Richard Posner wrote an interesting essay "Bad News" in the New York Times recently. This quote gives you a rather good idea of some of the themes.

But suppose cost conditions change, enabling a newspaper to break even with many fewer readers than before. Now the liberal newspaper has to worry that any temporizing of its message in an effort to attract moderates may cause it to lose its most liberal readers to a new, more liberal newspaper; for with small-scale entry into the market now economical, the incumbents no longer have a secure base. So the liberal newspaper will tend to become even more liberal and, by the same process, the conservative newspaper more conservative. (If economies of scale increase, and as a result the number of newspapers grows, the opposite ideological change will be observed, as happened in the 19th century. The introduction of the ''penny press'' in the 1830's enabled newspapers to obtain large circulations and thus finance themselves by selling advertising; no longer did they have to depend on political patronage.)

The current tendency to political polarization in news reporting is thus a consequence of changes not in underlying political opinions but in costs, specifically the falling costs of new entrants. The rise of the conservative Fox News Channel caused CNN to shift to the left. CNN was going to lose many of its conservative viewers to Fox anyway, so it made sense to increase its appeal to its remaining viewers by catering more assiduously to their political preferences.

There is something to be said for this analysis. If you examine the debate on Daniel Drezner's blog and elsewhere, it seems to focus on objections by liberal journalists and the slapping down thereof. I thought it might be interesting to look at The Cato Institute - and look from both sides. They are not precisely Republican hacks - yet they have many Republican supporters. The Cato Institute is just plain more interesting to read than a Bush cheerleading section - a flaw in Posner's thesis, or a fount of valued credibility which draws funding?

If you search for keywords such as Bush and Republican, you will not find unmitigated praise. Of course some of the disagreement demands merely that they more further to the right. By definition this can cost them little - since critics will hardly defect to the Democrats, or even to third parties when there is a serious risk of helping the Democrats.

There are some oddities to be found though. Among many interesting things People for the American way have on their page about the Cato Institute, this interests me most now. Cato's pharmaceutical donors include Eli Lilly & Company, Merck & Company and Pfizer, Inc. Reading the entire page you will see this doesn't indicate they have mostly pharmaceutical donors, but comes at the end of a list of donors from various industries.

When I saw them, I immediately suspected the Cato Institute would be silent on certain issues. Oddly enough, I was partly wrong. After searching for the word drug in the search box on the site, in the middle of a huge block of stories discussing problems with the war on drugs, I found good articles on surprising subjects. Two on drug reimportation and one on the Medicare drug benefit passed by the Republicans. The latter doesn't actually mention the industry which lobbied for the subsidies, let alone name those who fund Cato, but under the circumstances I was moderately impressed.

Have these drug companies withdrawn their support? If so I haven't been able to discover it. Perhaps the Cato Institute is boldly acting against it's own interests, but I think it interesting to examine the possibility that they are doing themselves good rather than harm.

First the obvious - opposition from these and other Libertarians and believers in small government didn't derail the bill. Nor has it cost the Republicans lasting support - where would it go? It seems they can have their cake and eat it too - using money from the drug companies to send their message to votors who hate big government. Not that the libertarian and small government blocks never have an impact on policy, but they require support of other groups and emotional commitments. Tax cuts are supported by these groups, and by people who have more money today and not worry what it will cost in the future, and those who hate the federal government for reasons dating back to Jim Crow and before. Cuts in programs for the poor also seem to garner support from those who have a gut feeling that poor people are "them" - either because they don't work full time or because they associate these programs with minorities. Even people who are unhappy about subsidizing big drug companies don't usually seem to feel the same deep down anger that social programs sometimes trigger - somehow people who go to work every day or even own stock in the companies seem to become "us" rather than them. Even if Bush is not headed in the direction Grover Norquist claims he wants to go, Rove was no fool in choosing to support him and accept his support.

Arguably at least, the Republicans, the Cato Institute, and perhaps even the drug companies are working in their own financial interests. Would the drug companies do better to find another outlet to win Republican support? Perhaps they will, or perhaps they know what they are doing. Perhaps the votors who subsidize them are in some sense working in their own self interest - if a dollar value could be placed on emotional gratification received. A similar analysis for the Democrats would be easier if there were more equivilant Democratic think tanks - and worthwhile even for Democrats who wonder if the party is supporting the causes it ought to in such a way as to create victory - or in such a way as too attract money from it's base while losing elections.