Who cares if Murdoch lobbied?
Pummel Rupert Murdoch and his minions all you want for News Corp.’s phone-hacking of celebrities and crime victims, its computer-hacking, its blagging, its bribing of police, its payments of hush money, its obstruction of justice, and its operation of what former British Prime Minister Gordon Brown once called a “criminal-media nexus.”
But spare me the feigned outrage excited by this week’s interrogations of Murdoch and his son James Murdoch by the Leveson Inquiry into press ethics and practices. The Guardian, the Telegraph and the New York Times, among others, appear to be appalled by news that the media baron lobbied the UK government aggressively so that he could expand his holdings in the tightly regulated satellite broadcaster BSkyB from 39.1 percent to 100 percent. The Times cites subpoenaed News Corp. emails released by Leveson to show a Murdoch lobbyist working “hand-in-glove” with the office of a government regulator.
Isn’t climbing into the skins of regulators the very definition of lobbying? That’s how I understand it. Hate Murdoch all you want, but if you’re invested in highly regulated businesses like BSkyB and you need government approval to invest deeper in the regulated business, then working “hand-in-glove” with the regulators is exactly what the situation calls for. Should the Murdochs have ignored the regulators as they attempted to increase their holdings in BSkyB? Of course not.
Likewise, I fail to detect the scandal in James Murdoch meeting repeatedly with David Cameron while Cameron was still the leader of the opposition, as James confessed in Tuesday’s Leveson grilling (pdf), or of James’s admission of having raised the topic of News Corp.’s bid for BSkyB in a “tiny, side conversation” with Cameron at a social event in December 2010. If political judgments are being made over who can own and operate businesses, the Murdochs would be remiss if they hadn’t approached politicians for their support. For example, today’s Wall Street Journal reports that NetJets, the private-jet company owned by Warren Buffett’s Berkshire Hathaway has spent in excess of $1 million over the last three years to lobby Congress to reduce user fees charged to his wealthy customers. This is the same Warren Buffett behind the so-called Buffett Rule to soak the rich.
If the issue is that Rupert Murdoch is not a fit owner of BSkyB under the law because he buys and sells politicians, that his newspapers contrive investigations to punish politicians who stand in the way of his conquests and that his enterprises corrupt police forces, then let’s have that debate. But that’s not the accusation against Murdoch at the Leveson Inquiry this particular news cycle.
Remember, the UK media establishment has long felt threatened by Murdoch’s daring ways in the marketplace and has routinely urged regulators to save them from his predations. In October 2010, executives from the Daily Telegraph, the Daily Mail, the Guardian, the Daily Mirror, the BBC, Channel 4 and the BT Group signed a letter to government regulators protesting Murdoch’s proposed BSkyB takeover. The Financial Times, another Murdoch competitor, editorialized against the acquisition because Murdoch might use his newly expanded BSkyB power to subsidize and popularize his UK newspapers, including his money-losing Times and Sunday Times. Oh, and they made obligatory noises about how Murdoch’s purchase would damage democracy.
“We believe that the proposed takeover could have serious and far-reaching consequences for media plurality,” the 2010 letter from the executives lamented. As I observed at the time, this fretting about “media plurality” was a little rich coming from a consortium of bellyachers that included the BBC, a global enterprise that was then reaping $7.7 billion annually in revenues compared with BSkyB’s $9.4 billion. The BBC benefits from an arrangement in which all households that watch or record TV must purchase a compulsory $235 “license” (go ahead and call it a tax if you wish, because you’ll be fined up to $1,600 if you don’t pay) that funds the BBC. It takes some gall for the BBC, which automatically collects money from TV households, to protest what might happen if Murdoch gains greater control over a competing business that people voluntarily pay for.
My previously mentioned 2010 piece reviewed the historical heavy-handedness of UK media regulators. In 1920, when only three radio stations aired programming in the UK, the government declined applications for new licenses, claiming that “the ether is already full.” As Eli M. Noam reported in his 1991 book, Broadcasting in Europe, UK newspaper publishers encouraged the development of the “public” BBC so that no new commercial enterprise could take root, as happened in the United States, and attack their advertising base. UK regulators suppressed commercial TV and radio for decades and protected the BBC from the onslaught of cable TV. Parliament even regulated the VCR.
The campaign against Murdoch’s total ownership of BSkyB is only more of the same. UK protectionism and the state sanctioning of the BBC make Rupert Murdoch, a villain many times over in other arenas, an unlikely hero. Reading the latest Leveson transcripts, I have yet to find evidence of him seeking direct favors from the government (subsidies, bailouts, etc.), although I am made suspicious by his insistence today that, “I have never asked a prime minister for anything.”
As best as I can judge, he seems to be seeking the liberty to invest his billions the way he sees fit to compete against the established interests. Don’t damn Murdoch for learning the rules of the regulatory game and then playing them as aggressively as he can.
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In the old days, I tried to work into every Murdoch column a reference to his 2007 denial that he was a “genocidal tyrant.” I tried and failed in this column. Upbraid me via email, Shafer.Reuters@gmail.com, or unfollow my Twitter feed. Sign up for email notifications of new Shafer columns (and other occasional announcements). Subscribe to this RSS feed for new Shafer columns, and subscribe to this hand-built RSS feed for corrections to my column.
PHOTO: A combination of still images from broadcast footage shows News Corporation Chief Executive and Chairman Rupert Murdoch speaking at the Leveson Inquiry into the culture, practices and ethics of the media, at the High Court in London April 25, 2012. REUTERS/POOL via Reuters TV