At Fairfax, Misery Loves Company

fairfax chartYou may not have noticed, The Sydney Morning Herald and The Age being the sort of publications sensible people no longer read, but Fairfax Media’s journalists went all bolshie over the past few days and walked off the job. It was a display of curious logic: Its old media circulation and revenues are tanking, so why not chip away at what little remains by going on strike? At Fairfax, where CEO Greg Hywood takes home a reported $50,000 a week, it all makes as much sense as rewarding execs who have failed to reward shareholders.

How and why a once-sane media organisation reached such a state of addled misery is a question best left to corporate psychologists and other students of shared delusions – the fantasy in this instance being Fairfax editors’ fervent belief that the broader population subscribes to the same passions and monocular crusades as the cheap-to-hire twentysomething  women’s studies grads who now populate the organisation’s news rooms. If former readers don’t fret at night about global warming and predatory Catholic kiddie fiddlers (but not molesters associated with government agencies) or revel in the moral uplift to be gained by riding on bicycles or public transport, then a few more breathless reports about the planet’s peril and the joys of travel on late-night trains will surely convince them. Well that has been the theory, anyway, and Fairfax appears committed to that course until the bitter and, one would guess, imminent end.

That is the broad Fairfax mindset, as demonstrated by its  advertisers’ desertion and declining sales, but a more explicit illustration of the thinking that has helped lay the company low can be found in a column appearing beneath the byline of business columnist Michael West, who is miffed that Google makes more money and pays less tax than his own employer. Drastic reforms are needed, West advises, to make sure Google and other multinationals pay their fair share to the Australian Tax Office, as such measures would “fix the budget deficit in a jiffy”. Warming to his conclusion, West observes “when it comes to a potential incursion by the taxman at its revenue line, Google is already half a step ahead because the bulk of revenues it makes from its Australian operations are actually booked in Singapore.”

Now there are two ways of thinking about taxes and fairness. The first is what might be called the West perspective, which maintains that if Fairfax is being skinned by the revenuers then every other business should see its profits eroded in similar fashion. What is an onerous imposition on one outfit’s profits should be equally unfair to all. Presumably, the next time West sees a one-legged man, he will have his own foot off in the interests of fairness and an even playing field.

The second tack, as alien a thought as the notion that owning a bicycle may not signify automatic moral superiority, is that maybe, just maybe, Australia should grab a larger slice of the multinational tax revenues now going to Singapore by lowering its own rates and competing as a low-tax jurisdiction. A further thought: Fairfax might want to try a little innovation, hard though that may be to imagine of the company that passed up the opportunity to invest in Seek.

Still, there is consolation of a sort. At the farewell parties for the latest round of 70 soon-to-be laid-off Fairfax staffers, those plastered with pink slips can tell each other that the company’s troubles are all the fault of Google and inequitable taxation policies.

It won’t be true, of course, but it will serve as a distraction, at least for a few hours, from the perils of global warming and cassock-lifting clergy.

Roger Franklin is the editor of Quadrant Online


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