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Politico’s New Owners Are Hungry For More Influence In American Media

From CIA psyop to media oligarch
Berlin,,Germany,-,September,23,,2019:,Headquarters,Of,Axel,Springer

What if I told you that some of the most prominent American political and business news outlets aren’t owned by Americans, but Germans. Sounds like something out of the middle of last century, but it’s true.

I got interested in the subject after the New York Times reported some of the findings of an investigation into allegations that the German tabloid Bild and its then-Editor in Chief Julian Reichelt created a toxic working environment for women. Reichelt allegedly had intimate relationships with several female subordinates, one of whom was a trainee eleven years his junior starting in 2016.

The female trainee claimed Reichelt told her in November of 2016 that, “If they find out that I’m having an affair with a trainee, I’ll lose my job,” in testimony she gave investigators hired by Bild’s parent company Axel Springer, a transcript of the testimony obtained by the Times read. Despite these apparent concerns, the affair continued, and when Reichelt was promoted to editor in chief in 2017, he gave his lover a high-profile media job she was ill equipped to do given her inexperience. Afterwards, Reichelt continued to meet with his subordinate in hotel rooms in the Berliner Fernsehturm—where Axel Springer also has offices.

“That’s how it always goes at Bild,” the female employee testified. “Those who sleep with the boss get a better job.”

Once the investigation into Reichelt and other power players at Bild concluded, a statement from Axel Springer announced its findings and said that while Reichelt made “mistakes,” it did not change “the enormous strategic and structural changes as well as the journalistic achievements that have taken place under the management of Julian Reichelt.”

Throughout the ordeal, Reichelt maintained that he did not abuse the responsibilities of his position; however, he did issue an apology in the statement released by Axel Springer. “What I blame myself for more than anything else is that I have hurt people I was in charge of,” Reichelt said.

Reichelt took a 12-day leave of absence, but was able to return to his job after the company concluded his behavior did not qualify as a fireable offence, and was joined by a female co-editor, Alexandra Würzbach, who took control of personnel decisions.

Reichelt seemed able to withstand the media frenzy surrounding Bild’s work environment and allegations of sexual misconduct until the Times’ story caught the attention of an American audience. A day after the Times story was published, Reichelt was fired. Axel Springer, who defended Reichelt despite his mistakes and allowed him to keep his job, said Reichelt failed to keep private and professional matters separate. In the statement, Axel Springer CEO Mathias Döpfner thanked Reichelt for his work and praised his achievements before announcing Reichelt would be succeeded by Johannes Boie.

Axel Springer’s decision to can Reichelt at this particular moment was interesting to me. Bild is no small deal—it’s the most-circulated tabloid in all of Europe. I even took up reading Bild to keep up with current events when I studied in Berlin for a semester. And, if you thought the Times report was juicy, the reports from Bild’s German competitors as this story developed were even juicier. Der Spiegel initially reported the news of the inquiry into Reichelt’s conduct, which was not yet completed, with the headline “‘Screw, Promote, Fire.’” Der Spiegel said Bild was operating under “the Reichelt system.”

“The editor in chief was said to have invited female trainees and interns to dinner via Instagram. Young female employees were sometimes quickly promoted. Their fall from grace was similarly rapid,” the report claimed.

Axel Springer was under an immense amount of pressure, yet it decided to keep Reichelt on even though the investigators’ findings effectively confirmed what Bild’s competitors were reporting of its work environment under Reichelt. It’s hard to imagine an American media figure in a similar position surviving such an onslaught for such a long time. Many haven’t, which is what really got me digging. The best explanation I have for Axel Springer deciding to fire Reichelt upon the story making massive inroads with an American audience is to maintain its business ambitions in the United States.

Axel Springer is the largest digital and periodical publishing house in Europe, operating across 40 countries with holdings and licenses in six continents. Beyond Bild, they publish Die Welt, the German edition of Rolling Stone magazine, and Poland’s largest daily tabloid Fakt. Axel Springer has been a mainstay in European media since the immediate aftermath of World War II, when the journalist Axel Springer founded the company and named it after himself. After Bild launched in 1952, it skyrocketed to success, reaching peak-readership in the mid-1960s by feeding its audience sensationalized stories of politics, entertainment, and sports, as well as sillier reading topics such as horoscopes.

But that’s not the only secret to Axel Springer’s success. Two former CIA officers once told The Nation in an interview that Springer, who admitted in his autobiography that he had hardly any money to establish and operate the publishing house, allegedly received $7 million from the CIA to get the company off the ground and promote an Atlanticist perspective in line with American interests.

To this day, Axel Springer’s website proclaims its fidelity to this Atlanticist perspective.

Now, the media leviathan the CIA funded to advance American interests has turned its eye on swallowing up some of America’s most prominent publications, increasing its control over the dissemination of print information in an industry already dominated by a few select media conglomerates and American tech billionaires.

In 2015, Axel Springer purchased Business Insider for nearly $450 million. A $343 million purchase increased Axel Springer’s ownership share of the company from 9% to 97%—the other 3% is owned by Jeff Bezos.

Upon the sale, a press release from Business Insider read, “The addition of Business Insider’s 76 million unique monthly visitors will increase Axel Springer’s worldwide digital audience by two-thirds to approximately 200 million users, making the company one of the world’s six largest digital publishers in terms of reach.”

“With the acquisition of Business Insider, we continue with our strategy to expand Axel Springer’s digital reach and, as previously announced, invest in digital journalism companies in English-speaking regions of the world. Business Insider has set new standards in digital business journalism globally,” Döpfner said in the press release.

Axel Springer was also able to acquire Morning Brew in October of 2020, but still sought to expand its holdings in the United States. In March, the German publishing company was in talks to purchase Axios for between 400 to 450 million dollars before talks fell through. Despite this minor setback, Axel Springer was able to further cement itself in the American media market in August when it purchased Politico, which Axel Springer was already working with on Politico Europe, a 50-50 joint venture between the companies. As part of the sale agreement, which valued Politico at over $1 billion, Axel Springer took the remaining 50% of Politico Europe.

If Axel Springer refused to fire Reichelt in light of the Times’ report—action that was certainly deserved, and should have been taken immediately after the investigation’s conclusion—the company could have jeopardized hopes of acquiring more American media outlets, given the prolonged impact the Me Too movement has had on the American media apparatus.

The other reason Axel Springer may have decided to make the move now is that the controversy has finally reached back to its own parent company. In 2020, the U.S. based private-equity firm Kohlberg Kravis Roberts (KKR) became Axel Springer’s largest shareholder by purchasing a 43.54% stake in the company worth $3.2 billion. KKR now owns approximately 48% of Axel Springer, and has helped it purchase outlets to expand its influence around the world, but particularly in the United States.

I find the story rather fitting. What started as a CIA psyop to promote free market ideals and an Atlanticist world view has resulted in the embrace of the media industry’s oligopolistic practices to expand its control over the dissemination of information, and aligned with America’s financial sector in order to do so. It’s harder to think of a better story that summarizes the current state of global capital.

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