$750M of hush money paid out over the years

For some months now, The Slog has been running ‘What Murdoch companies elsewhere get up to’ as part of my naive plan to wake up Cameron and Hunt to what they were dealing with. (These posts can be found by using the search engine on my Hackgate page). They have been well-read by the Slog’s American audience, which is these days about 15% of total hits.

Yesterday I was tipped off about (and subsequently checked up on) an amazing allegation only now being taken seriously there: that via his infamous publisher buddy Roger Ailes, Rupert Murdoch’s Newscorp perfected the technique of records ‘blagging’, and certain other methods of phone-call interception, many years ago in the US.

They did this in a mysterious research centre known only as The Brain Room.

Ailes (an oddly controlling obsessive in the Howard Hughes mode) has featured in several of The Slog postings in this series. They include examples of Ailes spying on employees, accessing their phone records, and firing employees – followed by million-dollar payments after they accused him of getting them to lie to the FBI. But these latest allegations go much further.

The Brain Room was run by one-time Murdoch ‘political lobbyist’ and Tobacco industry lobbying hero Scott Ehrlich. Ehrlich still has a ‘consulting’ contract with Fox News via his media company Red Tie. Says pro-Assange secrets campaigner Tim Dickenson:

“Befitting his siege mentality, Ailes housed his newsroom in a bunker. Reporters and producers at Fox News work in a vast, windowless expanse below street level, a gloomy space lined with video-editing suites along one wall. In a separate facility on the same subterranean floor, Ailes created an in-house research unit – known at Fox News as the ‘brain room’ – that requires special security clearance to gain access. The brain room is where the evil resides. It’s where Willie Horton came from.”

The Willie Horton reference means nothing in the UK, but Dubya’s daddy George Snr used it against Democrat candidate Dukakis in the 1988 Election in the US. Horton was a murderer allowed out on a leave programme who killed again during one leave period. The scheme had been instigated by Dukakis when he was governor of the State. The consultant to Bush senior (the revelation sank Dukakis) was none other than….Roger Ailes. Nobody ever really worked out how Ailes gained the inner secrets of the case. But this man went on to run Fox News for Rupert Murdoch. And go seemingly rather mad while he was doing so. Allegedly. Ailes said at the time, “The only question is whether we depict Willie Horton with a knife in his hand or without it.” Very Fox News.

Meanwhile, a trusted Slog source in Washington DC maintained late last night BST that the FBI – having been foolish enough to tell the media it was investigating Newscorp – has been swamped with accusations of both a corporate and personal nature.

“I guess the pile of victims your police got is going to be dwarfed by this mountain,” said my informant, “Stories have been circulating for years about grubby payoffs that help sweep under rugs. But the big fat payoff the Feds want here is a 9/11 link”.

The facts support my source’s assertion. The New York times, for instance, reported in 2009 how the New Jersey company Floorgraphics accused Newscorp of hacking into their password-protected computer systems to obtain proprietary information for an ‘investigative’ news story. The subsequent journalism was described as “utterly false and malicious” by the company, which lost several lucrative contracts as a result.

In the end – paranoid about publicity relating to The Brain Room – Newscorp bought Floorgraphics outright after a $29.5M settlement had been turned down by the corporate victim. Clearly, Rupe’s investigation impressed the mogul so much, he bought the company. Or something like that.

I’m grateful to The Slog’s main New York source for helping establish that this $30million gagging bribe appears to be just the tip of a gigantic iceberg beneath the surface of Murdoch’s US activities.

“Some estimates suggest that the Newscorp hush-fund is heading up towards a billion dollars,” she writes, “and there are several published articles suggesting it’s well over $650 million. So I guess the truth lies somewhere between the two”.

The familiar sight of Murdoch’s tentacles looking for government favours is also disturbingly present….as it is in every country where he operates. David Cay Johnston of Reuters – a leading and award winning tax journalist – recently reported:

‘Over the past four years Murdoch’s U.S.-based News Corp. has made money on income taxes. Having earned $10.4 billion in profits, News Corp. would have been expected to pay $3.6 billion at the 35 percent corporate tax rate. Instead, it actually collected $4.8 billion in income tax refunds, all or nearly all from the U.S. government.

Fox News, the editorial pages of his Wall Street Journal and other Murdoch outlets often rail against taxes. Their attacks on government benefits for the elderly, the sick, the jobless and children focus attention on the uses of tax dollars and away from his aggressive efforts to enjoy the benefits of civilization without paying for them.’

When right-wing commentators note that ‘there is nothing Barack Obama would like better than to close Murdoch down in the US’, their assumption is one of a Democrat President trying to remove an opponent. In fact, it is more to do with Obama’s sense that Newscorp is already far too powerful and above the law in America. He will not have been reassured by recent events in the UK.