Media: Start spreading the news . . . Rupert's back in New York: The most famous American born in Australia has renewed his love affair with a trashy tabloid. Peter Pringle reports

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RUPERT MURDOCH is nowadays as much a Hollywood mogul as a newspaper owner: and when he rode into Manhattan last weekend to rescue the brassy tabloid the New York Post from the brink of extinction, it was hard to resist the notion that what he was really doing was remaking one of his earliest hits.

Well, not a hit exactly. Mr Murdoch, now 62, first bought the paper - his first major US title - in 1977 and never made any money with it before being forced to sell it in 1988 to comply with the rules about cross-ownership of newspapers and television stations.

But of the scores of properties he has bought and sold in his long career, none has exerted a stronger emotional hold than this trashy paper that never rose above third place in the city's three-paper market. Having to sell it was one of his most painful experiences, according to his biographer, William Shawcross.

Buying it was his entree into the New York power elite, where he felt much more at home than in the stuffy boardrooms of Fleet Street or the confining stage of his native Australia. He and his wife, Anna, loved being New Yorkers - he later became a US citizen - living in the most fashionable part of Fifth Avenue. His fellow citizens, though, never quite warmed to him. That may be why the first thing he did to celebrate his return to the ranks of the city's newspaper proprietors this week was to set about building a better image for himself than the one New Yorkers remember. 'Newspapers,' he said, 'are not about making money. They are about achieving things and trying to improve society. I've spent all day walking around Brooklyn and there are great problems here.'

A crusader for social change is not quite how New Yorkers remember the Australian-turned-American. When he owned the Post before, it was synonymous with sleaze. 'Sex Trial Shocker: I Slept With A Trumpet', 'Headless Body In Topless Bar' and 'Teen Gulps Gas, Explodes' were the kind of headlines they came to expect from the paper.

But this week journalists at the 192-year-old Post, the country's oldest daily paper, were ready to take anyone as owner, providing it was not a name that had come up recently. Since the start of the year, the paper had seemed doomed, courted by a series of stunningly unsuitable vanity publishers.

It was owned by a real estate developer, Peter Kalikow, who went bankrupt and failed to pay workers' social security. Then a debt-collector king, Steven Hoffenberg, took charge, but was immediately pounced on by the federal government for securities fraud and had to bow out.

There followed a Polish-born car park and health-club mogul named Abe Hirschfeld, who is 73 and given to telling silly stories and to bouts of hysteria. He said that he wanted 'pretty girls' on the front page, while admitting: 'I don't know anything about newspapers.' He was really interested only in the newspaper's building, and made himself so unpopular with the Post's staff that they told him, in a gloriously liberating front-page headline, to 'GET LOST]'.

There was no let-up in the Post's emotional outpourings against its owner. One day the entire front page was filled with a 19th-century portrait of Alexander Hamilton, who founded the paper in 1801. A big tear was rolling down Mr Hamilton's cheek. Inside, the columns ignored the news and instead retold colourful, unflattering stories of 'Honest Abe' with a shrillness and bluster that has become the paper's trademark.

Mr Murdoch looks like a fairy godmother by comparison, and Mr Kalikow's bankruptcy judge has given him from two to three months to put the paper back on its feet. It will cost Mr Murdoch dollars 8m (pounds 5.3m) to pay off known creditors, millions more to pay off unknown ones. He says it will cost him dollars 10m a year to run at current losses. He will acquire a rather splendid building overlooking the East River and he will have to pay off the dollars 15m mortgage.

The Post will add more debt to his News Corp, still dollars 7bn in the red. He has been reducing some of the debt by selling off his US stable of papers and magazines, including New York and Seventeen, the Chicago Sun-Times, the San Antonio Express-News, the Village Voice and the Star.

Whatever he does with the Post, it will be a far cry from the Seventies, when the office of the paper's publisher was occupied by Dorothy Schiff, a liberal doyenne who came from a wealthy banking family and ran a liberal newspaper. Mr Murdoch introduced his own special brand of tabloid stories and made sure they reflected the conservatism of the day. It is still a conservative paper.

Citizen Murdoch promises to reinstate some of the 70 staff - 10 per cent of the total - laid off by Mr Hirschfeld and will have to make a new agreement with the paper's unions. He must also obtain a waiver of the federal ban on ownership of a paper and television station in the same market, which forced him to sell in 1988. Mr Murdoch owns the Fox TV network, which has a channel in New York.

There seems little doubt the sale will go ahead. There are already signs in Washington that the waiver will be forthcoming. Mr Murdoch has Republican and Democratic allies in the US Congress, as well as the support of Mario Cuomo, the powerful Democratic New York governor, whom Mr Murdoch tried to run out of politics when he last owned the Post. Mr Cuomo has now agreed to help Mr Murdoch, on the basis that he is the last best hope of preventing a fine New York institution from dying.

Even Senator Edward Kennedy, who introduced the measure that stopped Mr Murdoch in 1988 because he was fed up with relentless attacks on him in Mr Murdoch's Boston Herald, now feels that he is the only one who can save it.

As for editorial content, most New Yorkers expect Mr Murdoch to produce the same as before. He has already fired the paper's editor, Pete Hamill. His departure was inevitable. In the Seventies Mr Hamill described Mr Murdoch's Post as being like a guest who throws up at a dinner party: 'He is looked upon with alarm and pity, but no one really knows what to do to help.'

Mr Murdoch's choice for editor this time is a Briton, Ken Chandler, a former Post managing editor who had been running the Boston Herald before he moved into Mr Murdoch's television network. He is not considered the kind of editor who might suddenly develop a social conscience.

The New York mayoral election this year gives Mr Murdoch a chance to plunge right into the city's politics again. In 1977 he backed the conservative Democrat Ed Koch, who won. Mr Murdoch celebrated with him on election night, much to the disgust of most of the Post's staff, who signed a letter complaining about a Koch bias in the news reporting. Then the Post backed Mr Koch against Mr Cuomo for governor, but this time Mr Koch lost. This year, the city's black mayor, David Dinkins, has some serious conservative challenges, and the Post could make a difference.

Mr Murdoch professes simpler desires. He says it is just great to be back in New York and to feel the buzz of the city again - which, considering he lives in Beverly Hills, is understandable. The city - and the Post - could certainly use his money and energy. Welcome home, Rupe. All - or most - is forgiven.

(Photographs omitted)

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