There's definitely some truth to your supply and demand argument. IMHO there is a major issue with working out a platform for payment. My Grandpa read the New York Times all the way through every day – having a single subscription worked. I skip around to at 20+ news sites and blogs on a weekly basis. There's no way that I would pay a typical newspaper subscription rate to each of them.

I don't think there's an easy solution. A pay-per-click system probably would just invite sensationalism. Personally, I think that the solution is partly to innovate up. Provide interactive content and go beyond and electronic copy of what could have been printed on paper.