Murdoch’s power: how it works and how it debases Australia

When Kevin Rudd launched his parliamentary petition for a royal commission into the power of News Corporation in Australia, Opposition Leader Anthony Albanese declined to provide Labor’s support.

“It’s a bit like complaining about the referee in a footy game,” he said. “It might make you feel OK [but] it doesn’t change the outcome or change the result.”

Albanese’s uncannily accurate description is a rare example of a senior politician speaking truthfully, if inadvertently, in public about the media company that is the puppet master of our politics and governments.

Not only is News Corp Australia’s referee, that’s exactly how it sees its role. And, as Albanese confirmed, how powerful people like him see its dominant position in our democracy.

In 2015, as both a participant and observer, I wrote about how media power works in Australia. Five years on, despite all the upheavals in the journalism industry, almost nothing has changed.

The rules of engagement

The point about real power is that it does its own work, particularly among those who deal in power. Nobody in the power elite needs to be told … everybody understands; the fact of power is enough. If there’s a bull in the field, everybody steps carefully. The fear gives him access; the access gives him influence. Real power is passive.

Nick Davies, Hack Attack

Shayne Neumann learnt about real power the hard way. In August 2014, as Labor’s little-known federal opposition spokesman for Indigenous affairs, Neumann was one of many politicians who rolled up to the annual Indigenous Garma Festival in Arnhem Land. While on a panel discussing the Recognise movement for constitutional acknowledgment of Aboriginal people, Neumann decided to criticise coverage of the issue by News Corporation newspapers: “There’s too much power in the media controlled by one man who lives overseas.”

That was an interesting thing to say in a public forum, I said to him afterwards. It needed to be said, he responded. When I asked whether he was concerned about the political consequences of criticising News Corp in public, he seemed genuinely surprised by the question.

It took less than 24 hours for Neumann to realise the consequences. On its front page and in its leader column the next morning, The Australian turned its guns on him.

“Aboriginal leaders have described as disgraceful, divisive and ignorant an attack by Labor’s Indigenous affairs spokesman, Shayne Neumann, about coverage of reconciliation in The Australian and other newspapers owned by Rupert Murdoch,” the page one news story began. In an editorial, it advised opposition leader Bill Shorten to counsel Neumann over his anti-News Corp comments.

Neumann is a bit player in the broader choreography of media power in Australia. But his front-page dressing-down in the house organ of Australia’s dominant media empire sent a salutary message — to him and to other senior politicians who ignore the ground rules of political and media life in Australia at their peril.

Don’t overstep the mark. Pay obeisance to the permanent source of power. Apply appropriate filters to your decisions and public utterances. And it doesn’t hurt to be obsequious.

For any politician or public figure needing formal talking points on how to approach this subject, they were provided by no less than the prime minister just a few weeks before Neumann committed his Garma faux pas.

“No newspaper has more profoundly or more consistently shaped the intellectual life of our country,” cooed Tony Abbott at The Australian’s 50th birthday dinner. “No think tank, no institution, no university has so consistently and so successfully captured and refined the way we think about ourselves.”

And on its owner: “Rupert Murdoch may have become an American by necessity, but he’s always been an Australian by conviction. The Australian has borne his ideals, but not his fingerprints; it has been his gift to our nation.”

The measurement of power in a society is an amorphous and necessarily subjective concept. “News Corp is easily the most powerful political force in Australia — bigger than the major parties or the combined weight of the unions,” writes 30-year Labor strategist Bruce Hawker in The Rudd Rebellion, his recent book about the 2013 election.

I heard the same view expounded by a former Victorian cabinet minister at a small dinner in Melbourne in 2012 given for Justice Brian Leveson, whose judicial inquiry into the News Corp phone-hacking scandal uncovered more detail about abuse of media power in 17 months than Britain had encountered in 170 years. “The Herald Sun is by far the most powerful institution in this state,” the minister told the judge. “Far more powerful than the government.”

When I once asked a senior cabinet minister in a recent federal government to explain how media power in Australia operates in the world of politics, this is how he answered: “A cabinet colleague of mine recently told me he’d had a call from [the head of a large media company] who said that one of his editors had put together all this personal information on him, but he was calling the minister just to let him know that he had instructed the editor under no circumstances was the personal information ever to be published.”

That’s how freedom of the press works in Australia, the politician explained, without a hint of joy.

The shadow of power

People are terrified for their own reputations. They want the press on their side.

Sienna Miller, actor

Media power lurks like a prowler in the dark. You can sense its danger, feel its presence, identify its victims. But rarely if ever does it show its full face in the light.

That’s because media power is a weapon built primarily on fear. Lord Beaverbrook, the legendary British press baron, once described it as “a flaming sword which will cut through any political armour … When skilfully employed at the psychological moment no politician of any party can resist it.”

When the News Corp phone-hacking/police bribery scandal erupted four years ago, actor Sienna Miller discovered her voicemails had been illegally intercepted by News of the World. Unlike other victims at the time, she decided to risk her career by taking legal action against News Corp, which also owns one of Hollywood’s biggest movie studios.

“Everyone was scared of Rupert Murdoch, even governments,” she told The Independent several years later. “People are terrified for their own reputations. They want the press on their side.”

She made the decision to sue News International because “the tabloid media culture in this country had got to a point where it was completely immoral. There was no consideration for you as a human being. You were successful, you were making money, therefore you deserved it and it was a very medieval way of behaving. I realised I couldn’t continue living in this country and do my job, which I loved.”

Miller got an apology and A$160,000 for her trouble.

Media power works most effectively when it is surreptitious and permanent. Single-purpose editorial campaigns against politicians or governments have limited impact, especially in an era of dying newspapers. Their main value to a media organisation is not the immediate outcome, but in cultivating a permanent shadow of fear that influences relevant government decision-making at pivotal moments.

Lance Price, an adviser to former British prime minister Tony Blair, said that during the Blair era Rupert Murdoch “seemed like the 24th member of the cabinet … His voice was rarely heard (but, then, the same could have been said of many of the other 23), but his presence was always felt. No big decision could ever be made inside No. 10 without taking account of the likely reaction of three men — Gordon Brown, John Prescott and Rupert Murdoch. On all the really big decisions, anybody else could safely be ignored.”

When Sydney’s The Daily Telegraph declared a jihad against Rudd in 2013, or The Australian campaigned for the downfall of Whitlam in 1975, they were not only attempting to bring down a government, they were adding large stockpiles of ammunition to their already loaded guns. What really matters in exercising media power is the perception that if the gun is loaded, its targets should fear the consequences and act pre-emptively to prevent a bad outcome.

No British politician could have ignored the treatment doled out to the former Labour minister Clare Short in the mid-1980s after she criticised The Sun’s use of topless women to sell the paper. She found herself denounced to millions as “killjoy Clare”, “fat”, “jealous”, “ugly”, “Short on looks”, “Short on brains”. At various points, writes Nick Davies in Hack Attack:

… The paper offered readers free car stickers (“Stop Crazy Clare”); sent half-naked women to her home; and ran a beauty contest to ask their readers whether they would prefer to see her face or the back of a bus. Separately, the News of the World ran two bogus stories suggesting she was involved with pornography; tried to buy old photographs of her as a 20-year-old in a nightdress; and published a smear story that attempted to link her to a West Indian gangster.

If this reads like just another rollicking tabloid satire targeted at an unfortunate politician, think about its impact on nearly all politicians. “That could be me” were surely the first words in the minds of British politicians as they digested the grotesque sideshow.

The Australian, The Daily Telegraph and individual media “megaphones” like Alan Jones and Andrew Bolt are masterful practitioners of the art of systemic denigration. Their “enemies lists” include politicians, rival journalists and a retinue of other public figures.

Coverage of these targets is a blend of legitimate reporting, innuendo and full-frontal Clare Short-style personal attacks and humiliations. Speak to anyone who has been subjected to this treatment and you will understand how the mere shadow of fear is so effective in restraining and modifying behaviour.

As the American humorist Art Buchwald only half-joked when he toasted The Washington Post’s famous owner Katharine Graham at her 70th birthday almost 30 years ago: “There’s one word that brings us all together here tonight, and that word is ‘fear’.”

The myth of Murdoch’s power

With a conspiracy-heavy culture there is no greater cult beloved of media polemicists and populist politicians than the spectre of Rupert Murdoch on the phone rapping out orders to hapless editors about his targets for the next day’s front page … this notion persists in a form of myth as reality.

Paul Kelly, editor-at-large, The Australian

Paul Kelly is right to dismiss the haunting spectre of his proprietor issuing “daily orders” to his editors. It doesn’t happen for the simple and obvious reason that it doesn’t need to.

Andrew Neil, a former editor of Murdoch’s The Sunday Times in London, cleared up the mystery of the missing instructions succinctly to a UK Parliament select committee on communications in 2008 in two parts:

Part 1: “Throughout the 11 years that I was editor of The Sunday Times, I never got an instruction to take a particular line, I never got an instruction to put something on the front page, and I do not think I even got an instruction not to do something.”

Part 2: “I was never left in any doubt what he wanted … On every major issue of the time and every major political personality or business personality, I knew what he thought and you knew, as an editor, that you did not have a freehold, you had a leasehold, as editor, and that leasehold depended on accommodating his views in most cases, not all cases, and there were sometimes quite serious disagreements we had and I still survived as editor.”

The late Harold Evans, a former editor of Murdoch’s The Times, defines the process described by Neil as “charismatic authority”, a concept devised by the sociologist Max Weber under which “policy derives from how the leader is perceived by others rather than by instructions or traditions”.

Murdoch executives, said Evans, “act like courtiers, working towards what they perceive to be his wishes or might be construed as his wishes … They act this way out of fear, certainly, because executions are so brutal, but the fear also reflects a more rational appreciation of the fact that his ‘wild’ gambles so often turn out to be triumphs lesser mortals could not even imagine.”

Does it make any difference whether Murdoch issues instructions by edict or through charismatic authority?

The difference is crucial. If editors depended on Murdoch “rapping out orders”, as Kelly correctly denies he does, they would be able to act independently in all matters other than when they got specific instructions. William Randolph Hearst, for example, ran his vast newspaper empire via telegrams like this one, which all Hearst editors found on their desks in April 1950:

THE CHIEF INSTRUCTS NOT, REPEAT NOT, TO PRESS THE CAMPAIGN AGAINST COMMUNISM ANY FURTHER. HE WISHES THE CAMPAIGN HELD BACK FOR A WHILE. PARTICULARLY THE EDITORIALS. HE FEELS WE HAVE BEEN PRESSING THE FIGHT TOO HARD FOR TOO LONG AND MIGHT BE AROUSING WAR HYSTERIA.

Murdoch editors receive no such instructions and never have. Instead they operate within a culture of expected behaviour. Phone-hacking and police bribery were able to flourish in News Corp’s UK newspapers because everyone knew they worked in an organisation where the boss measured success by results, not ethics, and where the ends always justified the means.

As Murdoch biographer and admirer William Shawcross explained it, the mogul’s wishes and views “merely emanated from him, rather like ectoplasm”. His editors “knew his opinions, and they knew his financial interests also. Many of them were constantly anxious to please him, and there is no doubt that one way of doing so was to anticipate his views.”

By radiating authority rather than issuing instructions, Australia’s dominant media owner has been able to influence the tone, politics and direction of his native country for six decades using a technique calculated to make it look like he has no directive power at all.

How to manage politicians

Prime minister, I have on my desk in front of me a very large bucket of shit which I am just about to pour all over you.

Kelvin MacKenzie, editor of London’s The Sun, September 1992

In the 68 years since he inherited the Adelaide News and parlayed it into a global media machine, Rupert Murdoch has mastered the art of exercising political power.

No longer is it the blunt tool it was in the 1960s when he used it to try to buy a slice of mining magnate Lang Hancock’s mineral prospects in the Pilbara. Hancock was prepared to cut a deal with Murdoch — then owner of The Sunday Times in Perth, which he sold to Kerry Stokes’ Seven West Media in 2016 — but was being blocked by the Western Australian government. “If I can get a certain politician to negotiate, will you sell me a piece of the cake?” Murdoch asked Hancock, according to Robert Duffield’s 1979 biography of the miner, to which Hancock replied, “‘Yes, by all means’.” Duffield continues:

Rupert went off to see him, and I went home to bed. Ten o’clock that night there’s a knock on the door and it’s Rupert. ‘You’re in!’ he said. ‘How on earth did you manage that?’ I said. ‘Simple,’ said Rupert. ‘I told him: look you can have a headline a day or a bucket of shit every day. What’s it to be?’

The dynamic between powerful political leaders and media owners has always been complex in its intensity, hostility and interdependence.

In the US, a large and politically mature country, no mogul since Hearst in the first half of the last century has exerted the level of influence and fear still wielded by media owners in smaller countries like Australia and Britain (although Fox News often comes close).

Before the arrival of digital media and 24-hour news cycles, the relationships between political leaders and media barons were largely conducted in secrecy. Occasionally tensions flared, as they did in British Parliament in 1919 when prime minister Lloyd George attacked the mogul of the day, Lord Northcliffe, as a victim of “diseased vanity” and added: “Out in the street they used to joke: ‘Have you heard? The prime minister has resigned and Lord Northcliffe has sent for the king.’ ”

No Australian prime minister has dared to say such things in public about any Murdoch (Keith, Rupert or Lachlan), Packer or other local media barons. Paul Keating privately told Blair — before Blair flew to Hayman Island in Queensland to secure Murdoch’s endorsement to become British PM: “He’s a big bad bastard, and the only way you can deal with him is to make sure he thinks you can be a big bad bastard too.” But even the feisty Keating would never say such things in public about a media mogul.

Murdoch’s role in politics is legendary across three continents. A declassified diplomatic report from the US national archives reveals that the US consul-general in Melbourne in 1975 cabled the State Department that “Rupert Murdoch has issued [a] confidential instruction to editors of newspapers he controls to ‘kill Whitlam’,” adding: “If Murdoch attack directed against Whitlam personally this could presage hard times for prime minister; but if against Labor government would be dire news for party.”

When Murdoch supported Ronald Reagan in the 1980 US presidential campaign, “Rupert used the editorial page and every other page necessary to elect Ronald Reagan president,” according to congressman Jack Kemp at a 1981 dinner honouring the media owner.

The former British prime minister John Major told the Leveson inquiry — set up after the UK phone-hacking scandal — that Murdoch demanded his government change its policy on Europe or his papers would oppose him at the 1997 general election.

“I think the sheer scale of the influence he is believed to [have], whether he exercises it or not, is an unattractive facet in British national life,” Major said, “and it does seem to me an oddity that in a nation which prides itself on one man, one vote, we should have one man, who can’t vote, with a large collection of newspapers and a large share of the electronic media outlets.”

Of course, Major never said anything like that when he was prime minister. Nor do any of the Australian prime ministers and senior politicians who turn up to meet Murdoch every time they visit New York, because they know that’s where the power resides.

They do it because they live in a nation that still operates like an outsized version of a country town — the kind of place where the mayor, a few business owners and the local newspaper publisher make all the big decisions.

It may look like an unseemly way to run the world’s 12th-biggest economy, but think about it like this: in Murdoch’s seven decades as a fixture across the global political landscape, 15 Australian prime ministers, 13 US presidents and 14 British prime ministers have acquired and lost power, while one man remains entrenched and unelected.

The thrill of power

I think it would be fun to run a newspaper.

Charles Foster Kane, in an early scene of Citizen Kane

There’s an almost furtive sense of exhilaration in owning, editing or running an influential newspaper or TV network. You get to decide the issues that matter, pull the strings that make powerful people jump, influence events that everyone else can only read about.

A snapshot of this surreal life was revealed by Phillip Knightley in his memoir, A Hack’s Progress. He tells the story of how, as a young journalist working for Sir Keith Murdoch’s The Herald in Melbourne in the late 1940s, he was co-opted to be Murdoch’s secretary on a visit to Canberra. Accompanying his father and Knightley around the bush capital was a young Rupert, who had just finished school.

Knightley writes: “Murdoch [sr] had lunch with the prime minister, Robert Menzies, and I went along to hand out the cigars and field telephone calls. Then he dictated a letter to his fellow newspaper proprietor Sir Lloyd Dumas, of Adelaide. It gave a summary of what had been discussed over luncheon, including four or five paragraphs on what the prime minister had said about the likelihood of an alteration in the currency exchange rate between Britain and Australia and advice on what Dumas should do to take advantage of the inside information …”

This is the subterranean world of media proprietors, their lieutenants and their supplicants. It’s a world where power, money and ideas are brokered between those who require good media coverage, and the owners of that coverage who, in turn, have their own commercial and ideological requirements. This is a world of posturing, greasing and finessing, not usually crass deal-making. There are no rules, just interests, and for media bosses there’s definitely no rule against having a lot of fun in the process.

“You can demonise me by using the word power,” Rupert Murdoch told Shawcross in the early ’90s. “But that’s the fun of it, isn’t it? Having a little smidgen of power.”

A lot of people have a little smidgen of power in their own principalities, but none of them spend their entire lives being duchessed by prime ministers and presidents, and fawned over by public figures, business leaders, society toffs and grovelling employees.

“The deferences and preferments that this culture bestows upon the owners of great newspapers are satisfying,” acknowledged Conrad Black, who once controlled newspapers stretching from London’s Telegraph to The Sydney Morning Herald (and later ended up in jail for almost four years on charges of fraud and obstruction of justice).

“What was most enjoyable,” said Black, “was being at least a presence in the great debates over the foreign policy issues of our time … I had access to cabinet ministers and historians, academics from the best British universities, and thinkers from that extraordinary seam of British intellectual life. The Telegraph’s magic opened doors in Europe and even some in North America.”

Henry Luce, the American magazine publisher who created Time, Life and Fortune, was another mogul who enjoyed the preferments of media ownership. On one occasion, after a dinner party attended by an array of A-list intellectuals and celebrities, he asked his hostess how she managed to attract such important people. “It’s very simple, Harry,” she said, “we just tell them you’re coming.”

Media power is wielded behind closed doors for the obvious reason that the only people in a democracy with that kind of influence are supposed to be elected. Anyone who has spent time at the top of a big newsroom, or inside a proprietor’s inner sanctum, understands how the levers work to influence, and sometimes determine, important societal outcomes. Mostly it’s influence applied responsibly. Mostly the decisions are ethical. But if the doors are closed, who would ever know when power is abused?

From the outside, big media businesses try hard to appear like any other commercial enterprises. The difference, of course, is that the widgets manufactured in media factories are words, images, ideas and influence, a composite currency with a premium exchange rate that can’t be measured.

Which is why no media owner today would dare to admit — as Lord Beaverbrook did to a royal commission into the press in 1947, when asked why he published the Daily Express — that: “I run the paper purely for the purpose of making propaganda, and with no other motive.”

No other motive except the exquisite satisfaction of controlling the chessboard.

Eric Beecher is chairman of Private Media (publisher of Crikey, The Mandarin and Smart Company) and Solstice Media (publisher of InDaily, InQueensland and The New Daily). He is a former editor of The Sydney Morning Herald and editor-in-chief of Herald and Weekly Times (owned by News Corp).

This was originally published in Crikey in 2015 and has been updated.