Jul 05 2011

As Murdoch deadline looms – a word from history

Posted by: Nick Shaxson in: Thoughts

In Treasure Islands I mention The Economist’s discovery in 1998 that Rupert Murdoch’s News Corporation paid just a 6% corporation tax rate, leaving others to pay their taxes for them. Many News Corporation outlets have been hostile to opponents of tax havens in the past, so this is a corporation that interests me a great deal.

Now we have the prospect of the Murdoch empire taking full control of BSkyB, under the benevolent gaze of a sympathetic Conservative-led and offshore-loving UK government. Culture Secretary Jeremy Hunt approved the takeover last Thursday, subject to a short consultation period that will run until this Friday. The pressure group Avaaz has helped delay things till now, but it looks like the steamroller will move ahead.

In this context, a reminder from history, gleaned from the 18-31 March edition of Private Eye:

Quote of the Week

“You tell these bloody politicians whatever they want to hear, and once the deal is done you don’t worry about it. They’re not going to chase after you later if they suddenly decide what you said wasn’t what they wanted to hear. Otherwise they’re made to look bad, and they can’t abide that. So they just stick their heads up their asses and wait for the blow to pass.”

Rupert Murdoch, interviewed by Thomas Kiernan in Citizen Murdoch, Dodd Mead, New York, 1986

You can see that same quote here too. Murdoch has form, in this respect. This latest story illustrates it:

What of Jeremy Hunt’s added conditions? They are not reckoned to be very demanding. One is to have an independent editorial director present at Sky News board meetings. Anyone familiar with Rupert Murdoch’s career in the media business will know that he eats independent directors for breakfast.

The Times of London and its sister paper had independent editorial directors who were ineffective and when similar safeguards were offered during Murdoch’s bid for the Wall Street Journal, Times journalist Fred Emery recalled Murdoch’s response when reminded of his promise not to fire Times editors without the approval of its independent directors: “God, you don’t take all that seriously, do you?”

Whatever undertakings are made about plurality and Jeremy Hunt’s conditions and all that – they need to be considered through the lens of history.

It seems that despite all the recent allegations, this steamroller is unstoppable. A major tax haven user and supporter is about to become more powerful.

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