China censors turn New Year seeking dreams editorial into nightmare GUANGZHOU, China (Reuters) - When former Xinhua state news agency vice president Tuo Zhen was appointed as head of the propaganda department in Guangdong, one of China's most liberal provinces, he carried with him a reputation as a hard-line leftist. High on his agenda was how to rein in two of China's most outspoken media outlets - the Southern Weekly and Southern Metropolis Daily - under the sprawling Nanfang Media Group that owns a stable of nearly 20 newspapers and magazines. Half a year later, his heavy hand sparked a rare newsroom revolt and strike by journalists at the Southern Weekly, while unleashing broader calls across Communist Party-ruled China for press freedom. Over 29 years, the Southern Weekly has earned a reputation for pushing the boundaries in pursuing agenda-setting, hard-hitting news, attracting some of the country's best journalists and a weekly circulation of 1.7 million nationwide. While the system of government oversight had already been well established, including an internal censor to vet stories, current and former staffers said the levers of control tightened substantially with Tuo's arrival last May. Xiao Shu, a former columnist at the Southern Weekly, said Tuo treated the paper not as an asset for pursuing the truth but "as a burden, or a negative thing, to trample on as much as he liked." While the work of propaganda officials is kept out of the public eye, the standoff at the Southern Weekly exposed some of the arbitrary inner workings of the system. It also highlighted growing middle-class demands for greater freedoms, fuelled by social media that crackled with debate on the paper before posts were blocked. Yao Chen, an actress with over 32 million online followers, posted a quote from dissident Russian writer and Nobel laureate Aleksandr Solzhenitsyn: "One word of truth outweighs the whole world." It was reposted over 95,000 times. While many Southern Weekly staff have declined to speak on the record, a picture has nevertheless emerged of Tuo pushing too far, just as China's new leadership under party chief Xi Jinping tries to project a more reformist image. "I think pressure on media has been accruing for so long," said Li Datong, a former journalist sacked for challenging censorship. It's no wonder that a relatively small thing caused an explosion. Journalists have a lot of anger built up. Illustrating that pressure, online accounts said Dai Zigeng, the publisher of the popular Beijing News daily, had announced his resignation after the newspaper resisted government pressure to republish an editorial criticizing the Southern Weekly. The central propaganda department had issued a directive to newspapers that they republish an editorial from the Global Times, run by Communist Party mouthpiece the People's Daily, that blamed the protests in Guangzhou on overseas forces. The Beijing News, a sister newspaper of the Southern Weekly, refused, resulting in a stand-off between editors and propaganda officials, according to microblog accounts. The newspaper eventually republished the editorial on Wednesday. Outside the Beijing News office in southeastern Beijing, a man at the front desk dismissed the "gossip" about Dai's resignation and said he was working as normal. In Guangzhou, the slow burn of resentment towards Tuo's censorship boiled over in the last days of 2012, as the Southern Weekly prepared its New Year edition, carrying an editorial on the progressive theme of "seeking dreams" in 2013. According to journalists and online accounts, however, propaganda authorities altered the text without consulting editors, introducing factual errors and a chunk of praise for the Communist Party, while watering down its core message for the need to deepen reforms and enshrine constitutional rights. Journalists blamed Tuo, as head of the provincial propaganda department, for the meddling and demanded an investigation. Tuo hasn't publicly commented on the incident and couldn't be immediately reached by Reuters. Tension further flared when the paper's head of new media, Wu Wei, was forced to reveal the password for the paper's microblogging account, two sources close to the reporters said, after which authorities posted a message explaining that the alterations had been made by editorial staff, not by propaganda officials. Outraged journalists rejected this statement as a lie and went on strike, even though many were reluctant to call it that. After three days of fraught talks and protests outside the newspaper gates, both sides appeared on Wednesday to have reached a deal. Sources close to the reporters said the censors had pledged to remove an "inspection" process to vet news topics, a system that Tuo institutionalized, while journalists would go back to work and not talk publicly about the matter. Despite this, the controversy is unlikely to be forgotten. "As a journalist, I have to fight because we have the same fate," said a reporter working for a sister Southern Media group publication. If we don't express ourselves and if we remain silent, then this profession has no meaning. Additional reporting by Megha Rajagopalan, Sui-Lee Wee and Michael Martina in Beijing; Editing by Nick Macfie