WHAT HAPPENED last week was like a scene from a holiday movie.

In the face of the biggest demand for toys in years, the Philadelphia Area Marine Corps Reserve's Toys for Tots program was experiencing its smallest contributions in memory.

With a week to go in its campaign to help needy children, the toy total was less than half its usual count. And, in the most challenging economy in decades, there was little hope for improvement. Things looked bleak.

We started a campaign in the Daily News, Inquirer and Philly.com to alert our readers to this need.

A week later, 40,000 more toys came through our doors, to put the total at over 60,000. The increased cash contributions are still being tabulated.

This "Miracle on Broad Street" illustrates the extraordinary power of our newspapers - to highlight a problem, galvanize our community and make a real difference, every single day.

And it's just the most recent example of stories that have made a difference.

People are talking about our recent series on the Environmental Protection Agency and the U.S. Postal Service, coverage of the Eagles' quarterback controversy and minute-by-minute dispatches from the Fumo and Fort Dix Five trials on Philly.com.

But some aren't just talking about the great stories in the Daily News and Inquirer. They're also asking a question: Are our papers going to make it?

It's no wonder.

The news about newspapers has been deeply distressing.

The Tribune Co. has filed for bankruptcy. Detroit's daily papers are about to cut four days a week of home delivery. And we've had to make some painful cuts, too, to remain profitable - including selective layoffs in recent weeks.

But there's more to the story here in Philadelphia. And given all the bad news and anxious questions, it's time to tell some of the rest of the story.

What makes our Philadelphia newspapers different? First and foremost, we've invested heavily in the quality of our journalism. And we've been rewarded for it with faithful readership, steady growth and profitability.

About 1.2 million people physically pick up and read our papers every day. That audience compares favorably to those of many national news outlets, and it dwarfs the reach of other local media. And 30 percent of our readers are young people, between 18 and 34.

Our advertisers tell us that nothing moves their products like an ad in our newspapers.

Beyond the newspapers, Philly.com's traffic has exploded to 50 million page views a month and more than 2.3 million unique visitors. That's the direct result of the investment we've made in good journalism, technology and creativity. It's the kind of investment that pays off in readership, respect and, yes, the revenue that makes the work possible. Most important, it's the fuel that powers our democracy, providing citizens with the facts they need to make informed decisions in their daily lives.

Our original news reporting sets the table for the entire region's news output, much of which derives from the work we do. No other news medium - television, radio or Web - can compare to the daily coverage produced by our approximately 400 journalists. More than 3,000 men and women sell the ads, run the presses, drive the trucks and make the papers possible.

This is a tremendous responsibility, and we take it seriously. Without the Daily News and Inquirer, who would be exposing corruption and incompetence, celebrating athletic and artistic accomplishments, chronicling business successes and failures, and covering our city and region so thoroughly?

Both papers are important. The Daily News covers the city intensely, and has expanded coverage of New Jersey and Delaware County. The Inquirer has a broad reach of the region.

This paper is opinionated, and isn't afraid to take sides and advocate for what is right.

And Daily News readers are just as passionate and opinionated as their paper. That not only makes for a special relationship that is unique among big-city papers, but it adds a richness to our public conversation.

The Daily News fights for its readers. People like Betsy Betancourt, who faced a family tragedy alone until Ronnie Polaneczky wrote a column about her that prompted scores of readers to come to the rescue. Columnist Jill Porter also has made a difference with her focus on the little guy and on big issues, and her columns spark huge response.

In November, city voters approved a charter change to merge our parks and recreation, to fix problems first brought to light by the editorial board.

Our journalists know what matters to your community because it's their community, too. They're driven by what compels you to pick up our paper every day: the need to understand this region and its people.

Much the same can be said of the homegrown group of investors who returned this paper to local control 2 1/2 years ago, proudly making the Daily News and Inquirer together the largest locally owned papers in America.

We're your neighbors. We grew up in towns like Upper Darby, Elkins Park, Springfield, Flourtown and Deptford Township. We went to school here. We care deeply about Philadelphia, its suburbs and South Jersey.

We're not trying to create the next multinational media behemoth. We're rebuilding the kind of world-class hometown papers that used to define cities like Philadelphia.

Big challenges lie ahead, and a slowing economy makes it undeniably tougher. But the Daily News has been around for 83 years; the Inquirer for 180. We're committed to making certain that they're both around for a long time to come.

At 51, I've been in other businesses that were just as tough as this one. But none of them seemed quite as important. And that's why I'm proud of this great, historic endeavor. Our local owners know that it's more than a business; it's a public trust. *

Brian P. Tierney is chief executive officer of Philadelphia Media Holdings, publisher of the Daily News and Inquirer.