29/07/2011 Newsnight


Political editor Michael Crick assesses the state of the British tabloid press.

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Tonight, the long, slow, self- inflicted mess of British tabloid


newspapers, from the families of murder victims allegedly hacked, to


the disgraced private detect yef i Glenn Mulcaire, who says he was


acting - detective, Glenn Mulcaire, who saves acted under instruction


who saves acted under instruction from News of the World.


Now libel payments in the Joanna Yeates case.


And guilty of contempt of court. Can the tabloids free themselves


from the cycle of decline. Apologies, sackings, investigation,


and further falls in circulation. We will hear from the detective


investigating Sarah Payne's death, and why he thinks he was hacked. We


will debate whether the British popular press is committing suicide.


The New York Stock Exchange opened today, perhaps not taking the


prospect of debt default completely seriously, as Congress and the


President continued to play chicken for control of the US economy.


we don't come to an agreement we could lose our country's AAA credit


rating. Not because we don't have the capacity to pay our bills


wrecks do. But because we didn't have a AAA political system to


match. Good evening. One of the reasons


the British press is so vigorous is because it is probably the most


competitive in the world. With more or less every newspaper seeing its


readership getting older, younger readers not buying papers and the


obvious challengers from the Internet, you might they think we


are now witnessing the perfect storm. Phone hacking, libel case,


contempt of court, and that was just today. The News of the World


might not be, in the end, the only tabloid to close. We will hear from


the detective in the Sarah Payne murder investigation in a moment


and debate whether the popular press has a future.


After yesterday's revelations, that the mother of the murdered


schoolgirl, Sarah Payne, had her phone hacked, by the News of the


World investigator, Glenn Mulcaire, today, Mulcaire himself entered the


fray. Hinting he might now reveal all. Responding to last night's


claims by the paper's then editor, Rebekah Brooks, that he had acted


alone in hacking Sara Payne's phone. Mulcaire didn't deny he had done


. There has been a lot of dumping on the reputation of Glenn Mulcaire,


rather unably I guess, given what he has done. Let's remember he


served time in prison for phone hacking. He's one of the few people


that can actually say he's taken his medicine. His statement today


is clearly saying to the company, if you carry on like this, I will


spill the beans F Mulcaire was going to speak out, this really


will crack this case open. I hope he does. If that's not enough for


the Murdoch press, today the Sun, along with seven other papers, paid


unknown libel damages to Chris Jefferies, lard Lord of the


murdered Bristol architect, Joanna Yeates. The Mirror, were also fined


�50,000 for contempt of court, and the Sun, �18,000. Chris Jefferies


is the latest victim of the regular witch-hunt and character


assassination, conducted by the worst elements of the British


tabloid media. Also today an intriguing story about Louise


Mensch, the Conservative, who was one of the toughest MPs at last


week's Murdoch hearings. She issued a statement about her


friendship with the violinist, Nigel Kennedy, pretty much


admitting she had once taken drugs with him. Mensch's statement was a


response to a mysterious David Jones, someone claiming to be an


investigative reporter, who had also sent his e-mailing inquiry to


Look, good on Louise Mensch for dealing with this. I don't care


what Louise Mensch did in night cluebs in the 1990, what she has


effectively done today is give a finger to a low life journalist who


tried to dig up dirt on her years ago, probably because she's


involved in exposing the truth on hacking and involved in the


committee. She has my full support. I seriously hope whatever story is


trying to peddle this story will think again. Isn't it legitimate,


that journalists should look into the background of prominent MPs, we


are talking about law breaking? Context is everything.


This is a really miserable time for the tabloid newspapers. With their


methods under attack from the British public, from the police,


politicians and now most likely the inquiry led by Lord Justice Leveson.


They face testify competition, not just from traditional broadcasting,


but now from the Internet and other social media. And whilst nearly all


newspapers have seen a significant fall in circulation, in recent


years, for the tabloid press, the drop in sales has been particularly


bad. Tabloid newspapers have been in


decline for some time, over the last 20 years, in terms of the


circulation they have declined 35- 40%, more than 12 million paid


copies today to fewer than eight million paid copies per day. They


have also seen a decline in advertising, particularly in recent


years, on the back of the recession. That has meant that profitability


of tabloid newspapers has also declined. So while tabloid


newspapers are clearly more profitable than their quality


counterparts, it is also the case that it is becoming harder and


harder for them to achieve the kinds of big profits that they were


able to achieve in the past. Nine years ago Glenn Mulcaire made


a name for himself, by scoring the first-ever goal for the newly-


formed AFC Wimbledon, who next year start in the Football League.


honest we should have scored earlier in the game. Tonight,


Trigger Mulcaire threatens even more dramatic shots. Hinting he may


yet name big names in the hacking Joining me now is Detective Chief


Inspector Martyn Underhill, he was the liaison officer with the Payne


family and investigated Sarah Payne's death. I had a lot of


contact with Sara Payne, and got to know her personally very well. We


used to speak to each other a lot on the phone, even when the case


finished. I remember in 2002, I got a phone call at home on Saturday


afternoon from a very high senior executive from News of the World,


who I knew. He said to me, we have got a story we are going to print


about you tomorrow and the Payne family, I would like you to make a


comment. He told me the story, which was outrageous and not true.


I said, I don't know where you got that from, but that is completely


untrue, if you print that I will sue will you - sue you. They said


they have a very good source you might as well admit it. I said the


source was wrong and I will sue. The story was never printed, Sara


and the family and I denied what was alleged. The matter was never


resolved in my mind, I never knew why that phone call took place, or


where the information came from. And then the phone hacking story


came in, and one thing that struck me about the senior executive from


News of the World, was that if he had a source, and he had asked me


for a comment, which I gave, he could have printed that story, but


he didn't. I think that source was illegal, I think that my phone was


hacked, my police phone was hacked. Because Sara used to leave me


messages on the answer phone and I used to leave messages. You know


the name of the executive, who was it? I don't want to name that


person, because that person hasn't had a chance to reply to what I'm


saying tonight. Suffice to say it was a senior member of the team of


the News of the World, and has been named in the scandal. Can you tell


us what the story was about, even though it was false? I'm only


talking about it now because of the hacking scandal. It has remained


private for eight years, and I don't want to discuss it. This was


a newspaper that was helping Sara Payne, she thought? So what were


they up to? Sara and I have a very good friendship. We have never


agreed on News of the World. When I was a serving police officer, and


now, I always told her that the News of the World saw Sara Payne as


a commodity, she sold newspapers. Sara was fefrently committed to


Sarah's Law, and still is, I respect her for that. I did try


after this phone call from the executive in 2002 and several times


since, I said the newspaper will turn on a sixpence, you are a


commodity and they will hurt you. Are you basically saying they were


double dealing, on the one hand they were helping her and on the


other hand digging dirt? The phone call I received in 2002 clearly


showed double dealing, I said to her to leave the paper. She


believes in Sarah's Law passionately, News of the World


achieved massive amount with Sarah's Law, which I'm proud to


have been part of. I can understand why she didn't leave, I warned her


saying the paper is double dealing. The events of the last few days


have shown that. You don't want to talk about the story because it was


false? It was, completely. This about your conduct as a police


officer, or were they looking in supposedly private matters, they


were digging dirt? This was private matters between myself and the


Payne family, which would have been embarrassing for me personally and


my relationship at that time and would have been terrible for the


Payne family as well. Did the Payne family, or Sara not say this is


terrible, it is clearly wrong, they shouldn't be doing this. You said


obviously she was committed to going ahead with Sarah's Law, and


being helped in that. But this is pretty awful? It was awful at the


time, and it still is, they were digging dirt. And clearly, in my


view, they were hacking phones, mine and Saras, she did challenge


the News of the World over it, and I did, saying I would sue. To be


fair I never had a good relationship with the News of the


World, I was a police officer dealing with the Payne family, I


was constantly in conflict with the news. I have met all the executive,


Rebekah Brooks, and others, because of the Sarah's Law campaign.


wouldn't name this executive tonight, but in Operation Weeting,


and subsequent inquiries you could? I have named the News of the World


executive to Operation Weeting, but I'm not prepared to name them


tonight. Now joining me is the academic and


writer, Sarah Churchwell, the Conservative MP, Jacob Rees-Mogg,


and the former People editor and editor of the British journal


review, Bill Haggerty. Is this tabloid - are the tabloids slowly


committing suicide? I don't think the, I think there have been very


disgraceful things that have gone on, these are working their way


through the courts and the contempt of court action, not to mention the


hacking trials that either have taken place or will go ahead.


see they still have an important role in British life. They do act


as a disinfectant? They sell millions of copies and are free,


competitive, aggressive press, and keeping British public life honest.


It would be great loss if we didn't have an effective and free press.


But they don't stick within the law. It is not that we need new laws


within the law of contempt and libel, and we're hearing a lot


about phone hacking? It is quite right the law should be applied.


And it is being applied. It is hard to see legally what the problem is.


You don't need more laws, just apply the ones that exist. Do you


think the tabloids are slowly unravelling, they face a lot of


competition, not just with each other but other sources of


information? I think the problem s I agree we need a free press. If we


needed any evidence we need a free press, the story wouldn't have


broken if it weren't for the Guardian. For would the MPs'


expenses scandal? They provide us with investigation, accountability,


they are providing a forum for all kinds of things we need. The


problem with the tabloids we have been seeing here, is they haven't


been behaving like journalist, but novelist, they have been saying


what they felt like. It is not about operating within the bounds


of the law, they have clearly been breaking the law. They have been


making things up, and they haven't operated within the boundaries of


journalistic ethics. Beyond that they are breaking the law. It seems


to me there are two problems, the law needs to be enforced, as you


said, it is being enforced, too often it is left to individuals to


try to pursue civil case, which often individuals can't do. But


there does need to be some kind of reckoning about journalistic ethics.


Not just reckoning about journalistic ethic, perhaps the


press has never been entirely respectable, perhaps that is a good


thing. But journalists used to read essential law for journalist, they


used to know what libel and contempt was? I think you are right.


It is essential they are not respectable. It isth has always cut


corners and been - it has always cut corners and been close to the


edge, but not this. It is over relatively recent years, I hope


that what has happened now, and there May may be more to come, will


stop it and put it back on track. Do you think it is the popular


press and it is popular because it is popular, because people want to


read it, do you think it is declining, it doesn't have the


capacity to influence things that it perhaps did a year ago? It is


declining b but not with what is happening now, it may decline


further, but the Internet gave it a terrible body blow, and the


industry hasn't found Outtara to harness the Internet and use it to


make profits. This story about Louise Mensch, we heart MP, Tom


Watson say it is ridiculous, but that story about what she may or


may not have done in her 20s, coming up now, does it suggest that


some people are out for revenge to try to get her? There's no evidence


of that. I was at Oxford with Louis when she never seemed to have more


than a small glass of sherry, I'm surprised by the revelations.


didn't dance on tables with Nigel Kennedy yourself? No I didn't, I'm


not a great dancer on tables. The timing is highly suspicious, I


would certainly agree with that. It is very odd that the papers should


be going back to raking up things people may or may not have done.


you think there is a fear in MPs, there was a fear that member who


talked to MPs about what the newspapers might drag up, there was


a degree of fear? I have never really believed that. I was only


afraid of Nigel Dempster thrfrbgs a worry about gossip story, it is -


there was a worry about gossip stories, it was never a serious


worry. There is too much concentration on spin, and that the


Government had to control the media. That lasts for a relatively short


time. New Labour was very good at it in its early days, and became


bad at it as the press saw through it. And that created a feeling that


the press was more powerful than it ever was. Do you think we will end


up with a new reinvigorated Press Complaints Commission, the boss


quit today, is that what we want? You need some kind of regulation.


You need some kind of accountability. I don't believe it


should come from the Government. The obvious objections to


Government controlling the press is precisely that you no longer have a


free press. You have to have the ability to criticise, investigate,


and not to be partisan and political. It needs to be something


with teeth, that can say, not just if you have broken the law, but


things like printing the facts matters. It matters if you make


things up wholesale. If you are a newspaper and claiming to tell the


truth t should matter and does matter. There will be more burdens


on newspapers from now? I think, but self-regulation has to be the


way forward. It hasn't worked properly, without a doubt. There is


not one political party that warrants statutory regulation of


the press. Indeed it would be very bad for democracy and the country,


were that to happen. But I do think there has to be major overall of


the Press Complaints Commission, a serious one, that is going to be


very difficult to. Do Do you think another newspaper - - very


difficult to do. Do you think another newspaper will go. I spoke


do you when the News of the World went? I think under these


circumstances no, but one could go with falling circulation and


inability to harness the Internet make profits. People seem to forget,


many people seem to think the newspapers are a public service,


but they are not, they have to make profits to survive. When they say


newspapers only want to sell papers, it is true. Did you weep when the


News of the World went? I didn't, I very rarely saw the News of the


World,ly confess it always wrote about celebrities I had never heard


about, it wasn't my weekend reading. I do like the Sun, however, I have


always thought it is a very well written, good political newspaper.


I would be sorry if that got into trouble. But I think newspapers


always have waxed and waned, this is not the first newspaper to have


closed. The ska Telegraph - the Telegraph incorporates any number


of newspapers that have closed over the years.


The idea of the richest country in the world, deciding not to pay its


debts, sound like a cross between a nightmare and a joke, but President


Obama was not in a jokey mood when he lectured Congress today about


the failures of the American political system. To get to grips


with raising the debt ceiling. The clock is ticking towards a possible


debt default next Tuesday w profound impli cakess for the


world's financial markets - with profound implications for the


world's financial markets. In the new film, Campaign America,


he leads the world out of crisis, who is the hero and who is the


villain, does he need saving from himself. Right now a $14 trillion


debt monster threatens to knock the financial world off course, sending


it into a slowdown or worse. To defeat it Republicans and Democrats


must unite. All they have to do is to lift the US Treasury's debt


limit by Tuesday. Which hero can wake the US up from a financial


nightmare, born of political The American people have made it


abundantly clear, they don't want us to raise the debt limit, whether


it is a short-term raise or a long- term raise. It is the President who


doesn't seem to understand the magnitude of our national debt.


Taxes are too low to cover spending, and the TEA Party, won't let them


rise, but for every dollar the US spends it has to Moran than 30 cent,


old-style Republicans are angry. The idea seems to be, if the House


GOP refuses to raise the debt ceiling a default crisis or gradual


Government shutdown will ensue, and the public will turn en masse


against Barack Obama. Republican House that failed to raise the debt


ceiling would some how escape all the blame. Then Democrats would


have no choice but to pass a balanced budget amendment and


reform entitlements and the TEA Party Hobbits could return to


middle earth, having defeated Mordor. Today there was a renewed


push to get the deal done. There are plenty of ways out of this mess.


But we are almost out of time. We need to reach a compromise by


Tuesday, so that our country will have the ability to pay its bills


on time, as we always have. Bills that include monthly social


security cheques, veterans' benefits and the Government


contracts we have signed with thousands of businesses. Keep in


mind f if we don't do that, if we don't come to an agreement, we


could lose our country's AAA credit rating. Who actually does the US


Government owe money too? There are small holdings by investment funds


and oil exporters, of the foreign cet creditors, the biggest is China,


followed by Japan and the rest of the world. No wonder China is often


called America's credit card. The biggest lender to the US Treasury


is the US itself, institutions from pension funds to the Federal


Reserve. The sharpest critics of the United States have described it


as a country with Social Democratic spending and TEA Party taxes, you


can't go on like, that but it is still hard to believe we are


talking about the world's wealthiest country, perhaps not


being able to pay its billsment how likely is that nightmare - its


bills. How likely is that nightmare society? A US sovereign default,


even if it is technical, short lived, made good in a matter of


days, will cause n my view, a worldwide recession. It is going to


completely disrupt financial markets from here to Tokyo.


chances of that are now small, but not negligible. What is more likely


than not, that next week there will be a fudge, no default, but no


convincing package of reform either. If so, analysts say, the US would


lose the AAA credit rating that allows it to borrow cheap money.


Getting to that new equilibrium, where the new underline safety of


the dollar is less than before, where this anchor of global


stability is becoming more brittle, that will require higher yields and


a much weaker dollar, and the combination will be weaker activity


in the US because of the higher interest rates, and weaker activity


in the rest of the world, because the US will be exporting with


weaker demand to the exchange rate. The trouble is there are banks and


private institutions around the world whose rules say they must


invest in only AAA rated securities. If the US gets downgraded, they


will be holding thrillions of US debt against their own rules.


problem is, if the US moves away from AAA rating, what do they do?


Now in a small country they would sell their bonds, but in the case


of the United States, the bond market is so huge, it is so big,


and the ownerships are so large, that it is really the central banks


that will have to change their mandate, rather than selling these


bonds. Because there wouldn't be enough buyers? Well, there wouldn't


be enough buyers in the world really, the world's not big enough


to absorb the amount of debt the US has.


Whatever Captain America's trouble, international investors are more


likely to waive the rules rather than dump dollars. As the market


opened, investors must have been wondered if a debt-free US could


ever be taken seriously. My guests are with me. Would


Republicans rather see the richest nation on earth default on its


debts than raise taxes? Thank you, first of all, for the opportunity


to come on your show and talk about grassroots American politics, which


I wrote a book about, it is called Right Angle, perhaps after the


events of the last two days I should have called it Handbook for


Hobbits. We don't want to see the country default, we don't think


that is where it is headed. In your report you talked about paying our


bills and defaulting in the same sentence. They are really two


different things. We can pay our bills n fact we have $200 billion a


month coming in, our bills are $145 billion, we have enough to pay


bills. The world should not be concerned. We have a net safety.


The world is concerned and so is senator John McCain, he said it is


crack political thinking and called you a political Hobbit. Yes he did.


But what he for gth got about The Hobbit trilogy, is The Hobbits win


in the end. What is going on is the bill is the safety net bill, that


covers our paying our bills every month. What we're really talking


about here is the deficit spending that is going on, and how do we


stop the deficit spending, no-one can spend in the deficit without a


consequence. Our consequences are coming up right now. How does


defaulting on your debts help. That I think senator McCain was


suggesting you're living in some kind of fantasy calling you a


Hobbit. He wasn't suggesting you defeat Mordor? We are not living in


fantasy. And our demand is that we live within our means. Which is a


balanced budget amendment. That is what we are asking for. Balance the


budget. That is what we want, first of all, is for them to take that up,


and senior Harry Reid says he has no choice, he does, we have -


senator Harry Reid says he has no choices. We have said cut, and


balance. Senator Harry Reid defeated you. But the big point


surely is that this could very easily be a rerun of the mid-1990s,


when a Republican Congress couldn't agree with a Democrat President,


and Bill Clinton won the next election by landslide, because the


country, in the end rallied round him? I think when you talk about


politics in America, you need to look back at 2010. We sent a clear


mandate, it was over two third of our country that agrows we need to


balance this budget, - agrees wrecks need to send a balanced


budget amendment to the people. We need to quit spending like we are


spending. That is what we are asking them to do, deal with this.


We are not sending them to default. They are putting us in this


situation. They are in the majority, they could come up with something


themselves, instead, Senator Harry Reid just sits back and says no, no,


no. Instead of presenting something himself. Are you concerned how this


is seen around the world. The British business secretary, Vince


cable said the world economy was being held hostage by American


right-wing nutters? Of course we're concerned about how the world will


be impacted by what we do. And that's why we are taking steps to


make sure that we correct the course we are on. We don't want to


drag the whole world economy down. That is why we need to correct our


economy and the best way to do that is to get a balanced budget


amendment in place, and then deal with this situation that we're in


by cutting and capping. Thank you very much, we will watch with


interest what happens over the next few days.


Now Michael Crick is here on his last appearance on Newsnight to


help us review the papers. What have we got. The front page of the


Telegraph is saying MPs on the Culture Select Committee are


Culture Select Committee are preparing to recall James Murdoch


after three senior former News International executives have


disputed the evidence he and Rebekah Brooks gave last week.


Interesting story on the front page of the Guardian, they say Miliband


is taking his first steps towards reconciliation with his brother, by


agreeing to be an unofficial ambassador from the Labour Party to


university and college campuses. Another story that struck me on the


front page of the Financial Times, about our former colleague Laura


Kunsberg about how when she joined ITV recently she took 60,000


Twitter followers with her. You're in that story? I did the same sort


of thing, I have a more modest band of followers. I decided not to loaf


them here and hope they will come with - leave them here and hope


they will come with me. That is all from us, it is Michael's last show


before he quits journalism to join channel 4 we leave you with a few


of the politicians he has made friends with over the past few


years. REPORTER: Aren't you taking the quiet man business a bit far.


Why are all the heaviests trying to get me out of there. Wouldn't be to


be better to spend the next week. Jeffrey Archer, clip, clip, clip,


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