Netanyahu's Tape Scandal Explained: Will Secret Negotiations With Adelson’s Media Rival Force Him to Resign?

A taped conversation between Prime Minister Netanyahu and the owner of a leading newspaper has shocked Israelis – here’s why.

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Israel Hayom owner Sheldon Adelson (left) and Yedioth Ahronoth publisher Arnon "Noni" Mozes.
Israel Hayom owner Sheldon Adelson (left) and Yedioth Ahronoth publisher Arnon "Noni" Mozes.Credit: Amos Biderman

It’s a revelation that’s shaking up Israel’s political and media worlds as intensely as reports of a proposed secret deal between Donald Trump, CNN and Fox News would rock the United States.

In a wide-reaching investigation by Israel Police of Prime Minister Benjamin Netanyahu, it was revealed Sunday that a tape exists of a conversation in which Netanyahu and media tycoon Arnon Mozes – owner of the Yedioth Ahronoth newspaper – appear to be hammering out a deal that would benefit them both.

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The details of their negotiations are still unclear, but what can be pieced together from journalists’ coverage is that such a deal would offer financial and business advantages to Mozes in exchange for favorable coverage of Netanyahu.

That deal may have possibly involved shutting down parts – or even all – of the Israel Hayom newspaper, which is owned by Netanyahu’s political patron, the American-Jewish casino magnate Sheldon Adelson.

Such an arrangement would have restored print media dominance to Mozes’ daily, which Netanyahu previously accused of plotting his political downfall. During his last election campaign, Netanyahu charged Mozes himself with engineering “a systematic smear campaign against a sitting prime minister, in order to replace the government in Israel, for the sake of obvious business interests and personal profit.”

Why has the story stunned Israel so?

The battle between Netanyahu and Adelson with Mozes has been a long-standing media soap opera with serious political fallout.

For decades, there had been only one dominant mainstream newspaper in Israel: Yedioth Ahronoth. Founded in 1939, and owned and controlled by the Mozes family since shortly after its founding, it’s had rivals when it comes to prestige and influence. But historically, its commercial domination of Israeli print media in both circulation and advertising sales has been undisputed and was only strengthened by its online arm, Ynet.

That all changed in 2007 when the Adelson-founded Israel Hayom burst onto the scene, introducing the concept of a giveaway nationally distributed newspaper to the Israeli market by offering a similar product to Yedioth, but for free.

Prime Minister Benjamin Netanyahu, right, with Miri and Sheldon Adelson at the inauguration of the Adelsons' School of Entrepreneurship, IDC Herzliya, October 26, 2016.Credit: Ilan Assayag

A strong supporter of Netanyahu for decades, Adelson had the clear agenda of backing Bibi’s efforts to return to the Prime Minister’s Office, which proved successful in 2009. Meanwhile, the fact that the paper – even its substantial weekend edition – is given away for free meant that it quickly unseated Yedioth as the highest-circulation publication.

Reflecting Adelson’s politics, Israel Hayom has been relentless in supporting Netanyahu’s policies, attacking his critics and defending his family. Its coverage has been so pro-Netanyahu that even right-wing rivals have criticized the newspaper: Defense Minister Avigdor Lieberman once called it “Pravda,” while Minister Naftali Bennett described it as “a mouthpiece of one man.”

The newspaper has been challenged by critics for representing nothing less than an indirect campaign contribution to Netanyahu. Political funding laws in Israel allow individuals and corporations to contribute only relatively small sums, and Israeli politicians do not enjoy the massive support that their U.S. counterparts do via Super PACs and other methods of political support.

Israel Hayom’s financial history remains a closely guarded secret, but media experts believe Adelson has absorbed tens of millions of shekels in losses in order to provide a cheering section for Netanyahu, so much so that it has been nicknamed “Bibiton,” a fusion of Netanyahu’s name and the Hebrew word for newspaper.

In interviews, Adelson has said the paper was created to balance the “far-left” agenda of Yedioth and other Israeli media. However, its unwavering support and constant flattering coverage of one politician meant Israel Hayom created enemies across the political spectrum.

In 2014, a bill helped precipitate the collapse of the government. The “law for the advancement and protection of written journalism in Israel” was widely known as the “Israel Hayom bill,” and was clearly designed to limit Adelson’s influence.

Initiated by MK Eitan Cabel (Zionist Union) and sponsored by members of five other parties, the bill would have made it illegal to widely distribute a full-size newspaper free of charge, in order to “defend written journalism” in a period of financial hardship for dailies in Israel.

While it didn’t explicitly mention any paper by name, only Israel Hayom fit its requirements. If the law had passed, Israel Hayom would be forced to charge its readers at least half the price of its cheapest competitor.

In the ensuing political struggle over the bill, Israel Hayom and Netanyahu both accused Mozes of orchestrating the bill through Knesset members who, they alleged, were receiving preferential treatment from Yedioth Ahronoth and its popular Ynet website, in exchange for helping him reestablish his predominance in Israeli media through the bill.

It has been widely asserted by Israeli pundits that a central motivation for the prime minister’s decision to call an early election in March 2015 was to dissolve a Knesset that was headed toward endangering Adelson’s newspaper through legislation.

If Yedioth Ahronoth publisher Arnon Mozes thinks that because his newspaper is 'the country’s paper,' the logical corollary is that Israel is 'the paper’s state.'Credit: Moti Kimche

Media wars played a central role in the intense Knesset campaign. A month before the election, Netanyahu published a tirade against Mozes on social media, charging that the publisher “does not shrink from acts to bring down the Likud government that I lead, close the newspaper Israel Hayom, and restore Yedioth Ahronoth’s rampant control of print journalism. In recent weeks, the attacks against me no longer appear once a day, in the morning, when Yedioth Ahronoth is delivered. They are published almost hourly, sometimes even half-hourly, on Ynet. Both these platforms deliberately engage in, and coordinate, slanders that are ludicrous, false and biased against me and against my wife, as part of a media campaign to replace the Likud government with a left-wing government and to restore Mozes’ control over the media market.”

The horrifying terror attack on Sunday, in which a truck plowed into a group of soldiers, killing four, interrupted a pitched public discussion as to whether Netanyahu should resign because the criminal investigation hampers his ability to lead the country. Several politicians called for him to step down, and there have already been reports of negotiations regarding the formation of an alternative coalition without Netanyahu.

Whether or not there is sufficient popular political will to unseat Netanyahu, one thing is certain: Israelis have had their faith even more deeply shaken in their leadership than it already was. In the past decade alone, they’ve watched scandals play out that resulted in a president being jailed for rape, a former prime minister sent to prison for bribery, and numerous misdeeds by ministers, lawmakers and mayors.

Now it seems that not only politicians but a veteran media outlet, one they have counted on for decades as a watchdog to keep their leaders in check, may have been willing to sell out and collude with a power-hungry premier.

If the latest revelations prove true, it will be a devastating blow to the public’s belief that there are any leaders of national institutions out there who put the country and the citizen’s interests ahead of their pocketbook.

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