Traditional folk songs are commercial songs which have been remembered after their authors have been forgotten. We remember Stephen Foster's name because so many of his songs remained popular for a long time, while songs composed by his less enduringly successful contemporaries are now called traditional.

Maybe one of the differences is that in the past popular songs had a different message than the ones Miley Cyrus sings. Or maybe we should borrow from Marshall McLuhan and say they have a different massage, one that massages the soul rather than the genitalia. Then maybe a new folk song is a new song that carries the older type of message, despite the fact that it's less likely to make a pot of money for somebody.