Australian mining tycoon Clive Palmer said this week that he was considering investing in the local media via a Guardian-style "blind trust."
The idea is that Palmer — recently criticized for trying to use his money to influence national debate — and other people with enough money to buy into a debt-crippled industry would do so for two reasons:
1. to make a financial return; and
2. to support ''quality, independent, professional journalism."
Anything strike you as odd about that?
''Editorial independence would be enshrined in the trust's deed … the trust would have no influence over the direction of the paper. It would be editorially independent. You wouldn't want it to be a propaganda sheet for anyone or any [political] party,'' Palmer told the Fairfax press.
This is the same Clive Palmer who during an interview with the ABC late last month made supportive noises about fellow magnate Gina Rinehart's purchase of a bigger share of in the same Fairfax, arguably Australia's most influential media company.
"She's a very, very smart woman, so if she's going after Fairfax, there must be something in it," Palmer told the Australian Broadcasting Corporation, adding that that he would consider an aggressive play for a 30 percent stake in the media company himself.
Rinehart, now Fairfax's biggest shareholder with a 12.58 percent stake, has made no secret of her desire to provide a voice for Australia's put-upon billionaires and their close cousins, the otherwise rich and influential.
Rinehart's investment and Palmer's musings no doubt provided inspiration for a recent extraordinary outburst by Australia's treasurer, Wayne Swan, who accused the magnates of using their money and influence to ''poison'' the political and economic debate.
(More from GlobalPost: Tough times for Australian billionaires)
Palmer first floated the "blind trust" idea during an interview with Fairfax's Australian Financial Review (AFR), saying he was "looking at media very strongly" as an investment.
However, Palmer insisted the AFR that rather than billionaire media owners, it was the overconcentration of media and cross-media ownership was a threat to democracy.
"Ultimate power tends to corrupt. You saw what happened to the News of the World," Palmer said, referring to Rupert Murdoch's Tabloid that closed last year amid a phone-hacking scandal.
Palmer, Australia's fifth richest person — who recently joked that he had always wanted to be a journalist — said investors in the blind trust could be limited to a 5 percent holding.
"We've all got a vested interest in a free press in Australia. You might get 20 people who all put 5 percent in, not enough so that either of them or anyone could have control."
He said he had been studying various models, including one in which "you would put your money into a blind trust."
The Guardian newspaper in Britain is owned by the Scott Trust, set up in but Palmer said there were other examples of the operating model in Europe and the United States.
"You'd get a return and you'd get good journalism," Palmer told the AFR, defying analyst assessments to the contrary.
“The only reason a wealthy individual would invest in media at the moment would be to make a play at controlling media," Pulse Markets managing director Hamish McCathie told AdNews.com. "From an investment point of view, it's just not a good investment otherwise."
Peter Cox, a media economist, may have even questioned Palmer's mental state: "He says he is doing it for investment purposes, but how can a blind trust be a good investment vehicle. Then he says he is doing it for the sake of bolstering the media industry, so it sounds like philanthropy, but that is certainly contradictory to his character... Maybe he was having a moment of confusion."
Fusion strategy managing director Steve Allen admitted to being a little confused himself: "It makes absolutely no sense. He is saying he will stand at arms length. But why invest in media assets if it is just a share play? What is the sudden new attraction if he doesn't want any influence?"
Citigroup analyst Justin Diddams put the story in perspective: "If we look back through history and those that have owned media assets, there has always been another agenda outside of news and money, there has always been a political agenda. Media buys you influence. If you talk about an independent trust, the word independent is a very loose description. Anyone would use their ownership to their own purposes. Why wouldn't you?"
Palmer, for his part, insisted he would do it for the right reasons, even going as far as to say it was vital that Fairfax mastheads survived.
"We've got to keep them going, and hopefully we can boost circulation," he said.
To concerns he would use any media asset to lobby government on behalf of the mining industry, he said any newspaper run by the trust ''could be for or against the carbon tax or the mining tax. That would not be a matter for the investors."
This from a man who is planning a High Court case against the government's new carbon tax, and who once declared a mining super profits tax a threat to the nation almost as great as a war.
Great idea, says Australia's main journalist's union, the Media Entertainment and Arts Alliance, whose spokesman Paul Murphy told Fairfax's Sydney Morning Herald newspaper: "In this era of changing media models we welcome any new initiatives that keep journalists in work and preserve independent and quality journalism.
"What Mr Palmer has proposed has all the hallmarks of an altruistic idea but we would be happy to meet with him to help develop this proposal. We welcome any new private funding in the media from people who are genuinely not seeking to buy editorial control."
Yeah, but is anybody really buying it?
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