1. It is true that if you copy too much text from a newspaper, it may discourage some readers from clicking through to read the article. On the other hand, how many readers click through to read the article, if it was copied in full, anyway? I know that I often find myself clicking through, even when a blogger has copied a substantial amount of the article--to see if they have quoted the article out of context.
2. Traffic that bloggers get because of an alleged copyright infringement are a tiny fraction of the hits that a newspaper receives as a result of Google searches, links from Drudge Report, or even clickthroughs caused by bloggers linking to an article on the newspaper's website. The problem that newspapers are having isn't because of bloggers, but the collapse of traditional dead trees publishing. Bloggers linking to newspapers are almost certainly a net gain for newspapers--unless, of course, you decide to turn an innocent, one-time mistake (as my co-blogger on The Armed Citizen made) into a $75,000 suit. At that point, the negative publicity and aggressive delinking from such newspapers is almost certainly going to turn such a lawsuit campaign into a net loss.
Yes, a newspaper deserves to get all the ad volume it would enjoy if everyone clicked through, instead of reading the article elsewhere--but there are polite, sensible ways to solve the problem, and there are impolite, irrational ways to do so. My guess is that the editor of the Review-Journal wouldn't trim his fingernails with a chainsaw, or stop his car by slamming it into brick wall. There are less drastic solutions--which nearly all newspaper organizations use, such as an email or letter demanding that you take down an infringement. (At least, I've read that this is the case; I've never had a news organization make such a request.)
In nearly all cases, bloggers have made an innocent mistake, through ignorance of the law (which is very easy, since fair use law is extraordinarily vague), or excess enthusiasm for a particularly well-written article. A blogger who ignores a request, or who keeps infringing again and again--I can see that a lawsuit might make sense there. But to go directly from one article infringing to a $75,000 lawsuit is just crazy.
Anyway, all that to point to this article at Nieman Journalism Lab, which points to an innovative solution to the dinosaur news media problem:
It is a head-turner, which seems to be, at first, an only-in-Utah story. The Deseret Morning News, KSL TV, and KSL Radio, all owned by one company, the Deseret Management Co., a for-profit arm of the Church of Latter-Day Saints, are combining operations.Instead of each organization sending a reporter to the statehouse to cover an event, one reporter covers it. The difference between radio, television, and newspaper is evaporating in the digital age. The Review-Journal is trying to use the tyrannosaurus rex approach of ferocity to stave off the inevitable end of the Age of Dinosaurs. (Unlike the movie Jurassic Park--where the T. rex at least has the good taste to eat the lawyer.)