As much as I love NPR, the last entity you want to own or fund a news organization is the government, because it's very easy to slip towards state propaganda.
There's one big problem about the "new way without the middleman", and it goes to the central function of a news organization, which is judgment, curation, and sniffing out BS. When we lose local news orgs, we lose that filter (for better and for worse).
The filter has several functions:
* tell us what a seasoned reporter thinks is true after years on a beat, by not including the BS;
* connect the dots between current news and other events (tell the bigger story to help me understand why something matters);
* save the readers time, because the readers don't have time to wade through all the verbose, partisan, poorly edited anonymous blogs. News organizations exist to highlight and synthesize and summarize. When they die, we lose that. Removing the middleman is really removing the people doing the labor of condensing many disparate points of view and the flat confusion of facts.
As local news organizations die, we will have less engaged communities on every level, and more corrupt local institutions, and that will lead to greater stagnation and inequity in the US. It's already a huge problem, and it will get worse.