by Bruce Page
The Journal, the New York Times and the Washington Post resemble a massive knapsack into which the chief elements of American journalism have been roughly packed many over decades: practices, histories, ethics and traditions all bundled together.
The Journal’s changes in four years under Murdoch have seemed like ones of alignment rather than basic character. That may have been shifted lately by its being recruited into phone-hacking damage-limitation; but what really matters is that three such iconic institutions seem to be nearing change or end.
If so what’s needed is to keep the listing vessels afloat long enough for highvalue treasures, weapons and so on to be salvaged for use in new voyages. (Is it possible to rebuild the hulls themselves?)
During 2008, when the financial weather turned really foul, important people who knew – or should have known – his record began suggesting that the media industry might after all like to consider Rupert Murdoch as a rescuer. Clearly the launch of his Wall Street Journal project was seen in some such light – but the illumination now seems dimmed. How and why was it turned on?
Faults of American journalism are easy enough to list – and not very different from those in other rich societies, though tabloid mildew may be less widespread. Its virtue has been commitment to a well-educated and well-resourced reporting staff, running deeper than anywhere else in the world. And a problem of course with running costs, as the possibilities of outsourcing the work involved scarcely exist.
Family ownership has been the model solution at the top end of the industry: as operated by the Sulzbergers of the New York Times, the Grahams of the Washington Post, and the Murdochs of the Wall Street Journal (since 2008, and of many other things further back).
The assortment of names suggests that the model varies considerably in operation. But it is there in each case to deal – successfully or otherwise —with calculations of honour. And these arise because no other measuring-rod really helps on how much to pay and how much to risk for a newspaper’s future. (Similar principles apply to television programming and Web-based journalism, but let’s call them all newspapers for now.)
If a newspaper is delivering profit at all, it can always deliver more by investing less in reporting – by diluting the amount of journalism in its product. Many products have something of the same quality, but in less troublesome form: coffee, for instance, often used alongside a newspaper. A manufacturer reducing costly arabica and increasing cheaper robusta can keep the operation under minute control, even, perhaps, trading off cheaper ingredients against the cost of advertising to persuade people that the coffee smells nicer.
Many uncontrollable variables prevent newspaper managers getting very far with a similar process: centrally, the newspaper knows so little about stories it didn’t get that it can only guess at the reasons. This makes it hard to give convincing answers to shareholders who simply feel that lower editorial budgets would allow a welcome addition to their dividends.
And to prevent such simple views being pressed to a conclusion classic family newspapers keep all the voting shares within the family. (Of course the Bancroft shares in the Journal have passed to Newscorp, but Newscorp is controlled by the Murdoch family via similarly restrictive arrangements.)
Why did people buy shares non-voting in the Journal and the Times which would give them no control over their investments? Because newspapers were for generations among the most reliable profit-earners, of American industry, seeming to offer revenue without responsibility, a very comfortable product.
Stolid income-earners as they once appeared to be, the reality is that newspapers seek out danger in a way that hardly any other business does. Hedge funds of course seek risk, but as their name suggests the perils they take on are simply measurable in money, and can be laid off; also, they can be analysed by the rules of classical probability. That financiers are often too greedy to bother doesn’t invalidate such precautions, but they are slight help to editorial planners.
When a newspaper selects and trains reporters it needs some of them to go out and get it into trouble – though no sober executive would put such reality into an e-mail. The business is remote enough from commercial orthodoxy to create a belief that the people in command need to be born to the work.
Early in 2007 when an investor demanded the end of ‘undemocratic’ voting at the New York Times, Donald Graham of the Washington Post requested space in the (still) Bancroft-controlled Journal to support the Sulzbergers in resistance.
… to eliminate the company’s two-tiered stock structure is to run crazy risks with the future of its most important asset, the New York Times.
But what’s crazy depends on circumstances. Here, Mr Graham was clearly worried about shareholders demanding cost reduction without concern for future editorial performance. That could well be crazy, but it’s an issue of feelings: numbers may be a help, but cannot be rigorous.
Many experts would prefer Mr Graham’s feelings to prevail, for the Post has a profitable past and has negotiated recent economic turmoil rather well. And many
– not all the same ones – would prefer it because his mother Katherine Graham risked the Posts existence 40 years ago by confronting the federal government over the crimes of the Committee to Re-Elect the President. Most plain investors would probably say ‘crazy’.
Mrs Graham saw a commercial aspect in her decision: surrender might lose some indispensable staff. But she said she could not have sustained it without obligations of duty and honour passed on by her father Eugene Meyer. (Presently, we’ll come to James Murdoch’s views on media’s obligations to a better society.)
Democracy should be able to get along without incessant exercises of honour; all the same the potential need is ever-present (and not only in journalistic components of the system). But newspapers are generally organised as plain jointstock corporations which don’t lay down a concept of honour for their investors. Corporate lawyers if asked whether the stuff has any value will produce answers very like those Falstaff gave himself (if not so forthright):
Can honour set a leg? … What is honor? A word. What is in that word? Air. A trim reckoning! Therefore I’ll none of it. Given that honour will be necessary sometimes, family has often been thought a better (if inconsistent) vector. Judging by inheritance, Mr Graham might go suitably crazy if required.
At the end of the Wall Street Journal matter sanity came out on top. But there had to be some cannonading for shareholder democracy, and some masterly history-editing with a star role for the head of the Murdoch clan.
Power to stop Newscorp acquiring the Journal always lay with the Bancrofts’ controlling shareholders in the Dow Jones company which owned it 100 per cent. They were not, like the Sulzbergers, Grahams and Murdochs, active in the business, but were rentiers. Their devotion to editorial independence let the Journal produce the world’s most and least objective journalism.
Some of them suspected that under Newscorp the second type would sooner or later prevail, and that caused rejection of Murdoch’s first purchase overture: an unsolicited (much-forecast) bid on 2 May 2007 for Dow Jones at $60 per share, or $5 billion. (In the hindsight of write-offs and trading losses it seems that the current market price, about half as much, would have been the better call.)
Immediately there was hostility to Murdoch: the economist Paul Krugman perhaps spoke for many in saying it would be ‘a dark day for American journalism’ should the deal come off. But if so they belonged to the lay public. Media commentators and financial analysts generally welcomed the Newscorp bid. The recalcitrant Bancrofts drew some damaging fire.
Certainly there was ample ammunition. Journal sales were falling, and the Dow share price was the same as in 1983. Some of the paper’s features had the look which comes from lack of regular maintenance. Dow management were not competing well against financial-data services like Bloomberg and ThomsonReuters. The nineteen-strong family chiefs notoriously couldn’t get together about reform: often they resembled combatants in the L
incoln County War. Their attempts to deal scrupulously with Murdoch’s people seem to have looked like hauteur.
And their right to be decision-makers at all was challenged, in the name of shareholder democracy. The eminent financial journalist Roger Lowenstein made out a case – applied also to the Sulzbergers and Grahams – which was essentially one of hypocrisy. Work by the Journal, Times and Post supported democracy throughout the world – but at home in America their controllers exercised unequal powers.
Arguments for shareholder democracy can be complex: strong when the problem is lazy managers avoiding accountability, weaker when fully enfranchised shareholders lust to cut investment and write themselves cheques. It doesn’t connect automatically to social justice or to electoral democracy. Shareholder democracy is a fine thing, but it was by no means on offer from the Murdoch family. (Rupert was known to think plain electoral democracy fairly dispensable in foreign countries, not a position favoured by either editorial persona in the Journal.)
But to a US media industry bloodied by recession and mutant technology Newscorp – equity structure regardless – offered big-spender charisma on a scene looking increasingly dim. There were stories about the origins of Fox, the origins of Sky, the ownership of some British newspapers acquired by political favouritism, and of certain others playing rough games – not unlike the familiar New York Post. The history had been recited, and some people suspected dark strands at the Empire’s core. But far more recited was the legend of Murdoch as a daring warrior slaying dragons around the world. It had long gone through the mutation in The Man Who Shot Liberty Valance – when Ransom Stoddard learns that his actual story has disappeared. ‘When the legend becomes fact,’ Maxwell Scott tells him, ‘print the legend.’
Too bad, thought Lowenstein, to snub as ‘tasteless’ and ‘arriviste’ a possible rescuer ‘who happens to be the most successful media titan of the last 50 years’.
It’s possible that Murdoch, for all the crassness he has displayed in downmarket papers, might be that owner.
. At least, his ideas for strengthening Dow Jones are intriguing. He wants to invest more resources in news, in particular to strengthen the Journal’s brand in Europe and Asia, where the paper had been retrenching … In short, he seems willing to take on an expensive and long-term project to resuscitate a great American enterprise.
This view drew applause, which drowned out much context. Given Newscorp’s global character the resuscitating would have much to do with British-generated profits – drawn from a massive television monopoly and some politically oppressive, scabrously irresponsible journalism. And the product of resuscitation would probably bear no close resemblance to the great American enterprise which the British and others had admired for years beforehand.
As the Bancrofts hesitated Murdoch complained bitterly about being subject to a hate campaign. But those few writers who tried to point to dangers did not feel they got much traction.* As always, it was hard to convey the special position of tabloid culture within the Archipelago.
High-quality journalists who don’t do it themselves use a curious verbal technique to discuss tabloids. Some process of declension comes into play – maybe it’s not conscious – which brings along a mild word rather than any of its tougher relatives. Is ‘crassness’ appropriate’ as employed above? Certainly the Sun is routinely crass, as in ‘lacking sensitivity, refinement, or intelligence’ – but ‘dishonest’, ‘manipulative’ and ‘incompetent’ look suitable as well. And apply also to the up-market Times.(Anyone who thinks such terms unrepresentative might like to make their own depressing trawl in the newspaper section of the British Library.)
Also by declension from ‘insolent’, tabloids are often called ‘irreverent’, and some sometimes are. But the Blair-inspired attacks on Chirac are surely too pompous to to be ‘irreverent’? The style used is a routine one, as likely to be applied in bullying an unfaithful footballer as reproving an international statesman said to risk the peace of the world. ‘Blustering’ and ‘turgid’ seem to fit much better.
The effect of milder synonyms is to improve prospects for what lawyers call the ‘boys will be boys’ defence. But it’s a poor case – and a particularly poor one for the offences of the defunct News of the World, where ‘cruel’ is the only proper word.
Least of all should it be thought that any supposed crassness might make tabloid culture peripheral under Newscorp rule. Murdoch has lectured all his ‘upmarket’ or ‘quality’ editors on the editorial superiority of the tabloids to their own papers (surely leading those with real technical savvy into heavy use of the ‘Up to a point, Lord Copper’ trope).
He has of course no direct experience manipulating the subjects of interview/exposure, and seems to think it is an impersonal process (which naturally it is not). One woman who had been the subject of a specially traumatic gossip-column exposé, encountering Murdoch in a random social context, asked if he felt any responsibility for the damage done to people like herself. He testily answered none: that the subjects of tabloid inquisition destroyed themselves by their bad behaviour.
At other times he has seemed to think that the raw materials of the tabloid machine present themselves for exposure – when actually much hard work goes into selection and manipulation. Nobody with direct experience would forget that (the basic methods are similar in any reporting). So perhaps he was partially accurate in telling the Commons committee that he could not help them much: Newscorp response to fading sales seems to have been indiscriminate demand for ‘exclusives, not excuses’.
He notoriously dislikes detailed reporting, but has an endless appetite for gossip. The Vanity Fair columnist Michael Wolff wrote a recent biography of Murdoch based on 50 hours of interviews – a truly remarkable quantity of CEO time – and says gossip is the key to access. He tries always to take gossip to Murdoch, and if supplies run short he makes some up, taking care to brief other familiars so that careless talk does not generate disconcerting problems.
Further evidence about Murdoch’s relationship to himself and his business emerges from the Journal negotiations. As part of the takeover proposition, Murdoch offered an independent board with power to safeguard the character of the paper and the tenure of its executives. The details are unimportant, as Murdoch had no intention of taking the system seriously, and did not do so.
The Bancroft side seems briefly to have thought it serious, and in June 2007 sent to Murdoch a rather tough document revealed in Sarah Ellison’s brilliant account War at the Wall Street Journal. It suggested that the Bancrofts would maintain a connection with the company through two board seats that would stay under Bancroft family control forever … [and] the journal’s publisher retain authority including budgets – over the news and editorial pages and be responsible for ensuring ‘that business operations do not interfere with journalistic and editorial integrity and independence’.
Nobody (and certainly not Murdoch) would pay $5 billion to acquire a newspaper under such conditions and he decided to break off negotiations, preparing a remarkable tirade – for publication to the Bancrofts and the world – which his team called ‘the Fuck You letter’.
It was never sent, because the negotiators used its menacing existence to make the Bancrofts ‘cave’ (Murdoch’s word) on editorial independence. But Ms Ellison obtained a copy for her book. It was composed by a group gathered around The Boss with one member hitting the keys, so there are some linguistic curiosities. It was certainly the mind of Murdoch, opening in bitter complaint about the immense (actually minimal) campaign against his offer of rescue. Comments are italicised.
For the past seven weeks, my company and my 57,000 professional colleagues have been subjected to a drumbeat of stories that cast us more as villains than as creators of one of the world’s most innovative media companies. We’ve been caricatured as meddlers, misanthropes and sops.
Meddlers, proven many times. Misanthropes? No-one said that. Or ‘sops’. If believed, at various times we’ve tried ei
ther to topple benevolent governments …
Yes. Australia 1975.
… or prop up despotic tyrants …
Yes. Notoriously, Chinese ones (not needing much help). Little sign of distaste for despotic tyrants: good friends with Silvio Berlusconi. .… no editor was free from my intervention, no newsroom impervious to my politics …
Certainly no editor of any significance has been free from intervention. And wasn’t it The Sun Wot Won It?
Without stringent controls put on my ability to interact with an asset I am generously offering to acquire, the credibility and integrity of those assets – their most valuable currency I should add – would be lost forever.
Doubtful that the Sun, News of the World and New York Post the had anything like credibility and integrity And levels in The Times and Sunday Times are lower than in their pre-Newscorp days.
We patiently accepted this vitriolic abuse as part of the price of being an agent of change.
And it might even have been amusing were it not so insulting and wrong.
What’s been lost in this noise is any sense that over the past fifty years, no other media company has done more to give newspaper readers, television viewers, moviegoers, book readers and internet users greater diversity of information …
Diversity? Well, in the sense that some papers have abruptly switched politics (serial diversity, perhaps). Some traces on the op-ed pages of The Times, Sunday Times and Australian. Minimal range compared with the Washington Post, Guardian, New York Times, Independent, even the Telegraph. Sky News provides properly diverse information, but would you stop it turning into Fox should the British regulator’s hand be removed?.
…than News Corp. No media company has salvaged more failing newspapers and nurtured them to health, than News Corp …
Sadly, most people’s newspapers are in poor health, including at Newscorp. … Armed with a steadfast confidence that we are not only a proper – but uniquely suited – suitor of Dow Jones, we proposed as a condition of our ownership the establishment of an editorial committee of the board to ensure that the business would continue to represent the highest standards of integrity and trust. We have some history in this regard. As a condition of our acquisition of The Times of London and The Sunday Times, we established a five member editorial board to ensure their editorial independence and integrity: That board has safeguarded these world-renowned brands throughout our 27 years of ownership. It was this structure that we offered to establish in our sole face-to-face meeting with some senior members of the Bancroft family nearly a month ago.