The Murdochs get a Spanking
The British Parliament sent billionaire publisher Rupert Murdoch through the gauntlet, mincing no words, declaring him "not a fit person" to run a major international corporation. As was evident in their testimony last fall the long-awaited report Tuesday found three senior executives misled Parliament, trying to cover up phone hacking at the now defunct News of the World. The pronouncement invites a political challenge to Prime Minister David Cameron's leadership. It was Cameron who was quite cozy with Murdoch and some of the conglomerate's top executives. Labor Party opponents want Murdoch's controlling interest in the very lucrative BSkyB to be reduced substantially from the present 39.1%. The British FCC, Ofcom has only once withdrawn a license in its 9 year history, but expect at least a reduction of shares order for the Murdoch family. The committee report explicitly says son James lied and blames him: "Had James Murdoch been more attentive to the correspondence that he received at the time, he could have taken action on phone hacking in 2008, and this committee could have been told the truth..." The popular defense, "I ran the company, but I didn't know what was going on," isn't working here anymore than it did when Enron's Kenneth Lay tried the same defense in Texas in 2002 and was convicted in 2006. It's far from a love affair between the Murdoch family and News Corps shareholders, who'd like to marginalized the power of the family. The stock here in the U.S. moved up once the Parliamentary "unfit person" edict was known. What the U.S. courts will do, if anything, is an open question for the moment. Rupert Murdoch issued a statement to his employees evading criticism of himself and saying, "There is no easy way around this, but I am proud that we have been working hard to put things right."