27 October 2005

The Price of Freedom

In discussions with some of my more thoughtful and enlightened Vietnamese friends, they would complain about government control over the media: "not like in Australia", they would say. Being tactful, trying to be objective, actually being objective, wanting to warn them in advance that not all was rosy on the other side so that they weren't disappointed when the "winds of change" finally reached their own country, and in the interest of truth, I always replied: their complaints are true, and we are (still) freer in Australia, but the major threat to press freedom in Australia comes not from the government (which, amazingly, funds 2 other pillars of good journalism: the ABC [government-owned, middle- to high-brow, centrist broadcaster] and SBS [the same, but targeted at immigrants]), but from the concentration of ownership of the media.

Vietnam really shook me out of my complacency regarding how important these things are. I have seen their fragility. Believe me, I am very very freaked out, and you should be too.

I have seen how powerful control of the press is. Control of the press works: it worked on me. The power of the press is not so much in what it 'makes' you believe, but in what information it withholds.

Fairfax (FXJ) is the largest independent media group and one of the few left in Australia. It is of decent quality. Its stable of newspapers, primarily The Sydney Morning Herald, The Age (in Melbourne), and above all (in my opinion, better minds will disagree) the Australian Financial Review are some of the few institutions left keeping the bastards honest.

FXJ has already survived one assault from Kerry Packer. I doubt very much that he has given up his ambition of owning it. I'm sure Rupert Murdoch would be equally delighted to own it too, given the opportunity. By the way, in case you need reminding, as far as media in Australia is concerned, Packer and Murdoch are just about it. If FXJ goes to either of them, you can forget about checks and balances.

So what to do? Compared to Packer or Murdoch, I am not even a David to their Goliath. I am a gnat.

Lefties and lawyers (and what - two-thirds? - of parliamentarians are lawyers, surprise surprise) believe that laws are the solution. They always want more laws. "There ought to be a law!" "They [it's always the mysterious 'They' who should do something] should suddenly become honest or magically transcend political reality and pass a law". But can it be done, given the nature of Australia's semi-democracy? Is it even desirable to have more laws? Will mere laws even work?

However you, Mr David Gnat, although you may not realise it, actually do have the power in the real world have to do something about it. And you barely have to leave your seat to do it.

Because any shares in Fairfax you control and refuse ever to sell are shares Packer and Murdoch and Ho Chi Minh can never control.

And if everyone does it then...

There are 924 million Fairfax shares outstanding.

There are 7 million taxpayers in Australia.

If my calculations are correct, that's 132 shares per taxpayer.

Today's FXJ closing share price was AU$4.06. That's a grand total of AU$535.92 per taxpayer.

That's a very small amount of money - and that's for the entire company!

Consider this:

1. It's such a small amount of money we don't need to exclude non-taxpayers - we can include pensioners, invalids and the unemployed. So, given, say, 10 million voters, that'd be 92.4 shares or AU$375.14 each.

2. Even if we control just over 10% of the shares, we can prevent a mop-up by a Goliath. [Under Australian law, anyone who buys 90% or more of the shares of a public company can force the holders of the remaining 10% to sell their shares at a "fair" price. They can then take the company private, reducing the amount of outside scrutiny possible.]

3. A Goliath would need about 20-50% of the shares to get real control, so even if we merely get hold of, say, 67% of the shares, we would still prevent Goliath from getting control.

4. If all the Davids work in unison they can get actual control of the company with a mere 33% of the shares.

So ask yourself: would you invest (not spend - you get a resaleable asset that pays dividends and should at least hold its value if not appreciate) a mere $500 to ensure the continued media diversity and freedom? [Disclaimer: I am not certified to give investment advice.]

Do you want a media that is merely a tool in the political-financial machinations of media barons?

If the answer is yes to the former and no to the latter, stop whinging and act today. I just bought 140 shares myself.

"...the working class has been become integrated into capitalist society and is no longer a revolutionary force." [The 'Frankfurt School' of social theory according to Anthony Giddens, The Return of Grand Theory in the Human Sciences - think about it: what are pension funds?]. Shareholder activism is the way of the future. So...put your money where your mouth is and buy 132 Fairfax shares today!

[Full disclosure: The author now owns Fairfax shares.]


Post a Comment

<< Home