How ‘bout Ads, with an option to pony up a subscription for Ad-Free...
That sounds like a reasonable compromise, while providing a funding cushion for Free Republic.
A few comments:
1. Obviously it's Jim Robinson's property and anything he wants to do is his call.
2. The likely nomination of Mitt Romney is going to cause serious problems for Free Republic. I agree with Jim Robinson that Romney is unacceptable. He's doing the right thing. Long-term, I believe Robinson will be proven right if Romney is elected, and he'll be viewed as an early warning of major problems. Unfortunately, that could have short-term financial consequences and maybe ad revenue is a good way to bridge that gap.
3. Including a tag of “donor,” “subscriber” or whatever on posts would be a good idea and could increase the number of smaller contributors. The only caution is that some people, for various reasons, prefer donations to be anonymous and the absence of a “donor” tag does not necessarily indicate nonsupport.
4. Requiring a subscription fee to access news websites has been proven not to work; people simply will not pay for online access and even a minimal payment requirement will kill a news website if it's a requirement to access all articles. (Paying extra for archive access to old articles is a little different, but that's not what's being considered here.) The only significant exception is the Wall Street Journal. I think it's pretty clear that the reason the WSJ online subscriptions work is that their readers are willing to pay a fee for access to premium content that has direct value to their business (and which often can be deducted as a business expense).
5. As long as Jim Robinson is careful to make **VERY** clear that advertisers don't dictate content, I believe this website could generate considerable revenue from ads. The key is making expectations clear up front to advertisers.