Other Group

Sludge

Formation:

2018

Type:

Center-Left Investigative Journalist Website

Founders:

David Moore

Donny Shaw

Sludge is an online investigative journalism outlet that attempts to expose special interest spending in politics, particularly targeting entities that oppose left-of-center environmentalist, defense, and social policies.

Sludge launched in 2018 using the controversial and struggling blockchain-based journalism platform Civil. [1] [2] In November 2018, Sludge journalist Jay Cassano resigned, claiming that Civil Media Company “lied to” and “defrauded” him and other journalists by paying a large portion of his salary in cryptocurrency-based tokens that had no or negligible real-world monetary value. [3]

Sludge claims to be “a public-interest startup” that is funded exclusively through reader donations, though it also received an initial investment from the Civil Media Company. [4] [5]

In March 2019, with its initial investment from Civil drying up, Sludge launched a Kickstarter campaign to crowdfund its work, with a focus on its efforts to expose “fossil fuel lobbying to kill the Green New Deal.” The campaign raised more than $26,000. In the campaign’s pitch, Sludge’s founders claimed to be developing a membership-based subscription model to sustain the outlet going forward. [6]

Background and Founding

Sludge was founded by David Moore and Donny Shaw, who formerly ran OpenCongress.org, a website for tracking money in the U.S. Congress. [7] OpenCongress, which has since been shut down, was a joint project of the Sunlight Foundation and the Participatory Politics Foundation (PPF), both left-of-center advocacy organizations. Moore continues to serve as Executive Director of PPF, which has the stated goal of “advocating for full public financing of elections.” [8]

Shaw is a journalist who has covered corporate involvement in politics for such outlets as the Daily Beast and HuffPost. At HuffPost, he co-wrote a piece pressuring the President of Brown University to step down from a position on the board of Goldman Sachs because of the company’s business practices. [9]

Relationship to Civil Media

In January 2018, Sludge was announced as one of 13 online publications in the “first fleet” of outlets on the new journalism platform Civil. [10] The Civil platform is owned by the Civil Media Company, which is funded primarily by Canadian billionaire and cryptocurrency entrepreneur Joseph Lubin. [11] Lubin’s company ConsenSys provided $2.5 million in cash to help launch Civil in October 2017, with an additional $2.5 million in in-kind services such as office space. [12]

Civil Media Company gave each Civil newsroom including Sludge an initial grant by the consisting of a mix of cash and cryptocurrency “tokens,” symbolizing an ownership stake in Civil. Moore told media outlet Ars Technica that the cash portion of Sludge’s initial grant consisted of “enough for five full-time reporters to be paid in cash salaries.” [13] These funds ran out in March 2019, according to Moore’s note on Kickstarter that solicited crowdfunding donations to keep the publication operational. [14]

In October 2018, an initial public sale of tokens to raise funds for Civil failed to garner enough interest, causing widespread skepticism about the viability of Civil’s business model. [15] In an article the following month in online publication CoinDesk, Civil was accused by multiple former and current employees, including former Sludge employee Jay Cassano, of intentionally misleading its staff to believe that each token would be worth at least $0.75, when in reality tax documents revealed them to be worth fractions of a penny. [16]

Cassano also accused Civil of “defrauding” him and criticized its business model as a “solution in search of a problem.” Regarding ConsenSys’s initial investment in Civil, Cassano was quoted as saying, “What technology has Civil created with that $5 million? As of now there are a dozen WordPress sites that have launched. Did they need $5 million for that?”[17]

Reporting

Sludge’s website consists of five sections, representing the various focuses of its reporting: “Climate,” its section detailing political and advocacy spending of the oil and natural gas industry; “Defense,” focusing on the defense industry; “Hate,” which attacks right-of-center advocacy using Southern Poverty Law Center-style guilt-by-association tactics; “Influence,” a catchall category for lobbying; and “Tech,” detailing spending by technology companies.

In July of 2018, Sludge broke a story detailing how Sen. Dianne Feinstein (D-CA), then facing a challenge from left-wing State Sen. Kevin de Leon (D), had failed to disclose that her husband owned more than $100,000 in Facebook stock when she participated in Facebook CEO Mark Zuckerberg’s testimony to the Senate in April. [18]

A December 2018 report by Sludge exposing that Democratic then-U.S. Representative Beto O’Rourke (D-TX) had received $430,000 from oil and gas executives prompted backlash against O’Rourke from left-leaning environmental groups, including his removal from OilChangeUSA’s “No Fossil Fuel Money Pledge.” [19]

In a Reddit post in March 2019, Sludge’s staff announced that it was developing a database cataloguing the stock and investment holdings of every member of Congress. [20]

On Kickstarter, Moore pitched investors on the future of Sludge by stating, “We need funding to continue our policy journalism this year on climate—as well as on dark-money funding of hate speech, tech industry lobbying, and more conflicts of interest down in ‘the swamp.’”[21]

References

  1. Farivar, Cyrus. “Civil unrest: How a blockchain-based journalism startup bumbled its launch.” Ars Technica. December 23, 2018. Accessed April 29, 2019. https://arstechnica.com/tech-policy/2018/12/civil-unrest-how-a-blockchain-based-journalism-startup-bumbled-its-launch/ ^
  2. WNIP. “Documented and Sludge the first publishers to use Civil’s crypto-platform.” WhatsNewInPublishing.com. August 22nd, 2018. Accessed April 29, 2019. https://whatsnewinpublishing.com/2018/06/documented-and-sludge-the-first-publishers-to-use-civils-crypto-platform/ ^
  3. Benton, Joshua. “’I had to borrow money to pay my rent’: Civil’s tokenomics has left some of its journalists wondering where their salary is.” NiemanLab. Nov. 27, 2018. Accessed April 29, 2019. https://www.niemanlab.org/2018/11/i-had-to-borrow-money-to-pay-my-rent-civils-tokenomics-has-left-some-of-its-journalists-wondering-where-their-salary-is/ ^
  4. “About Sludge.” ReadSludge.com. Accessed April 29, 2019. https://readsludge.com/about/ ^
  5. “About Sludge, A Newsroom on Civil.” Medium.com. Jan 19, 2018. Accessed April 25, 2019. https://medium.com/@readsludge/about-sludge-a-newsroom-on-civil-e8e4d3904885 ^
  6. Kickstarter Profile Created by David Moore. “Sludge: People-Powered Journalism to Follow the Oil Money.” Kickstarter. April 2019. Accessed April 29, 2019. https://www.kickstarter.com/projects/1428274608/sludge-people-powered-journalism-to-follow-the-oil/updates ^
  7. “About Sludge, A Newsroom on Civil.” Medium.com. Jan 19, 2018. Accessed April 25, 2019. https://medium.com/@readsludge/about-sludge-a-newsroom-on-civil-e8e4d3904885 ^
  8. “What We Do.” ParticipatoryPolitics.org. Accessed April 29, 2019. http://www.participatorypolitics.org/about/ ^
  9. Shaw, Donny and Tiffiniy Cheng. “What Do the Top Liberal Colleges Have in Common with Goldman Sachs?” Huffington Post. May 25, 2011. Accessed April 29, 2019. https://www.huffpost.com/entry/what-do-the-top-liberal-c_b_420635 ^
  10. “About Sludge, A Newsroom on Civil.” Medium.com. Jan 19, 2018. Accessed April 25, 2019. https://medium.com/@readsludge/about-sludge-a-newsroom-on-civil-e8e4d3904885 ^
  11. Aiello, Chloe. “Here’s what that start-up using blockchain to save journalism is actually doing.” CNBC.com. July 24, 2018. Accessed April 29, 2019. https://www.cnbc.com/2018/07/18/blockchain-media-startup-civil-doing-what.html ^
  12. Woods, Tyler. “Blockchain-based journalism startup raises $2.5 million, hires editor.” Technical.ly. October 27, 2017. Accessed April 29, 2019. https://technical.ly/brooklyn/2017/10/27/journalism-blockchain-startup-raises-2-5-million/ ^
  13. Cuen, Leigh. “Employees Say Startup Civil Hyped Crypto Returns, But Failed to Pay.” CoinDesk. November 26, 2018. Accessed April 29, 2019. https://www.coindesk.com/civil-startup-token-crypto-ethereum ^
  14. Kickstarter Profile for Sludge. Accessed on April 29, 2019. https://www.kickstarter.com/projects/1428274608/sludge-people-powered-journalism-to-follow-the-oil/description ^
  15. Benton, Joshua. “’I had to borrow money to pay my rent’: Civil’s tokenomics has left some of its journalists wondering where their salary is.” NiemanLab. Nov. 27, 2018. Accessed April 29, 2019. https://www.niemanlab.org/2018/11/i-had-to-borrow-money-to-pay-my-rent-civils-tokenomics-has-left-some-of-its-journalists-wondering-where-their-salary-is/ ^
  16. Cuen, Leigh. “Employees Say Startup Civil Hyped Crypto Returns, But Failed to Pay.” CoinDesk. November 26, 2018. Accessed April 29, 2019. https://www.coindesk.com/civil-startup-token-crypto-ethereum ^
  17. Farivar, Cyrus. “Civil unrest: How a blockchain-based journalism startup bumbled its launch.” Ars Technica. December 23, 2018. Accessed April 29, 2019. https://arstechnica.com/tech-policy/2018/12/civil-unrest-how-a-blockchain-based-journalism-startup-bumbled-its-launch/ ^
  18. Lee, Seung. “Sen. Feinstein failed to disclose husband’s Facebook stock before Zuckerberg testified: report.” Bay Area News Group. July 11, 2018. Accessed April 29, 2019. https://www.mercurynews.com/2018/07/11/sen-feinstein-failed-to-disclose-husbands-facebook-stock-before-zuckerberg-testified-report/ ^
  19. Hilgenberg, Josh. “Pretend Progressive Beto O’Rourke No Longer Among Group Pledging to Reject Major Fossil Fuel Donations.” Paste Magazine. December 19, 2018. Accessed April 29, 2019. https://www.pastemagazine.com/articles/2018/12/beto-orourke-removed-from-list-of-politicians-pled.html ^
  20. Reddit AMA. “We are money-in-politics reporters at Sludge.” March 2019. Accessed April 29, 2019. https://www.reddit.com/r/IAmA/comments/b6lp7b/we_are_moneyinpolitics_reporters_at_sludge_and_we/ ^
  21. Kickstarter Profile for Sludge. Accessed on April 29, 2019. https://www.kickstarter.com/projects/1428274608/sludge-people-powered-journalism-to-follow-the-oil/description ^

Directors, Employees & Supporters

  1. Alex Kotch
    Investigative Journalist
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