[Marxism] Good article, bad title
lnp3 at panix.com
Sun Jul 24 07:10:50 MDT 2011
(A better title would have been "Ex-Schools Chief Emerges as Likely
NY Times July 23, 2011
Ex-Schools Chief Emerges as Unlikely Murdoch Ally
By JEREMY W. PETERS, MICHAEL BARBARO and JAVIER C. HERNANDEZ
This article is by Jeremy W. Peters, Michael Barbaro and Javier C.
Joel I. Klein, the former New York City schools chancellor, was in a
tricky position. Three weeks ago, Rupert Murdoch asked Mr. Klein, now
his trusted deputy, to oversee an investigation into the phone hacking
scandal that has deeply wounded the News Corporation and its chairman,
something Mr. Klein was eager to avoid.
“I am trying to get as far away from this as I can,” he lamented to a
He has not succeeded. Mr. Klein, who joined the News Corporation as a
senior vice president in January, is not only responsible for the
investigation that could uncover what company managers knew about the
hacking, but he also has become one of Mr. Murdoch’s closest and most
visible advisers throughout the crisis.
His seemingly contradictory roles — de facto chief of internal affairs
officer and ascendant executive with Mr. Murdoch’s ear — are raising
questions about how robust and objective the internal inquiry can be.
When Mr. Murdoch summoned a team of top deputies and outside consultants
to London to help him manage the fallout from the hacking, Mr. Klein was
one of the first to arrive, moving into a temporary office 20 feet from
When Mr. Murdoch and his closest advisers debated whether to accept the
resignation of Rebekah Brooks, a newspaper executive at the center of
the controversy, Mr. Klein pushed for her exit. When Mr. Murdoch wrote a
statement to deliver to Parliament last week, Mr. Klein weighed in on
And while the world watched Mr. Murdoch and his son James testify, Mr.
Klein sat directly behind them for three hours, occasionally cleaning
his rimless glasses with his tie as he looked on in support.
Mr. Klein’s dizzying journey, in under a year, from one of the nation’s
foremost education reformers to the corporate consigliere for a media
titan whose politics are far to the right of his own, has surprised and
unsettled many friends and colleagues, who fear that he will be unable
to extricate himself from a scandal that shows no sign of abating or,
they say, ending well. “This was nothing he could have ever expected,”
said Barbara Walters, a longtime friend of Mr. Klein’s.
But in many ways, interviews suggest, his emergence as a dominant figure
within the News Corporation is consistent with a biography that combines
high-minded legal and social aims — antitrust law and education — with a
driving, sometimes overwhelming competitive fire.
“He has a take-no-prisoners attitude,” said Randi Weingarten, who
battled Mr. Klein when she was head of the New York City teachers union.
“He is a litigator. He is about winning.”
It is a sign of how delicate Mr. Klein’s position inside the News
Corporation has become that he was initially against the idea of an
internal review. In April, after London’s Metropolitan Police arrested
three News of the World journalists on suspicion of hacking, some
executives pushed for an investigation that would have the full backing
of the company’s board and senior management, according to two people
with knowledge of the discussions taking place at the time.
Mr. Murdoch opposed the idea outright. Standing firmly in his corner was
“There was a clear message,” said one of the people who knew of Mr.
Klein’s role and requested anonymity to divulge private conversations.
“Stay out. And let Joel handle it.”
Top lawyers and experts in corporate governance said the News
Corporation should have hired outside legal counsel to oversee the
inquiry, as dozens of companies like the American International Group
and Fannie Mae have done in the past, rather than rely on an insider.
“That is not standard practice,” said Charles M. Elson, an expert on
corporate governance at the University of Delaware. “You cannot be seen
as objective if you are inside.”
The News Corporation says the investigative body will have true
independence and the power to compel employees to cooperate. The company
points to the appointment of Lord Anthony Grabiner, a prominent British
lawyer who also sat behind the Murdochs during their testimony before
lawmakers last week, as the body’s independent chairman. Lord Grabiner
will report to Mr. Klein. Mr. Klein, in turn, will report to Viet Dinh,
an independent director on the News Corporation board.
Mr. Klein declined to be interviewed for this article.
“We’ve been given a free hand,” said Lord Grabiner, who added that he
and Mr. Klein never would have agreed to take on the job if they felt
the committee was a sham.
“If I thought for a moment that this was going to be an in-house job, I
wouldn’t do it because my reputation is on the line,” he said. “And I’m
sure he feels the same way.”
Well Practiced in Turmoil
Investigating his colleagues and possibly his superiors was not what Mr.
Klein, 64, signed up for when he joined the News Corporation in January.
His actual job is chief executive of the company’s fledgling education
division — a business that sits far down the pecking order in a global
media giant that owns Fox News, Twentieth Century Fox Films and The Wall
Street Journal. But Mr. Klein, a postal worker’s son who is known for
his agile mind and professorial appearance, is well practiced in
steering the high-powered through treacherous political shoals.
He helped the Clinton administration prepare Ruth Bader Ginsburg for her
Supreme Court nomination hearings in 1993 and also oversaw the Clinton
White House’s responses to the Whitewater inquiry. He withstood his own
contentious confirmation as head of the antitrust division at the
It was in that role that he first crossed swords with Mr. Murdoch,
pushing against his proposed $1.1 billion merger of his American
satellite television company with Primestar, another satellite provider.
The deal eventually fell apart, costing Mr. Murdoch an estimated $300
By the late 1990s, Mr. Klein was gaining international renown for his
aggressive prosecution of Microsoft, a seemingly invincible technology
behemoth with deep pockets and a high-powered legal team.
Mr. Klein, in his forceful but erudite style, spent months trying to
persuade lawyers inside the Justice Department who advised against
pursuing the case, fearing the government stood no chance of prevailing.
“If he had not been 100 percent behind it, it would not have gone
anywhere,” said David Boies, who tried the case for the United States
and is now chairman of Boies, Schiller and Flexner. “He had to overcome
a lot of objections from the staff.”
The government’s victory over Microsoft won Mr. Klein legions of
admirers, eventually including the company’s co-founder Bill Gates, who
became a major donor to New York City schools.
But his unyielding approach and determination to challenge orthodoxy at
times inflamed those around him, especially after Mayor Michael R.
Bloomberg named him schools chancellor in 2002.
At what was supposed to be a diplomatic introductory lunch with Ms.
Weingarten, the head of the city’s teachers union, he asked her how she
believed change should be accomplished within the schools.
“Incremental and sustainable,” she replied.
Mr. Klein scoffed. “We need a revolution,” he demanded.
His eight years as schools chancellor formed the foundation for his
unlikely friendship with Mr. Murdoch, who holds his own strong views on
education reform, which the two began to discuss over regular lunches
and dinners with their wives.
A Surprising Alliance
Though Mr. Klein did not see eye to eye with Mr. Murdoch on many
political issues, they agreed on a core set of education principles:
that charter schools needed to expand; poor instructors should be weeded
out; and the power of the teachers union must be curtailed.
In each other, they saw themselves: Mr. Klein and Mr. Murdoch were both
unapologetic about their beliefs, frustrated with status-quo politics
and tenacious. They shared a distaste for small talk with strangers and
had a habit of quickly disappearing from social events.
Their friendship morphed into a political alliance. Mr. Murdoch’s New
York Post emerged as an unflinching and potent champion of Mr. Klein’s
proposals to remake the school system, like his successful fight to lift
a state cap on the number of charter schools in New York City.
Mr. Murdoch began to put his own money behind Mr. Klein’s efforts. At
one point, he quietly donated $1 million to an advocacy group, Education
Reform Now, run by Mr. Klein, bankrolling a continuing campaign to
overturn a state law protecting older teachers, according to a person
told of the contribution.
When Mr. Klein visited The Journal last year to discuss education issues
with news and opinion writers, Mr. Murdoch interrupted to lavish praise
on the chancellor, much to the surprise of the writers. “Just listen to
everything that Joel is saying,” Mr. Murdoch insisted, according to one
person who attended the meeting.
As Mr. Klein considered stepping down as schools chancellor in late
2010, Mr. Murdoch made him an alluring offer: work for him, running a
new division of the News Corporation focused on education technology.
According to a friend, Mr. Murdoch told Mr. Klein he was willing to
spend $1 billion to build the business.
It was lucrative work. Mr. Klein’s compensation package may exceed $4.5
million this year, company filings show. He is eligible for News
Corporation stock awards and receives a $1,200 monthly car allowance.
At a Titan’s Ear
Some in Mr. Klein’s social circle were startled by his decision to join
the News Corporation’s right-leaning news empire.
“What? You’re going to work for Rupert Murdoch?” David Gergen, a former
adviser for Bill Clinton, recalled asking his friend.
Mr. Klein was a dyed-in-the-wool Democrat, though he had taken a more
conservative tack on education. He rarely took vacations, but when he
did he went to the Dominican Republic, where the fashion designer Oscar
de la Renta, a friend, held parties that became a retreat for Democrats,
including the Clintons.
When friends asked, he reassured them that his only interaction with Fox
News was seeing the television screens in the company’s elevators.
In his first few months at the News Corporation, he quickly assimilated
and seemed happier than ever before to several longtime friends. He gave
up BrickBreaker, the addictive BlackBerry game that he had grown fond of
as schools chancellor, saying he no longer needed it because his stress
levels had fallen. He told friends that his chronic back pain had vanished.
Mr. Klein has often traveled on Mr. Murdoch’s private jet, and he seemed
to relish access to the company’s stable of media properties,
occasionally wandering to the desks of Journal writers to discuss
In the eighth floor executive suite at the company’s Midtown
headquarters, where he occupies an office just down the hall from Mr.
Murdoch, he closely aligned himself almost immediately with the
chairman, isolating himself from other senior executives. That led to
some suspicion from colleagues, a person with knowledge of the company’s
dynamics said, especially as Mr. Klein left the impression that he
wanted the chief legal officer to report to him. Through his spokesman,
Mr. Klein said he had no interest in running the company’s legal affairs
and was focused on the education business.
Mr. Klein was keen on having his advice heard at the highest levels of
the company, according to people told of his conversations with News
Corporation executives. At his urging, with some encouragement from his
wife, Nicole Seligman, the News Corporation hired Williams & Connolly,
her former law firm, to provide counsel on the scandal.
Friends who have spoken with Mr. Klein in recent weeks said he was
conflicted about his new investigative assignment: eager to return to
the education sphere, but determined to redeem the News Corporation and,
in particular, Mr. Murdoch, by conducting a thorough inquiry.
“The easiest thing would be for him to walk away from this,” Mr. Boies
said. “The one thing I can tell you is that he will not say something he
does not believe. And he does not believe easily.”
During their days together on the Microsoft trial, Mr. Boies recalled,
Mr. Klein had a favorite legal maxim that would serve him well in his
new role at the News Corporation.
“Facts,” he was fond of saying, “are stubborn things.”
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