"It's the Media, Stupid."
Paul Krugman: But the Black affair isn't just about bad corporate governance. It goes without saying that Lord Black, like Rupert Murdoch, has used his media empire to promote a conservative political agenda. The Telegraph, in particular, has a habit of "finding" documents of unproven authenticity that just happen to support neoconservative rationales for war. We're now learning that Lord Black also used his control of Hollinger to reward friends, including journalists, who share his political views.
Break the Corporatist Strangehold on the US News Media, Show Up for Democracy in 2004: Defeat Bush (again!)
http://www.nytimes.com/2003/12/23/opinion/23KRUG.html
Citizen Conrad's Friends
By PAUL KRUGMAN
Published: December 23, 2003
Yesterday's eye-opening New York Times story about the inner circle of Conrad Black, the troubled chairman of Hollinger International, described him as a "throwback press baron." Indeed, his style recalls that of William Randolph Hearst. But it's a mistake to think of Lord Black, whatever his personal fate, as a throwback to a bygone era. He probably represents the wave of the future.
These days, everything old is new again. Income is once again concentrated in the hands of a tiny elite, and money rules politics to an extent not seen since the Gilded Age. The Iraq war bears an eerie resemblance to the Spanish-American war. (There was never any evidence linking Spain to the Maine's demise.) And Citizen Kane is back, in the form of an incestuous media-political complex.
Conrad Black's empire includes The Daily Telegraph in London, The Jerusalem Post and The Chicago Sun-Times. He switched from Canadian to British citizenship — an action that forced him to give up control of Canada's National Post — when the Canadian government prevented him from becoming a member of the House of Lords.
Now he's a lord in trouble. Hollinger, it turns out, has paid hundreds of millions in fees to companies controlled by Lord Black and to individual executives. Some of these payments were secret and were unauthorized by the board. Even if viewed purely as a corporate scandal, this is pretty major stuff.
But the Black affair isn't just about bad corporate governance. It goes without saying that Lord Black, like Rupert Murdoch, has used his media empire to promote a conservative political agenda. The Telegraph, in particular, has a habit of "finding" documents of unproven authenticity that just happen to support neoconservative rationales for war. We're now learning that Lord Black also used his control of Hollinger to reward friends, including journalists, who share his political views.
Inevitably the list includes both Henry Kissinger and Richard Perle, whom I hereby propose (stealing an idea from Slate's Tim Noah) as the subject of a parlor game about cronyism, along the lines of "Six Degrees of Kevin Bacon." The former Pentagon official, who has close ties to Donald Rumsfeld, has enthusiastically embraced the advantages of being both a businessman and a policy insider. His prestigious if part-time official position on the Defense Policy Board provides him with credibility, and at least the suggestion of both inside information and policy influence. This has led to lucrative consulting deals, and has attracted investments in his venture capital fund, Trireme Partners.
Last August, in a moment of supreme synergy, Mr. Perle, wearing his defense-insider hat, co-wrote a Wall Street Journal op-ed praising the Pentagon's controversial Boeing tanker deal. He didn't disclose Boeing's $2.5 million investment in Trireme.
Sure enough, Hollinger also invested $2.5 million in Trireme, which is advised by Lord Black. In addition, Mr. Perle was paid more than $300,000 a year and received $2 million in bonuses as head of a Hollinger subsidiary. It's good to have friends.
The real surprise, though, is that two prominent journalists, William Buckley and George Will, were also regular paid advisors to Hollinger. Now, I thought there were rules here. First, if you're a full-time journalist, you shouldn't be in that kind of relationship. Second, whoever you are, if you write a favorable article about someone with whom you have a personal or financial connection — like Mr. Perle's piece on the tanker deal or Mr. Will's March column praising Lord Black's wisdom — you disclose that connection. But I guess the old rules no longer apply.
That, surely, is the moral of this story. Lord Black may have destroyed himself by being a bit too brazen. But his more powerful rival Rupert Murdoch just goes from strength to strength, even though top positions in his media empire have a tendency to go to his sons, and the News Corporation has done far more than Hollinger to blur the line between news and propaganda. And the empire keeps growing: last week the Federal Communications Commission approved Mr. Murdoch's acquisition of a controlling interest in DirecTV, whose satellite television serves 11 million U.S. homes.
In other words, Lord Black may be about to fall, but the nexus among news coverage, political influence and personal gain seems likely to grow even stronger.
Posted by richard at December 23, 2003 10:57 AM