Will Punchbowl punch up at Kevin McCarthy?

In the era of hyper-niche digital media outlets, Punchbowl News has already succeeded in nabbing one of the greatest prizes in American trade journalism: the U.S. Congress.

Punchbowl News launched fortuitously on January 3, 2021, and Sherman and his three colleagues’ used their deep knowledge of congress to break news on the chaos in the aftermath of the insurrection at the Capitol several days later. Now, it has for the moment displaced his old employer, Politico, as Capitol Hill’s most important source of big news and process-y microscoops alike, with three daily newsletters aimed at a small but influential audience of members of Congress, Hill staff and journalists, D.C. lobbyists, and others who read the Washington tea leaves.

The formula is working: The outlet announced last year that it had over 100,000 free subscribers in its first six months, and was on track to bring in $10 million in revenue from a combination of paid subscribers and advertising aimed at influencing Congress. Punchbowl News is making so much money that its owners bought a Capitol Hill townhouse in 2021 that was listed at more than $3 million.

The center of covering a legislature is its leadership, and Sherman and co-founder Anna Palmer, who departed Politico with him, cover the institution from the top down. They have maintained close relationships with the most powerful leaders in Congress, while occasionally alienating or ignoring the fringe members who often hope to influence the lawmaking body by garnering sensational media coverage. (Before leaving Politico in 2020, the then-Playbook author at one point discussed the idea of launching a newsletter just focused on congressional leadership).

“Jake has been a thorn in the side of leadership on both sides of the aisle,” said Drew Hammill, the former communications aide and deputy chief of staff to former Speaker Nancy Pelosi. “At the end of the day though, he is a fair, well-sourced reporter who is only interested in the truth.”

But it’s the Punchbowl News relationship with McCarthy that is the subject of constant Capitol Hill chatter. McCarthy has said that Punchbowl News is his first read of the day. (The news was, of course, shared by Sherman.)

Sherman is also close with Dan Conston, who runs the Congressional Leadership Fund, the super PAC that is closely aligned with McCarthy. The duo have been friends since their days as students at George Washington University: Conston played a role in Sherman’s wedding, which was written up at the time in Politico Playbook, where Sherman was a frequent contributor.

Like many reporting relationships, the one between Sherman and McCarthy is transactional.  But beyond serving as a means to shape the narrative, Sherman has also been a valuable source of information to McCarthy’s camp. One person close to the new speaker noted that last week, the congressional reporter seemed to know things before they did, including information about how some Republican holdouts may vote.

McCarthy’s office and allies aren’t always pleased with Sherman’s reporting. On a private call this week with members, the California representative seemed to mock the outlet’s coverage of his speaker’s race. And on January 4, Punchbowl described his hopes as “teetering.”

McCarthy’s enemies complained Punchbowl was too sympathetic to the Republican leader. Throughout last week, while other outlets dubbed McCarthy “weak” and said his failure to immediately secure the speakership was an embarrassment, Punchbowl News carefully avoided passing judgment on his tenuous position. And as it appeared that McCarthy was gaining momentum, Sherman was often the first to break the news of members who flipped.

“You could practically feel how giddy Jake Sherman was on Friday to see his horse finally making a move,” one congressional reporter grumbled to Semafor.

Backbenchers also chafe at Punchbowl’s coverage. “Is there clearer example of “access journalism” in Washington than Jake Sherman / Kevin McCarthy?” Florida Rep. Matt Gaetz asked on Twitter last year.

“I am once again asking the Punchbowl dudes to stop running false overhyped scoops that serve as Kevin McCarthy press releases,” Jeremy Slevin, Minnesota Rep. Ilhan Omar’s communications aide tweeted Friday. “To all the reporters who messaged me privately thanking me because they agree but can’t say so publicly, you’re welcome.”

Slevin’s tweet acknowledged a fact that I found in my reporting all week. Either out of a sense of professional propriety or competitive jealousy (in some cases both), over a dozen staff and fellow Hill reporters pushed me to write a piece about Punchbowl News that would expose their ties to McCarthy.

Perhaps the greatest testament to Punchbowl’s growing power, though, came when I asked if any would go on the record with their criticism. All declined.