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Murdoch's Purchase of Dow Jones Approved by Board; TNR Baghdad Diarist's Claims Attacked by Right-Wing Blogs

Aired August 3, 2007 - 20:30:00   ET


FIONNUALA SWEENEY, HOST: Hello, I'm Fionnuala Sweeney in London. Welcome to CNN's INTERNATIONAL CORRESPONDENTS, where we examine how the media are covering the big stories.
This week, stop the press. Media mogul Rupert Murdoch gets his hands on the crown jewel of the Dow Jones media empire, The Wall Street Journal. What sort of changes can we expect?

Red flags are raised over a "Baghdad Diarist." The liberal New Republic magazine is under fire. And an Army private's words are under investigation.

Plus, bedtime books with a political theme. For little conservatives and liberals, how young is too young for political indoctrination?

The media mogul Rupert Murdoch has succeeded in his bid to buy the company and its flagship publication, The Wall Street Journal. The $5.6 billion offer won approval from the Dow Jones board on Tuesday.

Dow Jones has agreed to pay News Corp. $165 million if the deal falls through, plus an additional $25 million for News Corp. expenses if shareholders vote it down. That is not expected to happen.

Dow Jones Director Leslie Hill resigned from the board. Hill is a member of the Bancroft family, which controls Dow Jones and was part of a faction attempting to prevent the takeover. Well, Murdoch's ability to pull off a coup like this will not come as a surprise to anyone who has followed his career.

Phil Black takes a look at the man behind the empire.


PHIL BLACK, CNN CORRESPONDENT (voice over): When Rupert Murdoch appeared on "The Simpsons" playing himself, he introduced himself as "the billionaire tyrant." People who have worked with Murdoch say that was a candid statement.

ANDREW NEIL, FORMER EDITOR, THE SUNDAY TIMES: And there is an element of tyranny to it, or as I called it, "telephone terror."

BLACK: Andrew Neil was the editor at Murdoch's Sunday Times in London, worked at Sky News and FOX News. He knows the Murdoch style of management well.

NEIL: I described it as the court of the Sun King, and the king is in the middle and the courtiers are all around. And power comes from your closeness to him. When he rates you, you are very powerful. More powerful than people who have got bigger titles than you. When he doesn't or when he's finished with you, you might as well be in Siberia.

BLACK: Murdoch the Sun King has come a long way in 55 years since inheriting a small Australian newspaper from his father. He now owns a global media empire, with dozens of papers in Australia, Britain, and the United States.


BLACK: Television interests including Sky in Britain, FOX in the United States, and Star in Asia. His online stable includes MySpace, the social networking site. It is the sort of success that has attracted many critics.

This former editor of The Sun isn't one of them.

KELVIN MACKENZIE, FORMER EDITOR, THE SUN: Because he's so clever, instinctively clever, everybody has to paint him as a demon because they couldn't embrace him in any other way. Otherwise, they would say he was a god, and they certainly don't want to do that.

BLACK: God or demon, former employees say Murdoch's move on The Wall Street Journal was no surprise because he has always wanted to own a prestigious business newspaper.

(on camera): At the other end of the spectrum is Murdoch's The Sun, Britain's biggest-selling newspaper. It is proudly tabloid, with screaming headlines, trashy stories and topless page three girls. So what does the hands-on owner of this publication now have planned for The Wall Street Journal?

(voice over): Murdoch's bid for the paper included a promise not to influence its news judgment. He now has a chance to keep his word.

Phil Black, CNN, London.


SWEENEY: Joining me now is William Shawcross, the author of "Rupert Murdoch: Ringmaster of the Information Circus."

Now this is a rather paradoxical story, the tale of Rupert Murdoch, is it not?

WILLIAM SHAWCROSS, AUTHOR, "RUPERT MURDOCH: RINGMASTER OF THE INFORMATION CIRCUS": Why paradoxical? It is a man -- the story of his empire I think is the story of his life, his odyssey from a small town in Australia through most Australia, into Britain, and across into the United States where he has basically consolidated his position, and then gone on from the United States even further westwards to China.

SWEENEY: What drives him?

SHAWCROSS: He just wants to do bigger and better all the time. As far.

SWEENEY: In terms of what, though?

SHAWCROSS: In terms of newspaper ownership and ownership now of greater media. I mean, his father was a newspaper man who never owned his -- the papers that he ran. And Rupert was determined never to work for anyone else.

And he has built, and he has built, and he has built. And I think now, with The Wall Street Journal, what he wants to create is the greatest financial and purveyor news and comment, but mostly news probably throughout the world.

And he will make it very big in China too.

SWEENEY: Is it about being involved, interested in journalism and media as much as some alleged currying political favor and influence?

SHAWCROSS: Oh, I think he enjoys both. I'm sure this -- he once said to me, I like the smidgen of influence newspapers give me. But it is obviously much more than a smidgen. But he just -- he is just sort of -- insatiable is the wrong word, but unquenchable. He just goes on and on and on.

And it is -- he is 76, it is quite extraordinary.

SWEENEY: And what does he want his influence for with governments, for example?

SHAWCROSS: Well, he has strong views. He thinks, for example, in -- he thought that the United States was absolutely right to overthrow Saddam Hussein, and he was very supportive of Bush and Blair.

He thinks in Britain that the European Union is a disaster for business in Europe and that it is sort of -- the European Union structures are sort of a throwback to a socialist age which have no place in a modern, globalized world.

SWEENEY: But how does his conservatism strike with -- or contradict, if it does, his relationship with the Chinese government, for example?

SHAWCROSS: I think he was one of the first people to realize 20 years ago that China was going to be very, very big, ginormous, in fact. And he got into China early and he has been working very hard to create television, in particular, businesses in China.

It has been very hard because the Chinese have been suspicious of him. At one stage he made a famous speech saying that satellite broadcasting would mean the death of dictatorship everywhere because no dictators could control it.

Well, after that, the Chinese dealt with him very, very -- a great distance for quite a number of years.

SWEENEY: Then again, to what ends is he working?

SHAWCROSS: I think a lot of it is fun, actually. He really enjoys it. He hasn't got any sinister master plan. I mean, that is all nonsense, the hysteria about Murdoch I think is greatly overplayed and a lot of it is absolutely absurd.

SWEENEY: All right. But as his hold on media grows and expands and dominates the globe, where do you think it is going to end -- or does it end with his passing?

SHAWCROSS: I should think it ends with his passing. I mean, the empire is -- Murdoch's empire is the story of his life. And he has now got perhaps the jewel in the crown, which is Dow Jones and The Wall Street Journal, with which he will do a great deal.

And it is a rather wonderful counterintuitive investment, if you like, because most newspapers are not sold for vast amounts of money nowadays because people don't think they can make money from them.

Most newspapers are declining. Murdoch, for all the criticisms that are made of him, has invested in newspapers all of his life and kept them going. He has lost millions of pounds on the -- tens of millions of pounds on The Times in London, and he has never closed it.

He plans to make a lot of money on Dow Jones and The Wall Street Journal, but he has paid a huge amount of money for it because he believes in newspapers.

SWEENEY: All right. We will leave it there. Thank you very much, indeed, William Shawcross.

Now, power, politics, and the media. It has been said that, quote, "no big decision could ever be made inside Britain's Number 10 without taking account of the likely reaction of three men: Gordon Brown, John Prescott, and Rupert Murdoch. On all the really big decisions, anybody else could safely be ignored."

Joining me now, Alistair Campbell, director of communications under the former U.K. prime minister, Tony Blair, and author of "The Blair Years."

First of all, Mr. Campbell, is that true, to the best of your knowledge?

ALISTAIR CAMPBELL, FORMER BLAIR DIRECTOR OF COMMUNICATIONS, AUTHOR, "THE BLAIR YEARS": It certainly isn't. I think that was written in a book by Lance Price, who used to work for me. And it is not true, no. But I mean, the reality is that in the media jungle, if you like, Rupert Murdoch is one of the very, very big beasts.

And therefore it is worth any political leader I think just, you know, bearing in mind that down the ages print has a certain ability to influence political debate. Now television and radio and the Internet equally has. And therefore it is always worth bearing in mind that you have got to have dealings with these people.

SWEENEY: And at what point did you realize and start beginning to think of a strategy for approaching Rupert Murdoch? Or was it the same on his side, that he actually wanted to see a change of government as well in Britain?

CAMPBELL: I don't know. And I think -- my analysis of Rupert Murdoch is that he is very, very largely driven by his own business and commercial interests. I think he is basically a newspaper man at heart. But where he has been exceptional in his own field, has been his ability to kind of see the way that the media has developed.

And I think it has been interesting this week to watch the way that the debate over The Wall Street Journal has gone. That in a sense there, a lot of the arguments and demonization about him is borne of things that have happened in the past. But he is kind of always onto the next thing. And he is always, I think, a few steps ahead of his rivals.

But look, I think -- The Sun, his main tabloid newspaper in the U.K., I think it switched sides in the 1997 election in large part because they felt that actually we were going to win. And also because Tony Blair was a very, very attractive, modern leader who spoke to the mainstream and the lives of a lot of people who read that newspaper.

SWEENEY: I mean, if I may quote, sir, to you from your book. On page 603, you talk about Rupert Murdoch coming to dinner, along with his sons. And there ensues a rather heated discussion in Tony Blair's between one of his sons and Rupert Murdoch about the Palestinian-Israeli problem where you say Murdoch was very pro-Israel and pro-Reagan whereas his son James was not at all.

And afterwards Tony Blair said he was quite impressed with the way Murdoch let his sons do most of the talking. "And Murdoch pointed out that his were the only papers that gave us support when the going got tough. 'I have noticed,' said T.B."

I mean, would it have been possible to implement some of the policies that Tony Blair might have liked to implement, particularly regarding the Middle East without Rupert Murdoch's full support?

CAMPBELL: I think so. And I think that in the end leadership -- political leadership is about taking difficult decisions and seeing them through. Something like the build-up to the war in Iraq, it was difficult enough, would it have been even harder without any mainstream media support? Possibly.

But I think in the end that the reality now of the modern media, there is so much of it, whether it is print or it is TV or it is radio or it is the Internet, there is so much of it that a politician -- a top flight politician who knows how to make an argument, who knows how to communicate, they will get that argument through to the public over time.

SWEENEY: I mean, it's a very difficult question to ask. And I'm trying to put it sensitively. But would there ever have come a point where Rupert Murdoch might have put his foot down and said actually, no, I don't agree with something?

CAMPBELL: Well, I think it is -- I have tried -- I think Rupert Murdoch is probably the single most mentioned media figure in the 800 pages of my book. And I have described, for example a time when we went to visit him in opposition.

A conference of his editors in the Hayman Island, where I observed that actually -- and this is, again, I think, relevant to the argument that is going on about now about The Wall Street Journal. Rupert Murdoch doesn't have to sort of tell people too bluntly what he thinks of things, because I think people know what he thinks of things.

He is actually in his own a very effective strategic communicator. So his own editors, I think, know what his basic position is. And they know what kind of politics he believes in. But in the end, as I said right at the start, he is driven in large part, I think, by his commercial and his business interests.

He has got a better understand of the modern media than most people have. He does have an acute understanding of power, I think, and of political power, and how that works. And -- but I can't recall an instance where.

SWEENEY: Speaking of power -- I mean, speaking of power, I think you were about to say you can't recall an instance where he might have directly intervened. But in the U.S., now that he has acquired the Dow Jones, will that curry him more political favor in the United States?

I mean, what do you think his ambitions are politically there, in the political circles?

CAMPBELL: I honestly don't know. But I think his -- I would suspect his ambitions regarding The Wall Street Journal are to get it to take on some of the other broadsheet print media in the U.S., and to get better advertising and more readers and all of that.

But I also think it is part of this bigger vision, if you like, of an understanding of his company bringing together all of the aspects of the modern media in the way that it has developed and is continuing to develop.

And I think, as I said earlier, whether people like him or they don't like him, whether they think he is a good thing or a bad thing, he does have a better understanding of that changing media world than virtually anybody I think in his own business.

SWEENEY: One colleague I was speaking to today said that she would love me to ask you if it were true, as a final question, that the British media during your time as director of communications on Downing Street were afraid of you and that the only person you were afraid of was Rupert Murdoch?

I'm sure you would disagree. Do you comment?

CAMPBELL: I don't think the British media were that afraid of me. And I think that when you said earlier about, you know, how newspapers and newspaper owners make their views known. I mean, you know, the print is still a very, very effective way of carrying out -- for putting out your views.

But I -- look, I don't think I was afraid of Rupert Murdoch and nor was Tony Blair. But it is -- you know, Tony Blair had a very acute respect for his intelligence, certainly, for his understanding, his assay of the way that the world was changing -- the business world was changing, the media world was changing.

SWEENEY: Alistair Campbell in New York, thank you very much, indeed, for joining us.

Up next on INTERNATIONAL CORRESPONDENTS, doubts raised about The New Republic's "Baghdad Diarist." Did the Army private provide a story that was just too good to be checked for a magazine already infamous for fictitious reporting.


SWEENEY: Casting off a pen name, an Army private says he is the "Baghdad Diarist" for the politically liberal U.S. magazine The New Republic. Scott Thomas Beauchamp says "Shock Troops" and the two other pieces he wrote stirred more controversy than he could ever have anticipated.

And now, according to The New Republic's Web site, a military investigation has been launched into the incidents described in the article. Frank Foer, The New Republic's editor, has also stated the magazine plans, to the greatest extent possible, to report every detail.

Well, more in a minute on why Mr. Beauchamp's narrative has created a media uproar. But first a look at one of his articles. In "Shock Troops," he wrote, quote: "I love chicks that have been intimate with IEDs. It really turns me on, melted skin, missing limbs, plastic noses. I was thinking of getting some girls together and doing a photo shoot. Maybe for a calendar? IED Babes." Well, joining me now is Howard Kurtz of The Washington Post, who has been following this story closely.

Howard, let's start from the beginning, from the very first article to where The New Republic stands today.

HOWARD KURTZ, HOST, "RELIABLE SOURCES": Well, at first this blogger, this "Baghdad Diarist" was a mystery man. He was using a pen name. Nobody knew who he was. And he had these sort of gripping anecdotes, almost too perfect anecdotes, about petty cruelty by members of the U.S. Army in Iraq.

So this counter attack among conservative Web sites, said they just didn't believe that these incidents could be true. And some questioned whether this guys existed at all.

SWEENEY: And so then at what point did The New Republic decide -- or did the author himself decide to identify himself?

KURTZ: Well, I think once the U.S. military began an investigation, Scott Thomas Beauchamp decided that his identity was going to come out. So he went public to the extent of identifying himself and defending what he had written.

The problem for The New Republic and for the media in general is, it is very difficult to prove one way or another that these incidents actually took place. They almost kind of fall in the "you had to be there" category.

For example, he says he witnessed and was told about U.S. soldiers using Bradley Fighting Vehicles to run over stray dogs just for amusement. All of these episodes kind of make the U.S. military look bad.

And so some are wondering whether this guy, who has written some liberal screeds on other Web sites that -- whether he has some kind of agenda in possibly exaggerating some of these episodes.

SWEENEY: And in fact, when you mentioned the Bradleys there, I think if I'm not mistaken, that somebody actually disputed the ability of Bradleys to do what Scott Thomas, this blogger, was saying they could do.

KURTZ: Yes. Some in the military and just some people who write in to Web sites who have military experience doubt that the vehicle could do exactly what Scott Thomas Beauchamp described.

It also, for example, at this particular base in Iraq, it is not that big a base. There aren't many women there. And a number of soldiers who have served there have said they never saw this woman who supposedly was mocked by other soldiers because her face had been disfigured from some kind of roadside bomb.

So, so far The New Republic is investigating, has not really been able to corroborate in any meaningful way some of these episodes. And that has cast additional doubt on this whole thing.

Now my first thought was, where did they find this guy? An Army private who has such a good eye for detail and is also a good writer? Well, it turns out the guy is married to a reporter for The New Republic magazine.

SWEENEY: And so where does it leave The New Republic, which has been involved over the last 10 years in some credibility issues?

KURTZ: Yes, especially there was famous case here about a decade ago where a staff writer for The New Republic fabricated all kinds of pieces. A movie was made about it. So this was not what The New Republic wanted to happen.

What is happening is the editors are scrambling to try to confirm some of these incidents and prove that what was published in the magazine was not fiction. The problem is, their main source, their guide, the husband of their staffer, Scott Beauchamp, he has had his cell phone and his e-mail and laptop confiscated by the U.S. military.

So it is difficult to communicate with him. It is difficult to communicate with other members of his unit. All of this creating quite an ethical quandary for the magazine that still insists that these accounts are true, but has not yet been able to prove them.

SWEENEY: Quite a conundrum. We will have to wait and see how it develops. Howard Kurtz in Washington, thanks, as always.

Now CNN did contact The New Republic, but they declined to comment.

Up next on INTERNATIONAL CORRESPONDENTS, politically ever after. Whatever happened to fairy tales? And Curious George is the latest trend in children's bedtime stories' partisan (ph) politics. We will page through some of the polemics.


SWEENEY: U.S. politics for preschoolers. Children are reading bedtime stories with a blatant political message. It seems that the days of "Green Eggs and Ham" have given way to tales that are all about partisanship.

Ted Rowlands has more on putting the right or the left in books for children.


UNIDENTIFIED FEMALE: "Help! Mom! There Are Liberals under My bed!

TED ROWLANDS, CNN CORRESPONDENT (voice-over): Believe it or not, that's the title of a children's book, one of several with a political message aimed at kids.

UNIDENTIFIED FEMALE: And with that the liberals took over Tommy and Lou's stands.

ROWLANDS: The main characters, Tommy and Lou, lose their lemonade stand because of "liberals" including a Ted Kennedy look-alike and a character named "Congresswoman Clunkton," who resembles Hillary Clinton.

In the story, Tommy and Lou are legislated out of business.

ERIC JACKSON, WORLD AHEAD PUBLISHING: It has some liberals who just coincidentally look like Ted Kennedy and Hillary Clinton that try to tax and regulate a lemonade stand.

ROWLANDS: Eric Jackson is the publisher of this book and two other conservative children's books. Jackson says he doesn't think elementary school-aged kids are too young for partisan politics.

JACKSON: A lot of parents are looking for a book that represents their conservative or traditional point of view.

ROWLANDS: It's not just conservatives. The other side is doing it too.

JEREMY ZILBER, AUTHOR: "Democrats make sure everyone is treated fairly, just like mommy does."

ROWLANDS: Jeremy Zilber wrote, "Why Mommy Is a Democrat," which he sells mainly over the Internet from his house in Madison, Wisconsin. His book tells children that Democrats are just like mommy, they are nice to everyone, they make sure sick people can see a doctor, and, according to the book, they make sure we're always safe.

ZILBER: We teach them science, we teach them math, we teach them history, we teach them...

ROWLANDS (on camera): But, all that is factual, isn't it? I mean, this is not factual in that Democrats aren't all these great things.

ZILBER: Well, I think this is -- it's certainly based on fact.

ROWLANDS (voice-over): The fact is both sides believe their political message is so important that it's worth delivering to children. According to a children's book expert, at the University of Wisconsin, none of the books are very well written for young readers.

KATHLEEN HORNING, CHILDREN'S BOOKS CENTER, UNIVERSITY OF WISCONSIN: I can't really imagine a child wanting, "Help! Mom! Hollywood's in My Hamper," for example, read multiple times.

ROWLANDS (on camera): Political messages in children's books is nothing new. More than 20 years ago, Dr. Seuss did it in "The Butter Battle Book," the story of the Zooks and the Yooks, neighbors that build up competing arsenals, mimicking a nuclear arms race.

(voice-over): While this wave of books takes partisanship to what some think is a disturbing level, those behind the books, from both the left and the right, disagree.

Ted Rowlands, CNN, Madison, Wisconsin.


SWEENEY: And that is all for this edition of INTERNATIONAL CORRESPONDENTS. Tune in again next time for another look at how the media are handling the big issues. I'm Fionnuala Sweeney, thanks for joining us.