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In The Storm, Vince Cable's short, sharp book on the economic crisis, the deputy leader of the Liberal Democrats predicts that the reaction against the failure of liberal markets will not be a revival of socialism but a turn to state capitalism. He can see the future coming in the merger of business and political interests in Berlusconi's Italy and Putin's Russia, the growth of the large, and largely corrupt, sovereign wealth companies in China, Venezuela and the Middle East and the nationalist and protectionist stirrings in Europe and America. 

That much is uncontroversial, I thought as I read, but Cable then surprised me by emphasising a feature of growing state power that hardly anyone else has examined. "The collapse of advertising revenue supporting independent media," he continued, will provide legitimacy to the new order by "strengthening the relative importance of state broadcasters, including our own BBC".

George Orwell said, "To see what is front of one's nose requires a constant struggle." People who spend a part of every day with the BBC would be shocked to hear it described as the state broadcaster. Its output sounds nothing like the dull recitation of officially approved information of the old East European dictatorships. Yet for good or ill, the state funds the money-grubbing celebs, the quiz shows — which a ten-year-old could win — and the dramas — which a nine-year-old could write — as well as the BBC's better angels: those journalists, editors and producers who would no more deceive or trivialise than betray a friend.

Only occasionally do outsiders glimpse the special relationship. Newspapers have abused the monarchy with impunity for years. However, when the controller of BBC1 ran a trailer for a documentary on the Queen in which the makers had manipulated to show the head of state storming out of a
photo-shoot, the BBC forced him to resign, even though the fault was not his.

As I have argued here before, the combination of the recession and the collapse in advertising revenue brought about by the internet will leave the BBC standing alone like a giant among pygmies. Its annual £3 billion from the licence fee spares it the squeeze on funding which has already closed American papers and pulverised the British press. As Cable says, the political consequences may be ominous.

The BBC's more thoughtful executives and trustees know it and are becoming apprehensive. They understand that their freedom from excessive political interference depends on a thriving private sector.

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