The millionaire's media megaphone

Fox News, Air America, and the wealthy who shape our politics through media ownership

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Rich people live lives that most everyone else can only imagine. They can buy the nicest cars, drink the finest wines, afford the best doctors, and secure the highest priced lawyers. But when it comes to making donations to their favorite presidential candidates, they are like ordinary Americans in that the most they can donate is $2,300 per election cycle. Still, there is another way that only someone with megamillions can influence an election: buy a newspaper, radio network, or cable channel and use it to help a candidate get to 1600 Pennsylvania Ave.

This is what Alexander Hamilton and several of his Federalist Party allies did in 1801 when they founded The New York Evening Post to spread their anti-Jefferson views.

It is what William Randolph Hearst did when, having received The San Francisco Examiner as a gift from his father, he opened newspapers in New York, Chicago, Los Angeles, and Boston to further his political pursuits.

It is what the Reverend Sun Myung Moon, the leader of the Unification Church, did in 1982 when he started The Washington Times as a conservative antidote to The Washington Post.

And it is what Australian-born Rupert Murdoch did in 1996 when he started the Fox News Channel, which today has a reach far beyond its relatively small viewing audience. The cable channel may only have 1.5 million viewers, but when it makes news, say by trumpeting an inaccuracy or when one of its commentators attacks a guest, many other media outlets often report it and the blogosphere has a field day. As we head toward Election Day in November, there have has already been several such episodes.

In the quadrennial orgy of political spending known as “the buying of the president,” one highly effective way to spend millions is to invest in media outlets that provide political leverage. It’s perfectly legal — the campaign finance laws contain what is referred to as a “media exception” exempting from regulation the money spent on producing and distributing news stories and commentary. In some cases investments in the media not only pay political dividends but also earn dollar profits. Yet others lose money by the ton with little or no hope of profit, and the losses roll on as long as the owner thinks the political gains are worth it. Reverend Moon’s losses on The Washington Times are estimated to exceed $2 billon over a quarter century.

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At different times in our nation’s history different publishers and broadcasters have pushed different political perspectives, deciding which issues will be raised, which will be ignored, which candidates will be touted, and what should or shouldn’t be news. Hearst started out as a populist, for example, but became more conservative with age. At this moment in our history, the dominant voices among politically-potent, partisan media-owners are conservative. Only the four-year-old Air America strives to project a liberal voice, and to date it’s barely audible in most of the country, especially when measured against the giant megaphone that is Rupert Murdoch’s Fox News Channel.

Murdoch and the people who work at Fox News do not acknowledge that it has a conservative perspective; many conservatives see a comprehensive liberal bias in the mainstream media and accept the claim in Fox’s promotion: that it’s “fair and balanced.” Likewise, the unabashedly conservative and combative Bill O’Reilly says his O’Reilly Factor opinion show — it’s been the No. 1 cable show in its 8 p.m. time slot for more than seven straight years — is a “no-spin zone.”

However it is categorized, the Fox News Channel attracts a disproportionate number of conservative viewers. A recent Rasmussen Reports national telephone survey found that 87 percent of Fox News viewers say they plan to vote in November for John McCain, the presumptive Republican nominee for president, and only 9 percent plan to vote for his Democratic opponent, Barack Obama. Conversely, about two-thirds of the viewers of the other two cable news channels, CNN and MSNBC, say they plan to vote for Obama.

Is Fox simply a powerful magnet for conservatives? Is MSNBC, home of the ferociously liberal commentator Keith Olbermann, tilted toward liberals? Rasmussen also found that national security is the No. 1 issue for Fox viewers and that for CNN and MSNBC viewers it is the economy. What “liberal” and “conservative” mean is open to debate, and the meaning of the viewership split is open to speculation.

What is not open to speculation is that Murdoch is today’s most vividly successful media mogul with a political agenda. Like Hearst, he came into control of a newspaper as a young man — he inherited The News, in Adelaide, Australia, when he was 21 — and now his News Corporation empire is global in reach, owning not only magazines and newspapers, including The Times of London and The Wall Street Journal, but also film studios, book publishers, major Internet players including MySpace, and broadcast, satellite, and cable television stations and networks that reach every continent. Now 77, he ranks No. 33 on the Forbes 400 list of the richest people in the world, with a net worth of $8.8 billion.

In addition to the profitable cable news channel, his News Corp. also owns The New York Post (the Evening Post that Hamilton founded), which reliably loses tens of millions annually but just as reliably provides a conservative political voice in the nation’s largest city, and The Weekly Standard, a neoconservative opinion magazine founded by Bill Kristol. “Rupert calls once every few weeks, and we chat about politics,” Kristol told The New Yorker in 2006. “I would say he’s a pragmatic conservative. He’s pro-markets, and pro-defense, but he’s not a movement conservative.” The magazine loses about $1 million a year, but with Murdoch’s vast wealth, it appears, it’s a modest price to pay for The Standard’s impact on political thinkers. (Almost all political opinion journals, from left to right on the political spectrum, operate at a loss or, like Harper’s or the liberal The American Prospect, as not-for-profit entities.)

Reverend Moon, having sunk billions into the money-losing Washington Times, is a contender for No. 2 after Murdoch in terms of investing in a media megaphone. His News World Communications, supported by Unification Church money, also owns United Press International and Insight magazine, and formerly owned a newspaper published in New York City. The church subsidizes its publishing through an array of businesses that include major real estate holdings and a major fishing fleet.

Another possible for No. 2 is Sinclair Broadcast Group, the nation’s largest owners of broadcast television stations, which says its 58 stations reach about 22 percent of U.S. households. Sinclair set off controversy in the 2004 election cycle by openly promoting conservative perspectives, although CEO David D. Smith denied a political motive. To date the company has not been openly political in the current election campaign.

Adding to the conservative media din, which media critics often refer to as an “echo chamber,” is talk radio. A 2005 entry is Fox News Radio, now syndicating the audio of its TV programming to hundreds of local stations and available on satellite radio as well. The dominant talk radio hosts are conservatives — the pioneering Rush Limbaugh is No. 1 in the ratings, and Fox’s Sean Hannity, is No. 2.

In many ways, Rupert Murdoch is the modern-day William Randolph Hearst. Both men parlayed a single newspaper into a vast media empire with tremendous reach and indisputable influence on American politics.

By the early 1990s, Murdoch had become convinced that a significant part of the U.S. population was more conservative than the American media. Murdoch wanted to offer an alternative. Part of his motivation derived from what he perceived as too-friendly coverage of Democratic President Bill Clinton and the Democratic Party. He said at the time that he wasn’t starting a conservative network, but instead giving conservatives equal time and access.

In 1996 he launched the Fox News Channel, challenging CNN, then in its 18th year as the only cable all-news channel, as well as MSNBC, which General Electric, Microsoft, and NBC had launched only two months earlier. Few thought Murdoch could succeed.

“When we started Fox News,” Murdoch told Variety last year, “I was considered an idiot. How could I possibly do that, spend a billion dollars? It’s worth $10 billion today.”

One of the chief reasons Fox News has succeeded is Roger Ailes. In February 1996, Murdoch hired Ailes to be chairman and CEO of the Fox News Division. Ailes was a known political partisan who had begun his career as a disc jockey while attending Ohio University. After graduating in 1962, he turned down a job as a sports announcer at a radio station for one as a “prop boy” at a Cleveland television station. “The radio job paid more,” he wrote in his 1988 book, You are the Message: Secrets of the Master Communicators. “But my intuition told me that the future was in television.”

His entry-level job led to his becoming a producer for a local Cleveland TV program called The Mike Douglas Show. Douglas was then a little-known former band singer and the show offered celebrity interviews; the show gained popularity, went into syndication, and stayed on the air for 20 years.

At age 28, a fortuitous meeting in the green room of Douglas’s show would alter Ailes’s life. Douglas guest Richard M. Nixon didn’t think much of television. He thought it was a gimmick he needed to get elected. But Ailes understood TV’s power and politely told Nixon that TV was no gimmick. Nixon was so impressed that he hired Ailes in 1967 to help him run for president, according to Joe McGinniss’s book The Selling of the President, 1968. Ailes went on to work as a media mastermind for the campaigns of Presidents Nixon, Ronald Reagan, and George H.W. Bush. In 1989, he worked for Rudolph Guiliani in his first, although unsuccessful, bid to become New York’s mayor.

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While Murdoch may have hired Ailes in 1996 and financially backed the network, it was Ailes, the Republican operative with years of TV experience, who started the network from scratch and shaped what it would become. He basically started the network in six months. “We had no newsgathering operation,” Ailes told reporter Scott Collins for his 2004 book, Crazy Like a Fox: The Inside Story of How Fox News Beat CNN. “No studios, no equipment, no employees, no stars, no talent, and no confidence from anybody.” (Former Fox News employee Dan Cooper has disputed this version, arguing that several key people were in place pre-Ailes.)

Creating a newsroom for the 24-hour news channel meant hiring reporters, editors, and producers. But where Ailes especially excelled was in creating the commentary shows that have become Fox’s signature and account for most of the network’s popularity and its loyal audience.

One of Ailes’s smartest decisions was to hire Bill O’Reilly, an in-your-face curmudgeon, to start a daily, must-watch primetime news talk program. O’Reilly had come from the tabloidy entertainment show, Inside Edition, where he was host.

O’Reilly, who was part of Fox’s inaugural lineup, has created a following of close to 2.5 million for The O’Reilly Factor, according to Nielsen Media Research in May 2008. In comparison, MSNBC’s left-leaning Keith Olbermann, who many consider the O’Reilly counterpart and who competes with him for viewers in the 8 p.m. time slot, has a bit less than half of O’Reilly’s viewers.

The other successful primetime show belongs to the admittedly right-of-center Sean Hannity of Hannity & Colmes, a tag-team liberal-conservative pair dominated by the more telegenic Hannity.

Ailes expected it would take at least six years for his fair-and-balanced network to catch up with CNN. It happened in four.

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