BOOK REVIEW / MEDIA : Story of the Battling Detroit Papers Doesn’t Quite Deliver : PAPER LOSSES: The Great Detroit Newspaper War, <i> by Bryan Gruley</i> ; Grove Press, $23, 421 pages

The cautionary lesson of the 1990s is that crime--particularly the sin of overwhelming greed--does not pay. Some of us who failed to profit personally from the acquisition-crazed 1980s (which is to say, most of us) might take perverse pleasure in seeing just how far the Michael Milkens of the world have fallen. “Barbarians at the Gate,” the story of the messy R.J.R. Nabisco takeover, was turned into a popular HBO movie. Such is our appetite for watching the big-money men fall.

Now, from Detroit News Washington correspondent Bryan Gruley, we have “Paper Losses: The Great Detroit Newspaper War.” As the book’s subtitle promises, it’s “a modern epic of greed and betrayal,” this time between the Motor City’s two daily newspapers, the News and the Free Press, which seemed, by the ‘80s, to be locked in a mutual suicide pact.

The conservative News and the hipper Free Press had been involved for years in a struggle for supremacy that had eroded their fiscal foundations. They slashed ad rates to pump up the number of ads they ran and resisted raising the newsstand price lest they lose valuable readership. Being No. 1 in the market would soothe their collective ego and guarantee certain advertisers, who simply bought the market leader. But in trying to get and stay there, the papers were putting themselves out of business.

The News had a circulation lead, but the Free Press, owned by the giant Knight-Ridder firm, had more money to lose. The Evening News Assn. (ENA), which owned the News, was family-owned. A media company in financial trouble in the 1980s? Potential buyers started sniffing around, until the ENA, partly in self-defense, accepted an offer from Gannett Co.’s Al Neuharth.

Suddenly, in the fall of 1985, it looked as if the citizens of Detroit were about to become the beneficiaries of a real newspaper war, in which evenly matched combatants turned journalistic cartwheels to impress readers; surely anyone who believed that competition could lead to improved coverage was excited by the possibility. But as Gruley knows, the history of newspaper wars is not a happy one. In city after city, the weaker paper disappears, no matter how much money its owners are prepared to pour in.

The News and the Free Press now publish under a Joint Operating Agreement, which pools their business and circulation operations. Reporters theoretically remain separate and in competition, but they put out a Sunday edition together. The fight has no teeth left in it.

So what Gruley has is a sad but true story of what he calls “the new constraints and pressures that change has brought on.” Thanks to Wall Street’s predatory nature and technological changes that have forever altered the way a newspaper is made, the good old days--when strong families ruled and quality of product sufficed--are gone. His tale ends on an oddly pragmatic, down-to-Earth note: This is the new order, and we best get used to it.

He cites former Chicago Tribune Editor James Squires’ regret that a grand era has ended, but says: “As a newspaper journalist, I can work up some of the same nostalgia, but I don’t think I can afford to, because those days--which weren’t quite as glorious as Squires chooses to recall--cannot be retrieved.”

An admirable attitude for a man who makes his living writing for one of the newspapers in question. But the transition from daily journalist to author is a deceptively tricky one; Gruley did formidable research and tried his best to imbue his story with drama and fire, only to have it fall just short.

Perhaps an accepting nature is a hindrance at times. Journalists, particularly those of us who grew up in multi-newspaper towns (three dailies, when I was a kid in Chicago), will read the book with dismay and anger, but the general audience may not be seduced. This is a more serious endeavor than its subtitle would have us believe--sad confirmation for media watchers.

There is one quibbling fact that must be noted. Gruley explains that he received a 16-month paid leave of absence from the News to write the book; he anticipates that some readers will have a problem with a seeming conflict of interest, but insists that he “tried mightily” to remain objective.

I want to believe him, but, unfortunately, I’m one of those readers he predicted would be troubled. The way the publishing industry works, few writers can actually make a living at nonfiction prose, so I empathize mightily with Gruley’s plight. Probably there was no other way he could afford to write the book. Still, his solution bothers me.

I know journalists who have returned a basket of flowers to the sender to prevent even the slightest hint of conflict in future coverage. Gruley got a check and all his employee benefits while he was writing about the conflict between the News and its competitor. It’s an unsettlingly uneven relationship between writer and subject.