First, let's stipulate that the New York Times scoop last week about Fox News chairman Roger Ailes allegedly urging an employee to lie to federal prosecutors is a real jaw-dropper. The report, based on uncovered legal filings, not only has the media world stunned but it has loyalists who orbit the Fox News world utterly dumbstruck by the revelation.

They're stunned, not because they can't believe Ailes would do such a thing. Instead, they're shocked Ailes left himself so open, so vulnerable. They're astonished that his former employee, Judith Regan, reportedly has Ailes on tape urging her to lie to federal investigators about her affair with Bernard Kerik, a former top lieutenant of Rudolf Giuliani when he served as New York's mayor. With Giuliani eyeing a possible presidential run, Ailes allegedly told Regan to lie in order to protect both Kerik and Giuliani.

In short, the Times report has managed to shock everyone. It's shocked media insiders for the sheer recklessness of Ailes' behavior. It has startled Fox News critics (like myself) who are amazed how cavalierly Ailes would counsel an employee to break the law. And the report has shaken Ailes loyalists who can't believe the Machiavellian Fox News chief was so sloppy in his execution.

So yeah, this story is kind of a big deal and it has immediately been pushed to the head of the line in terms of pending Fox News troubles for 2011, right in front of Glenn Beck's ongoing caliphate conspiracy madness and the conservative attacks it has sparked on him,

Indeed, the Times report would mean that Ailes and Beck, Fox News' fiercest lightning rods, have quickly morphed from assets to liabilities. We know Beck's increasingly a liability because, thanks to his incendiary, hateful rhetoric, he's unable to retain virtually any nationally recognized advertisers. And that's been the case for almost a year-a-half now. No only are advertisers steering clear of Glenn Beck, but ratings continue to decline. That is not a formula for cable news success.

But even more scandalous is the specter of Ailes, who runs Fox News as his personal fiefdom, being thrust into the spotlight for potentially breaking the law; for allegedly telling an employee to lie to federal investigators.

Ailes and Fox News are still trying to absorb that body blow. They're trying to shrug off a claim of lawbreaking against the man who runs a law-and-order news operation. But the hypocrisy in play is almost too much to bear.

How so? Please flash back to Bill Clinton's impeachment circus. What was the line Republicans used all the time and the line that was regurgitated ad nauseum on Fox News? Correct, the president had to be punished because there is, in this country,the rule of law and nobody is above is above that rule of law.

“This has to do with the rule of law,” Sean Hannity announced for the umpteenth time back on Sept. 9, 1999, while discussing impeachment. It had to do with “whether or not that same law applies to the president.”

Fox News to America: The rule of law has to be applied to all citizens and it's doubly important that the rule of law apply to people who try to mislead federal investigators

So yes, based on the Times report, that would now apply to people like Roger Ailes. (Hoisted, petard, etc.)

But if you listen to the distant murmurs of Fox News' spin on the Ailes story, Rupert Murdoch's shop seems to be suggesting that the rule of law is no longer that big of a deal. And besides, that recorded conversation where Ailes urged an employee to lie to federal investigators was just a big misunderstanding. And so, according to the Fox News spin machine, “the matter is closed.”

Right. Good luck with that.

Here's how the Times reported the Fox News response:

[T]he spokeswoman, Teri Everett, said News Corporation had a letter from Ms. Regan “stating that Mr. Ailes did not intend to influence her with respect to a government investigation.” Ms. Everett added, “The matter is closed.”

As blogger Henry Blodget noted over the weekend, Fox News' official/absurd response only highlights how hot and how deep the water is that now surrounds the channel's boss [emphasis original]

Note what it does NOT say: It does not say that Roger Ailes did NOT tell Judith Regan to lie to the feds.

Instead, it says that News Corp. now has a letter from Judith Regan saying that Roger Ailes “did not intend to [tell her to lie].”

In other words, News Corp itself did not take a public position on what Roger Ailes did or didn't do. It is keeping its options open.

...

By the way, how would Judith Regan know what Roger Ailes intended?

ANSWER: She wouldn't. She's not inside his head.

So yeah, it's a non-denial denial. Kind of. Actually, it's just a complete mess.

Meanwhile, what about Murdoch? If the Ailes story continues to gain traction how will Murdoch possibly be able to defend him? Remember, Murdoch's professional reputation has already taken a massive hit in Britain in the form of the long-running, and hugely embarrassing, investigation of Murdoch editors who were allegedly hacking into the private voicemails of prominent citizens and using the contents in news stories.

Now in light of that News Corp. fiasco, Murdoch might be faced with having to publicly back Ailes in the face of claims that he was caught on tape advising his employee to lie to the feds? Trust me, Murdoch is not looking forward that humiliating prospect.

Then again, maybe Murdoch would simply pivot and announce that the rule of law no longer applies to Fox News.