What the hell does it take?

Several days ago, I spoke with an old friend, a state legislator, about the decline of quality news in America.
It appears that we're on the same page, though he is several years my senior, and has seen the jaded side of politics, more of which I don't really need to observe.  I have a pretty good idea, and that seems to suffice my needs.
He spoke of the local newspaper dropping the OTC market listings from the paper, and how he had been pretty much 'blown off' by the editor at the local rag.  After listening to the usual, 'we have to prioritize for our readership, times are tough, budgets are tight' excuses, my friend told the guy, "You know, this is why you and the paper won't be around in a few more years; you'll be lucky to put out three issues a week".
I had to agree with him.  It's common knowledge in our town that the newspaper has been dwindling for several years, somewhat as a result of the excuses given above, and the resultant decline in paid readership from 120,000 to about 70,000 over the last few years.  The hugely profitable 'class ads' have shrunk to a fraction of former listings, and the prices to place one haven't really adjusted to a declining market.  Additionally, their editorial support for increasingly liberal causes pretty much flies in the face of their readership's demographics.
Then we turned our conversation to a pub that we had seen go down the tubes: The Seattle P-I.
For those who don't know the name, or those who don't remember it, the P-I (for Post-Intellegencer) was once the flagship publication in the Pacific Northwest, and respected and quoted nation-wide as a reliable newspaper.
Years ago, it was the rare person who didn't know about the Seattle P-I; back in the '50's I can remember seeing it used as a reference for a number of things.
Much of the Watergate scandal could be found on it's pages, as some members of Nixon's inner circle had ties to Seattle and the Pacific Northwest.  Lots of news to be had, and you 'could find it in the P-I'', as the saying went.
Then, over time, hubris, slanted reporting, and overboard efforts to cut expenses, led to what many saw as inevitable: a merger with cross-town rival, The Seattle Times.  Under a joint marketing agreement, they joined forces to keep the brand alive and the globe on the front of the P-I building in place.
Alas, lack of quality, quantity and relevance led to the final closing of the doors.
In short, the P-I went under due to efforts to economize UNWISELY; the cut the size of the paper to almost tabloid, laid off workers who had been there for decades, saved money on ink, paper, shipping, delivery, and lots more until the 'saved' themselves right out of business, though they still have something of an internet presence.  At least they got what they went after, a lower cost model.
Looking back, it occurred to me that there might have been an additional factor that I had overlooked at the time: the advent and expansion of the internet.
The ability to get news and opinion from a variety of sources has, I think, led to a more educated populace in spite of the declines of brick and mortar publishers.  Same thing can be said for book stores.
Further, in watching the declines in TV numbers, it occurs that maybe some people will never learn; what does it take to make these people understand that Americans want and need unbiased reporting and information that allows them to form intelligent opinions?
News gathering and dissemination has grown to a multi-trillion dollar enterprise, so why, oh why, is there so little interest in keeping things together?
When MSNBC puts forth commentary that is rightfully ridiculed for it's editorial content by persons wholly biased and shamelessly partisan, what the hell do they expect?  Three or four hundred thousand people is a lot of people, but not enough to justify keeping the cameras on; reporters who act like giddy schoolgirls when reporting presidential politics and state openly that part of their job is to 'make this president look good' can't be helping the network; yet, it goes on, as the money drain continues.  While it's the network's money and they can do what they want with it, I wonder how much is coming from other than advertising revenue.
It can't go on forever, and what the hell does it take?