A Secret Country

by John Pilger

  To Murdoch’s other Mates on the right wing of the Labor Party, the deal Hawkie had done was worth rejoicing about. Neville Wran, who as Premier of New South Wales had given Murdoch a licence to print lottery tickets, remarked that he ‘wished Rupert owned 95 per cent of the Australian press’.

  As Murdoch began his bid for the Herald and Weekly Times Group, Hawke and Keating launched an attack on the National Times on Sunday, owned by the Fairfax family. The Australian Journalists’ Association newspaper described this as an ‘extraordinary campaign’ in which ‘Hawke and Keating decided to go in boots and all [and which was] significant because of the timing. Speculation about the future of the National Times on Sunday was rife, making the paper more vulnerable to a concerted political attack.’79

  Two stories the paper had published were singled out by Hawke and Keating. On September 10, 1986 a front-page report headlined, URANIUM: HAWKE WANTS PARK MINED, quoted a letter Hawke had written to his Environment Minister, in which he objected to the absence of a provision for mining in the draft management plan for Kakadu National Park in the Northern Territory, the world’s biggest and richest uranium province. The story was true, and no facts were disputed. On December 7 the paper’s front page reported that the Government had decided to contribute to a World Bank loan to the Pinochet regime in Chile, and that Bill Hayden had opposed the decision. Hayden denied his opposition, but the story essentially was true. Nevertheless, on December 8 Keating denounced it as ‘a complete fabrication’ and said that other stories the paper had published, such as the Kakadu uranium story, were ‘wrong and squalid’. He made no attempt to justify this and dismissed journalists’ questions about the Chile connection. ‘The National Times’, he said, ‘is a flagging, desperate newspaper which is going out of sight at a rate of knots and the quicker the better.’ The next day Hawke described the paper as ‘totally dishonest . . . a total disgrace to journalism’ and added, ‘They will not learn.’ He, too, offered nothing to substantiate this.

  The National Times on Sunday, a broadsheet, had grown out of a remarkable ‘stretched tabloid’, the National Times, whose strength had been that indeed it had not ‘learned’ to subvert its journalism to the ambitions and manipulations of politicians and their Mates. The paper had been given a degree of independence which was as rare as it was provisional. This was due to the paternalism and idiosyncrasies of the Fairfax organisation and specially the support of its libertarian chairman, James Fairfax.

  This degree of independence seemed genuinely to baffle Hawke, who, like so many public figures in Australia, regards his secret and contradictory activities as beyond the limits of free enquiry and comment.80 The National Times, wrote David Bowman, who had been editor in chief of its sister paper, the Sydney Morning Herald, ‘was a unique paper with an extraordinary history of tough, independent enquiry bent on exposing secrets, showing up social ills, and going over the high and mighty, for the health of the nation and the benefit of ordinary people. The trouble was that it lost money continually and made an army of enemies for Fairfax.’81

  For twelve years, the National Times presented a catalogue of some of Australia’s darkest, contemporary secrets. The paper’s small editorial team posed the first serious threat to political corruption and organised crime in Australia. Certainly, I cannot think of a newspaper anywhere in the world quite as tenacious and fearless and which, at its best, employed so many journalists of distinction: Max Suich, Evan Whitton, Brian Toohey, Wendy Bacon, Marian Wilkinson, Colleen Ryan, Adele Horin, David Hickie and others.

  Between them they attracted ‘an army of enemies’ and attempts were made to frame and discredit several of them, even to threaten their lives. Their enemies ranged from street thugs to thugs of another kind, among them the most powerful individuals in Australia. When Hawke was asked on television to confirm or deny that he had ordered the Australian security organisation, ASIO, to tap Brian Toohey’s phone, he refused to say. Toohey was the paper’s most famous editor and the recipient of more official ‘leaks’ than any journalist I know. He had so many leaked documents that he left them in suitcases at secret addresses all over Sydney. Politicians hated him, mostly for reasons of which a journalist ought to be proud.

  But when a Prime Minister and his senior Cabinet Minister make such a vehement public attack on a newspaper that is in financial difficulties, something has to happen. In March 1987, Brian Toohey, by now relieved of the editorship, wrote a long polemic which analysed the new establishment. Entitled ‘The Death of Labor’, it was illustrated by the brilliant Sydney artist Michael Fitzjames and showed two black horses with mourning plumes drawing a Victorian hearse and coffin. Astride one horse was Keating, in formal suit and topper, raising a glass of champagne on high. Similarly attired on the other horse was Bob Hawke, waving a big cigar. They were gazing at each other with looks of sublime satisfaction. Toohey described ‘a new Australia forged by a new type of entrepreneur [whose] fortunes are built on deals where nobbling official watchdogs or bribing union bosses eliminates much of the risk . . . [where] tax cheats become nation builders’. Hawke and Keating, he wrote ‘do more than enjoy the company of the new tycoons: they share their values [while] the sacrifices are being made by the battlers for whom Labor once fought’.82

  Toohey’s article was withdrawn by the Fairfax management several days before publication. As a result, the editor, Robert Haupt, resigned. Toohey did the same, and launched, virtually single handed, a magazine called The Eye, which promised ‘the stories the big boys won’t print’.

  On Friday, February 13, shortly after he had wrested control of the Herald and Weekly Times group, Rupert Murdoch flew to Queensland. It was St Valentine’s Day – the day that a coterie of Chicago’s Mafia bosses were assembled in a garage and dealt with in the customary way by their Mates – and the editors of Murdoch’s papers in Australia were assembled in a Gold Coast hotel and dealt with in the customary way. This was the Class of ’87, thirty-five in all, including the new boys from the Herald and Weekly Times group. They were billeted at the luxurious or hideous Gold Coast International Hotel, where Rupert and Anna Murdoch held a reception to welcome their guests. ‘They have a marvellous way of putting people at their ease,’ said one of the editors.83

  The next morning, sharp at nine, the editors gathered in the hotel’s Penthouse club, where the atmosphere was very different. ‘Each of us had to sing for our supper,’ one of them told me. ‘It was like I always imagined the Moonies behaved. Each of us had to reaffirm the Murdoch ethos: the kind of newspapers he wants, he gets and he controls; the kind of newspapers most Australians will read into the next century. I went home shaken and humiliated. But I still had my job.’

  David Bowman once described the Murdoch papers as ‘that augmented team of well-broken horses’. Two days after the augmented team had returned to their desks from the Gold Coast, they were writing headlines like these:

  MURDOCH A TRUE BLUE AUSSIE, SAYS PM

  HAWKE PRAISES MURDOCH COMMITMENT.

  The story was about a lavish dinner to celebrate Murdoch’s mother’s favourite charity, although, of course, there was more to it than that. Eighteen members of the Murdoch family were assembled to hear the guest of honour, Prime Minister Hawke, praise the ‘Australianness’ of Rupert Murdoch (who had not long renounced his Australian nationality in order to pursue his American commercial interests). ‘The crucial test of “Rupert’s national loyalties”’, said Hawke, ‘came during the America’s Cup challenge when he barracked for an Australian victory!’

  Knowing, temperate laughter lapped the smiling Labor leader and the smiling proprietor as a string quartet played, ‘For he’s a jolly good fellow’. The two men turned towards each other and raised their glasses in mutual approval; their Mateship now consecrated. During the first four years of the Hawke Government, the Murdoch family’s fortune increased from $A250 million to $A2,500 million.84

  ‘In other countries’, said Paul Chadwick, ‘it is a small group of generals
who sit above the main institutions. In Australia we also have a junta, for it seems that a small group of media owners can now cause politicians of all persuasions to desert their responsibilities to the public. The fear that politicians are showing is evidence of the danger it imposes.’85

  In November 1986, Treasurer Keating unexpectedly announced a new policy for the ‘re-structuring’ of commercial television. Under the old regulations no one could own more than two television stations. Now the Government proposed that any one owner could command an ‘audience reach’ of 75 per cent of the population. This would mean that a single operator could control stations in every capital city. It would also mean that the nation’s fifty television stations, which had been spread among twenty-five owners, would be taken over by a handful of conglomerates, notably those with numerous and often conflicting commercial interests. Not since the dawn of the television age had there been such a contraction of ownership. Not since the cry of ‘Gold!’ had sent diggers to Eureka had such a bonanza beckoned to so few. The Government’s announcement alone caused the share trading value of television stock to soar. And this time the diggers had only to reach for their phones.

  Keating said his concern was that those who owned newspapers ought not to own television stations. This was bad for democracy, he said. Some would have to sell and some would have to buy. Three Mates, Rupert Murdoch, Kerry Packer and Alan Bond, reached for their phones. In the words of the Sydney financial analysts, County Securities Australia:

  The Federal Government allowed the two most powerful print media proprietors next to Fairfax to gain substantial returns for their TV interests by way of allowing aggregation of TV licences under the 75 per cent rule. Mr Kerry Packer and News Corporation have received approximately 1.8 billion dollars in income, whereas the valuation pre the rules would have been in the vicinity of 800 million dollars – a one billion dollar gift.

  And it was a gift entirely free of tax.

  Kerry Packer is known as ‘Australia’s richest man’. This is probably true. Certainly, the years of the Hawke Labor government have seen his fortune rise from $A100 million to more than $2 billion86. In many ways he is like his father, Sir Frank Packer, a former boxer who owned Consolidated Press, whose power was respected, if not feared. Sir Frank was one of a group of newspaper proprietors known as the ‘wild men of Sydney’. I worked on his Telegraph newspapers during my tender years as a journalist. As a sub-editor on the Sunday Telegraph, I was sacked along with all my colleagues late one Saturday night after Sir Frank had stormed back from the races and disapproved of the front page. After an hour or so in the pub, we were re-instated when it was pointed out to the proprietor that he would have no paper the next day without us. The chief sub-editor knew him as ‘Gorgo’, which was a 1950s Hollywood beast.

  Kerry Packer had mild polio as a child and was apparently called ‘boofhead’ at school. Yet he excelled at sport. He was never the heir apparent and had to live two paces behind his elder brother, Clyde, who was regarded as brighter. They were, and remain massive men, like sumo wrestlers or of the kind you see in the southern states of America. In my second year on the Sydney Daily Telegraph I mistakenly rode in a lift with both of them and feared for the progress of our elevation. Kerry has a Lizard-like head: thus he is known as ‘The Goanna’.

  When Sir Frank died it was Kerry, not Clyde, who emulated their father’s manipulative skills; Clyde was paid off and went to live in Los Angeles. When he sold the unprofitable Daily Telegraph to Rupert Murdoch, Kerry did the deal in a car parked outside Murdoch’s hotel after a boxing match. When Packer escorted his daughter Gretel down the aisle at her wedding, it was Murdoch’s hand he grasped on the way.

  Packer’s personal passions are gambling, polo and cricket; he is said to gamble a million dollars at a time. He is widely admired for challenging the English cricket establishment and establishing ‘world series cricket’. He is also a serious fan of Genghis Khan, whose life he has studied. From time to time he goes into the bush of the Hunter Valley and, dressed in army fatigues and armed with a pellet rifle, plays war games with cronies; he has re-fought the Falklands War. He has been a secret backer of the South African Zulu leader Chief Buthelezi, giving the Inkatha movement several millions of dollars. His conservatism is as ingrained as his father’s; he sees no contradiction in supporting a Labor prime Minister who complies with his own ethos.

  The Packer ‘empire’ covers vast tracts of the Northern Territory and 170 companies around the world. He owns most of the magazines Australians read and the only national commercial television network. Although he is a corporate ‘deal maker’, he has made much of his wealth by currency trading, moving money from country to country and minimising tax; the Bahamas is his favourite tax haven. His most famous coup was in selling the Channel 9 Network to Alan Bond for a billion dollars, then buying it back from Bond for less than half that amount.87

  The original Channel 9 deal meant that Australia had, in Alan Bond, a brand-new media magnate. Bond was already famous as the man who had backed Australia’s successful America’s Cup challenger; and what Murdoch had done for the press, Bond had done for beer. Australians, who drink a lot of beer, used to have a wide choice. Today they drink beer owned mostly by John Elliott (Foster’s) and Alan Bond (XXXX, Toohey’s and Swan). Perhaps only ‘Bondy’ could make a fortune selling Swan lager to teetotal muslims by renaming it Long Nose Goose and taking the alcohol out. ‘There is an old Irish saying,’ said John Hogan of the West Australian Development Corporation, ‘“Stop shaking the rat, it’s dead.” In getting the best from a deal, Alan Bond doesn’t know when the rat is dead.’ A Texan banker, who knew Bond, said, ‘Doing business with Alan Bond is like wrestling with a pig. You both get sprayed with shit and the pig loves it.’88

  Indeed, Bond has almost gone bust and risen again. ‘He has been declared dead more times than Dracula’, said the business journalist Trevor Sykes in 1991, ‘However, I’d say he’s down to the last nails in the coffin this time. It’s amazing he’s survived for so long’.89 Apart from breweries and TV stations, Bond in his heyday owned satellites, hotels, worldwide property interests, oil fields, gold fields, and airships, much of it on borrowed capital. Bond still exudes a devotion to his adopted country; he came from England as a boy and believes the dry warmth of Western Australia saved his asthmatic father’s life. When he told me he would sell ‘anything’ except his Australian nationality, as Murdoch has done, he seemed sincere. He began as a signwriter and is partly responsible for a huge red dingo painted on the side of a building in Fremantle, near Perth. It used to be said he had an ‘edifice complex’. He liked to buy or construct great phalluses and call them after himself, such as the Bond Centre in Hong Kong. His fifty-first floor office in Perth was decorated with the works of Gauguin, Renoir, Toulouse-Lautrec and Van Gogh, whose ‘Irises’ cost him $A58 million, a world record. He is married to Eileen, who has been described as a legend in her own lunchtime and is seen about Perth either in her white Rolls-Royce, with cocktail cabinet, fridge and picnic table, or in her pale blue Mercedes sports with leopard-skin seat covers. ‘Alan’, she said, ‘calls it my pooftah car.’90

  Bondy’s first ‘personal yacht’ was built to his specifications in Japan for $A30 million. It had a helicopter pad and a grand piano and a guest list which included his Mates, Paul Keating and Bob Hawke. During the first four years of the Hawke Government, Bondy’s personal fortune rose from $A25 million to $A400 million.91 When Bondy planned his daughter Suzanne’s wedding reception, he told Eileen she could spend what she liked, and she spent at least half a million dollars. She had a church completely re-fitted and she built a tented city and filled it with guests flown in from around Australia and the world, including Princess Diana’s dressmaker and a dress costing $A170,000. She had the table napkins woven with gold thread and she paid $A10,000 for a pair of Michael Jackson’s diamanté socks, suspended in a plastic tube and authenticated by his own hand. The cake was said to ‘The biggest in the S
outhern Hemisphere’. At dawn the Krug ’79 was still flowing. Bob Hawke sent his best wishes. Suzanne has since filed for divorce.

  In December 1986 the Sydney Morning Herald disclosed that the Western Australian Corporate Affairs Commission was investigating two deals in which Bond had allegedly made more than $A16 million in tax-free profits. A Bond family company was said to have made $A8 million for a cash outlay of just $A100.92 The paper put a list of detailed questions to Bond concerning the allegations, but he refused to answer them; and when the story appeared he issued a writ for defamation and cancelled all Bond Group advertising with the Fairfax group. Two months later the Corporate Affairs Commission announced that it had cleared Bond of the allegations; surprisingly, it published no report. Bond subsequently dropped his libel action against the Sydney Morning Herald, just as the ‘discovery’ stage in the action was reached: that is, when the Herald lawyers would have had access to the records of the Bond family company, Dallhold. The newspaper published no apology and its advertising account with the Bond group was restored.

  In 1989 the Australian Broadcasting Corporation’s Four Corners programme acquired a copy of Dallhold’s accounts, which are normally not published. These showed that in 1988 the Bond family company made a profit of $A48 million, but paid not one cent of tax. Four Corners also revealed that the tax authorities had found that Bond and three of his senior directors had set up a ‘two dollar company’ through which each of them had made a profit of $A900,000 on developing the site for the Bond Building in Perth, without telling shareholders of the Bond public company that owns the building. At the time of writing in 1989, the Bond group was claiming to be $A36 million in tax credit.93