Thursday, April 14, 2011

Fisher Capital Management Corporate News: Why shouldn’t Murdoch get what he wants? Others do

Peter Wilby
The Guardian, Tuesday 12 April 2011
Article history
The phone-hacking affair is just one example of how politicians have lost the will and moral compass to control corporate interests

Imagine reports that, during the 2010 election, members of Labour’s campaign team hired private detectives to hack the mobile phones of Tory leaders and aides, accessing in particular voicemail messages left by the editors of the Sun and News of the World. Imagine that a sleuth was convicted, along with the minor apparatchik at Labour headquarters who hired him.
Imagine that Labour leaders insisted that the apparatchik was a rogue operator, that nobody else in the party could possibly be involved, and that Gordon Brown, along with his henchmen Eds Miliband and Balls, were entirely in ignorance of what their underlings had been up to.We can be certain the press would not let the matter rest there. Any shortcomings in the police investigation would be closely scrutinised.
Rupert Murdoch’s papers, including the Sun and News of the World, would show no mercy. They might be willing to draw the line at Brown – almost a forgotten man and one for whom Rupert Murdoch always had a soft spot – but they would not rest until Miliband and Balls were hounded out of the Labour leadership. They would demand more criminal prosecutions and handsome compensation for the violated editors.The rest of the press, too, would be keen to pursue the story.
Public life, we would be told, had been polluted, and those responsible should be stripped of office. At some stage the affair would acquire a title: Ballsgate, Miligate or Edgate, perhaps.So why, when it comes to phone-hacking at Murdoch’s News of the World, is everyone so quiet? Why has it been left almost entirely to this paper, with help from a few other media organisations such as the New York Times, to reveal the extent of the criminality? Why has the -gate suffix been given a rare holiday? This is not a grey area.
Phone-hacking is always illegal except, in certain instances, for the security services. There is no public interest defence. That was why Clive Goodman, the News of the World royal reporter, and Glenn Mulcaire, a private investigator, went to jail more than four years ago for intercepting the communications of aides to Princes William and Harry.Yet politicians, police and press have been extraordinarily insouciant. The police do not appear to have challenged the assurance of News International, News of the World’s parent company, that no other reporters were involved; though they knew Mulcaire possessed dozens of mobile phone PIN codes, they also failed to inform the owners of those phones in a timely manner that the security of their messages could be at risk. That is like failing to warn householders that burglars hold copies of their door keys.
Several politicians, including John Prescott, suspected more than a year ago that their phones had probably been hacked.Rebekah Brooks, currently the chief executive of News International, declined to give oral evidence to a 2009 MPs’ select committee hearing into the News of the World allegations, although she did submit written evidence.And the government still appears willing to wave through Murdoch’s attempt to take full control of BSkyB without any consideration of whether he and his leading executives have sufficient corporate controls to be entrusted with a virtual monopoly of non-terrestrial television. As for the press, the Mail, Express, Mirror and Telegraph newspapers (as well as, predictably, Murdoch’s papers) have almost entirely ignored the story
.One can offer several possible explanations: the symbiotic relationship between tabloid papers and senior police officers; newspapers’ traditional fear of starting “dog-eat-dog” wars and of provoking revelations of occasions when they too broke the law; the politicians’ fear that Murdoch will turn his papers against them and their parties.Another fear is that Murdoch’s journalists will use their formidable resources against anybody who displeases them.
Chris Bryant, one of the few MPs who dared to highlight what he calls “a many-layered scandal”, told the Commons last month that “a senior figure allied to Rupert Murdoch” had sent him a warning “that it would not be forgotten”.But there is something here that is deeper and more worrying for our public life than the politicians’ traditional fear of upsetting a big proprietor – a fear which, you may reasonably think, ought to have diminished now that fewer people read newspapers and the proprietor concerned has put most of his behind an internet paywall.This affair is just one example of how politicians have lost the authority, the will and the moral compass to control corporate interests. They consider only the most modest proposals to bring banks to heel. They make it laughably easy for multinationals to avoid tax. They stand by as supermarkets drive out small retailers. They introduce “reforms” toeducation and health that allow corporations to take over the provision, if not the ownership, of our biggest public services.
The corporate sector gets what it wants. Why shouldn’t Murdoch? It’s business as usual.The Labour party was once the political arm of the organised working-class. All three main parties are now the political arm of the organised corporate class. This is not a peculiarly British phenomenon. Almost every advanced democracy, and particularly the US, struggles to control the corporate sector. It is not just that politicians depend on its donations to finance election campaigns but also that they lack the staying power to withstand corporate pressure.
Most anti-corporate legislation fails to strike a chord with the electorate; the banks are a partial exception, but the arguments over how to deal with them are too esoteric to engage public attention for long. Voters may vaguely agree that the News of the World’s phone-hacking was wrong but, if they were truly outraged, they wouldn’t buy the paper. They may sympathise with the aggrieved celebrity victims but it is not a subject that affects them personally.
Designing and enforcing rules to restrain any conglomerate is a slow and laborious process. Politicians, like newspapers, prefer to champion causes they can expect to win. When they look at News International and its alleged misdemeanours, they see an arduous battle against overwhelming odds. With no medals for the winners, they have no appetite for it. Do not be surprised if, even now, Murdoch manages to wriggle free of this scandal with his influence and reputation intact.

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