Rupert Murdoch’s Watergate

Rupert Murdoch’s Watergate

An invasion of privacy scandal threatens the careers to two of Murdoch’s top executives and the apparent heir the News Corp. empire.


What began in Britain in 2005 as “a third-rate burglary” of voicemails, supposedly limited to a criminal invasion of privacy by a News of the World reporter and a private investigator, has flowered beautifully into a Level 7 scandal that threatens the careers of two of Rupert Murdoch’s top executives, not to mention the heir apparent to the News Corp. empire, James Murdoch. It even laps at the ankles of the 80-year-old magnate, threatening the final financial triumph that was scheduled to usher him into Valhalla.

In late April Jeremy Hunt, culture secretary in the coalition government led by Conservative Prime Minister David Cameron, will rule on whether News Corp.’s bid for full control of the enormously profitable BSkyB network (News Corp. holds about 40 percent) merits a full inquiry by the Competition Commission.

In years gone by Murdoch used his newspaper empire as a bludgeon to crush regulatory obstructions. He has forged strategic alliances with Margaret Thatcher, Tony Blair and Republican administrations on this side of the Atlantic. Rebekah Brooks, editor of News of the World between 2000 and 2003 and now chief executive of News Corp. subsidiary News International, is a regular informal visitor to Cameron at Chequers, the official country residence of Britain’s prime ministers.

But these days their private colloquies may be marred by a certain apprehension. Cameron was scarcely installed in 10 Downing Street before he summoned Andy Coulson as his media adviser. It was a flagrant declaration of interest, since Coulson was a notably grimy character in the Murdoch archipelago, having served as editor of News of the World—a job akin to supervising the efficient distribution of raw sewage into the prurient hands of about 3 million Britons every Sunday.

Amid the first stages of the phone-hacking scandal, Coulson resigned as editor when NoW reporter Clive Goodman, who ran the royal beat, and private investigator Glenn Mulcaire were convicted of hacking into the phone messages of members of the royal family. With Goodman and Mulcaire sent to jail and Coulson stepping down, Murdoch’s senior executives no doubt hoped that a lid had been clamped down on the scandal.

But it was already too late. News of the World, like Murdoch’s Sun, has always been in the business of peddling sex scandals and true confessions. Just as the FBI and big-city police departments teamed up with gossip columnists such as Walter Winchell, Hedda Hopper and Louella Parsons here, Scotland Yard and the scandal sheets worked together in harmonious relations greased by payoffs. The papers would get the stories and the cops would get favorable publicity, plus some cash. Peter Burden, a British journalist who has written extensively about News of the World, remarked to me recently that somewhere in the mid-’90s Murdoch realized that celebrity gossip had become an important and profitable international commodity. Meanwhile the snooping industry burgeoned.

The first line of defense—that Goodman and Mulcaire were unlicensed freebooters operating outside decorous guidelines—swiftly fell apart under the weight of palpable absurdity. As Nigel Horne, executive editor of the UK-based online daily The First Post, emphasizes, “The idea of rogue reporters blowing money without the knowledge of their bosses is a joke.” The paper paid Mulcaire £2,000 a week.

Scandals reach critical mass when containment breaks down and the various players begin to ponder charges of criminal conspiracy and perjury, not to mention the prospect of jail time. This is what has been transpiring in Murdochland, aided by pertinacious reporting by the Guardian and the New York Times, which was happy to remind the world at huge length in September that its rival, the Wall Street Journal, is part of an empire stained by criminal conduct.

Last Christmas Hugh Grant broke down while motoring in Kent. A man stopped, photographed him and then came over, offering to help. He was a former News of the World reporter, Paul McMullan, who now runs a pub in Dover. He invited the actor to drop by. Grant duly honored the invitation, armed with a hidden mike. He recently published his chat with McMullan in The New Statesman, guest-edited by his former girlfriend Jemima Khan. In the transcript, McMullan says Brooks knew about phone hacking at the paper. He also claims that Prime Minister Cameron probably knew as well.

As Burden speculates on his blog, “If Ian Edmondson [a former NoW editor] was involved, so was Andy Coulson. If Andy Coulson was involved, so was Rebekah Brooks. If Rebekah Brooks was involved, so was Master James [Murdoch]. And if they were, it’s very likely that Les Hinton, CEO of [Dow Jones and Company] (the brightest bird in Rupert Murdoch’s bush), was involved, too, because he was Executive Chairman of News International at the time.”

On April 10 Guardian columnist Steven Barnett expressed sentiments widely shared in Britain, writing in favor of a full review of the BSkyB deal: “The issue is that every aspect of Sky’s output will be driven by the same uncompromising corporate culture which has given us the News of the World’s criminality.” On April 8, in an effort to keep incriminating documents from being disclosed, News International said it would settle with a select number of victims, out of a £20 million fund. This supposedly last and final offer will crumble too in the face of hundreds of other claimants.

Will Rupert himself be enmeshed? Bruce Page, author of a fine book on Murdoch, suggests to me that what could drag the dirty digger into the swamp would be the disclosure of any deal he may have made to stem the scandal when Gordon Brown was still PM. Brown won’t confirm or deny that Murdoch approached him.

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