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Murdoch evidence supports break-up of his empire

What do you do with a global firm now worth $50bn, run by its family founders who control most of the votes but only 13% of the equity, when the CEO turns 80 and the empire is clearly too large for its management? That was the central issue highlighted on Tuesday in the Wilson room in the Commons. It was convenient for the old man, when asked for evidence he stumbled over and couldn’t provide, to dismiss his ignorance on grounds that he’d “lost sight of” the details because News of the World had been less than 1% of the total enterprise. Amnesia can be a useful ally in a cover-up, as it was for Reagan in the Iran-Contra fiasco. But here it was probably genuine. The truth revealed starkly yesterday is that the Murdoch empire is now too large for the Murdochs to be able to govern effectively.

So what happens when you’re the CEO of a massive corporation and have lost your grip – when a worldwide audience and key shareholders have now seen this sharply played out before their very eyes? Even if the Select Committee sessions yesterday failed to break the omerta of who knew what when, they did expose the inevitability of a major management shake-up. Two problems stand in the way. The chosen heir, James Murdoch, is robotic, bad-tempered and has admitted guilt in making pay-offs of nearly £2m, implying knowledge of illegal activity and an attempted cover-up. The other is contagion – the uncertain and arbitrary impact as discovery of phone-hacking or other criminal activity crosses the globe, particularly in the US.

The dismemberment of such a powerful enterprise should not of course be left to private discretion. Its prominence in the key role of agenda-setting in a democracy, its excessive concentration of power within a narrow coterie, its institutionalised criminality now clearly revealed, its unsavoury influence within the country’s power structure now laid bare, are all good reasons for overriding public decisions to determine its future. The dissemination of information and opinion in a democracy cannot be left as the private prerogative of a mogul, whether a Rothermere or a Beaverbrook or a Murdoch.

The most important reform needed from the Leveson inquiry into the press is limiting the ownership of one man or one organisation to a single Daily plus Sunday, and the incentives to encourage new entrants into the newspaper market to increase diversity and improve balance within the press. To that should be added consolidation and strengthening of the law restricting monopolistic cross-media ownership between broadcast and print media – a firewall which Thatcher spectacularly breached in the 1980s at Murdoch’s prompting and which set him on the road to real power. If the public inquiry secures these two objectives, some good might at last come from this awful scandal.

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