Newsmax and Newsweek, Sittin' In A Tree?

In early June, Newsmax raised a few eyebrows by declaring its interest in -- and then making an official offer for -- Newsweek magazine, which the Washington Post Co. has put up for sale.

While the offer itself got attention, the likely money behind it mostly didn't. While Newsmax makes rich Republicans its target demographic -- according to Talkers magazine, 20 percent of its readership claims a net worth of $1 million or more -- and while it claimed revenue of $36 million in 2008 and has projected $50 million in revenue this year, it likely doesn't throw off enough money for Ruddy to purchase money-losing Newsweek without help.

Enter Richard Mellon Scaife.

Related articles on ConWebWatch: Newsmax's Stimulus Falsehoods Behind the Whitewash The Bernard Kerik Rehabilitation Project Our Newsmax Problem Newsmax's Rehab Fail Pamela Geller's Pretty Hate Machine The League of Newsmax Columnists Related articles at Media Matters: Hyperinflation for sale: Newsmax and Dick Morris cash in on anti-Obama rhetoric Surprise: O'Reilly-Newsmax "summit" is an infomercial for a financial product

Scaife, that longtime right-wing sugar daddy, has been Ruddy’s benefactor for well over a decade, since Ruddy brought his Clinton conspiracy-mongering to the Scaife-owned Pittsburgh Tribune-Review. When Ruddy started Newsmax in 1997, Scaife was among the original investors, and by 2002 he was the third-largest shareholder. Today, all the other shareholders have been bought out, and Scaife and Ruddy are the sole owners of Newsmax -- Ruddy holds a majority stake of 60 percent, while Scaife owns the rest.The ConWeb has been mostly mum on this. If, say, George Soros had expressed interest in buying Newsweek, Fox News wouldn’t be able to report on anything else for days. But two right-wing political activists looking into obtaining the number-two weekly newsmagazine is raising barely a ripple.

Ruddy and Scaife purchasing Newsweek is not as far-fetched as it sounds, actually. Newsmax already publishes a monthly magazine that, despite an unmistakable rightward tilt, is professionally designed. A Ruddy-operated Newsweek would likely look much as it does now -- but would definitely have a lot more right-wing content, with an additional focus (like its current magazine has) on two other areas of Newsmax interest, money and health. It may also give a bigger platform for longtime Ruddy buddy (and failed prognosticator) Dick Morris, who has a history of helping Ruddy shill for Newsmax’s financial products.

Newsmax, for its part, has denied that it would change Newsweek's editorial product if it succeeds in purchasing the magazine:

The company’s bid for Newsweek’s print and online assets is congruent with its objective to diversify and expand into numerous distinct media brand offerings, like any major multi-title publisher.

Newsweek’s staff, advertisers and readers can be assured that if Newsmax Media, Inc.’s bid is successful, Newsweek's stellar brand and editorial representation would remain distinct from our other brands. Newsweek would continue in its mission to objectively report the news and provide analysis from a wide spectrum of perspectives.

Ruddy has also said he'd like to keep Michael Isikoff on at Newsweek. That feeling may not be mutual: Isikoff, who is leaving Newsweek for NBC, told Media Matters' Joe Strupp that Newsmax "would not be my preferred owner of Newsweek."

That remains to be seen, of course. But while Marketwatch's Jon Friedman has portrayed Newsmax as a strong if dull voice of reasonable Reagan-esque conservatism, it actually hasn't strayed all that far from its flamethrowing, anti-Clinton early years. That flamethrower is now trained on President Obama:

• Shortly after Obama was elected, Newsmax published numerous false and misleading claims about his stimulus plan.
• In March 2009, columnist James Humes invented a vicious smear about Obama, that he denigrated a statue of Winston Churchill and ordered it removed from the Oval Office. In fact, there was no evidence whatsoever that Obama said what Humes claimed he said, and Newsmax allowed Humes to alter the falsehood in a way that it was slightly less false -- he claimed that the quote received "frequent repetition on radio talk shows" but didn't name a single radio host who did so -- without indicating to readers that Humes had made a false claim or even apologizing for it.
• In September 2009, Newsmax columnist John L. Perry favorably noted the "remote, although gaining, possibility America’s military will intervene as a last resort to resolve the "Obama problem.'" After outrage grew over the perceived threat to the president, Newsmax quietly deleted the column without acknowledgment to its readers that it was disappeared or even that there was a controversy. In a statement issued separately, Newsmax dismissed Perry (who has not written for Newsmax since) as an "unpaid blogger," despite the fact that he had been writing for Newsmax for at least a decade.
• Newsmax has hired other extreme columnists, such as anti-immigrant activist James Walsh and hysterically the anti-Obama and anti-Muslim blogger Pamela Geller.

Meanwhile, Newsmax has served as a career rehabilitation center for disgraced conservatives, most notably Bernard Kerik (whose rehab didn't quite take). And Newsmax writers have been working for or with an anti-Obama group whose attacks Newsmax reported without disclosing the group's links to its writers.

Such slipshod ethics on basic issues as corrections and disclosure are anathema to real journalists -- like those at Newsweek -- yet are common at the "news" organization that wants to purchase it.

Meanwhile, Ruddy told the Financial Times of his other prospective plans for Newsweek:

“We have a free website but upsell people to health and financial newsletters online and in print,” he said. Newsweek, whose site he would not charge for, “would be the perfect vehicle for growing that business model”.

But Newsmax's can't keep politics out of those, either: It has repeatedly hawked its financial products by invoking Obama-bashing attacks.

As Media Matters detailed, in a promotion earlier this year for one of Newsmax's financial schemes, Dick Morris attacked Obama as promoting economic policies that would result in "more inflation" and "huge increases in interest rates," adding, "the cancer's dead, now we're suffering from the chemotherapy." Robert Wiedemer, co-author of a book around which Newsmax's promotion was built, accused government officials of using "outright manipulation" in unemployment statistics. Another spokesman said regarding a recently announced increase in gross domestic product, "Personally, I think they [sic] numbers were majorly fudged!" James Dale Davidson, an original investor in Newsmax who has been on the Newsmax board of directors, claimed that "supposed improvements" to the economy were "faked by the government," saying of the Obama administration's report of "jobs saved" due to the stimulus package: "It's a lie. It's a lie."

In a May 2009 promotion, Morris stated, "I think that Obama definitely is leading America into socialism." He also commented that "of course" Obama's policies will lead to "huge inflation," adding, "I don't see how any expert could disagree with that."

Ruddy and Morris were also prominently featured as part of a series of Newsmax seminars in California in January 2008 titled "Grow Your Wealth In Turbulent Times." According to the promotion for the seminars, "famed political guru Dick Morris will be joining us to offer his take on how the '08 elections will affect your portfolio. Dick is predicting a Democratic takeover with enormous changes for capital gains, taxes, budget priorities and other areas, with broad-based economic consequences." The seminar cost $75 per person to attend.

In Newsmax's most recent promotion -- an "Economic Crisis Summit," starring not only Morris but also “Premier Guest” Bill O’Reilly -- the introductory promotion asserted:

President Obama Will Usher in One of the Most Massive Tax Increases in History on December 31!

This is when the Bush tax cuts expire.

An immediate 10 percent tax increase across the board will strike citizens of all income categories.

He knows the capital gains tax will rise by almost 50 percent and the tax on dividends as much as 250 percent!

His Obamacare plan already calls for more taxes, including a $28,000 tax increase for millions of Americans.

And now Obama is openly talking about a new “value-added tax” which would be tantamount to a national sales tax. It is clear that the mentality of both the Obama White House and the Pelosi-run Democratic Congress is pro-taxes.

Let’s take that bamboozlement-filled section apart point by point:

• Obama will not cause an “immediate 10 percent tax increase across the board.” Obama’s fiscal 2011 budget would allow the Bush tax cuts to expire only for individuals making more than $200,000 and families making more than $250,000.
• Obama is also not allowing Bush tax cuts on dividends and capital gains to expire for most Americans . Obama’s proposed budget would raise the top rate on both from 15 percent to 20 percent, again applying only to the highest income brackets. That is not an “almost 50 percent” hike (for capital gains) or an increase of “as much as 250 percent” (for dividends).
• Health care reform does not include “a $28,000 tax increase for millions of Americans,” and it’s unclear from which bodily orifice Newsmax is pulling that number.
• Obama “openly talking about a new ‘value-added tax’ ” is pretty much limited to having once called it a “novel” idea.

In the actual "summit" -- again, an informercial for a financial product -- Morris engaged in anti-Obama scaremongering by asserting that "very significant inflation" is "looming with Obama," adding that "Obama is planning to raise taxes next year, and nothing is going to deter him."

(For his part, the show's host insisted O'Reilly was not "here to endorse anyone's point of view or to endorse product or financial service," and that O'Reilly was "joining us just to give us" his take.)

That sort of shameless, politically charged huckstering would seem to be in the card for Newsweek readers if Newsmax succeeds in purchasing it.

All of which would seem to make Ruddy's promises of editorial independence for Newsweek more than a bit hollow. The Newsmax business model, after all, depends in no small part on bashing liberals -- arguably the core Newsweek audience.

It appears that Newsweek saw this as well. The New York Times reported on June 30 that the Washington Post Co. has rejected Newsmax's bid for Newsweek, noting that the "conservative political ideology of Newsmax’s chief executive, Christopher Ruddy, is at odds with the editorial bent of Newsweek." According to Business Insider, Newsmax "remains committed to its long term objective to diversify and expand into numerous distinct media brand offerings."

So while Newsmax is still looking to expand, don't expect it to refrain from following its companywide right-wing agenda in the process.