Andrew raised a very important point: If news is a business, and it obviously is (Take a look at Ken Auleta’s books Three Blind Mice and Backstory) then you have to conclude that a good part of the drop in supply of quality news is the result of a reduction in demand. 

We can’t blame networks, newspapers, and stations for not duplicating what The NewsHour does on PBS.  That programming no longer draws the eyeballs needed to attract the advertising dollars that will pay the cost of putting it on the air or printed sheet, plus the substantial profit investors today demand.

When TMZ and re-runs of Seinfeld get more viewers than the evening news, we’re going to get more TMZ and Seinfeld and less Cronkite.

But it’s not just quantity, it’s also “quality,” by which I assume Andrew means objective, in depth, substantive reporting and analysis.  That too isn’t drawing as many eyeballs as any of the obviously biased screamers and interrupters on any of the other programs that purport to be news these days.  As a result, we get more O’Reilly and less Huntley and Brinkley.  And don't even mention Murrow.

The current business structure of teh news doesn’t take externalities into account.  There are indeed substantial costs involved when people are not as well informed.  But from a public policy perspective, how do you estimate, let along capture, those costs? 

Given the constant complaints about PBS we already know that funding it with general revenues is too controversial to expand.

How about a sin tax on the profits of Beck, Maddow, Limbaugh, Olberman, and Drudge that is used to fund more Lehrer-like shows? 

Or do we let the market work its will and let news dissemination go in whatever direction people are willing to pay for?