In the past week, two news stories, one national, one local, illustrate why we need "institutional" news sources.
The national story is the NYT disclosure that President Bush ordered warrantless interceptions of communications to and from American citizens.
The local story is the report in the Baltimore Sun that Maryland environmental Secretary Kendl P. Philbrick faxed a letter to a powerful state senator arguing against a bill that the senator's committee was considering. Using the Maryland Public Information Act (the state analog to the federal Freedom of Information Act), the Sun obtained documents that reveal that Philbrick did not write the letter himself. Philbrick merely lifted the text, verbatim, from the text submitted to him in an e-mail by a lobbyist for the state's largest owner of power plants, Constellation Energy. The lobbyist was so comfortable with the relationship between himself and the Secretary that he suggested that Philbrick provide him with official letterhead and an electronic signature so that he could dispatch the letter himself. (Presumably, when questioned, the lobbyist will explain that he was merely attempting to save the state the cost of a stamp.)
Both the NYT and the Sun expended substantial amounts of time and money on their stories. It is unlikely that the stories could have been written by bloggers who are typically short on time and resources. The stories broke only because the two papers had deep enough financial pockets to fund the investment that their investigations required.
The reports also illustrate the importance of the Sun's lawsuit against the Ehrlich administration's attempt to restrict the access of certain reporters to government sources. (Discussed here and here.) Newspapers operate much like other businesses insofar as their profit margin is not the same for all of their activities. Mundane reporting is relatively cheap, investigatory reporting expensive. To some degree, the profit from the day-to-day reporting supports the more cost-intensive (and lower profit margin) investigative reporting.
If the Ehrlich administration is allowed to limit the access to government of reporters that it doesn't like, it will effectively be increasing the cost of reporting on mundane affairs. As a practical matter, this will limit the ability of newspapers to undertake serious investigatory reporting.