Review of Moneyball

All credit for this article goes to Michael Lewis, author of Money Ball.

Money Ball by Michael Lewis: A Book Review by Henry I. Langsam

What is Money Ball Really About?

One of my fondest childhood memories includes going downstairs to the kitchen on a Sunday morning during the summer and looking at the baseball statistics for the week in the sports section of the Inquirer. What great truths would be revealed? Which member of the Phillies had the highest batting average? Which Phillies pitcher had the lowest earned run average? Which Phillies player drove in the most runs? Who had the most stolen bases? I drank in those numbers trying to find insight into the Phillies, confident that those statistics told me all the important things about baseball. During my youth, the Phillies were not winning that many games. So I, like many other Phillies’ fans, had to take solace from those baseball players from Philadelphia who were leaders in the various statistical categories.

In 1964, the Phillies led by Jim Bunning and Chris Short on the mound and Johnny Callison in the field were the dominant National League East team for most of the season. However, they managed to lose 10 of 11 of their last games leaving the Phillies one game shy of the playoffs. It was heartbreaking! I could not follow the Phillies after that with the same seriousness and intensity as before. It was like someone choked me near death.

In all fairness, the Phillies have given some great thrills. Mike Schmidt, Larry Bowa, Steve Carlton, Garry Maddox, Pete Rose, Lenny Dykstra, John Kruk and Darren Daulton: all leaders of various teams that were very successful in postseason play. But baseball was never the same for me after the 1964 Phillies. So I stopped studying baseball and held my distance as a passive, occasional observer.

This summer of 2003, a friend, Richard McBrien, lent me a book at the beach that he thought I would enjoy: Money Ball. The Art of Winning an Unfair Game by Michael Lewis. I had read Michael Lewis once before: his best seller Liar’s Poker. Liar’s Poker was the inside scoop of life and work at a Wall Street investment house. Though a pretty good read, it was not off the charts. Money Ball was a whole “nother” story!

Though Money Ball is ostensibly about Major League Baseball, it is really a book about business and life. Its message is useful for all of us, not just baseball fans. Look at business and life as it really is, not as you wish it would be, not as you think it should be, not as the experts say it is, not as conventional wisdom says it is, and definitely not as you wish it would be. It is not always easy to uncover or face reality, particularly if you are steeped in custom and are influenced by so-called outside experts.

Money Ball arose from the following question: "how did one of the poorest teams in baseball, the Oakland Athletics, win so many games during the 2000-2002 seasons?" The gap between the rich and the poor baseball teams was huge in 2002: the New York Yankees had a payroll of $126 million dollars while the Oakland A’s had a payroll of less than a third of that, about $40 million dollars. In 2001, Oakland spent $34 million dollars on payroll and won 102 games. In 2000, the Athletics spent $26 million and won 90 games along with their division. Perhaps the answer to the foregoing question about how the A’s can do so well while spending so little lies in the fact that it matters less how much money you spend than how well you spend it.

An independent financial authority on baseball pointed out that the least one team could spend on a 25 man roster was about $5 million dollars plus another $2 million for players on the disabled list and the remainder of the 40 man roster. He further stated that there is a huge factor of luck in any baseball game and there is a relatively small differential in ability between most major leaguers. That means that the fewest games a minimum wage baseball team would win during a 162 game season is 49 wins. This baseball pundit measures the financial worth of a team by asking how many dollars over the minimum $7 million does each team pay for each win over its 49th win. How many marginal dollars does a team spend for each marginal victory? From 2000 through 2002, the Athletics paid about $500,000.00 per win. Rich franchises such as the Baltimore Orioles and the Texas Rangers paid about $3,000,000.00 for each win, more than six times what Oakland paid.

The Oakland A’s were willing to rethink their business, baseball, under the leadership of their vibrant but crazed general manager, Billy Beane. They decided to look at things anew as they really were, not how the experts and old timers said they were. To do that, Billy Beane had to make a scientific investigation of the sport by determining what qualities in an athlete converted into wins or baseball advantages, Billy Beane was able to produce the most wins at the least price, for three straight seasons. How? Why?

Billy Beane, son of a Naval officer, grew up in a small rural California town. In high school, Billy was quite athletic and played for his baseball, basketball and football team. In Beane’s youth, he could beat anyone at anything. Billy was the quarterback on the football team; the high scorer on the basketball team; at 15, Billy hit over .500 in one of the toughest high school baseball leagues in the country.

The Greek chorus of conventional wisdom, the baseball scouts have a checklist to analyze talent. They looked at a players ability to run, throw, field, hit, and hit with power. Billy had talent. He was fast, could throw, hit .500, hit with power, and could field. Billy was considered by the Mets’ scouts as a premium prospect. He had the whole package: talented at other sports, athletic, good grades and he was going with all the prettiest girls.

Though inspected by scouts like a prized heifer, Billy had other ideas about his life and playing pro ball. He wanted to attend Stanford University on a joint baseball and football scholarship. Though it was insane for a major league team to waste its first round pick someone who did not want to play major league ball, the Mets had three first round picks in 1980 and were willing to risk one of them on a player who might not sign. The Mets took Darryl Strawberry with their first pick and paid a large signing bonus: then $210,000.00. With their second pick, the Mets took Billy Beane. The Mets offered Billy $125,000.00 as a signing bonus and Billy’s parents left the decision for him. Billy took the Mets’ offer though not without hesitation. Billy decided to become a professional baseball player because of money.

Prospecting for Talent

Lewis takes the reader into the "draft drama." The 2001 draft had been an expensive disaster for the A’s. The top players that the scouts and management had decided to draft were all gone before the A’s got to pick. The A’s had picked a 95 m.p.h. high school fastball pitcher. High Schoolers had young, fast arms and could deliver fastball velocity. But the most important quality in a pitcher is not brute strength but the ability to deceive. So, high school pitchers are twice less likely than college pitchers and four times less likely than college position players to make it to the big leagues. This pick was the result of listening to a scout. In 2002, Billy Beane was not going to listen to his scouts. Picking a high school pitcher defied the odds and defied reason. Beane was intent on bringing reason and science to baseball. Beane understood that the science of building a solid baseball team was at odds with what the conventional wisdom and it was a constant struggle for him not to adopt conventional wisdom in his organization. The A’s scouting department was the component of Beane’s organization that most resembled the rest of baseball and Beane understood that meant it probably had to change. If you look at the draft realistically, each team selects about 50 players and only two make it to the big leagues. What other business would accept that level of success. Billy felt that scouting in modern baseball was the rough equivalent of professional medicine in the 18^th Century. Beane shifted from depending on his scouts to using his general manager’s Paul DePodesta’s computer to look at the statistics of amateur athletes. Paul was moving from totally out of to the of the A’s draft room. Paul, a Havard economics graduate and mathematician and scientist, could see the statistical trends that eluded the professional baseball scout: first, there was a tendency of the scouts to generalize from their own experience when there was no reality correlation. Secondly, scouts tended to be overly influenced by recent performance, but what a player did last was not necessarily what he would do next. Third, there was a bias towards what people saw with their own eyes or thought they saw. There is a lot you could not see when you watched a baseball game and you could not see a prospective talent over the course of a season so a scout’s snapshot was only a thin slice of viewing. The scouting department had ignored Paul’s prodding to scout players his computer flushed out. It was traditional for the general manager to give his scouting staff the authority to scout and select ball players on their own. But Billy could not give a hoot about tradition.

The 2002 amateur draft was the future of the Oakland A’s. The A’s survived by signing cheap labor. A team that drafts and signs a player holds the rights to the player’s first seven years in the minor leagues, and his first six years in the major leagues. The team also enjoys the right to pay the player less than the player is worth. The reason is that the drafted player is indentured to the team during his first six years in the major leagues and therefore there is no free market system to compel management to pay the player his real worth. There are minimum salaries but that is not very meaningful to the player. For the first three years, a player is stuck with the team’s minimums. For the next three of six years, the drafted player could apply for salary arbitration which would pay the player what the player is worth according to how that player performs with respect to his position. Thus, the draft is crucial to finding cheap ball players. In 2002, the A’s lost three of their star players to free agency: Jason Giambi, Johnny Damon and closer Jason Isringhausen. The $33 million dollars that these three ball players would be paid by the clubs who poached them during the next baseball was just $5 million dollars less than Oakland’s entire payroll roster. The rules of Major League Baseball granted the A’s the first round draft choice of the teams that poached their top talent plus three more "compensation picks" which would occur at the end of the first round. Thus, with the A’s own first round picks, it had seven first round draft picks. How the A’s performed with those draft picks would determine their future? Billy was not going to let the scouting department virtually any role with respect to the team’s future.

In evaluating a catcher from the University of Alabama, Jeremy Brown, the scouts were extremely sour on this prospects. The scouts had a thousand players ranked above him. They saw him as a heavy set ball player that did not look like a major league ball player. Unknown to the scouts, statistically, foot speed, fielding ability and raw power tended to be dramatically overpriced. The ability to gain mastery over the strike zone was the single greatest indicator of future success. Therefore, the number of walks a hitter drew was the best indicator of whether he knew how to control the strike zone. A keen eye at the plate in college will likely be a keen eye in the pros. Plate discipline would be an innate trait rather than something a free swinging amateur can be taught in the pros. When a scout protested that he wore "large underwear" and had a "soft body," a "fleshy kind of body," Billy Beane responded: "Oh, you mean like Babe Ruth?"

Billy Beane considered doing away with his scouting department entirely in favor of Paul DePodesta’s computer. There is a thick distinction between conventional wisdom and a statistical analysis. The wisdom of the scouts was that in evaluating a prospect, it did not matter what he had done. It was what the prospect was capable of doing in the future. For Billy and Paul, a young player is not what he looks like or what he might become but only what he has done. Also Billy was saying do not be victimized by what you see in the ball player; look at the statistical reality. Jeremy Brown to Baseball America’s list of Top 25 Amateur Catchers which meant that the scouts who helped create that periodical believed that he never should be a pro baseball player but for the A’s, and their statistically based analysis, he was a first round pick.

Sandy Alderson: Beane’s Statistical Godfather

Billy Beane’s godfather of quantitative baseball was Oakland A’s former general manager, Sandy Alderson. Alderson was an expensively educated lawyer from San Francisco who attended Dartmouth College and Harvard Law School with no experience in baseball. Because of his lack of baseball experience, when Alderson entered baseball, he wanted to get his mind around it. He concluded that everything from on-field strategies to player evaluation was better conducted by scientific investigation: hypothesis tested by analysis of historical statistical data, rather than by reference to collective wisdom of old baseball men. Through statistical analysis, one could see through a lot of baseball nonsense. When baseball managers talked about scoring runs, they tended to focus on a team’s batting average. However, if you ran the analysis, one could see that the number of runs a team scores had little relation to that team’s batting average. It correlated more exactly with a team’s on-base and slugging percentage. Many of the strategies that made baseball managers famous, the bunt, the steal, the hit-and-run, were, in most situations, either pointless or self defeating.

For Alderson, his re-examination of the premises of professional baseball wound up being largely academic. Alderson had no baseball background and therefore had no creditability. The team was managed by Tony La Russa who had done well using conventional wisdom and overpaying for him. So why fix something if it was not broken? Also, the ego of certain baseball team owners was such that they would lose millions of dollars to field a competitive baseball team. New owners came into Oakland who were not going to spend money. As a result of that, the only option left to the general manager was to find an efficient way to spend money on baseball players. Alderson turned to a former aerospace engineer turned baseball analyst, Eric Walker. Walker’s analysis was to spend money on hitters. Walker felt that fielding was at most five percent of the game. The rest was offense and pitching. Walker reasoned that the most critical component of baseball was the three outs that define an inning. "Until the third out, anything is possible; after it nothing is." Anything that increases the offense’s chances of making an out is bad; anything that decreases it is good. The analysis holds that on-base percentage is crucial. On-base percentage is the probability that the batter will not make an out. Thus, the most important offensive statistic is the on-base percentage. Implementation of Walker’s analysis by Alderson resulted in a organization wide uniform hitting approach that had three rules:

1. Every batter needs to behave like a lead-off man, and adopt as his main goal getting on-base.

2. Every batter should also possess the power to hit home runs, in part because home run power force opposing pitchers to pitch more cautiously, and lead to walks, and high on-base percentages.

3. To anyone with natural gifts to become a professional baseball player, hitting was less a physical than a mental skill. Or, at any rate, the aspects of hitting that could be taught were mental.

Alderson was seeking to create a new corporate culture in his baseball program. In his view, scoring runs was less of an art than a "process." He theorized that if you made the process routine and got every player doing his part on production, you could pay a lot less for runs than the going rate. The central point of Alderson’s program was the "system" was the star, not the individual player. The most important thing in the system was the willingness of a player to take a base-on-balls. As a result of the implementation, more or less overnight, all the A’s minor league teams began to lead their respective leagues in walks. Alderson studied the "walk" statistic carefully and would complain to his managers if they failed to honor the system. However, Alderson did not march into Tony La Russa’s office and tell him to get his walks up. Alderson had never played in the big leagues and therefore lacked the confidence and power. In what other business did a middle management call the shots. Tony La Russa was a middle manager. In 1993, Alderson brought Billy into the front office and told him his job was to go out and find undervalued minor league players. Sandy handed Billy the pamphlet Sandy commissioned from Eric Walker. It was Billy’s first experience with an objective view of baseball. Billy asked Alderson if there were any more writings and research like Eric Walker’s pamphlet and Alderson pointed to a row of well worn paperbacks by a writer named Bill James who had opened Alderson’s eyes about baseball.

Bill James: The Father of Sabremetrics

Bill James grew up in Mayetta, KS population: 209. At the University of Kansas, James studied economics and literature. James, a professional writer, self published his first book, photocopied and stapled himself, called 1977 Baseball Abstract featuring 18 categories of statistical information that you just cannot find anywhere else. Among other things, James stated that one cannot tell by watching the difference between a .300 and a .275 hitter. The difference is about one hit every two weeks. This was written as part of an argument that scoring a fielder, that is, determining whether a batted ball into play was a hit or an error was subjective to the official scorer then viewing it and was not subject to statistical analysis. James felt that counting things was the only way to get to truth and reality in baseball: statistics rather than observation were the road to truth. Baseball statistics as we know them today were established by a British-born journalist named Henry Chadwick in 1859. Chadwick started going and counting the events that occurred on a ball field seeking reform: he wanted the players to be judged by their precise contributions to victory and defeat. Fielding errors were one of Chadwick’s attempts to assign blame. Chadwick knew cricket and not baseball. As bases-on-balls do not occur in cricket, Chadwick had trouble getting his mind around base-on-balls. Chadwick decided that walks were caused entirely by the pitcher and that the hitter had nothing to do with them. Therefore, walks are not factored into the batting average. The much heralded and respected RBI (runs batted in) statistic was developed by Chadwick, but it is not as good a statistic as it would appear on the surface. In order to knock a runner in, a runner needs to be on-base when you come to bat. Whether a runner was on-base before a batter appeared has a huge element of luck. Also, whether a runner scored was partly the achievement of others. Chadwick had succeeded in creating a central role of statistics for baseball, however in doing it he created accounting chaos.

In 1979, in the Third Baseball Abstract, James wrote:

A hitter should be measured by his success in that which he is trying to do, and that which he is trying to do is create runs. It is startling, when you think about it, how much confusion there is about this. I find it remarkable that in listing offenses, the league will list first-meaning best-not the team which scored the most runs, but the team with the highest batting average. It should be obvious that the purpose is not to compile a high batting average.

He went on to say that we cannot directly see how many runs a player creates but we can see how many runs a team creates.

Next, James set out to build a model to predict how many runs a team would score given its number of walks, hits, stolen bases, etc. He would test his hypothesis on how hits affected the runs scored. The first version of his runs created formula looked like this:

Runs created=(hits+walks) X total bases/(at-bats+walks)

This model came far closer, year in and year out, to describing the run totals of every big league baseball team then anything the teams themselves had come up with. That implied that professional baseball people had a false view of their offense. More specifically, professional baseball did not place enough value on walks and extra base hits. The teams placed too much value on batting average and stolen bases which James did not even bother to include.

Another baseball hobbyists began to write about baseball after James, Dick Cramer, a research scientist for SmithKline Glaxo who had access to a computer. By day, he used the SmithKline computers to discover drugs and by night he used them to test his own theories about baseball. Cramer had a hypothesis about clutch hitting: it did not exist, no matter what announcers and coaches believed, Major League Baseball players did not do particularly well or particularly badly in critical situations. This made some sense because no one who behaved badly under pressure would ever make it to the big leagues in the first place. Conventional wisdom said certain players were clutch players. With a slight exception, the validity of Cramer’s thesis was proven statistically: except that some left handed hitters fared worse against lefties than righties and some right handed hitters fared worse against righties than lefties.

Cramer and another fellow baseball hobbyist, Peter Palmer, an engineer for Raytheon doing software that supported the radar station in the Allusion Islands that monitored Russian test missiles combined for further analysis. Together, they created the statistic now widely used to capture the primary importance to offensive slugging and on-base percentages: OPS, an acronym for on-base plus slugging. Palmer also did the math that analyzed conventional baseball strategies: bunts, stolen bases, hits and runs. He determined that they were mostly self defeating. The hobbyists believed that the baseball managers were interested in not making fools of themselves than in using their resources most efficiently. The study of truth and reality in baseball by the use of statistics was called Sabremetrics.

Billy Beane’s 2002 Draft

When we think of intellectuals, scientists and thinkers, we might consider Albert Einstein or John Maynard Keynes, however, we surely do not think of baseball people as intellectuals. Bill James was baseball’s version of the intellectual. The message Bill James whispered to Billy was: if you challenge conventional wisdom, you will find ways to do things much better than they are currently done in baseball. The A’s not only adopted Bill James’ thinking, they built on it and improved it. The whole point of James was: don’t be an ape! Think for yourself along rational lines. Hypothesize, test against the evidence, never accept that a question has been answered as well as it ever will be. Do not believe a thing is true just because some famous baseball player says that it is true.

Before Billy Beane, the baseball field was a field of ignorance. As of June 4, 2002, the day of that year’s amateur players draft, there were still big questions about baseball which needed answering:

1. What was the most efficient way to use relief pitchers;

2. Which part of defense was pitching and what part was fielding;

3. How important was fielding;

4. No one had solved the problem of fielding statistics;

5. No one had figured out how to make the amateur draft more than crap shoot.

However, Bill James had written in his newsletters persuasively that:

In 1998, Billy’s first year on the job, the A’s went 74-88. In 1999, the A’s finished 87-75. Volker wanted to know how the A’s did it. Paul DePodesta wrote Billy’s Beane’s presentation before the panel. Billy testified to the blue ribbon panel that the Oakland A’s lack of funds meant signing no famous stars no matter how well the team performed and that kept the fans away. However, all the A’s marketing studies showed that the main thing fans cared about was winning. They did not care if it was with nobodies. Win and the fans come, lose and they stay home. "Assemble nobodies into a ruthlessly efficient for winning baseball games, and watching them become stars, was one of the pleasures of running a poor baseball team." Billy also suggested that his inability to pay the going rate for baseball players let alone stars meant that his success was likely to be short-lived. But perhaps Billy did not really believe what he said. Perhaps he felt that the baseball market was so inefficient that superior management could still run circles around taller piles of cash. The A’s won 91 games in 2000 and 102 games in 2001 and made the playoffs in both of those years. The A’s were getter better over time: not worse. Maybe the A’s were lucky: or maybe the A’s were more efficient. The Oakland A’s, by winning so many games with so little talent and payroll were something of an embarrassment to Bud Selig and his blue ribbon commission. Selig called them an "aberration."

Before the 2002 season began, Paul DePodesta had reduced the coming baseball season to a math problem. He asked how many wins would it take to make the playoffs? He concluded 95. He then calculated how many more runs the A’s would need to score than they allowed to win 95 games: 135 (This analysis derives from Bill James). Then, using the A’s players’ past performance as his guide, he analyzed how many runs they would actually score and allow. He concluded that if he did not suffer a huge number of injuries, the team would score between 800-820 runs and give up between 650-670 runs. From that, he predicted that the team would win between 93-97 games. Because the A’s entered the 2002 season without three players widely regarded by the market to be among their best, the expected result was a net loss of 7 wins: 102-95. How could that be when you lose three stars? Beane and his staff analyzed that established closers were systematically overpriced so the loss of Isringhausen largely meant that the A’s lost Isringhausen’s saves. Well how important are saves? Saves often occurred with a ninth inning that starts with the bases empty and the home team leading. Billy felt that you could take a slightly above average pitcher and drop him into a closer’s role and let him accumulate a gaudy number of saves and then sell him off. Translated to Wall Street thoughts, that meant you could buy a stock, pump it up with false statistics and sell it off for more than you paid for it.

The blue ribbon commission may have asked the wrong question: it was not whether a baseball team could keep its stars even after they finished with their first six years as indentured servants and became free agents: the questions was how did a baseball team find stars in the first place. Could it find new talent to replace the old ones lost? Talent was a lot more fungible than baseball teams believed. Isringhausen could be pretty easily replaced.

Well how about the loss of Johnny Damon, the A’s centerfielder? Before becoming Billy’s assistant, DePodesta had analyzed baseball’s statistics. He found only two statistics that correlated most closely with winning percentage: on-base percentage and slugging percentage. Everything else was far less important. "On-base percentage" is actually on-base per thousand at-bats. If a batter gets on base 4 out of 10 times, he has an on-base percentage of four hundred (.400). Slugging percentage is actually based on "per four thousand." A perfect slugging percentage achieving a home run every time is four thousand (four bases every plate appearance). The majority of big league players have on-base percentages between .300-.400 and slugging percentages between .350-.550. On-base plus slugging was the simple addition of on-base and slugging percentages. This was a much better indicator than any other offensive statistic of the number of runs a team would score. Simply adding the two statistics suggest that they are of equal importance but as it turns out, on-base percentage is more valuable than slugging percentage point for point. An extra point of on-base percentage was worth more than three times an extra point of slugging percentage according to DePodesta’s calculations. This analysis tells a baseball professional the most important thing a player can do is get on base. It does not matter how. There were underpriced baseball players able to get on base. Oakland’s on-base percentage was .324 or roughly ten points below the league average. The offense that the A’s lost in losing Damon was fairly easily replaceable. But the team could not analyze the loss of Damon’s defense as no such statistic then existed.

A method to analyze loss of defense arose from financial market analysis in the early 1980s: the advent of the options and futures market. Options and futures were fragments of stocks and bonds; they became known as derivatives. They had a certain precise quantifiable value. Stock and bond valuation was a matter of opinion: the market told us what they were worth. But fragments of a stock or bond, when you glue them back together, must be worth exactly what the stock or bond was worth. If they were worth more or less than the original article, the market was thought inefficient. A trader could profit from such inefficiencies.

A couple of option professionals, Ken Mauriello and Jack Armbruster, decided to solve the issue of evaluating defense by quantifying every event that occurs on the baseball field. They sought to determine how much should the players involved be held responsible and therefore debited and credited. These baseball students/analysts decided to base their accounting on runs: runs were the money of baseball. They collected ten years of data from Major League Baseball: every ball that was put into play. Every event that followed a ball being put into play was compared by the system to what had typically happened during the previous ten years. Thus, the performance of the player would be judged against the average. Mauriello and Armbruster began by turning every major league diamond into a mathematical matrix of location points. Each point was marked with a number. Then they reclassified every ball that was hit. There was no such thing in their record as a double: that was too inexact. There were no such things as pop flies, line drives and grounders: the baseball was hit with a certain velocity and trajectory to a certain grid on the field. In the Mauriello/Armbruster form of analysis, a line drive double hit to the gap became a ball hit with a certain force that landed on point number 643. Then the system carved up every baseball play into countless, meaningful fragments: derivatives. For example, take a single being hit to right field with a runner on first. If Raul Mondesi is the right fielder, that runner stops at second base instead of dashing to third because Mondesi threw a lot of people out. It is worth something. Mauriello and Armbruster took James and his co-hort’s analysis one step further. They recorded events on a baseball field without any reference to traditional statistics. They not only ignored RBIs and saves, they ignored all conventional baseball statistics. When Paul DePodesta saw the system in operation, he immediately understood its significance: the system extracts the element of luck. DePodesta liked the system so much, he encouraged Billy to hire these unconventional baseball statisticians. Now, the A’s had a way of valuing Damon’s defense. Let us assume for a moment that a line drive hit at X trajectory and Y speed to point number 965 had 8600 identical hits in the system history. Let us further acknowledge that 92 percent of the time that hit went for a double, 4 percent for a single and 4 percent of the time it was caught. Let us further suppose that the average value of that event is .50 of a run. The system then credits the hitter having generated .50 of a run and the pitcher with having given up .50 of a run. If Johnny Damon happens to get one of his trademark catches on such a hit, he is credited with saving his team .50 of a run. Using this analysis, the A’s were able to estimate how many runs Damon’s likely replacement would cost the team. The cost of losing Damon to his expected replacement was 15 runs or about a run every ten games. The Mauriello/Armbruster system was not perfect. It still could not make perfectly definitive statements about fielding under this system because the system did not measure where a defensive player started from. It does not tell you how far a player had to go to catch a ball. Bill James had rated defense no more than five percent of baseball. Superior defense might have been brilliant defense positioning by the bench coach rather than the talents of the ballplayer. The A’s concluded from this information they could not replace Johnny Damon’s defensive ability: the cost would be too great. Accordingly, to offset the loss of Damon’s defense, they added more offense.

The blue ribbon panel report believed that a poor team could not survive the loss of its proven stars. But the business was more complicated than that as proven by the A’s. But the A’s still had to account for the loss of Giambi.

Jason Giambi: A Baseball Hack

The A’s knew they could not pay for Jason Giambi, the worst fielding first baseman in baseball. They also knew they could not replace him: they could not afford it. But what they also knew as it was not that important to replace him identically. "The important thing is to recreate the aggregate." The A’s believed that they could replace his most critical offensive trait, his on-base percentage, along with other less obvious traits. Giambi’s on-base percentage had been .477, the highest in the American League by fifty points. The average American Leaguer’s on-base percentage was .344. They could not directly replace an on-base percentage that got you on-base 50 percent of the time. However, the A’s could replace it at relatively little cost, but they had to sacrifice other qualities in replacement players. Paul mused there had to be something wrong with a player for them to get to us.

Giambi would improve his team’s chances in many imperceptible and unmeasurable ways. He had an ability to wear down first string pitchers giving everyone else more chances to hit against a second stringer. He drew this from his perfect understanding of the strike zone. He had the hitter’s equivalent of perfect pitch. Giambi’s genius as a hitter takes control of the batting encounter away from the pitcher. Ted Williams, one of the game’s greatest hitters, authored a book called The Science of Hitting which stated that every hitter has a hole: a place where he cannot hit the ball well. If a pitch is thrown to the hole, you can reduce a hitter’s average by many percentage points. Giambi had a hole waist high on the inside corner of the plate about the size of a pint of milk: two baseballs in height and one baseball in width. The A’s have videotape of each hitter’s at-bat which is or can be reviewed by the hitter during the game in between innings. Mastery of the strike zone by the hitter is the key skill that the A’s try to teach their hitters. That is the equivalent of good work habits in our lives. If we could have our staff and colleagues consistently use good work habits in our jobs, professions and workplaces, would we not be scoring more runs too? What was the answer to the loss of Giambi: Scott Hatteberg, a slow misshapen "has been" catcher who never played first base and cannot throw.

Scott Hatteberg: A Sabermetric Hitting Dream

Hatteberg was a Red Sox catcher as the 2002 season apprached. Playing a half season as a catcher with the Red Sox with a ruptured nerve in his elbow, he pressed on the nerve every time he straightened his throwing arm. After an operation in the off season, he could not hold a baseball much less throw it. The Red Sox gave up on him and traded him to the Colorado Rockies. As a sixth year player in the big leagues, he was eligible for arbitration. His salary was to be $1.5 million for that many years in the league. The Rockies thought that he was worth 1/3 of that given that he could not throw, so they put him up for free agency. The Rockies, before doing so, proposed a deal of a pay cut from the $950,000.00 that he made in Boston to $500,000.00. The witching hour for decision was on December 20, 2001, when Paul DePodesta, assistant general manager of the A’s, telephoned Hatteberg’s agent. The A’s ended up in a bidding war for Hatteberg. The Rockies wanted him as a spare player to be set on the shelf in case something happened to one of their players: the A’s wanted him to hit. Only the A’s wanted him to play first base. Hatteberg was to be Giambi’s replacement at first base.

As infield coach for the A’s, Ron Washington’s job was to take them as Billy Beane sent them during spring training and make sure they did not embarrass anyone on opening day. Considering that the A’s would have started a blind man if he could get on base, Washington had a lot of work. Although the A’s fielded Hatteberg at first base on opening day, he was not ready as a fielder. Lcukily, the designated hitter position became open so they decided shove him into the designated hitter position for as long as possible to avoid having him fielding at first base. When the team went sour, Beane purged much of the team getting rid of players which left Hatteberg needed at first base. Hatty was ackward but he was naturally more athletic than most guys hidden at first base. Playing first base is also a social occasion. When the opposing team’s player walks, gets a single or gets on base on an error, you would have to know who to talk to, when to talk to them and what to say. Hatteberg loved talking to people at first base. Playing first base was not why the A’s bid for Hatteberg: when Hatteberg was with the Red Sox, he had an on-base rate about 25 points higher than the league average. Properly rested and playing regularly at first base, he would get on base even more. Secondarily, Hatteberg would wear out opposing pitching. His at bats went on and on. Hatteberg was unafraid of striking out. This absence of fear showed itself in how often he hit with two strikes. He was fearless because he seldom struck out. He consistently worked himself into deep counts but despite hitting often with two strikes, he routinely put the ball into play. The ratio of his walks to strikeouts was among the highest in the league: fourth in the league in the 2002 season.

As a student of the game of hitting, Hatty owned a phone record of Don Mattingley talking about hitting. He listened to it often. Mattingley preached that you could look at a guy’s strikeouts and walks and tell what kind of a year he had. Hatteberg also thought through baseball’s process of debilitating (wearing down) hitters. He felt that the big leagues was a ruthlessly efficient ecosystem: every hitter had a weakness. Once the weakness was exposed, you had to make an adjustment or the whole league would get you out. If you had a weakness for pitches out of the strike zone, unless you could compensate with an extraordinary talent, you were doomed. From this paradigm, Hatteberg concluded that unless there were two strikes, he would not swing at anything he could not hit hard even if the pitch was a strike.

In 1996 when Hatteberg was in the big leagues for good, the Boston Red Sox hitting culture tried to sink his game. He was thoughtful, patient: the Red Sox thought that was a defect. The Red Sox wanted players to harness their aggression. Even the Red Sox’s star, Wade Boggs, a great patient spray hitter, was harassed by the Red Sox organization. When Boggs would take a walk when there was a guy on second, they called him selfish. Coach Jim Rice, a former Red Sox slugger great, berated Hatteberg for lack of aggression. The Red Sox coaches encouraged him even when he took poor swings but succeeded. The Red Sox were obsessed with outcomes: Hatty with process.

Hatty was finicky as a batter, he only picked the pitches he wanted to hit. Hatteberg concluded his 2002 season with some odd statistics and one not so odd. In 2002, he was:

1. No matter how successful you are, change is always good. There can never be a status quo. When you have no money, you can’t afford long-term solutions, only short-term ones. You have to always be upgrading. Otherwise you are...[in trouble].

2. The day you say you have to do something, you are screwed. Because you are going to make a bad deal. You can always recover from the player you didn’t sign. You may never recover from the player you signed at the wrong price.

3. Know exactly what every player in baseball is worth to you. You can put a dollar figure on it.

4. Know exactly who you want and go after him. (Never mind who they say they want to trade.)

5. Every deal you do will be publicly scrutinized by subjective opinion. If I’m [IBM CEO] Lou Gerstner, I am not worried that every personnel decision is going to wind up on the front page of the business section. Not everyone believes that they know everything about the personal computer. But everyone who ever picked up a bat thinks he knows baseball. To do this well, you have to ignore the newspapers.

Billy Beane was a phenomenal trader. He stuck to rules one through four vigorously but really could not live with rule #5. He did care what the newspapers wrote. It is his incredible competitiveness, creativity and imagination that allowed him to pull off trades that others would never even think of. He learned to use the cash of the rich teams like the Mets and the Yankees where cash is often thrown as an afterthought in trades to pay the salaries of the players he really wanted.

Jeremy Giambi became a Philly briefly for a portion of the 2002 season. The younger brother of Jason Giambi, the baseball machine, was on the A’s and was hired as part of the solution to replace Jason. Jeremy ceased being an on-base machine and an efficient offensive weapon during the first half of the season. He was a 27 year old professional baseball player having too much fun on a losing team. Behind this, he was reported as going to strip clubs, drinking too much on team flights and otherwise staying out late. Billy decided to fire him and he did not care who he got in return. The Phillies offered John Mabry. Billy did not know who Mabry was and did not care. DePodesta tried to talk Billy down. He explained to Billy that this is a lousy baseball decision. Billy responded that it might be his worst baseball decision but it was his best decision as a GM. Paul argued that it was irrational. Billy was not thinking objectively. He was looking for someone on whom to vent his anger. When Billy traded Jeremy Giambi, the A’s were 20-25. They had lost 14 of the previous 17. Two months later, they were 60-46. Billy was now a genius. "Shooting Old Yellar had paid off."

Billy would keep up constant chatter with other general managers and one of the purposes was to gain intelligence about how the other general managers were evaluating the value of ball players that Billy might be interested in obtaining or trading.

In 2002, Billy traded for all star second baseman and leadoff hitter Ray Durham with the White Sox. To get Durham and the cash to pay the rest of Durham’s 2002 salary, all Billy had to give up only one flame-throwing triple A pitcher named John Atkins. Over the past eighteen months, Billy traded every pitcher in the A’s farm system whose fastball was greater than 95 mph except Atkins. Ray Durham, a very fine player, benefitted the A’s for a half season but was also the gift that kept on giving. When the A’s would lose Durham to free agency (which they sure would the following year), he would be a type A free agent. When you lost a type A free agent, you received a first round pick plus a compensation pick at the end of the first round. If the White Sox had valued those picks, they would have kept Durham on until the end of the season and then let him walk from his contract. Those two draft picks alone were worth paying Ray Durham to play half a season.

The Toronto Blue Jays general manager, J.P. Ricciardi, said that watching Billy do a deal was "like watching the wolf talk to Little Red Riding Hood." Billy often sought to insert himself into a middle of a deal that was none of his business in order to get some value from a deal. When the Montreal Expos were trading their soon-to-be free agent star Cliff Floyd, the Expos general manager, Omar Minaya, started talking with Billy. Eventually, Omar took a deal that included a Red Sox trade for Floyd in exchange for two big leaguers, Rolando Arrojo and a South Korean pitcher named Seung-jun Song. Beane had only offered a promising double A pitcher for Floyd. But to insinuate himself into the deal, Billy offered Omar any player in the A’s farm system, within reason, to let Floyd go to Boston through the A’s. Billy suggested that Omar ask for one more minor leaguer, Youkilis, an eighth round draft choice the previous year: a Greek god of walks in baseball. Omar asked who he was. Billy responded that he was just a fat Double-A third baseman. He was tearing up Double-A baseball on the fast track to the major leagues and he was starting to acquire power. Billy suggested to Omar that the way this be done is Omar tell Boston that Youkilis is in the deal. Then hang up. He argued, the Red Sox are a rich team. How are they going to explain to people that they did not get Cliff Floyd because they would not give up Youkilis, a no name fat Double-A ball player. Poor teams have one advantage over rich teams: immunity from public ridicule. Omar was concerned that Billy was screwing up the deal. Billy responded that he was trying to give a free player from Oakland to Omar, a whole additional player that without Billy’s insertion, Montreal would not have had. Billy asked Omar to imagine the Boston headlines: "New Red Sox Owners Lose Pennant to Keep Fat Minor Leaguer."

The Red Sox assistant general manager, Theo Epstein, a 28 Yale graduate in 2002, intended to be a general manager someday. He is, in fact, the general manager today. Like Billy, Epstein is to the use of Sabremetrics. Though the Youkilis trade did not happen, the set up was brilliant, the conception was phenomenal.

How Some Undervalue a Pitcher

Through their wheeling and dealing, the A’s acquired Ray Durham and Ricardo Rincon, a left handed relief pitcher, both of which added snap to their team. The A’s had won their previous 19 games and tied an American League record for consecutive wins. On September 4, 2002, with a crowd of 55,528, the largest regular season attendance, the A’s went out to do what had never been done in 102 year history of the league: win their 20^th game in a row. Though up 11-5 in the top of the seventh inning, trouble struck. The A’s 6' 5" right handed reliever was called into try to close. Lewis described his pitching style:

Chad Bradford wants to be normal, but he is anything but. His idiosyncracies run to his core. In high school he had a shiny white rock he would sneak with him to the mound. He attributed part of his success to the presence of this shiny white rock. He thereafter carried it home with him and for the next three years, he never ventured to the pitcher’s mound without his rock. He would sneak it out with him in his pocket and put it on the mound in such a way no one ever noticed. In the big leagues, he no longer used his lucky rock, but he did not lose his idiosyncracies. He always throws the exact same number of pitches in the bullpen in the exact same order. He tells his wife to leave the stadium the moment he enters a game. He never touches a rosin bag.

Statistically, Chad Bradford’s 2002 effort indicates he was the best pitcher in the A’s bullpen and one of the most effective relief pitchers in all of baseball. The O’s payed Chad Bradford $237,000.00 a year in 2002. Billy Beane did not have the bucks to buy great big league pitching talent. Pitchers were like writers according to Billy Beane, each writer had a different way of achieving his effects and they needed to be judged by those effects rather than by their outward appearance or technique. For example, to place a premium on velocity for its own sake was like placing a premium on a big vocabulary for its own sake. Saying all pitchers should pitch like Nolan Ryan was as absurd as insisting that all writers write like John Updike. Good pitchers were pitchers who got outs. How they did it was beside the point.

Sometimes pitchers with phenomenal control one morning throw the ball over the catcher’s head that afternoon. Sometimes flame throwers exhaust their fuel. Sometimes great prospects go nowhere and sometimes sleepers become stars. Sometimes a 30 year old mediocre pitcher develops a new pitch and becomes a star overnight. Some major league pitchers have statistics better than their minor league ones. Pitching is an odd business. It is obviously a physical act but it is also in part an act of imagination. The adjustments that lead to pitching success, the getting of outs, are mental as much as they are physical acts. Chad Bradford is the king of the odd out getters. The quality of his imagination is far greater than the strength of his arm.

Bradford grew up the youngest child of a lower middle class family in Byrom, MS. While a youngster, Chad’s father, suffered a stroke that nearly killed him and left him paralyzed. The doctors told his father that he would never walk again. His father insisted the opposite. He announced while in his hospital bed his intention to raise his three boys and earn a living. Through an act of will, which he also thought of as an act of God, he did just that. By Chad’s seventh birthday, his father was not only able to walk but to play a form of catch with his son. He could not raise his arm up above his shoulder but he could get a glove to stop a ball. After he caught the ball from Chad, he would toss it back to him underhanded. The strange throwing motions stuck in the little boy’s mind. Just about everyone who makes it to the big leagues was an all everything in sports in high school. Just about every big league pitcher dominated high school hitters. Chad barely made the team in high school. His high school coach described Chad’s strong suit as being "basically...he wanted to be there. That was it." Chad learned some baseball tricks through his coach Moose which included throwing slightly above sidearm at about two o’clock instead of twelve o’clock. This put movement on his fastball which made it difficult for hitters to hit him. Chad was not recruited by any major colleges and so he sought and found a position at Hinds Community College, a couple of miles down the road. At Hinds, he pitched well but not well enough that anyone thought he had a future in the game: except for an odd Australian scout from the Chicago White Sox.

In 1994, Chad was shocked when he received a telegram from the Chicago White Sox telling him the team had drafted him in the 34th round. After the draft, the White Sox did not advance the money to sign him and told him to continue pitching so Chad went to the University of Southern Mississippi where he continued to pitch. Chad signed with the White Sox for $12,500.00 in his first year. In college baseball, Chad’s 86 mph fastball seemed respectable. In the minor leagues, it was ridiculous. Chad was earning $1,000.00 a month in the minor leagues. In the off season, to make ends meat he drove a fork lift and swept out trailers. He was a marginal prospect and unless he did better, he was going to be out of baseball. His delivery started getting lower and lower from the original sidearm. Although Chad could not explain it, he kept throwing lower and lower dow,n and the more he did, the more he continued to flummox in Double-A ball.

In June, 1998, Chad was moved by the White Sox from Double-A to its Triple-A team in Calgary. The new field was high in the foothills in the Canadian Rockies with the wind constantly blowing out. The place was hellish on pitching careers. An obscure soft tossing Double-A ballplayer was now a mercilessly suffocating pitcher in Triple-A. Chad’s throwing motion had dropped down even further: he was attacking hitters underhanded. Chad’s underhanded throw was timed generally between 81-84 mph, far from the usually requisite raging fastballs of 95 mph plus. In the big leagues, his unconventionally released underhanded fastball took about the same time to reach the plate as a more conventionally delivered 94 mph fastball. His sinker rose before it fell. His slider made for a right hand hitter’s eye before swooping down and away. Even hitters who faced him before fought the instinct to flinch. Chad also threw groundballs. No matter how thin the air, or how the outgoing breeze, it remained impossible to hit a groundball over the wall. Chad finally made it to the major leagues where he managed to finish his first year with an earned run average of 3.23. The White Sox simply could not see what they had: they could not see reality. They made up some reasons and sent Chad back to Triple-A. The White Sox refused to call him up though he saw pitchers around him who were not as good as he being called up to the majors.

Unbeknownst to Chad, Chad has two new admirers after the Australian scout: Paul DePodesta of the A’s and bored paralegal named Voros McCracken. Voros had taken up fantasy baseball and had been thinking of drafting Chad for his fantasy baseball team. However, before he did, he wanted to have a better understanding of what made major league pitching a success or not. He did not know how you tell if a pitcher was any good. In 1986, at the age of 14, Voros had picked up a work of Bill James. He welcomed the iconoclasm that he soon learned after reading James and discerned that the baseball announcers who were giving about 80 percent bull which they delivered most convincingly.

The internet advanced baseball knowledge. It created discussion groups, web sites about baseball and cheap publication of new writings and ideas. Up to this point, no one had distinguished pitching from good fielding. If you do not know how to credit the fielder for what happens after a ball gets into play, you cannot know how to assign blame to the pitcher. Therefore, one could never say with a certainty how good any given pitcher was or any given fielder. When Voros looked at the problem afresh, he tried to think about it logically. He divided the stats a pitcher had into those that defense behind could affect: hits and earned runs. From those, he separated the stats a pitcher did all by himself: walks, strikeouts and home runs. He then ranked all the pitchers in the big leagues by the second category. When he ran the stats for the 1999 season, he wound up with the list topped by these five pitchers: Randy Johnson, Kevin Brown, Pedro Martinez, Greg Maddox and Mike Mussina. However, a curious statistic popped up about Greg Maddox: his earned run average had risen from 2.22 in 1998 to 3.57 in 1999 largely because he gave up 57 more hits in 32 fewer innings. Millwood, the same year, had the lowest hits per ball batted into play. Even stranger, their statistics the following year were reversed. This did not make any sense.

Voros concluded from his statistical analysis: "What if a pitcher has no control of whether a ball falls for a hit, once it gets put into play?" It was generally assumed that a strikeout pitcher would have fewer balls put into play and therefore might have better results. It was also generally assumed, that pitchers could affect the way a ball was put into play. It was assumed that great pitchers like Randy Johnson or Greg Maddox coaxed hitters into hitting the ball in a way that was less likely to become a hit. That assumption did not square with the record books. There were years when Maddox and Johnson are among the worst in baseball in this regard. Thus, what had previously been attributed to the skill the pitcher was caused by defense, ballpark, or luck. It is pretty obvious that Maddox and Millwood pitched in front of the same group of fielders in the same ballparks. Therefore, defense and ballparks should not be a material factor. Voros then concluded: what if what was here before regarded as the pitcher’s responsibility is simply luck?

Voros then set out to prove himself wrong. He wrote a computer program that compared the major league pitchers who had similar walks, strikeouts and home runs but had given up very different number of hits. He located 90 pairs from the 1999 season. Voros reasoned that if hits per ball in play were indeed something a pitcher could control, then pitchers who had given up fewer hits in 1999 would proceed to give fewer hits in 2000. They did not. There was no correlation from one year to the next in any given pitcher’s ability for hits per ball in play.

Based on Voros’ pitching analysis, Voros developed the statistic he could trust: DIPS: defense independent pitching statistic. It also could have been called LIPS for luck independent pitching statistic because it also stripped luck out of the equation. In any event, Chad’s Triple-A DIPS were even better than his astonishingly impressive defense dependent ones. He then snapped Chad Bradford for his fantasy league team.

When we think of Voros’ analysis, like the James’ analyses before him, are assume it would change major league baseball: it did not. Voros said:

But Paul DePodesta had read McCracken’s work. After reading it, the first thing he thought about was Chad Bradford.

The A’s had already come to believe that the right pitching statistics were much more reliable than evaluating "how a pitcher looked." Bradford hardly ever walked a batter. He gave up virtually no home runs. He struck out nearly a batter an inning. However, Paul thought that McCracken’s analysis was one point short: Paul thought that a pitcher could control extra base hits. Bradford gave up his share of hits per ball in play but they were groundball hits: a 5:1 groundball ratio. The big league average was more like 1.2:1. Groundballs were not only hard to hit over the wall, they were hard to hit for doubles and triples. Though the Greek chorus of baseball oldies but goodies called Chad a "trickster", the Sabremetricians saw Chad for what he was, a highly efficient relief pitcher with an 85 mph fastball.

The Human Element: The Human Condition

When comparing ballplayers, how do we account for the human factor? Is every player governed by his statistics? Eric Chavez was playing third base for A’s. In 2002, Chavez was 24. The season was not over and he had 31 homers, 28 doubles, 55 walks, a .283 batting average and a .353 on-base percentage. To whom do you compare him? Jason Giambi at 24 spent half the year in Edmonton on a Triple-A team. In the half he was in the big leagues, he hit 6 homers, 28 walks, and hit .256. At 24, in 1988, Barry Bonds hit .283, 24 homers, 72 walks and 30 doubles. That is comparable to Chavez. Alex Rodriguez, A-Rod, was 24 in 1999 where he hit .285, with 25 doubles, 42 homers and 111 RBIs. However, Chavez is the best fielding third baseman in the game and A-Rod is not the best fielding shortstop. Lewis asked an Oakland A’s employee with whom he was having this comparative baseball discussion: Isn’t every player different? Doesn’t every player have to be viewed as special? Isn’t the sample size always one? Casey responded: Baseball players follow similar patterns and those patterns are etched in the records books.

Now Tim Hudson is in trouble going for the 20^th straight win and they call for Chad Bradford from the bullpen. Chad relieves his pressure by often thinking about his father. That puts things in perspective. The doctors told his father that he would never walk again and the man not only walked he worked and not only worked but played catch. Given his father’s limitations, how hard is playing baseball? Tonight, however there was so much on the line: so much pressure. Tonight, Bradford was thinking only: do not mess this up. Sometimes Chad would revert to the Bible: his favorite passage: Philippians 4:13: I can do all things through Christ who strengthens me. Even this was giving him no solace. That night, Billy Beane’s out getting machine was malfunctioning. Chad Bradford’s head was getting to him. Billy Beane, who never watches a game, sat and watched that one. In nearly 70 innings, Chad has walked 10 batters: about one every 30 he has faced. In the eighth, he walks the lead-off batter. He walks the second batter. It is first time he has walked two batters in a row. The third hitter hits a slow grounder to first base but Chad fails to cover first base. Billy thinks he is watching a new interpretation of Hamlet. Next play, instead of making an out, there is a misplaced throw to home and a run scores with no outs and bases loaded. Well, I am not going to go through every hitter but suffice it to say, it did not go well for the A’s. The A’s went out and allowed 11 runs to score by Kansas City tying the game 11-11. But who comes up in extra innings to close out the game? You just know it’s got to be Hatteberg. He proceeds to hit the winning home run and the A’s set the record. Billy’s out machine did not work: that’s the human factor. The odds of losing a game in which you are up 11-0 may be 14 million to one.

In the 1983 abstract, Bill James had thought about what had happened to the A’s at this evening’s momentous game. Bill suggested that there is a force that constantly reduces the differences between strong teams and weak teams, teams which are ahead and teams which are behind, or good players and bad players. James posited: