Every weekday at 11:30 a.m., the section editors of the Daily News gather in the "Flamingo Room," a modest-sized conference room with pink walls. There, they discuss the day's developing stories. "We also have the body in the bag," says city editor Kurt Heine, during a recent meeting. "Last night, an employee of a Northeast recycling plant found the half-naked body of a woman wrapped in trash bags. Her foot was sticking out. We'll have more on this later on this afternoon."

The other editors nod and continue down the story list, which includes a piece on the rising murder rate, an examination of how the collapse of Detroit's auto industry could affect Philly factory jobs, and a Phil Jasner Q & A with himself about the 76ers.

On one side of the Flamingo Room hangs a collection of black-and-white photographs, many of which recall the paper's early-1980s heyday.

There's one of the famed columnist Pete Dexter pulling what looks to be a piece of gum out of his ear. Dexter penned beautiful, Hemmingway-esque dispatches often drawn from his hard-living lifestyle. "I didn't have a beat. I just did what I wanted to do," Dexter once said, remembering his time at the paper. "The columnists were all crazy having fistfights and throwing stuff out the window." Once Dexter wrote about a South Philly teenager who died over drugs. The kid's friends and family didn't appreciate the article and told Dexter so. Dexter went to confront them in a bar, bringing along his friend, the heavyweight boxer Tex Cobb, for support. When a group of guys walked in with baseball bats, Cobb said, "I hope that's the local softball team, Pete." It wasn't and the men fought in the street until much of Dexter's body was broken.

There's another one of "The Franchise," Chuck Stone, a brilliant man who wore a crew cut and a bow tie. Stone wrote unflinchingly about civil rights, and enjoyed hero-like status in the city's African-American community. He was once called in to help broker a deal during a Graterford Prison riot. During his 19 years at the paper, dozens of criminals surrendered to Stone in the newsroom. "For a while, that was the deal in Philadelphia," Dexter once said. "If you were black and killed somebody you went to see Chuck. That way the cops wouldn't tune you up. Chuck had no sympathy for rapists but if you killed somebody he could overlook that briefly."

There's one of the profanity-spewing editor Gil Spencer, who burned holes in his desk with cigarettes and would storm around the newsroom shouting things like "God save me from serious journalists." When the Phillies won the 1980 World Series, he was unable to decide between the now famous "We Win" headline and some other one. He allowed the officer janitor to choose. Later, it was discovered that the janitor couldn't read.

"For a while, we had to bar the door to get in this place," says columnist Jill Porter of the glory days. "We were being written up all over the country about how great a tab we were and how crazy it was to work here."

But today, on the other side of the Flamingo Room, opposite the photos, is a glass partition that overlooks the newsroom, which is far more subdued now; it feels more like an emergency room waiting area. There's good reason for this.

"The mood is shit," says one reporter. "We're doing our best to put out a great paper but we're also really busy looking for jobs."

tab keyed: "No matter what happens," says Daily News editor Michael Days, "the aim will be to put out a kick-ass newspaper." Photo By: Michael T. Regan

Last month, Philadelphia Newspapers Inc., a division of Knight Ridder, the California-based chain that owns the Daily News and the Inquirer, announced severe staffing cutbacks. A fifth of the Daily News' editorial positions were to be eliminated. Since then, buyout packages have been offered to all reporters, copy editors, photographers and graphic designers.

The Inquirer, which will lose 75 of its newsroom staffers, faces its own set of unique challenges. Just a decade removed from being a Pulitzer powerhouse, many believe Knight Ridder has, in its desire for ever-increasing profit goals, transformed the Inky into a shadow of its former self. The latest cuts will leave it with 300 fewer staffers than it had in 1989. The paper had four overseas bureaus in the 1990s. It will now have one.

But the People Paper, whose offbeat cleverness, lowbrow wit, nationally respected sports section and occasional major fuck-up have long mirrored and helped define the city's working class ethos, is in even sadder shape.

Even before these latest cutbacks, hiring reductions have dramatically reduced the staff. In the last few years, three newsroom staffers have died and three have quit without being replaced. In the late 1990s, 169 cubicles were installed when the Daily News newsroom was relocated from the seventh floor of 400 N. Broad St. to its current ground-floor offices. Now, about 30 of those desks are vacant.

"You need a bullhorn to talk to someone around here," says Porter.

After the cuts, the newsroom will be at less than half the strength it was during the 1980s. Morale is at an all-time low and the staff is still reeling from the unexpected departure of longtime and highly beloved editor Zack Stalberg earlier this year. On top of it all, many fear that contract renegotiations, now under way, could lead to a bitter and protracted labor strike sometime next fall.

"I love the Daily News," says reporter G.W. Miller, an 11-year vet who took the buyout. "I'm just not sure it's going to be around in a few years."

PNI publisher Joe Natoli categorizes the cuts as an unfortunate, but necessary step to offset declining circulation numbers and sagging advertising sales. Like many newspapers, the Daily News and Inky are struggling to maintain footing in a media landscape increasingly dominated by the Internet, while at the same time trying to satiate the appetites of Knight Ridder's Wall Street investors. Last year, PNI experienced a 3 to 4 percent decline in advertising sales, says Natoli, or a $12 million loss.

Still, despite its struggles, PNI last year racked in $50 million for Knight Ridder, whose 19 percent profit margin ranked second only to Gannett Newspapers, the nation's largest newspaper chain.

"Yes, 19 percent is a very healthy number," says Knight Ridder spokesperson Polk Laffoon, "but that just doesn't happen on autopilot. What's at stake here first and foremost is sustaining the health and prosperity of all Knight Ridder's 31 newspapers."

Besides, says Laffoon, "There are many different definitions of quality and there are many newspapers across the United States that may not meet most journalists' definition of quality, but still sell very well."

That sort of thinking does not sit very well in the newsroom.

"If I called Knight Ridder 'cocksuckers' one too many times," says gossip columnist Dan Gross, as he wrapped up a recent conversation, "feel free to change one of those 'cocksuckers' to 'greedy bastards.'"

Panic set in at the newsroom as soon as the buyouts were announced on Sept. 20. Staffers began asking themselves basic questions, says longtime political reporter Dave Davies.

"After 25 people leave, what kind of newspaper will we have?" Davies asks. "Will there be interest and resources from Knight Ridder to continue good journalism? Which of my colleagues will be staying? And what are my alternatives?"

Many are deciding it's time to move on. Although the exact impact of the buyouts won't be known until the Nov. 4 deadline, more than 25 staffers have applied for the buyout, a development that will prevent layoffs, but is symbolic of the paper's sagging morale.

"People are so overstretched and overworked already," says Gross, who has not applied for the buyout. "There's not a soul here who isn't questioning how much their job would suck after 25 more people leave."

The newsroom will be losing at least half a dozen city desk reporters; six years ago the city desk had roughly 50 reporters. One editor estimates that after the latest cuts could leave it with as few as 20. Reporters G.W Miller, Erin Einhorn, Earni Young, Yvonne Latty, Don Russell and city editor Yvonne Dennis are among those known to be leaving. On Monday, editor Michael Days e-mailed the staff to tell them, "We're very close to being oversubscribed for the buyouts." There's talk of friction at the Inquirer, pitting younger staffers against veterans who, if they don't leave, will cost the newcomers their jobs.

Other recent buyouts and retirements have already drained the paper of many longtime institutional voices such as Frank Dougherty, Ron Goldwyn, Joe Clark and Ron Avery.

Russell, who has been with the Daily News for 18 years, is another key loss. A reporter and humorist who authors the popular Joe Sixpack column and the Eagle opponent "Hater Guides," Russell wrote exposés of the city cab industry, covered Hoagie Gate and penned a series of articles that led to a City Council investigation of whether Veterans Stadium beers actually contained the 18 ounces that vendors advertised.

Russell's wife, Theresa Conroy, is a Daily News court reporter, and he says it was just too risky for them both to stay at a paper on "such shaky ground." Although he is glad the paper will still run his Joe Sixpack column on a freelance basis, he says leaving was the most difficult and saddest decision of his career.

"The Daily News has informed, entertained and helped define the city for decades," Russell says. "If it withers because of arbitrary, profit-hungry cutbacks by a large, out-of-town corporation, it plainly hurts our community. To me, that is the antithesis of journalism."

Four photo desk editors have applied for the buyout, says executive photo editor Michael Mercanti. "We're so threadbare as is," he says. "This is a Katrina-like hit for us." (Unable to sustain such a loss, the paper has denied two of the photo desk editors' requests.)

Some at the paper feel the cutbacks could sound the paper's death knell.

"This is the stab wound to the femur that will eventually bleed the paper to death," says one longtime newsroom staffer who, during two decades at the paper, has seen it weather constant cutbacks, a labor strike and the heated 1995 contract renegotiations that almost led to the paper's closing. "They've already cut away all the fat. Now they're at the bone.

"You have to put a certain amount of things in a newspaper to make people feel it's worth 60 cents. You can't just have one major story, a bunch of briefs, wire copy and sports. I think after the buyouts, people will go through the paper pretty fast. There are maybe a couple of things that interest you but it's going to leave you unsatisfied and hungry for more."

Coverage will no doubt suffer.

The newshole will shrink, the features sections is already being scaled back and long-term investigative projects like last year's award-winning "School Zones" series — a comprehensive look at the dangers of school crossing sites — will become difficult to execute.

"I'm really worried about the impact in the city," says investigative reporter Bob Warner. "We already have well-documented corruption problems in City Hall. We need more reporters to perform our watchdog mission, not less."

Proud of the underdog status that has for so long defined the Daily News, many staffers feel the paper can still provide quality coverage if it focuses primarily on its strengths of crime, politics, celebrity news and sports. (The sports department, the paper's bread and butter, seems to be emerging unscathed from the buyouts.)

Indeed, the paper thrived with a skeleton staff of fewer than 80 during the late 1970s when it was in the process of putting the Evening Bulletin out of business.

"While there's no way to spin this to say we can be a better paper with 25 less people, maybe we did get a little fat with our success," says political reporter Gar Joseph, echoing a sentiment held by some staffers that over the years the paper has geared more mainstream and moved away from its tabloid roots.

"Sure," says Jill Porter, who has been with the paper for 30 years, "it's not like we won't be able to put out a good paper with 100 people, but when we had 70 people there was a sense of energy and growth at the paper. There was a future ahead. The mood now is so different. It feels like a dying era."

Nighttime city editor Kevin Bevan calls himself one of the optimists.

"Once the dust clears," he said during a recent coffee break in the building's fourth-floor cafeteria. "The staff will refocus, re-energize, and no matter how many people we have left we'll still be able to put out a great paper people want to read."

office space available: In the late 1990s, 169 stalls were installed in the Daily News newsroom. Now, about 30 of those desks are vacant. Photo By: Michael T. Regan

Although staffers remain committed to putting out a quality paper, the Daily News' future depends mainly on Knight Ridder. "Are they going to support the new Daily News as a viable newspaper?" asks Howard Gensler, the paper's Public Eye columnist and also an officer of the Newspaper Guild of Greater Philadelphia. "Or will they continue to diminish it to the point where it basically doesn't exist anymore?"

The newsroom supports the expansion of Web-based coverage, says Gensler, and understands that measures need to be taken to pick up declining ad sales.

"All of us want to figure out the best ways to adapt," he says, "but we want to make sure that in adapting we don't destroy the core product."

The man in charge of guiding the Daily News through this latest storm is Michael Days, who was at the paper for 18 years as a reporter and editor before being named Stalberg's successor. Stalberg had attained near mythical status in the newsroom during his two decades at the paper's helm and was known for defending the paper against corporate downsizing.

"If there is any one person I would credit for single-handedly maintaining the life of this newspaper," says reporter Kitty Caparella, "it would be Zack."

When Stalberg unexpectedly retired from the paper earlier this year to take a job with the Committee of Seventy, a political watchdog group, many viewed it as a bad sign.

"When you see a guy like Zack leaving," says Russell, "you can't help but say, 'What's he know that everybody else doesn't.'"

Stalberg says he "got out purely for personal reasons."

"I just felt that after 20 years in the same job it was time for something different," he says. "I certainly did not see this coming."

Although Days is highly respected in the newsroom, some question whether his laid-back style is the best fit for the challenges that lie ahead.

"Some editors jump on the desk and scream and shout," says Days. "Yeah, I can have a calm demeanor, but there's a steely person underneath. I'm a brother from North Philadelphia who grew up with people putting guns to your side, to your head. I'm not saying this is going to be easy, but I'm in a job that I wouldn't have probably got 20 years ago, so I feel blessed in a lot of ways to have this opportunity. Otherwise I wouldn't be in this job."

One hurdle has already been averted, says Days, referring to layoffs, which would have been "poisonous" for staff morale.

"We're going to have to be a more focused newspaper, no doubt about it," he says. "We'll focus on our primary strengths of sports, crime, politics and advocacy pieces. Will we be able to cover as much as we'd like? No. But good quality doesn't necessarily mean bulk."

Days says he was not informed of the buyouts when he took the job but that you'd have to be "pretty damn dumb to be surprised by this" given the current woes of the media industry.

"We have to continue to be aggressive in figuring out how to create different vehicles for the Daily News to reach its audience," he says, adding that the paper will continue to expand its blogs and podcast features.

"There is a lot of shared pain right now," he says, "but the paper will survive because of its unique voice.

"We've always been a paper with celebrated reporters and editors who come up with good ideas and execute them well. That part of who were is not going to change. No matter what happens, the aim will be to put a kick-ass newspaper."