I think that regulation to avoid libel can't really be considered censorship. Libel requires a specific target, and how would you pinpoint a target for something of this magnitude?
If a paper publishes an article that takes a couple deep south communities, and adds a nice dash of exaggeration to paint the entire south as a racist, terrible place, then who's really been slandered? Hundreds of articles such as this have been published, with no legal consequence-nor should there be.
If a paper runs the headline-"White man kills 8" and ten years later, he's found innocent-can whites sue for libel? After all, they've been made to look more violent, with an incident that was disproven.
As to murdoch being biased- is anyone surprised? There's not a news organization in the world without an agenda, although it's certainly true murdoch is more blunt about it.
Who's to decide what's 'too far' for journalism? I don't want to be the one drawing lines- I'd rather see murdoch's vitriol, fox's clowning, and CNN's bias than have any one group with the power to regulate media content to the level there'd have to be to prevent any sort of reoccurrence of this nonsense.
The disallowance of defamation only further demonstrates the slippery slope fallacy is wrong: there is no true freedom of speech to begin with, no ideal position from which to slide. Nevertheless, it's beside the point; what's interesting to look at here is the imbalance of political reporting (as well as general decency standards, i.e. the example in the original post). As I said before, news agencies around the world are already held to various enforceable accountability and balance standards, which you don't seem to acknowledge.
In Australia, from which my examples are drawn, there is
already a group with the power to regulate media content. They are called The Australian Communications and Media Authority and they enforce legislation and regulation affecting broadcast media. Notably, this includes the Broadcasting Services Act 1992 (Cth) which stipulates a number of balance restrictions, such as the requirement to provide all parties with reasonable access during an election and clearly label all campaign material. Television and radio broadcasters continue to push their agendas as they please with free editorial license, despite the ACMA having enforcement powers up to shutting down the broadcaster for breaches, it is just not masqueraded as god given truth.
Print media is alternatively covered by a self-regulatory body, the Australian Press Council. They have comparable reporting standards and codes of ethics but no power to enforce them. Given our newspapers have no greater freedom of speech but countless more examples of abuse of it, it's clear which model is superior. The fantasy third option, having
no oversight, would only be even worse.
I couldn't tell you the names of equivalents in other countries, but I'm sure you'll quickly find them out for yourself if you start broadcasting a pro-Islamic extremist rant on a random television frequency.