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What Murdoch Faces Now

Posted By aaron On July 17, 2011 @ 3:32 pm In U.S. News | Comments Disabled

Ken Auletta
New Yorker
July 17, 2011

For nearly two weeks, Rupert Murdoch and his people have claimed that the newspaper scandal in London was caused by a few rotten apples. Now that a very large apple, Rebekah Brooks, has been arrested, it is clear that it is the entire barrel that is rotten. Since many editors had to have known of the illegal hacking, and many people on the business side would have had to sign off on large, illegal payments to the police for information, more apples will drop in coming days. And not only at News Corp.: Sir Paul Stephenson, commissioner of the Metropolitan Police, resigned Sunday. The best public-relations advice in the world will not help contain what is, for Murdoch, a spreading contagion that is no longer confined to London.

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In the United Kingdom, Murdoch and his son James will have to tell a Parliamentary committee on Tuesday what they knew and when they knew it. More than that, they will have to try to rescue their company from multiple government onslaughts and criminal investigations from members of Parliament who think they must impose curbs on News Corp.’s ownership of newspapers and television and sports in England, and from shareholders who claim they have been cheated.

In the United States, News Corp., as an American company, will, among other things, have to explain why it has not violated the Foreign Corrupt Practices Act, which makes it unlawful to pay bribes to government officials overseas—a proscription that includes the London police; whether the New York Post (or any of the company’s British newspapers) hacked into the mail or phone calls of celebrities in this country or of the families of 9/11 victims; and why their unethical behavior does not disqualify them under F.C.C. rules that require that those who license TV stations must be of solid moral character. Les Hinton, the head of Dow Jones and one of Murdoch’s senior executives in this country, has already resigned. (I wrote about Hinton’s departure on Friday.)

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