White House Chronicle

News Analysis With a Sense of Humor

Lackluster City? Get a Brand

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If your city is mostly famous for being between two other cities, if its main claim to fame is “It’s a great place to raise children,” then it’s time for your city fathers to take a course in branding.
Cities that prosper — that bring in company headquarters, tourists and where the crazy rich want be — have to have distinguished brands.
New York’s brand is glorious excess. It has the brand of ever higher, stranger skyscrapers. The world’s most successful media mogul, Rupert Murdoch, has just plunked down $57.2 million for what looks to be the world’s most lonely living space: the top four floors of a 60-story, bronze-and-glass building of a kind that is now transforming the Manhattan skyline. Take a small plot of land, build until what you get is slender tower that defies nature and looks as though its purpose is to challenge a strong wind.
Murdoch’s aerie has glass on four sides, and he can see forever, at the least until other towers rise up. If you want to spy on him, you will have to do it by drone. His own paparazzi might try to get a picture using a drone, but where would they publish it?
If you have a few million to spare you can still get in the East 23rd Street building. But those that would make an eagle jealous have gone to Murdoch. Most of us would be scared up there: a new take on “Naked and Afraid” because without neighbors, there is no need to wear clothes.
Cities in the United States that have done the branding thing right are New Orleans, jazz and food; San Francisco, cable cars and attitude; Boston, higher education and hospitals (eds and meds); and Chicago, wind and the uber-hub airport. Washington is a special case: great museums, the White House and the Capitol, and palpable delusions of importance.
The branding ace, running in front worldwide, is London. The Romans gave it a head start, but it was not until the Swinging Sixties that London became a destination for the globe. You would think that the place had enough branding with the old features: Tower Bridge, the Tower, the Houses of Parliament and Buckingham Palace, plus the Changing of the Guard.
But no. London keeps adding dizzying new features to its brand superiority. There is the Tate Modern, an art gallery in an old power station; the London Eye, a Ferris wheel that has captured world attention and city imitators; a bridge across the Thames River that wobbles, and now a new bridge is planned with gardens and shops on it. Then there are the taxis — black boxes, that remind you where you are in case you have overlooked the big red buses.
The current mayor of London, Boris Johnson (who has branded himself as a possible prime minister) has been keen to preserve and protect the London brand by insisting on preserving the double-decker buses, distinctive taxis and other expensive city bric-a-brac, because it is a hell of an investment.
Sure Paris has the Eiffel Tower, but it is aging. Rome has the Coliseum — talk about aging. And St. Petersburg has the Winter Palace and the Hermitage. But for city branding, London is in front and pulling away, as the Brits exploit the cash value of differentness.
Providence and Baltimore are two cities of which I am particularly fond. But I would urge the city leadership in both places to get a brand, a trademark. It pays. Rides (London Eye, Eiffel Tower elevators, the San Francisco cable cars) are sure winners. Could I suggest an amphibious train across Baltimore Harbor, and the mother of all rollercoasters – big, but not scary — in Providence?
Like London and New York, these days you have got to think big in city branding, or you will miss the incredible fun and profit of a city being silly.
Frivolity pays, ask London’s Boris Johnson — and share a thought for Rupert Murdoch, stuck up in the sky. — For the Hearst-New York Times Syndicate

The Merger Industry Is Doing Just Fine

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Whether Rupert Murdoch’s 20th Century Fox succeeds in its $80 billion bid for Time Warner, rest assured the mergers and acquisitions (M&A) industry will do just fine. Very fine, actually.

There is such a thing as the M&A industry, but it is elusive. It has no trade association and cannot be looked up in the telephone directory. But this virtual organization is a power in the land and very, very rich.

It is made up of investment bankers, lawyers, economists, advertising agencies, public relations tacticians, lobbyists and legal printing firms. They all swing into action like sharks alerted by blood in the water. They are a diverse crew with one thing in common: They do not come cheap.

At the top of the pinnacle are the investment bankers and their pals in the hedge-fund world, who are ready with ideas and capital if it is needed; ready to reap the rewards of arbitrage. These are the elite officers of the Wall Street Brigades; money is their North Star. They have been bred, in the best schools, to expect it as their entitlement, and they are keen to live up to that expectation.

They are retained by both sides in a hostile takeover and, however it goes, their fees will be enough on one transaction to keep them on Easy Street for years. They fly high, shoot high and live high. They are aristocrats in the kingdom of money.

Just below them come the lawyers, droves of them each offering advice on some aspect of the challenge. Each billing more for one hour than most people earn in a week. When working on a big merger, where there are billions and billions of dollars in play, the legal fees run into the tens of millions of dollars — and nobody cares. Outside of the senior management, who expect to get extraordinary wealthy — hundreds of millions of dollars, at least — in a takeover, it is the bankers and the lawyers, denizens of Fifth Avenue and the Hamptons, who make out beyond normal dreams of avarice, and do it over and over.

So it is not surprising that it is often bankers who instigate mergers either by pushing the ideas and the finance mechanism on the firm that hopes to be the acquirer, or persuading a firm that it is time to put itself on the market. Once a target is “in play,” as Time Warner is, anything can happen: A white-knight suitor can come along or the vulnerable company can become an acquisition, as in the way Men’s Warehouse stitched up Jos. A. Bank.

If there is a hostile battle, the advertising and public relations people come in, cajoling shareholders to hold out or sell out. More millions are spent in this effort: No one is trying to save money when the transactions are so large.

The biggest winners are those at the top of the heap: the managements. They own stock options and shares, plus special deals are written to sweeten things for them.

Everyone engaged in the M&A industry makes money when the game is on, all the way down to the caterers, who provide the sustenance when the midnight oil is burning. A merger is a grueling and fun undertaking; the fun of making money under pressure, a lot of pressure and even more money.

Who loses? Certainly the staff of the lesser-partner firm. The conqueror calls the shots and decrees the layoffs, which are one of the principal savings or “efficiencies” of the takeover. There will be less duplication, fewer subsidiary businesses, and fewer facilities that can be consolidated.

The other loser, feverishly denied in advance of the nuptials, is the consumer; the poor stiff who purchases the goods and services that the new entity offers. These may be fewer and, almost certainly, they will become more expensive over time.

Not all mergers are bad. Actually, Rupert Murdoch’s takeover of The Wall Street Journal has resulted in an invigorated newspaper.

But anyone, including myself, who has flown on the merged American Airlines and U.S. Airways has nothing good to report about service, pricing, or frequency. I’ll venture that the M&A moguls are taking private jets — wouldn’t you? — For the Hearst-New York Times Syndicate
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Murdoch Has ‘Unfit’ Company

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Rupert Murdoch, the 81-year-old chief executive of News Corp., has been told by a select committee of the British parliament that he is “unfit” to head his global media conglomerate.

It is a particularly British accusation and one that is especially punishing, both because it is so indelible and is so seldom used.

“Unfit” is not a charge that is often leveled, so its impact is especially great. In 1971 a publishing rival of Murdoch’s, Robert Maxwell, was indicted as being “unfit” to run a public company. His were sins of greed and venality.

Murdoch’s sins, you might say, are sins of encouraging a culture of corruption in two of his London-based tabloid newspapers: the defunct News of the World and The Sun. It should be said that Murdoch did not invent the culture of Britain’s tabloid press, but he encouraged it to lengths of excess that had not been dreamed of earlier.

Fleet Street — the collective name for British newspapers which derives from the street where they were once all located — has always been a place of excess. But things really turned white hot in the late 1950s and 1960s.

Television and radio were competing for entertainment value, but news was still the province of newspapers. The game was to shock the readers without depressing them. The publisher Lord Beaverbrook said during World War II of his Daily Express: “I want the readers to feel the sun is shining when they read the Express.”

When I arrived in Fleet Street, well after the war, the sun was still shining in the popular papers. And what better way to keep the sun shining than by exposing the foibles of the aristocracy, the Royal Family and, of course, film stars?

We, the denizens of Fleet Street, were modestly paid but were given essentially unlimited expense accounts to disport ourselves around the clubs and restaurants of London in search of the rich and famous at unguarded play. The culture was one of discover, speculate, elaborate and publish.

Reporters were pushed very hard to dig up the titillating, embellish it and present it as news. We descended on crime scenes, the sexually engaged and the overtly greedy.

Yet there were limits, unwritten but understood, especially pertaining to private grief and even the Royal Family. Infidelity from a vicar was reportable. Similarly rumored goings on by major politicians and national figures, less so.

But change was on its way in the shape of Rupert Murdoch, and in the growing force of television in British life. Murdoch trashed the barriers, such as they were. He started publishing pictures of bare-breasted girls in The Sun, and turned his tabloids from being newspapers that published gossip along with the news to gossip-only papers. They became vicious as well as tawdry.

Murdoch also turned his papers from leaning politically left-wing to being savagely right-wing. It worked.

The Sun and the News of the World started making enough money to finance Murdoch’s other ventures, including buying and building Fox News.

Murdoch established an even more irresponsible culture. There were no rules now: Hence the phone-tapping, police bribing and other sins that have brought Murdoch to his sorry state of being “unfit.” There was a new thuggery and vulgarity that had not existed.

Yet if Murdoch is unfit, so are his accusers. It is British politicians — including Margaret Thatcher, Tony Blair and David Cameron and their followers — who indulged Murdoch, courted him and encouraged the arrogance of Fleet Street.

British newspaper publishers have always considered it their right to have access to the prime minister and no holder of that office has sought to disillusion them. – For the Hearst-New York Times Syndicate

Murdoch Is Felled by a Disease He Once Cured

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In the 1960s, even to an old union man like myself, British newspaper
unions had reached a point at which they were a threat not only to the
newspaper industry, but also to the freedom of the press itself.

It took someone as ruthless and sociopathic as the unions to find a way to
break their hold. That man was Rupert Murdoch and he did it with
outstanding courage, cheek and military-like planning.

In theory, the deal was simple: If the unions would not behave in the
workplace, he, the proprietor, would move the workplace.

In today’s world, this sounds easy. But in those days, trade union rights
were regarded as inviolable. A blow against one union was a blow against
all unions. “Solidarity,” in union speak, was awesome.

Yet Murdoch set out to leave London’s Fleet Street; then the physical home
of nearly all of Britain’s national papers, now the metaphorical home of
British journalism.

In secret Murdoch built the most modern printing plant of its day in
Wapping, the old dock area in the East End of London. He surrounded it with
razor wire and prison-like defenses and secretly recruited new workers
from the areas of Britain with the highest unemployment.

Nothing so bold had ever happened in British industrial relations.

To get the operation rolling, Murdoch made demands of the National
Graphical Association — the most militant of the unions — on
computerization. The union did not want journalists touching computers,
and they wanted no changes in the antiquated machinery that they used.

Strikes were frequent and often unofficial: The workers just downed tools
over almost always imagined grievances. Then they started censoring the
newspapers: They would not print newspapers with editorial material they
disapproved of. Production was said to be “lost.” This euphemism meant
that the newspapers never appeared in some markets.

If a newspaper were to run a story about communist penetration of the
unions, which was rife, the printers censored it. Sometimes they allowed a
blank space to appear, and sometimes the paper had to withdraw the
offending-but-accurate report to get printed at all.

With planning worthy of a great general, Murdoch orchestrated the move to
Wapping and sprung it on the country as a fait accompli in late January
1986. The journalists, who belonged to a less belligerent union, the
National Union of Journalists, were divided. Some “went to Wapping,”
others quit.

All of Murdoch’s titles moved, including the weekly News of the World, The
Sun, a daily, and the venerable Times and Sunday Times. Five thousand
old-line workers were sacked for honoring what the unions said was a
provoked strike.

But the press was saved, and Murdoch saved it. All the newspapers made it
to fight another day.

The unions had become arrogant, thuggish and sociopathic. They did not
care about the principles of a free press, the illogic of their Luddism or
the greater harm to society. Power and money was their thing, and they had
power: power to boss the bosses, power to set the number of workers who
worked each night, and increasingly power to determine what was printed.

Lord Rothermere, one of Britain’s newspaper barons, was once asked, “How
many people does it take to produce The Daily Mail?” His lordship replied,
“About one quarter.”

The featherbedding was awesome. Some delivery drivers got paid by three
newspapers for delivering papers when they were, in fact, working
somewhere else altogether.

So there is a fine irony that the Murdoch’s News Corp. now stands accused
of many of the sins of the unions he disciplined: sociopathic arrogance; a
desire to control the news as well as cover it; and a thuggish corruption
that reached into the highest levels of at least three British
administrations, Thatcher, Blair and Cameron; and has brought low the
world’s largest and most storied police force, the Metropolitan Police,
known as Scotland Yard.

Murdoch’s many newspapers in England accumulated so much power that they
began to dictate the news, orchestrate policy and politicians came live in
awe of the power of the News Corp. apparatus to reveal people’s private
lives, delve into their finances, and have their careers boosted or
blunted by columnists and selective reporting.

Many years ago, before Murdoch established himself in Fleet Street, one of
its legendary characters, Harry Procter, wrote an angry memoir called
“Street of Shame.” Yes, indeed. — For the Hearst-New York Times Syndicate

Prime Ministers and Publishers: An Unholy Alliance

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Lord Northcliffe: The Read Baron

Lord Northcliffe

 

British newspaper publishers love prime ministers. Conversely, prime ministers love publishers. That is, if the publisher in question owns a national newspaper with a big circulation (often in the millions).

You cannot get into the club if you only own, say, the Lewisham Borough News. This is an exclusive club for those who wield real, palpable power: Witness the scandal of Rupert Murdoch’s News Corp. in Britain today.

The club has been operating for more than 200 years. But it was at the turn of the 20th century, with ever-expanding voter rolls, that the intimacy became really intense. Victorian prime ministers had to put up with editors and owners of journals of opinion, like The Spectator or Punch, and sometimes The Times.

Conservative Prime Minister Benjamin Disraeli and his Liberal rival, William Gladstone, bargained with the media of their day. But these did not sway huge swathes of the electorate in the way that was to come. General education produced millions of avid readers and improved printing technology, notably the Linotype machine, made large mass- circulation newspapers possible.

Two brothers, Vere Harmsworth and his more colorful sibling, Alfred, were the first big-time press barons. In time, they were rewarded with titles: Alfred became Lord Northcliffe and Vere, Lord Rothermere.

It is unlikely that all of the prime ministers — and all of them had to deal with the press barons — really liked the intimacy. These men mostly had huge egos, daunting agendas, and their friendship always came with a price. So, of course, did the friendship of the politicians. They sought support in elections and freedom from scrutiny in governing.

Part of the price was usually the peerage, but then there were other considerations. Lord Beaverbrook, a Canadian, wanted prime ministers to endorse his campaign for “Empire Free Trade.” Others had other interests; but the tariffs on newsprint, the subsidy of cable traffic (which made getting news from overseas cheaper), and subsidized postal rates for newspapers and periodicals were common to all.

Northcliffe lectured World War I Prime Minister Lloyd George on how to run the war — and everything else. Beaverbrook treated Lloyd George’s successor, Bonar Law, a fellow Canadian, as his surrogate in government and campaigned for him relentlessly.

After that, Beaverbrook turned his demonic energies to supporting Winston Churchill — even though Churchill was at a low period during much of the1930s. Not only was the man who was to be Britain’s greatest prime minister out of power, he was also out of money.

The newspaper proprietors, in surprising unity, came to Churchill’s aid. Churchill boasted that he made 1 million pounds from his articles in one year and retired his debts. That was an astounding amount of money, and it reflected the fact that the newspaper bosses were overpaying him enormously, according the historian A.J.P. Taylor.

The leading paymasters were Beaverbrook, who owned the Daily Express and the Evening Standard, and Brendan Bracken, the Irishman who owned the Financial Times. In Churchill they saw potential, a lively contributor, and someone who gave the best dinner parties in England. Bracken even encouraged rumor that he was Churchill’s illegitimate son, although he knew this was nonsense.

The cultivating of prime ministers was an ecumenical affair. Cecil Harmsworth King, who ran Mirror Group Newspapers in the 1960s, lectured Prime Minister Harold Wilson on everything, including his own somewhat ridiculous idea that Britain needed a bipartisan national government — as in wartime — to get it out of his its financial difficulties. Rupert Murdoch went all out for Margaret Thatcher. But he turned against her successor, John Major, and supported the Labor Party and Tony Blair. Gordon Brown failed to get Murdoch’s nod, but current Prime Minister David Cameron did. The rest, as they say, is history.

When television came along, the proprietors had a new incentive to cultivate prime ministers: licenses. The big winner here was the least pushy of the publishers, Roy Thomson, another Canadian, who owned The Times. He got the license to run commercial television in Scotland and became Lord Thomson. Like Murdoch, Thomson did not crave the company of prime ministers. He was happy to let others carry his requirements to the men in power. Murdoch has used various  intermediaries, including the American economist and free-market ideologue Irwin Stelzer.

Is it all over now? Will prime ministers shun the company of media barons?

Will the sun rise in the East tomorrow?  — For the Hearst-New York Times Syndicate

 

 

 

Hey Dick, Add a Spoonful of Socialism to Your Tea

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MAASTRICHT, Netherlands — The English like to say, from an old music hall song, “a little of what you fancy does you good.”  Well, so does a smidgeon of socialism.

Shock horror! Alert Dick Armey, inform Rudy Giuliani and let Rupert Murdoch know. Heresy is dangerous, and the correct authorities should be informed.

Like most people who rail against European socialism, those three have been the beneficiaries of some largesse that might be described as socialistic.

Armey, who is leading the tea bag revolution and who talks of the socialist threat as though a fleet were coming up the Potomac to sack Washington, is the beneficiary of the rights, honors and money that come from being a former congressman, all the way down to a handsome health care package.

Then there is Giuliani, who presided over the second most liberal city in the United States, after San Francisco, added to its amenities and improved America’s largest subway system. Notably, he did not end rent control, now known as “rent stabilization,” nor did he end a plethora of liberal services available in New York. Yet if the former mayor, who wanted to be president, wants to denigrate something, he utters the “s” word.

Murdoch is special. He has played footsie with the Gordon Brown Labor government in London; played up to the Communist Chinese; cooed over the Clintons and booed ideas of assistance to the media; and employed a staff at Fox Cable News who are devoted to castigating Europe and its left-of-center democracies. Worse, Murdoch has benefitted over the years from various government subsidies including the Commonwealth Press Cable Rate, which moved news inexpensively around the world before the Internet. And he has never cried out against second-class postage, another huge government subsidy to publishers.

OK, socialism, even the mild kind favored here in the Netherlands, isn’t the promised land of governance; but it produces, at the street level, some pretty agreeable result. Scads of American visitors groove on the country’s parks, public toilets, bike paths and buses that are easy to use.

This small city of about 200,000 bears its medieval history with pride and its socialist amenities with grace, from miles of bike paths to trains that can whisk you to the next hamlet or to Hamburg, Germany.

Travel to a nearby major city, like Amsterdam, Brussels or Paris, and Europe is yours with its high-speed trains that crisscross the continent at 200 mph, and even plunge under the English Channel to London’s St. Pancras Station, a masterpiece which has been restored to its Victorian glory.

London itself adds public amusements with pride. Three recent ones are the Ferris wheel, known as the London Eye; the foot bridge across the Thames, nicknamed the “wobbly bridge”; and the New Tate, an art gallery in an old power station.

You can put this down to the kind of post-socialism that former British prime minister Tony Blair (a Murdoch man) described as “social-ism;” not the old-school, “Keep the Red Flag Flying” socialism, but the idea that people are entitled to services beyond national defense. A good question for Giuliani might be: “Would you have approved the building of Central Park?”

Where socialism–lite has failed in Europe is in an excess of regulation, particularly the rigidity it has brought to hiring and firing. This has kept small business in Europe operating at the mom-and-pop level, scared to hire because in most European countries firing is subject to a labor tribunal’s approval. Approval seldom comes.

One of the great drivers of entrepreneurism in the United States is the harsh but effective idea that employees serve “at will.” That, the socialists can’t stomach. They want Paradise enow.

A little socialism will do–and we needn’t mention single-payer health care.

 

Right-Wing Publishing: Musical Chairs

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Word is out that Rupert Murdoch’s News Corporation is on the verge of selling its conservative political magazine, The Weekly Standard, to the publishing company owned by billionaire Philip Anschutz. If the deal goes through, it does not bode well for The Standard, founded and edited by William Kristol and Fred Barnes.

More than any other conservative paper, The Standard has been able to find and develop new and original talent.

The list of writers of real ability who have passed through the portals of The Standard, located on 17th Street in Northwest Washington, includes David Brooks of The New York Times; broadcaster and writer Tucker Carlson; and Christopher Caldwell, Matt Labash and Matt Continetti, who still write for the magazine.

By comparison Anschutz’s current Washington property, The Examiner, a free daily newspaper, is home to some old standards like Michael Barone, Byron York and Mark Tapscott, who came to the paper from The Heritage Foundation. No one pioneering or fresh. The Examiner is the exemplar of your father’s conservatism.

But worse, leaving aside the politics, which is why The Examiner and The Standard exist, is the basic newspapering of The Examiner. It needs work–just to make it more of a plausible newspaper. The headlines are too small. It covers national politics, but in all other respects, it is a local newspaper with wobbly news judgment.

If any of these weaknesses are to infect The Standard, an important voice of erudite conservatism will be lost. Scintillating new writers will not get a start. Bashing liberals is not enough.

At 10th birthday party for The Standard (founded it in 1995, when Irwin Stelzer, a News Corp adviser, persuaded Murdoch `that the United States needed a magazine of opinion and literary comment like the venerable Spectator in England), Brooks said The Standard was a magazine conceived to serve a government in power not to whine in opposition, which by implication is what Human Events, The American Spectator and National Review do. Even in opposition, it has kept its optimistic tenor and its book reviewing is of a high order.

Sadly, The Standard has never been able to totally learn from its English cousin. American conservatives want just conservative views in their political magazines, not the occasional piece of amusing heresy.

There is a third player is Washington conservative journalism: The Washington Times, a respectable daily with a definite rightward slant, sometimes in its coverage as well as on its opinion pages. It is the home to old-line conservative writers and some liberal ones, including Pat Buchanan and Larry Kudlow on the right, and Nat Hentoff and Clarence Page on the center-left.

The quality of the newspaper craft in The Times dwarfs The Examiner. But those two papers and The Standard are the toy things of rich men with a political point of view. The Times is owned by the Unification Church, led by the Rev. Sun Myung Moon. You could say that all three are vanity publications: They lose money, lots of it.

But this is not new. The late great New York Herald Tribune was bought by oil billionaire Jock Whitney to counter the liberal New York Times, and to save an important conservative voice in New York at a time of liberal ascendancy.

Earlier, during World War I, Max Aitken, a Canadian, bought the London Daily Express, at the behest of the Conservative Party, to keep a conservative voice in Fleet Street. The Tories were so grateful that they elevated Aitken to the Peerage, as Lord Beaverbrook. Both Beaverbrook and Tories lived to rue the day. Beaverbrook because he realized his chances of being prime minister had evaporated with the honor and the Tories because Beaverbrook was a maverick. Also, Beaverbrook soon started making money–lots of it–off his newspaper and did not have to worry about conservative orthodoxy anymore. Neither Murdoch nor Anschutz nor Moon is ever likely to make any money out of their publishing properties.

Amazing how unbusinesslike conservatives can be when it comes to defending the faith.  –for North Star Writers Group