tedster - 8:42 pm on Feb 14, 2011 (gmt 0)
The manual action Google toks could be manually marking those paid links as nofollow on Google's back end. Then there's no penalty, but no boost either. And there's no reason to give your competition a few weeks or months of improved traffic in that kind of situation.
In my earlier comment about manual analysis, I meant the reason this happened is because an SEO consultant worked with the NYTimes - and he did the manual analysis. His manual work is what uncovered the pattern of paid links that had slipped right through Google's algorithm.
The manual action that Google then took was a different kind of "manual".