The Murdoch Archipelago

by Bruce Page

  He was asked also about London Weekend: hadn’t he dictated programming, and dismissed executives? It had been just a two- or three-week action, rescuing LWT from bankruptcy. As programming it produced only Panorama and Upstairs, Downstairs. (These were famous shows: the first was in fact a BBC flagship; the second was commissioned by LWT after his time.) There was no bankruptcy or other trouble at Channel 10 and so there would be no question of ‘marching in and firing everybody’. (Notoriously Sir Kenneth Humphries and most of his team were dumped once Murdoch’s men were in place.)

  Mr J. W. Shand QC, leading counsel for News, suggested that the company’s CEO should expound his ‘citizen status’ – not his residential status, the actual issue before the Tribunal. ‘I regard myself as an Australian,’ said Murdoch.

  … I carry an Australian passport. My children are Australian. I pay my taxes in Australia. I have a home in Australia. It has all my personal belongings in it. It is lived in by no one but myself … I certainly intend to come back to this country and certainly when my children are old enough to leave home I trust I will in fact put them through Australian universities. I choose to have them with me. I think that is very important, more important than proving some point at the moment by separating and breaking up the family.

  Senator Evans, cross-examining, could not learn much about how much time Murdoch spent in Australia: a ‘fair amount’ in 1977; most of 1972; not much of 1970–1. Evans quoted what Adrian Deamer had written after leaving the Australian:

  [Murdoch] is an absentee landlord visiting Australia for short periods three or four times a year and making snap decisions while he is here, often based on incorrect or incomplete or misleading data.

  … I ask you to comment on its accuracy? [Murdoch answered,] Mr Deamer is a very good journalist with a very good phrase … I would say it is most inaccurate. I have never lost my touch, my love for this country or my involvement. I have been totally involved in this country and everything that goes on in this country whether or not I am physically on certain days here.

  However, said Evans, Mr Murdoch held a green card issued by the US Immigration Service – and had done since 1974. Did not that mean the US thought him a permanent resident? It was just a necessity of working in America for an Australian company, said Murdoch, enabling him to avoid innumerable visa applications.

  You do not dispute my characterisation, admittedly in general terms, of the procedure and of the status of this particular card?

  It gives you residence.

  Permanent status?

  I did not say that. It does in fact give me the right after a number of years to American citizenship, which I have not taken up, but I chose to remain Australian.

  Can I just pursue this point, Mr Murdoch? You do recall having applied for an immigration visa in the United States?

  I applied for a green card.

  You accept my statement that in order to get a green card you must have first got an immigrant visa: you do not get them any other way?

  Mr Shand found the line of interrogation objectionable: it was asserting facts about immigrant status, rather than questioning. ‘I will proceed to the next point,’ said Evans.

  Mr Murdoch, you have said at a number of places throughout these proceedings you are an Australian by instinct and inclination. It is the case, is it not, that your possession of a green card does entitle you to citizenship status after five years of such possession of that card; is that correct?

  I have been told that.

  So on the basis you have put to us quite recently, a few moments ago, you are in fact almost now entitled to apply for citizenship should that be your desire?

  Yes. But I think I have stated many times it is not my desire.

  It is not your present desire. I was thinking of a desire which [it] is possible you could formulate in the near future?

  I cannot imagine it.

  News Ltd’s argument, said Evans, was that the meaning of ‘resident’ was largely determined ‘by considerations of Australian-ness and emotional and intellectual attachment …’ It was this, he said, rather than the challenge by the ALP, which brought into issue Rupert Murdoch’s basic feelings about his country.

  And these, Shand now said, were literally inalienable. Shand’s final submission suggested that to reject the share-transfer would amount to denying Murdoch’s nationality. Section 92D had no purpose except excluding aliens from control of Australian television. And ‘is it even vaguely rational to suggest that Mr Murdoch is an alien, an outsider, a non-resident? Put in that way, which we suggest is the common sense and realistic way, the question only permits one answer: he is an Australian by derivation, by nationality, by career, by citizenship, by conduct …’ The attachment, in short, was so vibrant that he resided metaphysically whatever the physical facts. (Surely Shand must have been tempted by Burns – ‘My heart is not here / My heart’s in the Highlands, a-chasing the deer’ – but he held off.)

  In August 1979 the Tribunal gave approval, saying, ‘On the basis of advice received and the evidence before it, the Tribunal is of the opinion that Mr Murdoch cannot be regarded as being in contravention of Section 92D.’ A lawyer cannot see ‘mental reservations’ in a client. But if Shand had stated the reality – that Murdoch was Australian, but open to offers – it would have been hard for the Tribunal to find as it did and allow further expansion of News into Australian television.

  Media sophisticates were not surprised when the deals of 1987 – his descent on the Herald group – showed that Murdoch’s desire was not to free Australia from monopoly, it was to impose one. But even they were startled in 1985 when he exposed the frailty of his patriotic bond. Why should it matter? To some people on the left – where Murdoch has intermittent appeal – patriotism anyway invites deception. And the transcripts suggest that in applying a rhetorical kiss-of-life to the corporate case he possibly fooled himself. But this kind of illusionism has serious consequences for news media, and explains something of Newscorp’s international behaviour.

  Patriotism is the presentable member in a turbulent family of synonyms. Nationalism has its good points, but it is often a chaotic nuisance, and once corrupted to jingoism or chauvinism is noxious. If Rupert Murdoch couldn’t see much wrong with ‘GOTCHA’ most people could. Racism, the extreme case, now has few explicit defenders.

  George Orwell proposed to consider traditional emotions in the light of immunology, arguing ‘that patriotism is an inoculation against nationalism, that monarchy is a guard against dictatorship, and that organised religion is a guard against superstition’. Pure rationalists may be shocked, but Orwell, who thought collective allegiances indispensable, also thought they unavoidably contained darkness, the national manifestations especially (leaving monarchy and religion aside). Rebecca West, turning Dr Johnson rhetorically on his head, said there is a scoundrel in all of us, and that a patriotic vacuum would contain nothing likely to moderate collective passions – generated in what the biologist Edward 0. Wilson called the ‘hardwired part of our Paleolithic heritage’: ‘The human brain evidently evolved to commit itself emotionally only to a small piece of geography … For hundreds of millennia, those who worked for short-term gain within a small circle of relatives and friends lived longer and left more offspring’ even when the net impact shattered their chiefdoms and empires.

  In the Johnson original, patriotism is a scoundrel’s refuge because he will mine its irrational components for gain whenever he sees no better way forward (reckless, in West’s version, or ignorant of his own state). And patriotically coloured sentiment will certainly sell newspapers and television – Fox News has been following the method with particular enthusiasm since 9/11. Though the figures show it isn’t invincibly effective, it is undoubtedly an easy journalistic path.

  Classically, personal gain is the point where patriotism parts from its synonyms: patriots are typically at odds with the object of their loyalty warning, upbraiding, sometimes rebelling. Nationalism, running mo
re to flattery, can pursue advantage with less handicap. In either case the engagement is irrational, but patriotism takes it to be made with a society subject at least partly to reason. It is not-for-profit, non-negotiable and non-transferable. But crucially it is additive, as in Burke’s classic conservative version of the development of loyalties: ‘To be attached to the subdivision, to love the little platoon we belong to in society, is the first principle (the germ as it were) of public affections. It is the first link in the series by which we proceed toward a love to our country and to mankind.’

  A dangerous world needs extension of that series, allowing group identities to reinforce – not destroy – each other, and individuals to acquire new allegiances without cancelling their initial ones (become naturalised, that is, though for refugees the original nation may be lost). ‘Every civilised man,’ said the patriot Kipling, ‘has at least two home countries, one of which is always France’ – clearly seeing no reason to stop at two. And increasingly we don’t: notably in Europe, that old arena of hatreds.

  Rupert Murdoch apparently spoke of this when he said that becoming American didn’t end his being Australian. But, if he understood it, why is the Newscorp house-style rancid chauvinism? To be sure, Jimmy Breslin of the Daily News has never admired the boss of Newscorp, but he was not just fantasising when, writing of Murdoch’s advent as his fellow citizen, he said, ‘We are a mixed population and he tried so blatantly to use race to sell [the New York Post] that he became known as “Tar baby Murdoch”.’

  This isn’t limited to tabloid print. The Times may segue from a heavy joke about German cars as ‘adaptable off-road vehicles crashing through the Ardennes’ into a fantasy about new plans to put Deutschland über Alles. A Sunday Times man defends a still barmier farrago about Germany by asserting (alongside a picture of himself in a steel helmet) that his victims probably want to ‘send panzers over the border and shoot the editor’. The News Corporation assumption is that staunch patriots want this stuff: that the Chinese like to think the US deliberately attacked their embassy in Belgrade, or Americans that US bombs don’t kill Afghans. The relevant Murdoch networks oblige, and the Sun continues feeding a supposed British appetite for predatory refugees. (Nicolas Chauvin, the original, at least confined his flattery to Napoleon.)

  A diagnosis on Orwell’s lines can explain this through Murdoch hoking up and then trashing his Australian national attachment. He could do so because it had never been felt deeply enough to inoculate him against its various corrupt forms. The bravura of the performance (marred only by a touch of paranoia) derived not from depth of attachment but from its lightness – the fluid qualities of an authoritarian personality showing through again. A patriot might have produced the hokum at the Tribunal (though most would have been embarrassed), but that would have made the later Manhattan courthouse ceremony all the more impossible. Someone who hasn’t seriously felt an allegiance can of course readily acquire others. But it will be far more difficult to understand why those who have experienced the emotion feel disgust at its exploitation. Furthermore, those to whom patriotism is real never represent it as a dispensable handicap (‘Who else chooses to be battered and bruised … in being an Australian when it would be a lot easier not to be one?’).

  Generally people find that their national allegiance – whether or not multiple, like Kipling’s – is a stable attribute of their personality, even if they dislike ceremonious patriotism. Both an eighteenth-century statesman and a contemporary biologist tell us that the roots of this emotion are primitive and not to be played with. Burke added to his message a statement that the public systems which assist the development of real allegiance – and today he would doubtless include newspapers, television, schools and churches and probably everything down to sports clubs – constitute ‘a trust in the hands of all those who compose it; and as none but bad men would justify it in abuse, none but traitors would barter it away for their own personal advantage’. The next part of the story is about Murdoch bartering his own nationality away, which he did in a complicated fashion. ‘Traitor’ is of course a very hard word. But the Sun chose to insert it as emotional spice into a passage of political flattery.

  Construction of the Fox network seems to most witnesses to have been Rupert Murdoch’s most striking operation. A widespread view, as it got under way, was that it could never work because of the number of regulatory barriers which impeded it and which would have to be shattered or circumvented. He was already rated as a world-class exponent in this branch of political science, but Fox established him as the supreme virtuoso.

  After a remarkably profitable 1970s, placing Star Wars within contemporary mythology, the long and adventurous career of the Twentieth Century-Fox movie studio was by 1985 in a tangle. It had been taken over during 1981 by two oil-andgas entrepreneurs, Marvin Davis and Marc Rich. Rich made for Switzerland in 1982, slightly ahead of the Justice Department (remaining there in well-padded exile until Bill Clinton notoriously pardoned him as a final Presidential act). Davis was not much aided in running the studio by the fact that his absconding partner’s half-share was frozen by government application to the courts. In particular it did not help with finding new finance for the debt-sodden enterprise.

  Davis had by 1984 got back more than he put in, but had decided that Fox’s long-term problems were somewhat beyond him. He invited Barry Diller, who had established a brilliant creative reputation at Paramount, to join him, but they found they could not agree either about what movies to make or about how to raise cash for making them. Diller aroused the interest of Michael Milken, the junk-bond financier, whose career was just then close to its apogee (that is, the point in orbit most distant from earth). Attempts were made to assemble a proposition, but for assorted reasons it collapsed.

  One shaft of light appeared at the start of 1985, when the Justice Department decided that Davis could buy Rich’s frozen half-share. On 21 March 1985 it was announced that News Corporation would take over the ex-Rich holding from Davis. Rupert Murdoch was one of a number of people who believed that Hollywood studios should become prize assets for television network operators, and that made 50 per cent of Fox worth $250 million.

  In the same week Milken was holding a week-long Los Angeles conference for borrowers and lenders using his ‘high-yield’ bond business at Drexel Burnham Lambert. It is still remembered as the ‘Predator’s Ball’, the representative episode in what ranked, until the dotcom bubble, as the most thrilling modern instance of financial unreason. But of course the criminal charges later laid against Milken, his friend Ivan Boesky and various subordinates were unimagined in 1985. It was a happy throng discussing the gushers of speculative cash being tapped to fuel immense deals in news and entertainment media.

  Barry Diller gave a cocktail party at the end of the conference at which the chief guest was John W. Kluge, whose Metromedia Company owned seven television stations in prime locations around America. Michael Milken knew that Kluge wanted to sell some parts of Metromedia, perhaps including the television stations. With Rupert Murdoch and Marvin Davis present, Diller asked Kluge to lay out the position. Kluge said that the licences in Los Angeles, Chicago, DallasFort Worth, Houston, and Washington DC were certainly available. New York and Boston could be, but discussions were under way with the Hearst Corporation. As it happened Kluge and Murdoch were well acquainted. Kluge had long since advised to Murdoch to get into American television, and now he was serving up just that opportunity on a grand scale.

  Next day there was a negotiation meeting, which produced an outline proposition under which Fox would take over the Metromedia stations – though the basic Newscorp–Fox deal, including a very necessary injection of cash for the studio, still had to be put to bed. Metromedia’s price would be $1.05 billion for the five stations, or $2 billion with New York and Boston included. Murdoch said he only wanted the two-billion deal, which would give access to a quarter of America’s television audience.

  Diller thought the price (equivalent t
o $3.2 billion today) was crazy, but Murdoch told him not to worry about it. The point was to work up momentum before some competitor got on to Kluge. The idea of mating a television network with a movie studio was great, but not unique – Ted Turner was already working on his own combination. Diller saw the force in that, but, price apart, he could not see a path through the legal canebrake.

  First there were the cross-ownership rules, preventing a newspaper owner from controlling a television station in the same location. Newscorp now owned not just the New York Post, but also the Boston Herald and the Chicago Sun-Times, all in prime sections of the Metromedia territory. Did Murdoch really want to give them up? The way to deal with cross-ownership, Murdoch said, would be to get a temporary waiver from the Federal Communications Commission (FCC) and find a permanent solution later.

  A more serious regulatory hurdle concerned the entire philosophy of the deal, and the basic design of American television. With the aim of inhibiting concentrations of power, it had been given a highly sub-divided structure, containing hundreds of stations, often locally owned. Most of them could not afford to make their own drama, soaps and news, so they had to buy supplies in. To maintain sub-division, limits were set on the number of stations which any one company could control. The networks could increase their audiences by making deals with affiliated stations, which bought some of their programming and thus enabled the networks to increase advertising revenues. But they were barred from having a financial interest in material produced for distribution to affiliates. The whole point of putting Fox and the Metromedia stations together was to exploit such a financial interest – indeed, to facilitate the concentration of power. But there was a way through, very characteristic of Murdoch.