Pretty fucked up, it seems. First, this Wall Street Journal article on the death of the slush pile. Literary Rejections on Display has this post on a query rejection emphasizing the doomsday state of publishing. Both non-form rejections I've received cited the fiercely competitive fiction market, and there's been plenty of buzz about timid editors looking only for grand-slams and blockbusters, the mid-list be damned.
Even when they get things right, publishers still get it wrong. For almost two weeks now, I've tried to find a copy of Game Change, the Heilemann-Halperin book on the 2008 campaign. HarperCollins got a boatload of free publicity and spun up plenty of demand for the opus. The only thing they seem to have forgotten to do is print some actual books.
Where does all this leave us, dear writers? Should we shelve our completed novels and wait for better times? Or will there never be better times? Has consolidation of the book industry, publishing and retail, made the climb up the publishing ladder a Herculean effort, the equivalent of scaling Everest, that only the few and the lucky will survive?