Howard years, Bolt and McCrann belt Cossie and Crikey helps save $300m
July 22, 2008
Here are Stephen Mayne's six stories from the Crikey edition on Friday, 3 March, 2006.
4. How Crikey saved a public company $300 million
By Stephen Mayne
The original kicker on the Crikey website – "Bringing down governments since September 1999" – was always a bit of a joke, even though some people publicly claimed that jeffed.com had helped bring down Jeff Kennett.
However, the question of our influence is about to be brought back into focus with a story in a trade magazine that goes to 7000 executives around the world claiming that Crikey saved a major Australian company a huge amount of money.
We can't bring you full details until Monday's edition but the story claims some Crikey questions at an AGM generated adverse publicity which prompted a board to get out of a business just before the whole industry imploded. An executive from the company is quoted claiming it was a publicity-generated decision to sell saved shareholders $300 million. Wow! Where's the commission?
Crikey has always been a student of media power, but at one level it is self-indulgent to naval gaze about your own outlet's power. The Murdochs and the Packers have long exercised huge power through their media outlets, but they never gloat about it. Rupert was reportedly furious when The Sun ran its famous "It was The Sun wot won it" headline after the Tories won an election in the 1990s.
However, I'm not so shy and am happy to publicly debate Crikey's power – or lack of it. The Age was furiously attacked in the Murdoch press when this paragraph appeared on the front page the day after shareholders voted to move News Corp to Delaware:
It was difficult not to wonder if the News shift to the US was due in some way to the presence in the past six years of corporate governance warrior Stephen Mayne.Now I'm prepared to admit that is probably a touch overblown. It was institutions voting down the executive options at the previous News Corp AGM which triggered the move, although the Sun King absolutely hated me rubbing salt into the wounds telling shareholders we'd all just witnessed an "historic day" with Rupert being rebuffed by his shareholders for the first time in more than 50 years.
There are plenty of other interesting and contestable claims about Crikey's power. I've claimed credit during numerous speeches for getting Steve Vizard off the Telstra board in 2000 when he resigned a few days after I nominated on a platform opposing his conflicts of interest. Others say he was going anyway.
Similarly, I reckon the decision of Qantas, Optus, NRMA and the Commonwealth Bank to abandon their cash for comment contracts with Alan Jones or John Laws in 2001 was partly due to board tilts and AGM criticism. Others say the contracts were all going to be dropped anyway.
The best example of media power is when a story (or threatened campaign) stops something from happening in the first place – changes to media ownership laws being a case in point. Fairfax board sources have claimed our yarns predicting Qantas chairman Margaret Jackson was about to defect to News Corp stopped this from happening.
Similarly, our stories about Richard Howard's proposed White House internship causes the PM to change his mind when we pointed out candidates had to be US citizens and he risked being labelled a "queue jumper".
Crikey is rightly credited with triggering the demise of the Democrats with all those leaks around the leadership crisis in 2002. However, would the Dems be a continuing force today if Crikey didn't exist. Probably not, as relations were so poisonous that those internal letters would almost certainly have been leaked elsewhere.
Of course, the vast majority of our stories have no influence and change nothing, but if we ever get around to writing the Crikey book, the question of power and influence will make for an interesting chapter. Stand by for Monday's big claims which will no doubt be scoffed at in some quarters.
5. Corporate grovelling to John Howard
By Stephen Mayne
The AFR's Laura Tingle carried some interesting quotes from former Ansett and British Airways CEO Rod Eddington this morning, pointing to the extraordinary grovelling that is going on around John Howard's 10th anniversary celebrations. Try these lines for size from the chairman of JP Morgan at the big Canberra dinner on Thursday night:
Prime Minister, this has been a remarkable ten years and your leadership and the way that you've led your team is something that all of us in the business community admire. Those of us who have the privilege of sharing this special night with you salute you and extend our gratitude to you for what you have done for our great country over the last ten years and we wish you well and continued success in the years to come.Eddington was part of the News Corp board that dumped Australia and shifted its head office to the US in 2004, something that only could have happened after Peter Costello introduced capital gains tax rollover relief a few years earlier. Rod clearly hasn't been reading The Australian lately which has been belly-aching about the government's lack of reformist zeal, especially on tax.
However, what is more surprising is that he's prepared to be so partisan at a Liberal Party fundraising event when another of his gigs is being chairman of the Melbourne Major Events Company for the Bracks government.
The same goes for investment banker Trevor Rowe, the man who Peter Beattie installed as chairman of the $45 billion Queensland Investment Corporation. Rowe was at the Sydney celebration last night and publicly declared that John Howard was "an extraordinary global statesman". Here's the full quote in The Australian:
We have never had a Prime Minister with that kind of standing – certainly in my lifetime. The way he has conducted himself on a global stage has given him this global statesman position, which not only in terms of geopolitical context has been good for Australia but from a business point of view has been very helpful with the Chinese and elsewhere.You'd think Australia had led a successful United Nations mission into Iraq if you believe this sort of garbage. As for being a genius with the Chinese, people forgot that they are desperate for energy and we happen to have a lot of it. Only a mug of a prime minister could have stuffed that up and the much-lauded $25 billion Woodside gas deal was done about three years too early in terms of maximising the price.
6. McCrann and Bolt give Cossie a belting
By Stephen Mayne
Peter Costello invited plenty of media folk to his big function celebrating ten years in office at Melbourne's Federation Square last week as he continues to plot and plan his assault on The Lodge. However, if it's ever going to happen, you would expect he would be backed by his local conservative paper, Rupert Murdoch's Herald Sun.
The paper's conservative epicentre revolves around their two powerful foundation commentators, Andrew Bolt and Terry McCrann, who've been plying their trade for Australia's biggest selling paper since it was formed out of the merger of The Sun and The Herald in September 1990.
The two of them are close friends, consult about their columns and follow what the other is doing, which makes today's dual attack on the great Victorian hope, Peter Costello, very interesting. Bolt has regularly been mentioned as aspiring to replace Petro Georgiou in Kooyong, but today he has let fly at Costello for failing to back a tilt at the seat by former Alexander Downer staffer, Josh Frydenberg. Try these lines from his column for size:
Peter Costello is the one making all the look-at-me noises. But it's the supremely confident Alexander Downer who is ready to be our next Prime Minister. At least, Downer feels ready. Readier, perhaps, than many voters may feel to accept him. And, I suspect, he now has what Costello fears he doesn't – the support, even admiration, of Prime Minister John Howard. It's on.Bolt went on to point out Costello has indeed been talking up the AWB scandal which is certainly damaging to Alexander Downer.
Where would Costello actually want to take his government? To the Left? The Right? Who knows, when this fierce new critic of multiculturalism is even now trying to save the Liberals' most rabid multiculturalist, Petro Georgiou, from losing pre-selection in his totemic seat of Kooyong? The reason he's helping Georgiou has nothing to do with ideology, actually. Georgiou's rival in Kooyong is Josh Frydenberg, a former adviser of, yes, Downer. Costello is fighting for power, not an idea.
Even more interesting was McCrann's thumping of Costello today over yesterday's attack on the Labor states for not yet signing over the corporations power before the deadline in July. Costello was making apocalyptic predictions if this happened but McCrann turned the attack around completely as follows:
It's the Federal government that's the real culprit. It's casually, arrogantly, ineptly and most of all unacceptably, abused what might be termed the 'corporations law relationship' between Canberra and the states. By sneakily trying to use the Federal Government's 'corporations power' under the Constitution to snatch control of industrial relations.Whack, that's got to hurt. It also confirms Christian Kerr's comments about the Howard years being marked by a centralised grab for power. And given the woeful job that ASIC has done over the years, Canberra can hardly claim to have made a great fist of corporate regulation either.
The states are challenging the constitutionality of the Fed's IR rort. Sorry, rules. But whatever the outcome of that, Costello can hardly complain when the states aim to beat him, or rather the government, at its own game. Canberra wants to use the corporations power for an end intended neither by the constitution not the states, so the states have every right to withdraw their referral of elements of that power.
If Cossie is ever going to make it to the top job, he's clearly got some work to do in his own patch first. The contrast with all the backing that the Packer camp give John Howard in Sydney is stark indeed.
8. The Howard conservatives and women
By Stephen Mayne
There's some very interesting product-differentiation going on inside the Howard government at the moment around the rights and responsibilities of women.
On Tuesday, Joe Hockey and Mal Brough unveiled a far-reaching package of reforms to Australia's child support system which dramatically tilts the power balance away from single mums and back towards divorced dads.
Anything to do with family policy is assumed to carry the personal authority of John Howard and this package looks like a classic example. Mothers will now have even greater financial incentive to simply stay at home and put up with their troubled marriage rather than breaking out and forging a new life.
The following day, Peter Costello delivered his wide-ranging Press Club speech in which he declared one of his future goals was to "look at how to improve opportunities for women, create the most female-friendly environment in the world."
The next day John Howard and fellow conservative Tony Abbott announced their $50 million abortion counselling policy after both were rolled on the RU486 debate.
Costello supporter Judith Troeth has come out today attacking some of the conservative men in the Howard camp, such as factional warrior Santo Santoro who claims present counselling services are tilted in favour of pro-choice advocates.
And then there's the absolute shocker from another Howard backer Mal Brough, who made the following boast in Parliament yesterday:
In the area of superannuation we have the co-contribution helping families and we are actually letting women be able to contribute to their own superannuation whilst being at home.And what about the PM's speech in Canberra on Wednesday when he celebrated the fact that 30% of new businesses being run from homes were being set up by women. Then there was the passion he displayed for the family benefits system – the very system which creates huge incentives for mothers to stay at home.
John Howard and his male conservative backers are not exactly creating the most female friendly environment in the world and Peter Costello appears to have cottoned onto this fact as he continues to work on product differentiation.
Meanwhile, where are all the feminists at the moment commenting on these developments? The silence is just as deafening as when the PM fawned all over that well known sexist patriarch, Kerry Packer.
9. The Howard years – 12 more statistical measures
By Stephen Mayne
There have been plenty of suggestions of statistics that subscribers would like to see comparing Australia in 1996 and 2006, but don't forget to also email through the actual stats themselves to smayne@crikey.com.au:
Here are another 12 measures which are mostly focused around the economy and federal budget:
| Measure | 1996 | 2006 |
| Total tax revenue | $116 billion | $237 billion (inc GST) |
| Net worth of govt | -$74bn | -$26bn |
| Federal tax as proportion of GDP | 22.3% | 24.8% |
| GDP | $518bn | $987bn |
| Education spending | $10.12bn | $14.77bn |
| Welfare spending | $46.7bn | $81bn |
| Company tax revenue | $18.2bn | $41bn |
| Income tax revenue | $61.7bn | $110.5bn |
| Household/electrical imports | $1.77bn | $6.3bn |
| Tourism revenue | $11.55bn | $20bn |
| Exports goods and services | $99.4bn | $170bn |
| Imports goods and services | $101bn | $200bn |
For all the overblown rhetoric, John Howard and Peter Costello have ridden a huge boom and still managed to increase tax as a proportion of GDP, retain a negative net worth of $30 billion for the Federal government, massively blow out welfare spending, under-invest in education and oversee a deteriorating trade performance with import growth outpacing exports.
What would the corporate sycophants be saying if all these measures had been genuinely impressive?
16. Can James Packer retain his father's power?
By Glenn Dyer and Stephen Mayne
The steady stream of stories about the redecorating of the walls in Sydney Italian eatery Machiavelli have one common link that tells a lot about how James Packer is trying to position PBL in the wake of his father's death.
A range of signals suggest that James and his scheming PBL CEO John Alexander are trying to retain the undoubted unspoken power that Kerry Packer possessed that enabled him to become the most powerful person in the country's biggest city.
At Machiavelli, it's out with the politicians and in with the mates of PBL (and JA) in the shape of business people like Chris Corrigan of Patrick, and the chefs of leading Sydney restaurants that JA and others like to graze at.
In the most absurd move so far, John Howard's photo came down yesterday and was replaced by Eddie McGuire, AM. Does anyone else sense a touch of the "'only we at PBL have the power to make this happen"?
James is certainly not mucking around stamping his authority on the empire. The AFR's Chanticleer columnist John Durie has today followed our tip about the impending revamp of the PBL board with KP's friends, Robert Whyte, Laurie Muir and Rowena Danziger, set to make way for people like Chris Corrigan and investment banker, Chris Mackay of UBS.
Another sign has been the grabbing of control over the Nine Network by James and JA, something they were unable to do while Kerry Packer was alive. Eddie McGuire is a long-time MoJ (Mate of James) but his vision so far – let's start with a blank screen, but ratings are out and profit is in – hasn't exactly set the world on fire.
Another is Russell Crowe, who became involved in the Packer service and documentary shortly after ditching the Murdoch-associated Wendy Day as his spokesman for Grant Vandenberg, the man who runs JA's court.
Then there's been reports of phone calls to many in the Sydney business community from the Park Street bunker trying to get things done the Packer way. One such call was to the Sun-Herald last week to try and sack gossip columnist Annette Sharp for daring to write stories about James, David Gyngell and various Nine people, as well as ACP staffers that upset Park Street and John Alexander.
Some of the power is quite real. James Packer described the ascension of Ron Walker to the Fairfax chair as "an inspired choice" and we received this email from someone closely connected to the quality end of Fairfax recently:
You didn't hear it from me but Ron Walker has stopped articles on Packer appearing in The SMH, The AFR and Sun-Herald of late. One journalist was threatened with the sack.Ron Walker has publicly revealed that he copped a call from James last year complaining about being photographed in his swimmers. The kid clearly doesn't get it. You shouldn't even try to micro-manage power like this in the internet age.
When you consider the funeral, the memorial service, the doco on the Nine Network and the broadcasting of the service from the Opera House, it looks like a process designed to send very strong signals that James is his father's son, but in a focused, business fashion, depending more on proper management decision-making than gut instinct.
And yet a bit of public arm twisting, weight throwing and other expressions of power are handy to make sure the general public and those in business know their place and acknowledge the new Emperor of Sydney.
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