any non-media company this revelation would have led to blanket coverage, calls for resignations, immediate action by the regulator etc. Instead there was a kind of ghostly silence.

The Metropolitan police – led by Assistant Commissioner John Yates – announced an inquiry. And then, within the space of a few hours, he announced the inquiry was over and there was nothing to inquire into.

News International, doubtless pleased by this clean bill of health, came out all guns blazing, denouncing the Guardian’s deliberate attempts to mislead the public. Most of the press decided it wasn’t much of a story. The regulator decided there was nothing wrong. And many MPs were sympathetic in private, but indicated there was little in it for them in sticking their heads above any public parapet.

Along the same lines, the prominent British journalist and critic Peter Oborne has a searing commentary on what the hacking scandal means about the society. I’ll quote liberally from his lede, which is fantastic:

Let’s try a thought experiment. Let’s imagine that BP threw an extravagant party, with oysters and expensive champagne. Let’s imagine that Britain’s most senior politicians were there — including the Prime Minister and his chief spin doctor. And now let’s imagine that BP was the subject of two separate police investigations, that key BP executives had already been arrested, that further such arrests were likely, and that the chief executive was heavily implicated.

Let’s take this mental experiment a stage further: BP’s chief executive had refused to appear before a Commons enquiry, while MPs who sought to call the company to account were claiming to have been threatened. Meanwhile, BP was paying what looked like hush money to silence people it had wronged, thereby preventing embarrassing information entering the public domain.

And now let’s stretch probability way beyond breaking point. Imagine that the government was about to make a hugely controversial ruling on BP’s control over the domestic petroleum market. And that BP had a record of non-payment of British tax. The stench would be overwhelming. There would be outrage in the Sun and the Daily Mail — and rightly so — about Downing Street collusion with criminality. The Sunday Times would have conducted a fearless investigation, and the Times penned a pained leader. In parliament David Cameron would have been torn to shreds.

Instead, until this week there has been almost nothing, save for a lonely campaign by the Guardian. Because the company portrayed above is not BP, but News International, owner of the Times, the Sunday Times, the News of the World and the Sun, approximately one third of the domestic newspaper market. And last week, Jeremy Hunt ruled that Murdoch, who owns a 39 per cent stake in BSkyB, can now buy it outright (save for Sky’s news channel). This consolidates the Australian-born mogul as by far the most significant media magnate in this country, wielding vast political and commercial power.

Every summer Murdoch, now 80 years old, pays one of his rare visits to London, the social highlight of which is the annual News International party. An invitation carries the same weight, say insiders, as a royal command. In the phrase of one of his executives, to turn it down is a ‘statement of intent’.

And you thought Murdoch had power here. (Don’t get me wrong, he does have vast power here, but it’s on a different level in the UK, not to mention Australia).

I reviewed that angle in May, looking at a piece Archie Bland wrote for CJR and one Sarah Ellison wrote for Vanity Fair. Both are worth reading to get an expanded view on what Rusbridger and Oborner are talking about above.

Our piece had this incredible quote from the executive editor of Murdoch’s “serious” UK paper, the Times of London, on why his paper wasn’t covering the scandal:

“With this whole story I just hear the shrill shriek of axes being ground,” said Roger Alton, executive editor at The Times. As editor of The Independent in 2009—after ten years at The Observer, which he left acrimoniously—he felt the story was old news. “Everyone has an agenda. The New York Times certainly has an agenda, after Murdoch’s very forceful attempt to rival them with The Wall Street Journal.” There was no way to condone what had happened, Alton added, but that doesn’t mean the story merits coverage today. “For me this is stuff that happened a long time ago. People have gone to prison. Coulson’s resigned twice. It’s not as if any perceived wrongdoing hasn’t been sufficiently addressed. For me it’s roughly on a par with parking in a residents’ parking bay in terms of interest.”

That set me off:

This is either insane or craven. I’ll go with the latter. Police coverups. Corporate coverups. Celebrities and royals hacked. Hundreds of millions of dollars. Billionaire Rupert Murdoch. Press hypocrisy. Payoffs to keep quiet. Possible perjury by the prime minister’s top aide. Stonewalling executives who now run The Wall Street Journal. And it’s far from over. This story is a journalist’s dream.

Now even Alton and The Times can’t ignore this one. It’s now front page news in that paper.

Today, The New York Times fronts a smart story on how the Milly Dowler news has finally set cowering British politicians, both Conservative and Labour, against Murdoch.

Britain’s Parliament on Wednesday collectively turned on Rupert Murdoch, the head of the News Corporation, and the tabloid culture he represents, using a debate about a widening phone hacking scandal to denounce reporting tactics by newspapers once seen as too politically influential to challenge.

Here’s a sample of the outrage in Parliament yesterday:

Zac Goldsmith, another Conservative legislator, said that Mr. Murdoch was guilty of “systemic abuse of almost unprecedented power” and had run roughshod over Parliament.

“There is nothing noble in what these newspapers have been doing,” he said. “Rupert Murdoch is clearly a very, very talented businessman — he’s possibly even a genius — but his organization has grown too powerful and has abused that power. It has systematically corrupted the police and in my view has gelded this Parliament, to our shame.”

“To our shame,” indeed.

Rusbridger has the obvious next question:

But what now? How can we make sure that we never again have this kind of dominant force in British public life?

Will this pushback will be sustained and will Murdoch’s chokehold be broken? I seriously doubt it. Even the most immediate possibility, the BSkyB transaction, is most likely just being delayed in the hope that this will blow over. But it shouldn’t be.That deal should be killed outright. If the events of the last five years haven’t shown the perils of media consolidation, nothing will.

This story is now out of Murdoch’s control. He and his people have miscalculated in the last few years—not unreasonably, but presumably out of hubris, too—that their political power would enable them to sweep this under the rug with minimal damage.

They almost pulled it off. Scotland Yard had policemen on the take, it feared damaging its symbiotic relationship with News International, and the guy who headed its pathetic “investigation” left and went straight onto Murdoch’s payroll as a Times columnist. News of the World editor Andy Coulson, who Murdoch’s folks now say authorized police bribes, landed in 10 Downing Street as Conservative David Cameron’s top flack, something like Obama coming into office with Jayson Blair—a joke, but it happened. A News International journalist, meantime, became top flack for Labour’s Ed Miliband, the opposition leader, and ordered Labour MPs to go easy on Murdoch and News International. Oborne on that:

But until this week, Ed Miliband had made the pragmatic decision to ignore the phone-hacking story — explaining privately to confidants that he had no choice because the alternative would be ‘three years of hell’ at the hands of the Murdoch press.

Murdoch’s people undertook to destroy or hide evidence and have executives stonewall inquiries. It paid large sums of money to its scapegoats, the former royal editor Clive Goodman and private investigator Glenn Mulcaire, after they went to prison—presumably to buy their silence. It has misled the press, Parliament, the press’s self-regulatory body, and the public many, many times. By owning The Wall Street Journal, he has prevented it from bringing its still-flickering investigative might to bear on this scandal (while diluting that might more generally). This is no small thing. Go back and read some of the paper’s many excellent page one Murdoch stories before he took it over.

Their miscalculation lay in underestimating The Guardian and Nick Davies, who have pulled off one of the greatest newspaper investigations of all time. Full stop. This one will go up there in the pantheon with Watergate. And while it’s still unfolding, now, finally, they’ll have a little help.

This scandal has shown how important newspapers are (in ways both good and bad), but it’s worth noting in conclusion here that The Guardian is being hammered by the collapse of the newspaper industry. It loses tens of millions of dollars a year. In a few years it will almost certainly not have the institutional muscle that enabled it to face down News Corporation and its collaborators.

Then what?

Further Reading:

News of the World and U.S. Media Culture
. I don’t think it would happen here, but…

News Corp. and Murdoch Swamped By Hacking Scandal News. Revelations come fast and furious in the twenty-four hours after a Guardian bombshell.

Why News Corp. Can’t Cover the U.S. Business Story. It is the story.

Murdoch’s Hacking Scandal Gets Much Worse. The Guardian shows News Corporation at an all-time low (and that’s saying something)

Murdoch’s Hacking Scandal. Two stories cover the political, police, and press angles on the News Corp. coverup

The News Corp. Coverup. Memory-impaired execs, payments to key figures, and Keystone Kops

Anybody There? Why the UK’s phone-hacking scandal met media silence

A Times Must-Read on the News Corp. Hacking Scandal

Journalism Scandal at News Corp. A peek into Murdoch’s news culture.

Audit Notes: News Corporation Hacking Scandal Edition

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.