Hard News by Russell Brown

Usual suspects

I am normally allergic to political arguments that hinge on a definition of "class", but as the outrageous detail of exactly what went on in media baron Conrad Black's Hollinger group seeps out, Dick Meyer's angry editorial, The Predator Class, seems right on the money.

Meyer is editorial director of CBSNews.com, and the recipient of several major awards for investigative journalism. He is not some conspiracy kook. And yet last week, he felt moved to say this:

The emerging accounts of thievery in the world of mutual funds confirm, for me at least, something I have suspected since the go-go 1980s - the existence of an economic predator class.

I believe there is now a professional, well-trained elite, supported by large institutions, that is adept and willing to use corrupt practices to accumulate wealth.

Meyer was not directly referring to Black's business but it appears to be shaping up as an admirable proof of his theory, and - surprise! - it involves Washington insiders - Richard Perle, Henry Kissinger et al - with whom we are already all too familiar.

Until last Monday Black was chief executive of Hollinger, which owns, among other things, The Daily Telegraph, the Chicago Sun-Times and the hardline Israeli newspaper The Jerusalem Post. He "resigned" amid revelations that he and his closest affiliates had taken more than $US32 million in payments not authorised by the Hollinger board. Major investors will now begin action to retrieve more than a quarter of a billion dollars in "management fees" and other payments that have gone to Black and his colleagues in recent years. At the same time, the US Securities Exchange Commission has launched a probe, and Hollinger appears to certain to default on a $US120 million bond issue.

So what where the Hollinger board members doing? Why, taking money, of course. Black stacked his board with compliant neocon luminaries such as Richard Perle, the former chair of the Defence Policy Board, advisor to Rumsfeld and a key figure in the rush to war in Iraq. You may recall that Perle quietly resigned this year after the New Yorker's Seymour Hersch showed that he had failed to disclose some fairly startling conflicts of interest.

Rumsfeld has his own ethical problems, of course. As Fortune magazine reported this year, he failed to disclose that he was an active director of the Swiss company that supplied North Korea with two light-water nuclear reactors. Even when he chaired a 1998 congressional panel examining classified data on the potential nuclear threat from North Korea, he told no one of his direct commercial involvement. And he later helped scotch a Clinton plan that would have seen North Korea abandon its nuclear activities in exchange for aid and normalized relationships.

So anyway, a Hollinger company, Hollinger Digital, appears to have been in the business of bunging money to Hollinger board members' companies. Perle's war-and-security business Trireme Partners got $2.5 million. Another Hollinger director, Gerald Hillman, secured a $14 million investment from Hollinger for his own company, Hillman Capital, which is also a partner in Trireme. And Kissinger, a Hollinger board member? A member of Trireme's "strategic advisory committee" - as is Black himself.

I assembled more background on this in the Wide Area News section on the Mediawatch website, which you may wish to check out. Since I did that, this story has emerged, claiming that Hollinger may be rescued from an apparently inevitable break-up and sale - and the very close and potentially embarrassing due diligence that would entail - by The Carlyle Group, a banking operation with close links to both the Pentagon and the Bin Laden family.

Former British Prime Minister John major is a Carlyle director, and its advisors include George Bush Snr and James Baker. Its chief is former Reagan defence secretary Frank Carlucci. Wow. If these people don't want to be the subject of conspiracy theories, they really shouldn't be doing this sort of thing.

The Observer also has a background story that looks at the whole mess.

It all makes the Ahmed Zaoui story back home look like a bit of colonial bumbling - which I suspect it is. The Greens' Keith Locke has called for the Inspector-General of Intelligence and Security, Justice Laurie Greig, to be taken off the Zaoui case on account of comments he made in Gordon Campbell's interview with him in this week's Listener. He won't be, of course, but for any number of reasons - including what appears to be a fundamental failure to understand refugee issues, and an appearance that he has prejudged the case - he does not now seem capable of delivering a decision on Zaoui's case that is seen to be safe. Indeed, talking to Hugh on 95bFM this morning, Helen Clark seemed to be quietly welcoming the chance to have this kicked up to the High Court and out of the Kafkaesque world created by National's 1996 legislation. Frankly, I don't think even Winston Peters believes that Zaoui is truly a terrorist.

But, just to show that dissent can make a difference and that sometimes the right thing does happen, huge congratulations are due to Scoop with the news that the state of California will now require electronic voting systems to be backed up by paper ballots. When Alastair Thompson broke the story of the manifold problems with the Diebold voting machines earlier this year, it was ignored by the major media in the US. But because it had merit, and because Alastair and Bev Harris wouldn't let go, it began to stick. It seems likely that other states will follow California's lead - perhaps in time for next year's presidential vote. The American people might not know it, but they really do owe Alastair.

So congratulations to England, then: it was a thrilling World Cup final, if only sporadically one of high-quality rugby. For all the talk about Jonny Wilkinson, I wonder what England will do without the colossal leadership of Martin Johnson. Does anybody know when we get another crack at them so we can shut up the loathsome likes of Stephen Jones?

It's looking like we'll do so without John Mitchell as coach. Even though his team has had a better than 80% success rate and now holds all but one of the trophies for which it is eligible, it may not be good enough. The NZRU has announced a contestable process for the appointment of the next coach. I would be surprised if that wasn't Graham Henry, perhaps with Steve Hansen as his offsider.

And, finally. I dragged my sorry old ass out the door on Friday night to see Scribe play the St James. And I'm glad I did: he's special. It's a long time since I've seen a lead rapper with the clarity and command of the stage that he has - maybe all the way back to KRS-1 at the Brixton Academy. Festival Mushroom's Australian-based chief, Roger Grierson, was at the gig - already frothing about PanAm's set at the Control Room earlier in the evening - and seemed to be having a hell of a time. Scribe's on every leg of the Big Day Out next January, and his album's released in Australia to tie in, on January 16. Watch him go.