corporate and think-tank researcher

Donald Gutstein

23 Jul '11

Murdoch’s ties to Big Tobacco

Rupert Murdoch’s phone-hacking problems have been all over the news in recent days, but it wasn’t too long ago his media properties were providing a supportive environment for Big Tobacco that went largely unreported.

Murdoch’s connection to Phillip Morris Co. was revealed through secret industry documents made public as a result of the landmark 1998 U.S. tobacco industry settlement.

The 1981 publication of a Japanese study suggesting that non-smoking wives of smoking husbands were more likely than wives of non-smokers to get lung cancer shocked the industry. Big Tobacco realized that second-hand smoke would be the greatest threat it had encountered, more potentially damaging than earlier studies linking smoking with lung cancer, heart disease and other illnesses.

When the victim is the smoker, the industry was able to argue—successfully—that harm caused by smoking was regrettable, but is, after all, a result of personal choice. The individual knows the risks when she smokes. If a person gets cancer even though he doesn’t smoke, but is simply in the presence of smokers, then that is a different matter. Smoking leaps from individual choice to major public policy issue. The industry “calculated bans in work places, aircraft, restaurants and other venues would result in a dramatic plunge in the number of cigarettes smoked,” the South China Morning Post reported after an investigation of industry tactics in Southeast Asia. “People would have less time to puff. And that would lead to billions of dollars in lost revenue.”

To stave off this catastrophe, the industry used every available channel of persuasion and propaganda to cast doubt on the link between second-hand smoke and disease. The channels included supportive media like Murdoch’s News Corp.

A 1985 draft speech for Philip Morris’s CEO for a marketing meeting noted that the media company was already onside. “We plan to build similar relationships to those we now have with Murdoch’s News Limited with other newspaper proprietors,” the memo said. “Murdoch’s papers rarely publish anti-smoking articles these days.”

A second document for the same meeting created two days later asked the question: “how can we change the public’s view towards smoking?” After outlining various strategies to turn back the tide, the memo makes the point that

… we are not using our very considerable clout with the media. A number of media proprietors that I have spoken to are sympathetic to our position – Rupert Murdoch and Malcolm Forbes are two good examples. The media like the money they make from our advertisements and they are an ally that we can and should exploit.

In most societies in the world today public opinion is formed, to a significant extent, by the news media and I believe we should make a concerted effort in our principal markets  to influence the media to write articles or editorials positive to the industry position on various aspects of the smoking controversy.

Philip Morris and News Corp. drew together during the 1970s, driven by ideology, money and a hatred of government, except for those of Margaret Thatcher and Ronald Reagan. In 1975, the companies worked with Australia’s Liberal Party to overthrow the Whitlam Labor government, which had a policy of restricting tobacco advertising. In 1989, Murdoch was invited to join the Philip Morris board, where he remained for a dozen years. And Murdoch invited a succession of company executives to sit on his board. One observer called it “a cozy relationship all around.” It was a coup for Philip Morris, giving the company access to broadcast and print editorial pages and a platform from which to disseminate its view of the benefits of smoking.

Hamish Maxwell, who had worked for Philip Morris since the first studies linking smoking and cancer were publicized in the early fifties, was appointed to the News Corp board three years after Murdoch joined the Philip Morris board. Maxwell helped develop PM’s international tobacco business, which, as director of marketing, he shaped into a major growth engine.

Maxwell left the News Corp. board in 1998, and the following year another senior Philip Morris executive joined it. Like Murdoch, Geoffrey Bible was an Australian. Like Maxwell, Bible was a long-time PM employee. When Bible retired he was treated to an “obsequious valedictory” in Murdoch’s Weekend Australian. No thought was given to the estimated 20.7 million people who would die from the company’s products by 2050. (In 1999, Bible received US $21.2 million from the company, about a dollar for each tobacco death.) Instead, Weekend Australian correspondent Rodney Dalton effused, Bible’s thoughts would be struggling with what he should do: ski in Switzerland where he owned a chalet, swim in Bermuda where he owned a house, or head to the golf course for another lesson? Bible’s friend Murdoch said in the article that Bible had “the single toughest and worst job in America.” But Bible, who was still on the News Corp. board, was “honourable,” Murdoch insisted.

And when Bible left News Corp. in 2004, he was replaced by Peter Barnes, another Australian and former president of Philip Morris Asia. Like Maxwell and Bible, Barnes’ expertise was consumer marketing. “Peter was a senior executive in virtually all of the key markets in which News Corp. operates,” Murdoch said in praising the appointment. Barnes was still on the board in 2011.

Philip Morris senior ranks were crowded with Australians who were friends or relatives of Murdoch. Bill Murray was a close friend of Murdoch’s and, as PR monitor SourceWatch claimed, “chief architect of the company’s dirty tricks and science-corruption campaigns.” Murray was instrumental in promoting Bryan Simpson, who happened to be Murdoch’s nephew by marriage. Simpson later was picked to head Infotab, the international tobacco institute.

The intimate relationship between the companies paid dividends for many years. In 2000, an individual named Steven Milloy became “science columnist” for News Corp. subsidiary Milloy had no science background, but wrote columns attacking scientific studies that found links between second-hand smoke and lung cancer. The first piece attacked a study which found that women living with smokers had higher levels of chemicals associated with the risk of lung cancer, accusing it of being nothing more than spin. He also attacked the landmark 1993 Environmental Protection Agency study that linked health risks and second-hand smoke.

In a second column Milloy dismissed 20 years of research on the effects of exposure to second-hand smoke: “Secondhand smoke is annoying to many non-smokers. That is the essence of the controversy and where the debate should lie – the rights of smokers to smoke in public places versus the rights of non-smokers to be free of tobacco smoke.”

Milloy didn’t reveal that he was on the Philip Morris payroll when he wrote the columns, under contract to monitor tobacco studies. But science reporter Paul Thacker exposed the connection in The New Republic.  Milloy received $92,500 for fees and expenses from PM in each of 2000 and 2001 when he wrote his columns. Fox News didn’t seem to care about the conflict of interest when it found out.

The Murdoch empire continues to support the industry’s claim that the link between second-hand smoke and disease remains unproven. Murdoch’s New York Post, with a long history of industry support, is the attack dog of choice. In the late 1970s, the Post was likely the only newspaper to run “almost daily, cigarette ads in color on its back page  … and in its main news section.”

When New York City brought in a ban on smoking in bars in 2001, the Post fulminated that the “Nicotine Nazis” were basing the ban on the “Big Lie.” When Mayor Michael Bloomberg proposed extending the ban to all bars and restaurants, he was accused of being an elitist zealot, spouting nonsense and engaging in a puritanical righteous crusade. “Next he’ll ban smoldering incense at St. Paul’s Cathedral,” the paper snorted.

As recently as 2010, the Post was still raging on about a proposal to extend smoking bans to all parks, beaches and pedestrian plazas in the city. “This ban is not so much about public health as it is another heavy-handed behavior modification scheme cooked up by a fellow who is incapable of minding his own business,” a September 19, 2010 editorial ranted.

As the phone-hacking scandal leaps the Atlantic and settles on Fox News, further connections between the Murdoch empire and Big Tobacco are coming to light.

Former Fox News executive Dan Cooper claims that Fox News chief Roger Ailes had him design a “brain room” deep in the bowels of 1211 Avenue of the Americas, the Fox News head office, to house a counter-intelligence and black ops office in which hacking phone records would be “easy pie.” Ailes brought in Scott Ehrlich to run the brain room, Cooper alleges.

Before Ailes set up Fox News for Murdoch in the mid-90s, he ran his own political consulting firm and Ehrlich was a top lieutenant. Ailes helped put Republican candidates into office, most notably Richard Nixon, Ronald Reagan and George H.W. Bush.

He also had a string of corporate clients, including the Tobacco Institute, Philip Morris and RJ Reynolds.

Surgeon General Everett Koop’s 1986 report, “The health consequences of involuntary smoking,” decisively portrayed second-hand smoke not just as an annoyance but as a quantifiable health risk. It was estimated that passive smoking contributed to 50,000 deaths a year in the U.S.

The next year Congress banned smoking on all domestic flights under two hours and extended it to all domestic flights two years later. The Environmental Protection Agency was working towards placing passive smoke on its list of major carcinogens.

In response, the Tobacco Institute launched a massive “Enough is Enough” campaign, playing on many people’s concerns that government was reaching too far into their lives.

Roger Ailes and Scott Ehrlich were members of a tobacco industry group tasked with beating back the tide of regulation. Their job was to go after the Clinton administration’s health care reform, which was to be funded in part by a dollar-a-pack tax on cigarettes. Big Tobacco paid Ailes to produce ads highlighting the plight of “real people” affected by higher taxes.

In one confidential memo to Philip Morris, Ehrlich proposed an “underground attack” option following a major Hillary Clinton speech. It would be costly, he wrote, but would be “designed to hit hard at the key [Representatives and Senators] through their soft underbelly, while attempting to stay under the radar of the national news media.”

Three years later, Ailes was working for Murdoch, creating what Rolling Stone calls “the most profitable propaganda machine in history.” And Ehrlich, fresh from his dirty tricks for Big Tobacco, was allegedly running Murdoch’s brain room.

Murdoch will have no problem shuttering his British newspapers, which contribute only three percent of News Corp.’s $32 billion in revenue. But Fox News is another matter altogether, responsible for nearly a fifth of the corporation’s $5 billion in profit.

With FBI and Department of Justice investigations under way, further Fox News revelations will likely follow. Big Tobacco’s murderous rampage is on the wane, at least in North America. Will Murdoch go down too?


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