Press Box

Murdoch: The Filth and the Fury

How low he’ll stoop.

Rupert Murdoch

Now that he seems to have bagged the prize, what sort of owner of the Wall Street Journal will Rupert Murdoch make? In his May 11, 2007, letter to the Bancroft family, which controls parent company Dow Jones & Co., Murdoch assumes the pose of an ethics lecturer at the Poynter Institute:

I have … always respected the independence and integrity of the news organizations with which I am associated.

Always is a long time, long enough to take us back to 1984: Murdoch had just purchased 6.7 percent of Warner Communications and hoped to take over the entertainment company. Steven J. Ross, Warner’s chairman and CEO, promptly barricaded and locked the door by acquiring an interest in a broadcaster that owned a TV station in the same market—San Antonio, Texas—where Murdoch owned newspapers. (Sample headline from one of the newspapers: “Uncle Tortures Pets With Hot Fork.”) Ross’ move queered the deal on two counts. U.S. law limits foreign ownership of U.S. stations—Murdoch had not yet become a U.S. citizen and his News Corp. was still a foreign operation. Also, cross-ownership of a newspaper and a TV station in the same market would have forced regulatory action by the FCC, probably forcing Murdoch to sell one or the other.

Ross had thwarted Murdoch’s conquest, or so he thought. When Warner sued to prevent Murdoch from acquiring more stock, Murdoch countersued, “accusing Warner of ‘a pattern of racketeering,’ ” as the New York Timesreported. Murdoch’s suit claimed Ross and other Warner managers had enriched themselves through insider trading.

As part of his takeover strategy, Murdoch buggered the independence and integrity of his New York Post. He ordered three of its journalists to investigate Ross—not for a news story but to help his lawyers, as the Jan. 28, 1984, New York Timesreports:

Rupert Murdoch, the publisher of the New York Post who is trying to gain control of Warner Communications Inc., assigned a Post editor and two reporters to help his lawyers unearth information about Steven J. Ross, the chairman and chief executive officer of Warner, a lawyer for Mr. Murdoch said yesterday.The lawyer, Howard Squadron, said Mr. Murdoch believed that the editor, Steven Dunleavy, was “a terrific investigator’” and asked him, Jeff Wells and Guy Hawtin to assist in a suit by his company, News Corporation, against Warner. Mr. Squadron said the information was to be used in preparing to depose Mr. Ross.

According to Connie Bruck’s book Master of the Game: Steve Ross and the Creation of Time Warner, Ross had reason to be anxious about the scrutiny. He and Warner had ties to the mobbed-up Westchester Premier Theatre in Tarrytown, N.Y., which the feds had been investigating since the 1970s. The theater’s operators were “identified by Federal authorities as organized-crime figures,” according to the Times, and some were convicted of fraud for their Westchester labors. The investigation also nabbed a Warner executive close to Ross, Solomon M. Weiss, who was convicted in 1982 of racketeering, fraud, and perjury. Ross, who died in 1993, was never charged, although the Times reported that one prosecutor called him “the real culprit” in the fraud case.

That Murdoch had no compunctions about assigning his reporters the work of private investigators is no aberration. As the Murdoch rap sheet published recently by the Wall Street Journal on Page One shows, the rotten old bastard loves to leverage his editorial assets in service of his businesses. This is only the most tawdry example.

Typically, Murdoch lies his way out of such jams  or obfuscates. In this instance, he maintained that the Post reporters were working as investigators for his company, not as journalists, even though they told Warner employees they were working on a Post story. In the Feb. 6, 1984, Times (article purchase required), he mouthed this transparent fib: “If they misidentified themselves, they were wrong … and they’ll be reprimanded.” Oh, sure, reprimanded with bonuses.

Murdoch’s suits against Warner were all thrown out, Neil Chenoweth writes in Rupert Murdoch: The Untold Story of the World’s Greatest Media Wizard. His investigation of Ross produced no dirt—that we know of—although it may have played a part in convincing the nervous Warner executive to have his firm buy back Murdoch’s stock. For his trouble, the tycoon netted $41.5 million on the transaction. Murdoch later purchased the Fox film studio, became an American citizen, and launched the Fox TV channel. And he ended up owning several of the TV stations that Warner had invested in to block him.

That Rupert Murdoch feels the need to negotiate a pact with the Bancrofts guaranteeing the editorial integrity and independence of Dow Jones publications when he takes over tells you everything you need to know about his methods and practices. Will he use Wall Street Journal reporters as private investigators to advance his businesses? Will he dip into not-yet-published Journal and Barron’s stories and extract market-changing news and act on it? Reward his friends in politics and business with favorable coverage? Intimidate political and business adversaries with “investigations” personally commissioned by him?

What do you think?


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