I STAND BY MY STORY
Derek Draper forecast here on 23 May that the Sun would back the euro eventually. He believes it still THE REFERENDUM on the single cur- rency is 1,000 editions of the Sun away, and 175 weeks is a long time in politics. That same amount of time ago Murdoch's flagship was a Tory-supporting circulation success edited with panache and humour. How times change. That is what makes last week's tantrum so intriguing.
Why now? It was, of course, partly down to a new editor keen to make a splash (and a double-page spread) to impress his new boss, but it was no maver- ick operation. The general thrust of the attack was authorised by Murdoch, though he was slightly taken aback by its juvenile tone. His representative on earth, Irwin Stelzer, had paved the way earlier in the week with a Sun op-ed and provided the intellectual rationale in last week's Specta- tor, blaming Gordon Brown for leading poor Tony astray. Stelzer's article was no less fascinating for its opening (and uncharacteristic) faux pas in which he described the Cardiff summit as a `G7 meeting'; it was, of course, a meeting of the European Council, hence Blair's warm words on Europe, which, it has to be said, despite Alastair Campbell's massaging of the message, were noted by the whole lobby.
One of the most amusing sights one sees when News Corp watching is Mur- doch's minions contorting themselves into finding reasons for Blair's behaviour. They seek to blame anyone but the PM himself because they know that RM still dotes on him. A senior Wapping executive who spent time with Murdoch recently says his admiration for Blair is undimmed — he is affectionate, even fatherly when talking about him. Murdoch himself believes that Blair has been seduced by siren voices on the Continent, who tempt him with the idea that he could take over the leadership of the Union — but only if he gets Britain to sign up to EMU. So, as well as Brown, we should blame Kohl. 'If only these sodding chancellors would leave my boy alone!' one can imagine him snarling.
Poor Rupert. He just cannot bring him- self to believe the truth — Blair actually believes in the single currency. That the Prime Minister, God forbid, supports the stated position of the government. 'We are', his Chancellor told the Commons last autumn, 'the first British government to declare for the principle of monetary union.' Brown and Blair wrote that pas- sage together. Isn't it clear enough?
The Chancellor will be equally clear in Idaho next month at News Corp's summer beanfeast. Blair hopes the event will thaw the frosty relations between Brown and Murdoch but that is unlikely, whatever the surface bonhomie. Murdoch sees more of the Labour party he loathes in Brown than he does in Blair, hence Stelzer's intemper- ate attack. One difference between Brown and Blair is that Blair talks politics, while Brown talks economics and his views are far removed from Murdoch's free mar- ketry. The Sun's smooth political editor, Trevor Kavanagh, will travel to Idaho with Brown to act as cupid but it will be a diffi- cult wooing.
Last week's turbulence should not dis- tract us from the underlying dynamics of the euro debate. The government is play- ing a long game, as John Smith would say. New Labour's strategy is to let the euro be its own best advocate. When it begins in January 1999, it will sweep first the Conti- nent and then our consciousness. Ordinary voters (and Sun readers) will soon deal with it on holiday and read and hear about it in the media. The convenience and price transparency it will bring will shift public opinion. Blair knows that one last push from him will be necessary to secure sup- port in the eventual referendum, but until about mid-1999 (probably at the time of the June Euro-elections) the emphasis will be on the first part of the government's `prepare and decide' formula.
As time goes by, business will begin billing and paying in euros and they will appear on high-street tills and on bank statements. It is likely that Britain's econo- my will be slowing down as the Continent's takes off. In that environment the Sun's position will look increasingly bizarre. One senior Sun writer admitted as much in pri- vate last week, 'It's too early to tell whether our position is sustainable', he explained. Murdoch's view is that it will take eight to ten years for the currency to prove itself (whatever that means) but what if the consensus is that it works before then?
Behind all the froth in his titles, Mur- doch's position remains one of arch-prag- matism. He will do whatever is in his commercial interests (and so, incidentally would Elizabeth, his British-based and more euro-friendly daughter). What really worries this American passport-holding Australian is not British sovereignty but News Corp sovereignty. The single curren- cy will make company accounts more trans- parent, increasing the chances of effective regulation and taxation of multinationals. Still, at some point the inevitability of a growing euro-zone and Murdoch's continu- ing desire to expand his Continental inter- ests will force him to make peace with Brussels. The issue is when. Will it be before or after the all-important British referendum? Well, he didn't leave it until after 1 May to patch things up with the Labour party, did he?
In the meantime the editor of the Sun will be given his head. (And for his sake, the knocking copy had better stem the paper's relative decline visa vis the Mirror.) There'll be lots of bluff and bluster. That is how Murdoch operates, in a climate of confusion and intimidation. Away from the front page, New Labour's courting of News Corp and News Corp's courting of New Labour will continue. But how will it all end? Let's have a look into Mystic Meg's crystal ball and watch those 1,000 Sun edi- tions roll by.
As Britain prepares for the euro, Blair begins to talk of a 'new deal' being drawn up by Brussels before Britain can sign up. After a few months of statesmanship he emerges victorious with a new agreement on, say, flexible labour markets and encouraging the entrepreneur — there could even be 'five pledges'.
More importantly, behind-the-scenes understandings will be reached on what impact the euro will have on the regulation of Murdoch's businesses and his liabilities. A New Labour approach is on the ascen- dancy in the Commission, replacing the tired old social democracy that Murdoch so detests. Irwin Stelzer is grounded in his Washington eyrie for a while and Elizabeth Murdoch is made UK chairman of News Corp (or some such title).
This heralds a new era of realistic sup- port for Blair's hard- fought 'new euro' deal. The Sun will urge a national debate of its readers. Its latest phone poll will show a majority now support signing up to the single currency. The paper finally suc- cumbs. 'Sun readers vote YES!', its front page screams. Britain will join the euro. Oh, and of course, it will be the Sun wot will have won it.
The author was chief adviser to Peter Man- delson from 1992 to 1996, and now writes a column in the Saturday Express.
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