I recently read an article published in the Atlantic Monthly about how Google is trying to save the news industry. I was a bit skeptical when I first read in the book Losing the News that Google CEO Eric Schmidt said at a magazine publishing trade conference that he wants to save the business. Tech people typically don’t have much respect for content-creators. But apparently Google, a company built on the idea of making money from organizing the wild web’s seas of information, sees high-quality content as a vested interest. Sucky content = no readers = no money.

Now that I think about Google’s mentality towards the news business, I can see what Scmidt was talking about. I see the steps they’ve taken to bolster traditional media companies instead of just being parasites. These include the Google News site, YouTube Direct, and the Living Stories collaborative project with NYT and WaPo. With any luck, Google’s innovation and entrepreneurial spirit can pump some life into the outdated newspaper industry and save accountability journalism. And by “accountability journalism” I mean news about CIA black sites, BP oil gushers, and financial regulation (this kind of stuff). Not news about Lindsay Lohan crying in court or Snooki getting trashed (this kind of stuff).

One of the key problems disrupting the newspaper industry today is the problem of how to monetize its content. According to Losing the News, for the past 100 years, newspapers married capitalism with public interest to print its papers. Lucrative advertising revenue supported journalism. Then  Craigslist and the Internet unseated newspapers as the gatekeepers to the attention spans of local audiences (read #2 on this page), and much ad revenue was pulled out from under newspapers’ feet. This is grossly simplified, but you get the gist.

So the problem we now face is how can we monetize quality journalism? Newspapers should die, but the kind of accountability and investigative journalism that made them great needs to live on. Why should quality journalism survive? I believe newspapers are a public good. In terms of economics, good journalism is a positive externality, something whose benefits are not completely captured in terms of money by the producer. A general solution to positive externalities is government intervention, but many journalists balk as the thought of being funded by the very people they (supposedly) monitor. I have very little faith in circulation revenue providing sufficient funding because people have come to expect free content and also because I myself don’t know if I’d buy a subscription to the Times even if they erect an online pay wall.

It’s diffused responsibility, and newspapers are the Kitty Genovese’s of the world getting stabbed to death while we all watch from our apartments. Okay, that last example may have been a little too much.