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Austerity is a Dirty Word in Europe But What Next?

By SARAH DiLORENZO

(AP) -- The day after Francois Hollande rode to power in France on a slogan of "change now" the conversation in Europe is already different: Austerity has become a dirty word.

In Greece, political parties who reject the extreme belt-tightening required by international bailouts were the big winners in parliamentary elections. German voters in a northern state ousted the coalition led by Chancellor Angela Merkel's conservative party, which has pressed the case for austerity.

And France, of course, elected Hollande, its first Socialist president in more than a decade and one who has promised more government spending to stimulate the economy.

"Austerity can no longer be inevitable!" he shouted in his first speech after Nicolas Sarkozy conceded Sunday night. The question remains whether Germany - which is Europe's economic powerhouse driving the austerity agenda - will allow at least some countries in the eurozone to spend more freely in the face of a recession that is spreading across the continent.

Rising uncertainty over how Europe's handling of the debt crisis may change in the weeks and months ahead has made investors nervous. Stock markets were volatile on Monday, falling sharply in the morning and recovering in some countries by the close.

The sharpest selloff was in Greece, where the main stock index plunged almost 7 percent. The euro briefly spiraled to a three-month low against the dollar, hitting $1.2972.

More turmoil in the eurozone would affect the global market, particularly countries like the U.S. whose financial system is intertwined with that of Europe.

As investors become nervous about the future they pull back on their investments, hurting economic activity, while drops in stock markets drain wealth from savers.

American exporters would suffer if sagging confidence in Europe shrinks the value of the euro against the dollar. Exports have been one of the U.S. economy's few strengths since the recession ended three years ago.

The most nerve-wracking development occurred in Greece, where political parties that backed two bailouts lost their majority in Parliament. That opens up the possibility that Greece's new leaders could renege on commitments made to secure the country's massive rescue loans - or even decide to leave the euro. The conservatives will try to put together a new government, but there's a good chance they could fail - and that would usher in another month of financial chaos before new elections.

Merkel pressed Greek leaders to stay the course.

"Of course the most important thing is that the programs we agreed with Greece are continued," she said Monday.

But Greece isn't the only problem. The 17 countries that use the euro - and 9 other European countries - agreed in March to a fiscal compact that seeks to make countries balance their budgets. But as Europe's economy gets weaker, the public and politicians are growing weary of the budget-cutting that is required to make this fiscal compact work.

Eight of the 17 eurozone nations are already in recession and unemployment across the bloc rose to 10.9 percent in March - its highest ever.

If investors pull back from Europe amid uncertainty, its growth policies will have trouble making headway - and that could also drag on the global economy.

The U.S. and European Union are important trading partners and each consumes a large portion of the other's exports. With unemployment skyrocketing in Europe, consumption is flagging and that will have a knock-on effect on the U.S.

The American and European financial systems are also heavily intertwined, and U.S. money market funds still have significant exposure to Europe.

Over the past two years, France and Germany have steered Europe through the debt crisis - though not always well - and declared an end to the flouting of deficit limits that led Europe into the debt crisis.

But the crackdown could not have come at a worse time - with the world economy slowing - and propelled Europe into a vicious austerity spiral. Cutting spending - which meant laying off state employees and ending stimulus programs - further slowed nations' economies and produced less tax revenue, which meant more cuts were needed to meet deficit targets.

Now a backlash has begun and for many, Hollande is its leader.

The new French leader has promised to end the negative loop, demanding that the fiscal compact that targeted spending be re-negotiated to include measures to promote growth. Many economists have long advocated for a greater emphasis on growth, but that idea seemed to gather steam among European policymakers only as Hollande promoted it.

"At the moment that the (French vote) result was proclaimed, I am sure that in many European countries, there was relief, hope," he told supporters in his central hometown of Tulle.

European Central Bank President Mario Draghi called for a "growth compact" even though that institution has long demanded fiscal discipline. The Dutch government, long a supporter of such discipline, fell over the issue of too much austerity and too little growth. And even Germany, the primary architect of austerity, has said a growth pact should be drawn up.

Still, concrete proposals for stimulating short-term growth have been few. European officials have talked about boosting funding for the European Investment Bank, and economists have urged making more targeted and aggressive use of EU structural funds for infrastructure projects such as roads.

Yet with a budget only around 1 percent of EU gross domestic product, the EU's prospects for large-scale spending are limited.

Jeffrey Bergstrand, a professor of finance at the University of Notre Dame, said Germany is going to have to shift on the subject of stimulus. Even though its economy is the largest - and among the strongest - in Europe, it can't thrive if no one else is.

"Merkel has to be paying attention to (unemployment) because Germany, unlike the United States, is very, very reliant on exports, and exports tend to go to your neighbors," he said. "She will have to listen. She will have to give."

Germany has long maintained that it made painful cuts and reforms after the reunification of its East and West while other nations kept spent beyond their means.

But economists argue that Germany reaped the benefits of all that spending, too, since it sells goods to eurozone countries. And at any rate, Germany is one of the few eurozone members that can spend a little more because its economy is strong and its deficit is in check.

Despite this new divergence between France and Germany, that relationship will remain central to a solution to the crisis. Merkel and Sarkozy were so close they were known as "Merkozy" - and the big question now is if there will be a "Merkollande" in Europe's future.

"There can be some short-term friction when they have to adjust to each other," said Laurence Boone, chief European economist at Bank of America Merrill Lynch. "But it doesn't seem to me that there is an alternative, because Spain and Italy are not strong enough."

Merkel called Hollande immediately after his victory and Hollande campaign manager Pierre Moscovici said his boss would head to Berlin shortly after his inauguration on May 15.

Hollande's decision to follow through on campaign promises of jump-starting the French economy by investing in infrastructure and buoying small businesses will determine how bumpy the road ahead is.

He has promised to keep the deficit in check by also raising taxes on the wealthy and closing some corporate loopholes - but some investors say that will kill the very growth he hopes to foster.

"Hollande's platform of anti-austerity is not really anti-austerity; it's really anti-growth," said Jeffrey Sica, president of U.S.-based Sica Wealth Management, which has over $1 billion in assets under management. "Whether it's taxation or regulation or however they're going to raise revenue ... they're going to shift the blame to business and to other higher income levels."

If he does start wildly increasing spending, France will no doubt see its borrowing costs rise - which could make his policies untenable and prompt a shift back to austerity. It was those rising borrowing costs that eventually forced fellow eurozone nations Greece, Ireland and Portugal to seek bailouts.

Some are hoping that Hollande will turn out to be more pragmatic.

"Adieu, election campaign. Bonjour, reality," read an editorial in Germany's daily Sueddeutsche Zeitung.

 

Drug War Slayings Suppressing News in Mexico

E. EDUARDO CASTILLO

(AP)--Four of reporters and photographers covering the perilous crime beat have been slain in less than a week in violence-torn Veracruz state, where two Mexican drug cartels are warring over control of smuggling routes and targeting sources of independent information.

The brutal campaign is bleeding the media and threatens to add Veracruz to the growing list of states where fear snuffs out reporting on the drug war.

Three photojournalists who covered crime in the port city of Veracruz were found dismembered and dumped in plastic bags in a canal Thursday, less than a week after a reporter for an investigative national newsmagazine was beaten and strangled in her home in the state capital of Xalapa.

Press freedom groups said all three photographers had temporarily fled the state after receiving threats last year. The organizations called for immediate government action to halt a wave of attacks that has killed at least seven current and former reporters and photographers in Veracruz over the last 18 months.

Threats and killings have spawned an atmosphere of terror and self-censorship, and most local media are too intimidated to report on drug-related violence in more than a cursory way. Social media and blogs are often the only outlets for reporting on serious crime.

Veracruz isn't the only battleground for Mexican media. In at least three northeastern states, journalists are under siege by assailants who have thrown grenades inside newsrooms and fired into newspaper and TV station buildings.

In the state of Tamaulipas, on the border with Texas, local media stopped covering drug trafficking violence, mentioning drug cartels or reporting on organized crime shortly after two gangs began fighting for control of Nuevo Laredo in 2004. As part of that war, reporters were targeted to keep them silent or because they had links to gangs.

Mexico has become one of the world's most dangerous countries for journalists in recent years, amid a government offensive against drug cartels and fighting among gangs that have brought tens of thousands of deaths, kidnappings and extortion cases.

Prosecutions in journalist killings are almost nonexistent, although that is the case for most homicides and other serious crimes in Mexico.

The latest killings came in Boca del Rio, a town near the port city of Veracruz. The victims bore signs of torture and had been dismembered, the state prosecutors' office said.

One victim was identified as Guillermo Luna Varela, a crime-news photographer for the website http://www.veracruznews.com.mx who was last seen by local reporters covering a car accident Wednesday afternoon. According to a fellow journalist, who insisted on speaking anonymously out of fear, Luna was in his 20s and had begun his career working for the local newspaper Notiver.

The journalist said Luna was the nephew of another of the men found dead, Gabriel Huge. Huge was in his early 30s and worked as a photojournalist for Notiver until last summer, when he fled the state soon after two of the paper's reporters were slain in still-unsolved killings. He had returned to the state to work as a reporter, but it was not immediately clear what kind of stories he was covering recently.

State officials said the third victim was Esteban Rodriguez, who was a photographer for the local newspaper AZ until last summer, when he too quit and fled the state. He later came back, but took up work as a welder. The London-based press freedom group Article 19 said he, like the other two, had been a crime photographer.

The fourth victim was Luna's girlfriend, Irasema Becerra, state prosecutors said.

Article 19 said in a report last year that Luna, Varela and Rodriguez were among 13 Veracruz journalists who had fled their homes because of crime-related threats and official unwillingness to protect them or investigate the danger. The Committee to Protect Journalists said in 2008 that Huge had been detained and beaten by federal police as he tried to cover a fatal auto accident involving officers.

Last June, Miguel Angel Lopez Velasco, a columnist and editorial director for Notiver, was shot to death in Veracruz along with his wife and one of his children.

Authorities that month also found the body of journalist Noel Lopez buried in a clandestine grave in the town of Chinameca. Lopez, who disappeared three months earlier, had worked for the weeklies Horizonte and Noticias de Acayucan and for the daily newspaper La Verdad.

The following month, Yolanda Ordaz de la Cruz, a police reporter for Notiver, was found with her throat cut in the state.

Lopez was found after a suspect in another case confessed to killing him, but the other two murders have not been resolved.

The cartel war in Veracruz reached a bloody peak in September when 35 bodies were dumped on a main highway in rush-hour traffic. Local law enforcement in the state was considered so corrupt and infiltrated by the Zetas and other gangs that Mexico's federal government fired 800 officers and 300 administrative personnel in the city of Veracruz-Boca del Rio in December and sent in about 800 marines to patrol.

Mike O'Connor, the Committee to Protect Journalists' representative for Mexico, said journalists in Veracruz were exercising an unusual degree of self-censorship even before Ordaz and Lopez were killed. He said media avoided much coverage of crime and corruption.

"Important news was not covered because it might upset the Zetas. Then these guys were killed and self-censorship cracked down even more," O'Connor said. "Almost all of the police beat reporters left town after those killings."

Regina Martinez, a correspondent for the national magazine Proceso, continued to cover crime-related stories along with a handful of other journalists, however.

On Saturday, authorities went to her home in Xalapa, the state capital, after a neighbor reported it to be suspiciously quiet. They found the reporter dead in her bathroom with signs she had been beaten and strangled.

"Self-censorship was extraordinarily strong but whoever killed these journalists wanted more," O'Connor said. "It still wasn't enough to satisfy whoever killed these journalists."

Mexico's human rights commission says 74 media workers were slain from 2000 to 2011. The Committee to Protect Journalists says 51 were killed in that time. It noted in a statement on the Mexico killings that Thursday was World Press Freedom Day.

 

Activist Now Wants to Leave China

By ALEXA OLESEN and MATTHEW LEE


(AP)--The blind Chinese activist at the center of a six-day diplomatic tussle between the U.S. and China said he fears for his family's lives and wants to leave China, hours after American officials announced an agreement with Beijing that was to guarantee his safety.

Chen Guangcheng escaped from illegal house arrest and other mistreatment in his rural town, placing himself under the protection of U.S. diplomats last week. On Wednesday, after six days holed up inside the American embassy, he emerged and was taken to a nearby hospital. U.S. officials said they had extracted from the Chinese government a promise that Chen would reunite with his family and be allowed to start a new life in a university town.

Hours later, however, a shaken Chen told The Associated Press in a telephone interview from his hospital room that U.S. officials told him the Chinese authorities would have sent his family back to his home province if he remained inside the embassy. He added that, at one point, the U.S. officials told him his wife would have been beaten to death.

"I think we'd like to rest in a place outside of China," Chen said, appealing again for help from U.S. officials. "Help my family and me leave safely."

State Department spokeswoman Victoria Nuland said in a statement that no U.S. official spoke to Chen about physical or legal threats to his wife and children. Nor did the Chinese relay any such threats to American diplomats, she said. She did confirm that the Chinese intended to return his family to their home province of Shandong, where they had been detained illegally and beaten by local officials angry over Chen's campaigns to expose forced abortions, and that they would lose any chance of being reunited.

"At every opportunity, he expressed his desire to stay in China, reunify with his family, continue his education and work for reform in his country," Nuland said. "All our diplomacy was directed at putting him in the best possible position to achieve his objectives."

The differing accounts could not be immediately reconciled. But the turn in Chen's fate comes after nearly seven years of prison, house arrest and abusive treatment of him and his family members by local officials.

Chen's flight into the protection of U.S. diplomats in Beijing last week had created a delicate diplomatic crisis for Washington and Beijing. It also threatened to derail annual U.S.-China strategic talks with U.S. Secretary of State Hillary Rodham Clinton starting Thursday.

Under the agreement that ended the fraught, behind-the-scenes standoff, U.S. officials said China agreed to let Chen and his family be relocated to a safe place in China where he could study at university, and that his treatment by local officials would be investigated.

Chen, 40, said he never asked to leave China or for asylum in the U.S. and said American officials reassured him they would accompany him out of the embassy. At the hospital, Chen was reunited with his wife, his daughter and a son he hasn't seen in at least two years. But after they got to his room in Chaoyang Hospital, he said no U.S. officials stayed behind and that the family is now scared and wants to leave the country.

"The embassy told me that they would have someone accompany me the whole time," he said. "But today when I got to the ward, I found that there was not a single embassy official here, and so I was very unsatisfied. I felt they did not tell me the truth on this issue."

He also took issue with another facet of the U.S. version of his departure - that on his way to the hospital Clinton called him and he told her in halting English "I want to kiss you."

"I told Clinton that I want to see her now. I said" - he said speaking in Chinese. Then switching to English he said, "I want to see you now."

Chen had become an international symbol for human dignity after running afoul of local government officials for exposing forced abortions carried out as part of China's one-child policy. He served four years in prison on what supporters said were fabricated charges and was then kept under house arrest with his wife, daughter and mother, with the adults often being roughed by officials and his daughter searched and harassed.

His dogged pursuit of justice and the mistreatment of him by what seemed like vengeful local authorities brought him attention from the U.S. and foreign governments and earned him supporters among many ordinary Chinese.

The differences over his security aside, leaving Chen in China is risky for President Barack Obama. Washington will now be seen as party to an agreement on Chen's safety that it does not have the power to enforce.

Ai Xiaoming, a documentary filmmaker and activist, said the Chinese government fails to ensure people's rights, so the best solution would be for Chen and his family to go to America.

"In the first place, Chen Guangcheng should not have to ask a foreign country to protect his rights. His rights should be protected by his own country, through the constitution. But it is obvious that this cannot be done," Ai said. "I feel that the U.S. has always accepted political refugees, it has always provided asylum, so I hope to see Chen Guangcheng safely leave."

Clinton said in a statement that Chen's exit from the embassy "reflected his choices and our values" and said the U.S. would monitor the assurances Beijing gave. "Making these commitments a reality is the next crucial task," she said.

The discrepancies also muddy an agreement that would have shelved, at least temporarily, a predicament that threatened to move human rights to the front of a U.S.-China agenda crowded with disagreements over trade imbalances, North Korea and Syria.

With Chen out of the way, in theory, Clinton, Treasury Secretary Timothy Geithner and their Chinese counterparts would be set to focus on the original purpose of their two-day talks starting Thursday: building trust between the world's superpower and its up-and-coming rival.

Even so, the Chinese Foreign Ministry signaled its pique with the affair, demanding that the U.S. apologize, investigate how Chen got into the embassy and hold those responsible accountable.

"What the U.S. side has done has interfered in the domestic affairs of China, and the Chinese side will never accept it," Foreign Ministry spokesman Liu Weimin said in a statement.

Senior U.S. officials, speaking on condition of anonymity to discuss the intense negotiations that led to Chen leaving the embassy, said the U.S. helped Chen get into the embassy because he injured his leg escaping from his village. In the embassy, Chen did not request safe passage out of China or asylum in the U.S., the officials said.

The officials refused to say if Washington would apologize. One official said that embassy staff acted "lawfully" and in conformity with policy, suggesting that the U.S. does not believe it has anything to apologize for.

The arrangements for Chen carries risks as well for China's government, which worries about encouraging activists and government critics.

As news spread that he had been taken to the hospital, in the eastern part of the city, media crews and a few supporters gathered outside. A man stood in front of the gate at the hospital and held up a sign saying "Freedom for Guangcheng, Democracy for China" for a minute before police took him inside. The hospital's name became a banned search term on the much-censored Chinese Internet, joining a long list of permutations for Chen's name.

The U.S. officials said Chen would be settled outside his home province of Shandong and have several university options to choose from. They also said that the Chinese government had promised to treat Chen "like any other student in China" and would investigate allegations of abuse against him and his family by local authorities.

Documents Reveal al Qaeda's Plans For Seizing Cruise Ships, Carnage in Europe

By Nic Robertson, Paul Cruickshank and Tim Lister / CNN

On May 16 last year, a 22-year-old Austrian named Maqsood Lodin was being questioned by police in Berlin. He had recently returned from Pakistan via Budapest, Hungary, and then traveled overland to Germany. His interrogators were surprised to find that hidden in his underpants were a digital storage device and memory cards.

Buried inside them was a pornographic video called "Kick Ass" -- and a file marked "Sexy Tanja."

Several weeks later, after laborious efforts to crack a password and software to make the file almost invisible, German investigators discovered encoded inside the actual video a treasure trove of intelligence -- more than 100 al Qaeda documents that included an inside track on some of the terror group's most audacious plots and a road map for future operations.

Future plots include the idea of seizing cruise ships and carrying out attacks in Europe similar to the gun attacks by Pakistani militants that paralyzed the Indian city of Mumbai in November 2008. Ten gunmen killed 164 people in that three-day rampage.

Terrorist training manuals in PDF format in German, English and Arabic were among the documents, too, according to intelligence sources.

U.S. intelligence sources tell CNN that the documents uncovered are "pure gold;" one source says that they are the most important haul of al Qaeda materials in the last year, besides those found when U.S. Navy SEALs raided Osama bin Laden's compound in Abbottabad, Pakistan, a year ago and killed the al Qaeda leader.

One document was called "Future Works." Its authorship is unclear, but intelligence officials believe it came from al Qaeda's inner core. It may have been the work of Younis al Mauretani, a senior al Qaeda operative until his capture by Pakistani police in 2011.

The document appears to have been the product of discussions to find new targets and methods of attack. German investigators believe it was written in 2009 -- and that it remains the template for al Qaeda's plans.

Investigative journalist Yassin Musharbash, a reporter with the German newspaper Die Zeit, was the first to report on the documents. One plan: to seize passenger ships. According to Musharbash, the writer "says that we could hijack a passenger ship and use it to pressurize the public."

Musharbash takes that to mean that the terrorists "would then start executing passengers on those ships and demand the release of particular prisoners."

The plan would include dressing passengers in orange jump suits, as if they were al Qaeda prisoners at Guantanamo Bay, and then videotaping their execution.

Lodin and a man called Yusuf Ocak, who allegedly traveled back to Europe with him, are now on trial in Berlin where they are pleading not guilty. Ocak was detained in Vienna two weeks after Lodin's arrest.

According to a senior Western counterterrorism official, their names were on a watch list, and when they handed over documents at a European border crossing, their names registered with counterterrorism agencies.

Both men have pleaded not guilty to terrorism charges. Ocak is also charged with helping to form a group called the German Taliban Mujahedeen, and is alleged to have made a video for the group threatening attacks in Germany.

Prosecutors believe the pair met at a terrorist training camp in Pakistan's tribal territories and were sent back to Europe to recruit a network of suicide bombers.

"We do not know what those men were up to but there are certain files of information that would make it plausible that they were probably thinking of a Mumbai-style attack," says Musharbash.

In the fall of 2010, a year after the document was written, European intelligence agencies were scrambling to investigate a Mumbai-style plot involving German and other European militants -- which sparked an unprecedented U.S. State Department travel warning for Americans in Europe.

"I think it is plausible to think that the 'Future Works' document is part of that particular project," says Musharbash.

"Future Works" suggests al Qaeda was an organization under great pressure, without a major attack to its name in several years, harried by Western intelligence. If anything, its predicament is even more dire today.

"The document delivers very clearly the notion that al Qaeda knows it is being followed very closely," Musharbash tells CNN. "It specifically says that Western intelligence agencies have become very good at spoiling attacks, that they have to come up with new ways and better plotting."

Part of the response, according to the document, should be to train European jihadists quickly and send them home -- rather than use them as fighters in Afghanistan and Pakistan -- with instructions on how to keep in secret contact with their handlers.

What emerges from the document is a twin-track strategy -- with the author apparently convinced that al Qaeda needs low-cost, low-tech attacks (perhaps such as the recent gun attacks in France carried out by Mohammed Merah) to keep security services preoccupied while it plans large-scale attacks on a scale similar to 9/11.

Those already under suspicion in Europe and elsewhere would be used as decoys, while others would prepare major attacks.

That is yet to materialize, but Musharbash believes a complex gun attack in Europe is still on al Qaeda's radar.

"I believe that the general idea is still alive and I believe that as soon as al Qaeda has the capacities to go after that scenario, they will immediately do it," he says.

While "Future Works" does not include dates or places, nor specific plans, it appears to be a brainstorming exercise to seize the initiative -- and reinstate al Qaeda on front pages around the world.

Rupert Murdoch: Media Magnate Grilled on Power, Influence

By Laura Smith-Spark

It's a rare sight: Rupert Murdoch, the indomitable head of the News Corp. empire, called before a judicial inquiry again Thursday to explain how his influence has shaped Britain's media and political landscape.

The British inquiry has shone the spotlight on Murdoch's dealings with a succession of British prime ministers going back decades. It also has raised questions about whether cozy relationships have worked to Murdoch's personal advantage, questions that have been posed elsewhere too.

The inquiry brings into sharp focus the scope of a vast media empire with a presence in Britain, Australia and the United States, where Murdoch's News Corp. controls The Wall Street Journal, New York Post, Fox News and Harper Collins publishers, among other interests.

"He has more power than any other private citizen in the United States," said media commentator Michael Wolff, founder of Newser.com and author of "The Man Who Owns the News: Inside the Secret World of Rupert Murdoch."

For Murdoch, who became a U.S. citizen in 1985, the United States is where the stakes are highest -- because that's where the real money is. His News Corp. faces an FBI inquiry there into alleged phone hacking and is the subject of increased scrutiny in Australia following an inquiry into media standards.

In Britain, Murdoch's appearance at the independent judicial probe known as the Leveson Inquiry is the culmination of months of turmoil that have cost his company dearly in terms of money and reputation. More still is at stake if criminal prosecutions arise from a phone hacking scandal at one of his tabloid newspapers.

The 81-year-old News Corp. chairman admitted Thursday to a cover-up of abuses at the News of the World and apologized for not paying more attention to the scandal.

Murdoch denies political influence

On the stand in London Wednesday, Murdoch's political influence was under the microscope. He insisted that his newspapers did not lobby for his commercial interests and he had "never asked a prime minister for anything."

"You would wish to point out that no express favors were offered to you by Mrs. Thatcher; is that right?" he was asked by Leveson Inquiry lawyer Robert Jay, referring to former Prime Minister Margaret Thatcher.

"And none asked," responded Murdoch. 

The question of influence is key because of the concerns raised over the impartiality of Culture Secretary Jeremy Hunt in considering a takeover bid by News Corp. for British satellite broadcaster BSkyB. Hunt's aide resigned Wednesday over communications with News Corp. that suggested the global media giant was getting inside information, although Hunt denied any improper dealings on his own part. 

And it's significant in part because of the sheer scale of News Corp.'s operations around the globe.

With some 48,000 employees worldwide, the company "had total assets of approximately U.S. $60 billion, total annual revenues of approximately U.S. $34 billion and in excess of 260,000 shareholders" as of the end of last year, Murdoch said in written testimony.

"This is a man who has held power far greater and far longer than anyone else in our time," said Wolff of the octogenarian.

For 60 years, Murdoch has been both a powerful private citizen in the United Kingdom, United States and Australia, and a businessman wielding huge influence, Wolff said. "He is so powerful that he doesn't have to ask for anything ... it just comes to him," he said.

News Corp., through its British arm News International, commands some 37% of national newspaper circulation in Britain. It publishes the Times, Sunday Times, Sun and Sun on Sunday newspapers

Given that about 60% of the UK population reads a national newspaper, Murdoch's influence is hard to overstate, said Steven Barnett, professor of communications at the University of Westminster in London.

His attitudes on issues including the Europe Union, opposition to a single currency, taxation and immigration have percolated down to the UK population through his titles, as they shape the news agenda, Barnett said.

The Sun readership matters more than most in political terms because it has 6 to 7 million readers, Barnett said, and polling shows many of these are floating voters.

 

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