8:51 am Jul. 15, 20111
In an interview with The Wall Street Journal yesterday, Rupert Murdoch was hanging tough.
He said that in the massive phone-hacking scandal that has embroiled British Parliament, shuttered his biggest British newspaper and scuttled his $14 billion bid to take control of British satellite broadcaster BSkyB, his company had lost "nothing that will not be recovered."
"We have a reputation of great good works in this country," he told the Journal, and added that his reaction to the press surrounding the controversy was that he was "just getting annoyed."
"I'll get over it," he said. "I'm tired."
By the time of the Journal interview, Murdoch had agreed to appear before a parliamentary committee investigating the phone-hacking scandal on July 19—only after the committee’s chairman, John Whittingdale, ordered that summonses for his and his son James' appearance be drawn up. (James had previously said he would not be available until August, and Rupert not at all.)
Later in the day, he was trying to spin it to his own newspaper, the Journal, as though it were all just part of the plan: "We think it's important to absolutely establish our integrity in the eyes of the public," he said. "I felt that it's best just to be as transparent as possible."
Some of the things being said about his company in Parliament were, he said, "total lies."
He had arrived in England on Sunday and dined with Rebekah Brooks, the chief of News International, News Corp.'s division for British newspapers. He put his arm around Brooks, and called her his "first priority."
But last night, Saudi prince Alwaleed bin Talal al-Saud, known as the "Arab Warren Buffet" and controller of a seven percent stake in News Corp., expressed different priorities. Interviewed on the British evening news program Newsnight, the Prince said of Rebekah Brooks: "For sure she has to go, you bet she has to go."
What must the Murdochs—Rupert and son James, who controls News Corp.'s Europe and Asia divisions and thus sits over News International, have thought when they got this unfortunate assist from the prince?
"The indications are that her involvement in this matter is explicit," he told "Newsnight." "For sure she has to go, you bet she has to go. Ethics to me is very important. I will not tolerate to deal with a company that has a lady or a man that has any sliver of doubts on her or his integrity. From my dealings with Mr. James Murdoch and Rupert Murdoch it's almost impossible for James and Rupert to know what's going on at News of the World level."
But Murdoch might also have realized on his own by then that it is not a good idea to player-coach Rebekah Brooks in a hostile parliamentary committee meeting. (For a taste of what it's like to sit next to her in one of these things, watch the short video below.)
Murdoch told the Journal that reports News Corp. was looking at spinning out its British or even all of its newspapers were "pure and total rubbish."
As we pointed out yesterday, reports out of Australia and more recently in The New York Times suggest that Murdoch himself is staunchly against the spin-off—but that his position, as the acceptance of Brooks' resignation arguably shows, is not as strong with shareholders as it was before all this broke. And it is shareholders that are pressuring the company to dump the papers.
Is his insistence that all this is merely "annoying" to him simply the hubris of a press baron eager to show Wall Street that his own confidence in his future hasn't ebbed? It's a strange form for it to take. But I find it believable.
The Murdochs are in a rout. This front is lost. Everything that's opened up so far has gone against them. The Murdochs are regrouping.
The New York Times reports that they've retained Brendan Sullivan, the Washington criminal defense attorney who represented the recuperating Iran-Contra antihero Oliver North, the New York Stock Exchange's Richard Grasso, former Alaska senator Ted Stevens, and the four F.B.I. agents implicated in the Ruby Ridge shootout at moments when the nation was in high dudgeon against them. In each case, implicitly or explicitly, the political sentiment of the nation as a whole was before a tribunal as much as any defendant.
They've added the public-relations firm Edelman, the Times reports, which has a strong British outfit, to provide "public affairs support," shorthand for working with situations that involve the legislature and regulatory bodies in England, and flown top executives from his New York firm, Rubenstein, to England to help.
Murdoch is marshaling his forces. What will be his strategy now? Two broad paths are before him. He can do what the shareholders probably want him to do: Take his medicine, get these pesky regulatory bodies and parliamentary committees to finish letting out all their steam, come up with some recommendations, follow them, wait for public interest to die down, and then charge forward with his ultimate plan for world media domination, a little behind schedule.
That approach would not bear the Murdoch seal quite, though. Wags in England have talked before about Wapping, which among Murdoch-watchers in Britain is a bit like his Trafalgar.
Forgive the diversion for a moment: In January 1986, Murdoch was at the center of what the Guardian has dubbed "one of the most dramatic industrial disputes of the last century" when, as history now commonly tells it, he provoked a printers' strike in Fleet Street, secretly set up new presses in Wapping and trained picket-crossers in secret to operate them. All the old printers got the sack; he got a brand new printing plant.
The bold move, unheard of in British labor-relations history, is now pretty widely credited with having saved British newspapers. It might have happened anyway: "If British unions were then (rightly) regarded as the worst in the western world, then Fleet Street's print unions were the unchallenged worst of the worst," Sunday Times editor Andrew Neil told the Guardian in 2006 (same link as above).
"Typesetting machines" were controlled by the printers' union, meaning reporters couldn't actually computer-typeset their own material, providing countless meaningless jobs for countless union members. The situation was too ridiculous to sustain itself, and Parliament would ultimately wake up to the stranglehold unions had on the nation and make the necessary adjustments. But not on Murdoch's schedule.
That Rupert Murdoch, I think, is the one we will soon see.
If Parliament will have him testify, he will make it the most excoriating testimony they've heard in a long time. He'll move the issue from phone-hacking to government regulation of the free press, and to a history of more than 40 years of MP's cutting deals in Westminster pubs with Murdoch's hacks. (Who will come out the worse for that: Government or Journalists?)
And of course, Gordon Brown, lately a sympathetic figure whose recent allegations against News International have more short-term emotional pull than long-term serious worthiness, can be made into mincemeat. (Murdoch has already begun, in his way: Brown's claims that the Sun illegally obtained medical records from his newborn son to get an exclusive on his diagnosis of cystic fibrosis are among the few specific claims Murdoch himself brings up to rebut directly. One can tend to forget that the murderer knows where the bodies are buried: His confidence, I take it, will show that straightforward, sleazy-but-legal shoe-leather produced the exclusive. If there were a body buried here, why would Murdoch take us to it?)
Prime Minister David Cameron has been able to deflect opposition leader David Miliband's carping about his connections to News Corp.—especially inquiries into how he came to hire former News of the World editor Andy Coulson to be the chief spokesman for the Conservatives and ultimately his chief press man at 10 Downing Street even after warnings that Coulson was in the phone-hacking scandal up to his neck—mostly by joining the chorus of M.P.s on both sides calling for Rebekah Brooks' head.
In short: The alliance arrayed against Murdoch in England right now is one of convenience. It is not organized; its interests are not common. When this becomes an issue of monopolies, government regulation, freedom of the press and journalistic ethics, those cracks will start to surface. And what's more, the deep exploration of the relationship between Fleet Street (or Wapping) and Parliament does not favor these lawmakers, who, at the end of it all, have to get re-elected.
News of the World political editor David Wooding casually mentioned in an interview that one such M.P., unnamed, was in a bar with him when he learned his paper was about to close, leaking him a pile of documents that would result in a "stonking" political exclusive.
When the close proximity of Parliament and the press is explored, it's a bit like when a politician's liaison with a prostitute is revealed. The politician is ruined, but who reviles the prostitute? The fact that some journalists have been able to manipulate Westminster is an achievement for them—and an embarrassment for the politicians.
On one hand it's easy to get carried away, as I believe Guardian columnist Marina Hyde, a self-described "recovering Murdoch employee," did when she said that Britain "is a land where a change in prime ministers constitutes the mere shuffling of Rupert's junior personnel." But his influence there is also much broader than the presently incontrovertible evidence thus far made public would lead you to believe. In fact, it's one of those open secrets, so that actually opening it up further becomes a challenge.
Hyde's next sentence: "Anyone in doubt as to exactly how dirty a little secret Murdoch has always been is reminded that despite Margaret Thatcher being so close that they repeatedly Christmassed together at Chequers, she does not once even mention him in her memoirs. Not once!"
Those and many other political memoirs can easily be rewritten, if Rupert Murdoch will decide to speak candidly. And many of the people in government he's supported or arguably even sustained over the years have reason to fear this, not least of all the recently indignant prime minister himself.
Which Murdoch will we see? I think we'll know on Tuesday. But you don't hire Brendan Sullivan to get your paperwork in order, to oversee compliance with government regulators and police investigations. You hire him to win. Murdoch may be tired, but he's not resting his case.