Conor, You have a point. I had a paragraph about externalities in my Post column that I cut for space. The argument would have run something like this: it's good for you if I read the New York Times, and good for me if you read it, and without a subsidy the total amount of Times reading will be sub-optimal. I think that's a fairly easy argument to make. Maybe it's even true.
Trouble is, I don't think it's a legitimate purpose of government to try to affect what you read. Preventing you from reading something (censorship) is obviously worse than causing you to read something (via subsidy), but the latter is still troublesome. In fact, it may even be unconstitutional. Who decides what communication/speech gets subsidized? If the Times gets a subsidy, does the Daily Worker? It smacks of an "establishment" of speech analogous to the establishment of religion.
Of course one key thing about the First Amendment is that its religion protection is the only one that goes both ways -- ie, you can't restrict it and you can't establish it -- so it may not be literally unconstitutional for the government to "establish" a set of high-minded bullshit beliefs in the name of a free press. But it would be pretty perverse, and it would bother me for the same reason an establishment of religion would bother me.