Fairly accurate introductory article, though I think it misses 3 things:
1) Fact-checking: Inaccurate information very rarely gets above 5 upvotes, so while it's true that someone can post wildly-erroneous information and that sometimes a certain topics can get "swarmed" by biased upvoters, I still have found my information absorption from social news to be much more valuable than the traditional approach.
2) The fact that immigration was only on the front page once is misleading - I guarantee you there's a good portion of the social news readership who wouldn't be sitting in front of the TV watching the news anyway, and they didn't mention categories within the sites, like http://politics.reddit.com/ or http://www.digg.com/politics, both of which I spend a good amount of time getting information from regardless of if it makes it to the general population's front page or not. I'd guess gamers, sports addicts, etc., might use the same approach to get their focused information while also keeping an eye on what makes the front page.
3) I hadn't heard the "you're draining funds from investigative reporting" argument before. Again, though, I hope the army of individual contributors, combined with appropriate upvotes for factual information, would supplant this while ushering in a new and better era of true information gathering and distribution.
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