The ad is a little strange because of conflating different problems. And you would have to investigate the creation of each listed book to see if they really would be impossible without existence of commercial publishers who heavily edit and pay advances.
Some of the books listed were written by newspaper reporters. The decline of newspapers is far greater than of libraries or publishers. Without the experience gained working for big budget newspapers, those authors wouldn't have written worthwhile books.
Some of the research, for books by listed authors, was paid for by private charities (Robert Caro, Harvard; Zora Neale Hurston, Gugenheim Foundation). If advances continue to decline (and that's the problem, not whether publishers are profitable), such organizations will have to step up. But, to a large extent, they can't. If you look at figures 1 and 2 here, you'll see that why:
http://www.cbpp.org/cms/index.cfm?fa=view&id=3927
State universities, starved for funds, are not going to be able to subsidize their publishing arms.
Compared to the decline in state support for universities, I think that community library budgets are holding up fairly well (in other words, declining more slowly).
Declining library book availability will never be seen as the same kind of a crisis as airport delays
