America’s Two Crises

[If you’re as fed up with Rupert Murdoch’s Evil Empire as I and most of the civilized world are, and if you seek an alternative to WSJ, click here.]

In Chinese writing, the word “crisis” has characters for “danger” and “opportunity.” What a wonderful description of the concept! If you handle a crisis well, you may succeed beyond present hope. If you handle it poorly, you may not survive.

Much media attention today focuses on the 2012 elections. But we have two crises right now that are far more important. The first has more danger and the second more opportunity. But if we don’t resolve both to our advantage, we may seal our own fate regardless of what happens next year. In fact, the two crises’ outcomes may foretell the results of the 2012 elections.

1. Default by Uncle Sam. The first crisis is perhaps the most difficult to face. As I have explained in detail, a national default would unbalance the global financial system, with both immediate and longer-term catastrophic consequences for US economic leadership.

Some consequences, such as replacing the dollar as the chief international currency and the basis of oil prices, might take some time. But bad effects, including rising interest rates and inflation here at home, would begin immediately and get steadily worse.

And that’s only half of it. There is also a significant probability that a default would kick the US back into recession, a “double dip.” If the default continued for more than a month or two, it might turn into a US depression and global recession.

So a lot of evil would flow from default. You might think that would make the choice easy. Just avoid default at all costs.

But the truth is just the opposite. If the President avoided default by caving in to the extremist ideology of the House GOP Freshman, almost equally awful consequences would ensue.

Foreigners would conclude that the United States is not serious about reducing its debt and deficits because it is unwilling to raise revenue. They would also fear that, by unwinding social safety nets in the middle of a severe recession, we would subject ourselves to vastly increased risk of political instability and even revolution, electoral or otherwise. Foreigners therefore would be more circumspect in dealing with us, and international investors would begin to move money out. Our national reputation as a sober, practical financial problem-solver would be gone forever.

Hard numbers, which can’t be “spun”, corroborate these fears. A $4 trillion reduction in debt was the maximum ever under serious bipartisan discussion. Even if enacted, it would reduce today’s deficit by only 28.6%—barely more than a quarter—in ten years. Moreover, based on this year’s interest figure ($386 billion per year), nearly all of the debt reduction would go towards interest on the national debt. Even without compounding, and without any additional spending, such a “solution” would leave us with over 99% of our current national debt still outstanding in ten years.

No reasonable outside observer could see this proposal as a serious effort to deal with our national debt, especially if achieved at the cost of social and political instability. So to avoid playing the fool to anyone abroad who can reason and do arithmetic, we must, as a nation, decisively repudiate the right wing’s “no tax increase, ever” ideology.

There are some belated signs that national polls and political pressure are causing the GOP House zombies to rethink their pledge to Grover Norquist. If so, an interest-only debt deal with some increases in revenue might portend the beginning of a long, slow period of national renewal.

But, if the “big” interest-only deal fails, the President will have only two ways to move the nation forward. He can negotiate a “small deal” that staves off national default and gets a foot in the door for revenue increases. Or he can allow a default to occur, let the GOP take the well-deserved blame, and try to pick up the pieces and control the damage as quickly as possible. Anything less than these two alternatives will just kick the crisis down the road, allowing our national decline to lengthen and steepen and our foreign credit to weaken.

2. Dismantling Rupert Murdoch’s Empire of Corruption. The second crisis is much less a strategic puzzle than a matter of will. All it requires is diligence and perseverance to solve. And the job is mostly one for our law-enforcement authorities and our remaining independent media.

For almost two generations, an utterly ruthless and unscrupulous man—Rupert Murdoch—has been seizing control of the free media in the English-speaking world. He has bent them to his will, ignoring the rules of objectivity and impartiality in journalism, using free speech as a shield for grossly irresponsible partisanship, and buying, blackmailing or trampling all opposition.

By means that no doubt included bribery and blackmail, he succeed in dominating the news media or their fastest-growing segments in his native Australia, the “Mother Country,” and finally the United States. On the way, he bought himself a British knighthood and US citizenship to speed his plans. The only native-English-speaking nations that remain relatively immune from his all-corrupting influence are Canada and tiny New Zealand.

Not only was Murdoch’s media empire a prime mover in our nation’s greatest foreign-policy error since Vietnam. Not only has it created a political atmosphere in which civil discourse is impossible and national default seems possible for the first time since we rose to global power. It has also contributed to the national mythology that is undermining our government and even our private business every day. And, as if that were not enough, it has thrown all its considerable weight against our reducing our dependence on fossil fuels by ridiculing the science of climate change and hyping the declining abundance and questionable economics of fossil fuels beyond all reason.

In short, Murdoch is more responsible for the declining state of our nation than any individual now alive, with the possible exception of George W. Bush. And “Dubya” never would have gotten close enough to the presidency for the Supreme Court to steal it for him without the grossly partisan propaganda of Murdoch’s media empire.

So if you want to pick the single living individual most responsible for our national decline and the disappearance of the American Dream, it’s Rupert Murdoch. The question is, what will we do about him?

After decades of serf-like acquiescence to his predations, we have an opening, brought to us by events in the Mother Country. Independent reporters in the British (aptly named) Guardian and later the New York Times have turned over a few stones and exposed some maggots in Rupert’s empire. Not only have these miscreants hacked the phones of dead children and prime ministers. They have deliberately tried to instill Mafia culture [search for “Carlucci”] in an organization supposedly dedicated to truth.

Now the tide of public opinion is turning, and the proper course of action is clear. We must strike while the iron is hot. We Yanks cannot let the British so-called “scandals” that have eroded Murdoch’s power across the Pond go to waste.

Independent journalists here must redouble their digging, on every aspect of the Murdoch Empire in every one of its vassal states, including ours. Prosecutors must start investigating and prosecuting every whiff of a crime.

There are several laws that Rupert or his minions here may have violated. They include the Foreign Corrupt Practices Act, the Racketeer Influenced and Corrupt Organizations Act, the Computer Fraud and Abuse Act, the Electronic Communications and Privacy Act, and the privacy provisions of the Patriot Act. If half the allegations in the newspapers are fact, there should be enough there to put key executives away for decades, if not Rupert himself.

In addition, antitrust authorities here in the US, plus their counterparts in the EU, should use every violation of law they can find to dismantle Murdoch’s media empire and subject it not just to the scorching light of real journalism, but to the fire of honest competition.

That is not all. We must revisit and re-enact two sets of laws that, if still in force, might have limited Rupert to a minor tabloid empire, something like the old, now defunct National Enquirer.

Before the reign of Ronald Reagan, mass broadcast media could not attack public figures without giving them a chance to respond, on air and for free. This rule, the “Fairness Doctrine,” was ruled constitutional in a case called Red Lion Broadcasting Co. v. FCC. Reagan’s FCC repealed the rule, opening our mass media to lies mislabeled as “fair and balanced news.”

Once we also had strong rules against media cross-ownership, which prevented dangerous mergers consolidating media power in a few hands. Rupert used his corrupt influence to weaken them and bought US citizenship, by a special act of Congress, to subvert them.

Much has changed in technology and media since these two laws originally came to be. But two things are clear. First, we must have some means for public figures attacked in the mass media to make a response as effective, and with an audience as wide, as the attack. Second, we cannot allow owners of media to become powerful enough, as Murdoch has done, to control even a significant fraction of our mass media. Monopoly of media markets by a single, self-interested individual is no more conducive to the “marketplace of ideas” that our First Amendment is supposed to protect than is the government censorship that our Founders feared most.

How we bring the monster Murdoch down and re-establish free and rational markets for political discourse may be our most important step in saving our nation from irreversible decline. It is much more important than prosecuting the few remaining terrorists, especially now that bin Laden is dead. For Rupert Murdoch and his twisted media empire have done more harm to this nation than all the terrorists in our history.

Our prosecutors and antitrust authorities should declare war against them and make that war their top priority. Unlike the war in Iraq and even Afghanistan, this is a war we must win if we are to restore our democracy and recover freedom of speech that works in practice, not just in theory.

As authoritarian nations like China and Russia look at our recent history, they must be laughing. They still control their own mass media, but they have learned much from their disastrous flirtation with Communism. They would never let things get so out of hand that some fifth of their entire population believed in economic fairy tales told by media controlled by a single private person.

If English-speaking democracy—and perhaps democracy itself!—is not to become extinct like the dodo, and if China’s and Russia’s brands of rule by a self-selected meritocratic elite is not to become the leading model for the rest of the world, we’re going to have to do at least half as well in suppressing idiocy spewed by people like Murdoch and their minions. (As you read this, Murdoch has India’s chaotic democracy next on his target list.)

We now have a chance to act. There are cracks in the castle walls of corruption. All we have to do is get our battering rams pounding the walls 24/7/365 and keep pushing and banging until the they come tumbling down. Once we can see the monsters inside and the maggots under rubble in full daylight, we still may be able to save English-speaking democracy and, with it, our way of life.

Can Bloomberg.com succeed the Wall Street Journal Now That It’s Dead?

The full realization of Rupert Murdoch’s unmatched role in our national decline has led me to question my own actions. Have I unwittingly supported his global power? I canceled my cable TV subscriptions once I retired, and I never watched Fox anyway. But did I unwittingly support him in another way?

I’ve subscribed to the Wall Street Journal for about thirty years, since a mentor recommended that I read it to learn more about business. It taught me much of what I know about business and investing, and some of what I know about economics.

When I first subscribed, and for much of the ensuing three decades, the Wall Street Journal was a great newspaper, comparable in quality to the New York Times, the Washington Post, and the Los Angeles Times in its heyday. The old Journal confined its right-wing slant on politics to the editorial pages and gave its reporters leeway to report the news.

But all things change. In 2007, the Bancroft family, who then owned the Journal, decided to sell it, and its parent, Dow Jones, to Murdoch’s News Corp. Like many others, I opposed the sale. I wrote an essay to that effect, to no avail. The rest is history.

In my 2007 essay, I compared Murdoch with William Randolph Hearst in some detail. The resemblance is uncanny. It extends from their mutual imperialism and jingoism and the tragic consequences, through their influence on (if not control of) national politics, to their tendencies toward lordly aristocracy, as exemplified by Hearst’s grand castle at San Simeon.

But both men’s worst feature was deliberately distorting the news, both for sensationalism and to achieve ideological objectives. As I put it then, “What’s true of civilization generally is true of journalism in a microcosm. We don’t need folks who make their own reality. We need folks who take care to understand and inform us accurately of the reality that exists.”

I’ve continued to read what’s now the “WSJ” on line. I’ve done so, I’m now ashamed to say, out of sheer inertia and misplaced brand loyalty. But I needed (and still need) a reliable source of business news to manage my investments and stay aware of the world, in which—for the first time in my 66 years—the private sector now reigns supreme, virtually worldwide except for China, Iran, North Korea and Zimbabwe.

Unfortunately, WSJ is no longer a reliable source of news. The fault begins with the headlines, which often prove misleading summaries of the stories that follow. Not surprisingly, the discrepancy always leans toward jingoism abroad, lower taxes and no regulation here at home, and a constant drumbeat of express and implied criticism of Democrats in general and the President in particular.

Once you get past the misleading headlines (with which Murdoch himself once meddled), the stories are no better. There are obvious factual inaccuracies that any trained business reporter, let alone a more experienced editor, should have identified and caught. There are persistent and widespread attempts to bury facts favorable to government or Democrats in the middle or at the end of stories. As a result, organization is universally poor, for it serves as a tool of propaganda, not explication. And the WSJ’s reporters apparently failed to ask obvious, burning practical questions more times than I could count.

WSJ's bias extends not just to domestic politics, but to global affairs and our part in them. Stories about successes elsewhere in the world, especially in China or Russia, often have portions or companion stories, having nothing to do with current events, purporting to show just how bad things are there and/or how much better they are here.

As readers will recognize when I drop my anonymity, I have more than passing experience with Russia. Among other things, I used to read the Soviet house organ Pravda.

WSJ now has come to display the same sort of chip-on-the-shoulder, sour grapes jingoism that Pravda once made famous. If someone else does something good, it can’t be that good, and anyway we do it better and our system is better. WSJ, just like Pravda in Soviet times, takes that puerile approach to many positive developments abroad.

In that respect, WSJ often reminds me of a resentful teenage boy trying to show that his father, despite obvious flaws, is the best on the block. So do the numerous ungrammatical, poorly written, poorly organized, illogical and endlessly repetitive comments on any story with the slightest political implications. These invariably bash the President, the Democrats, “liberals,” and “socialists,” in the tone that teenage boys use to provoke a fistfight. Maybe teenage sons of subscribers actually write most of them. But I have a suspicion that a fifth column of frustrated real journalists writes at least some of them, as parodies of what a grand old newspaper has become.

Of course a “news” empire that calls itself “fair and balanced” would adopt the same transparent Orwellian marketing ploy as the Soviet mouthpiece, whose name means “truth” in Russian. At least Rupert changed the on-line name to “WSJ” to give us helpful notice that it’s not the same newspaper it once was. The old Wall Street Journal is indeed dead and gone, although its name and agonized ghost still inhabit a version printed on dead trees.

Rupert already has my money for a year’s online subscription. But I’ve decided to let it lapse when it expires this October. Henceforth I will redouble my efforts not to contribute so much as a nickel to his Evil Empire.

There is, however, a small problem. I still need business news to manage my investments and stay abreast of business, commerce, industry and finance. Where can I get it?

My initial thought was to turn to the Brits. Apart from their gaudy tabloids and their lack of a first amendment, they seem to have a better grip on what news is and how it works with democracy than we do. So I thought I’d renew my subscription to the Economist and maybe get one to the Financial Times. I still may.

But the British publications just don’t offer the breadth, depth or currency of news on American business that I need. I am, after all, a Yank. So I started looking at Bloomberg.com as a WSJ substitute. After two days of comparison, here’s what I found.

Bloomberg.com is a free, online, comprehensive source of business news. Its coverage is a bit narrower than WSJ’s, but there’s plenty of overlap. Where the coverage differs, Bloomberg.com’s extra stories tend to give more depth, especially in matters of finance, while WSJ’s extra stories tend to support its pervasive ideology. I have to confess, however, that WSJ does have some “scoops” that Bloomberg.com appears to have missed.

Where stories overlap, there is no comparison. The stories in Bloomberg.com have much better depth, are more complete, and have more useful numerical information more logically presented. They are also better organized, perhaps because reporters and editors are not using organization as lawyers do, as tools of ideological persuasion. On stories that matter to the economy, such as the current danger of a national default and negotiations to avoid it, Bloomberg’s stories are simply better in every way—more full of fact, less full of speculation, and less slanted.

The WSJ does have a slight technological edge. Its online format is more pleasing and readable, and its photos and graphics are better and better integrated with text. Bloomberg.com needs to hire some gifted layout editors and present more economic data graphically.

But, based on my brief first look, I conclude that Bloomberg.com has far better content and organization. And Bloomberg.com does have one technical advantage over WSJ: a “Queue It” feature that let’s you save stories that interest you, read or unread, in your account “in the cloud,” where presumably they will be available forever. That’s a valuable service for this blogger, who spends a lot of time tracking down old stories (in grossly overloaded sets of bookmarks on two computers) and re-inventing the wheel.

In the final analysis, what matters most in news is credibility. By links in this blog, I’ve cited the Wall Street Journal many times, simply because its more-than-century-old brand once had enormous prestige in business and finance. But WSJ has outlived that prestige and no longer merits it. In time, I think, independent, non-ideological sources of news like Bloomberg.com will fill the gap that Murdoch’s ownership has created and justify credible citations now that the tarnished brand no longer can.

The small price of a WSJ subscription is negligible to me, especially compared to the money that prompt and accurate investment information can help me make. So the fact that Bloomberg.com is free of charge and WSJ charges for complete stories makes little difference. What makes the difference is relative freedom from errors and bias. With Bloomberg.com, I will save the mental strain and effort of extracting the real meaning from badly organized, hastily written stories and compensating for bias.

So beginning this week or next, I will start to link business and financial information on this blog to Bloomberg.com, rather than WSJ. Once my subscription to WSJ expires in October, I will no longer have access to complete stories and will stop linking to that source.

The switch will have a signal benefit to readers. You will no longer have to have a WSJ subscription or trial subscription to read linked stories in their entirety. The thought that my links on this site may have impelled even a single reader to subscribe to Murdoch’s Evil Empire truly gives me pangs of conscience.

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