Closing Another Book

At least you can’t accuse Mark Shapiro of not cleaning up his messes.

With the completion of last week’s annual July garage sale, Shapiro essentially closed the book on his role as general manager of the Indians, a job he took over in late 2001, by sweeping out most of the last remaining vestiges of his tenure as the Cleveland Indians’ general manager. .

It was hardly a rousing success. When his 9th year is completed, he will have posted exactly two winning seasons in a career that ultimately will be known more for bungled opportunities, bad decisions and misspent millions than anything else.

The good news, though, is that for the next few years general manager-in-waiting Chris Antonetti won’t have to preside over his own annual auction. Pretty much anything not nailed down already has been sold by Shapiro and all that remains in the cupboard that Antonetti inherits is an essentially minor league team with a mostly minor league budget.

Shapiro’s sale didn’t create much of a windfall for the team this year, assuming you define windfall as legitimate prospects. The good stuff had been picked over the past few years anyway and all that remained in the cut out bins were the likes of a sore-armed Jake Westbrook, an injury-prone Kerry Wood and an attention-challenged Jhonny Peralta. Indeed, in a few cases the Indians actually had to help pay the salaries of the departed. For their trouble the Indians received a few low level prospects who you’ll most likely never hear from again.

Given the voodoo economics of baseball and the draconian way in which Shapiro had the Indians participate, it’s hard to argue about any of these trades. Indeed, you really can’t argue much with any of his previous trades, either. The Indians under Shapiro were mostly desperate sellers because of their own financial issues and pretty much had to take what’s offered in order to meet their more immediate goals of fiscal prudence.

Under Shapiro’s careful direction, hammered out at the insistence of owners Larry and Paul Dolans, the Indians are officially s shoestring operation again, much as they used to be, with no business charging major league prices.

Shapiro’s teams made two runs at a championship and twice Shapiro wasn’t able to get the team over the hump. But those teams look like anomalies at this point because they had top-level talent making major league dollars. But as decisions Shapiro made didn’t pan out and age and impending free agency caught up with the players he mostly inherited the Indians have been on a slow, painful march to the bottom as they look to pare their budget to an absolute minimum.

Whether you think the team under Shapiro was shrewd or simply mismanaged depends on what you think about the contracts of the three players they just dumped. Along with Travis Hafner and his contract, they are at the core of why the Indians are struggling so mightily financially.

Let’s start with Westbrook. He’s under .500 for his career with an ERA of 4.34. Until his injury, his best attribute was as an inning eater, pitching over 200 innings in each of 2004-06. Those seasons led the Indians to sign him to a contract that’s paid him over $10 million in each of the last 3 seasons alone. It’s hard to know if Westbrook’s contract was market price or if Shapiro set the market by overpaying him in the first place. Suffice it to say though that more than a few people questioned Shapiro’s decision at that time to give Westbrook that kind of contract given his rather modest accomplishments.

Peralta is even more of a mystery. He’s a lifetime .264 hitter whose one decent season in 2005 convinced Shapiro to label him a core player. That led to Shapiro signing Peralta to a long-term above market contract to buy out of his arbitration years. Peralta never duplicated that 2005 season, coming relatively close just once in 2008. Meanwhile he proved to be a player who seemed oddly indifferent to his craft.

The signing of Kerry Wood still mystifies. Wood had been a closer for only one season with the Cubs when he was signed by Shapiro. While he did save 34 games, the Cubs didn’t seem particularly interested in re-signing him. Meanwhile it was difficult to understand Shapiro’s thinking giving the context of the Indians at that time.

Remember, the 2007 Indians went 96-66 with Joe Borowski saving 45 games. They beat the Yankees in the divisional series and were up 3-1 against Boston before losing 4 straight. But Borowski was a high-wire act and a better general manager would have made the move for another closer then.

But Shapiro stood pat and the team regressed in more ways than just on the mound. CC Sabathia, the reigning Cy Young award winner was traded. Thus by the time Wood was signed for the 2009 season, the team was a shadow of its former self. The Indians had far more fundamental problems that needed addressing and signing a player like Wood for just two years at that kind of money reeked of stop-gap. It’s money could have been much better spent.

Now back to Travis Hafner for a moment. The reason he’s still standing in an Indians uniform has nothing to do with either sentimental attachment or production. It’s simple dollars. His current salary is $11.5 million and there are still two seasons, plus a club option in a third, at $13 million per. There’s also a $2.75 million buyout if that club option isn’t exercised.

At that price, he’d have to be producing Albert Pujols numbers to move him, which if he were I still believe he’d be traded. But that’s a rather worthless debate. He’s been out of the lineup recently with a sore shoulder, though in fairness it’s kind of hard to tell. In July he hit 1 home run and had 4 RBI. He also had 21 strike outs and had more games with multiple strikeouts than in any other month of the season.

His is the contract that just keeps giving and giving. While there’s no reason to think that Shapiro wouldn’t have traded Peralta, Westbrook and Wood just for sport, in truth those trades are as much directed at Hafner’s unmovable contract as they were to conclude the process Shapiro started when he and the Dolans determined that they could never sign Sabathia.

In a sense, then, these recent trades provide a fitting conclusion to Shapiro’s career as a general manager. He was never able to climb the mountain with this team because for all his bluster and easy-going ways, he wasn’t a particularly good judge of talent. In making his one real run to a championship he consistently bet on the wrong horses and those bets ended up costing this franchise millions in unrealized value while inhibiting the real growth of legitimate prospects.

From this point forward, the team now is in the hands of Antonetti, someone who has been trained directly by Shapiro and who will be supervised by, wait for it, Shapiro. That means there’s no reason to believe that much will change, from the business model built on a one-word strategy “hope” to an endless cycle of trades and prospects.

So come season’s end, when Antonetti takes over for good and reboots the server, in all likelihood, there’s little chance it’s going to clear the error codes.

The Big Six

If the Cleveland Indians have a set of goals for the season scrawled on a piece of paper inside the mind of general manager Mark Shapiro, it probably says “when you don't know where you're going any road will get you there.”

Here's a test: on any night watch the Indians for as long as you can stand and then try to write down exactly what you think they were trying to accomplish. On the list of things you're likely to write down, “win games,” if it appears at all, will be down at the bottom. For a team rebuilding that's understandable. The real problem is that at the bottom also will be “developing a team that someday will win games.”

During this past off season Shapiro spent a lot of time talking about how this team needed to get a better start out of the gate than in seasons past. Shapiro all but painted the picture that the team's slow starts was the primary reason Eric Wedge now has “former Indians' manager” as part of his title.

To that end Shapiro and the brain trust that brought you this roster went about supposedly revamping the spring training experience as if the only thing that stood between this roster and on-field success was a better cut of steak at the training table. Manager Manny Acta placed more emphasis on winning preseason games than did his predecessor (as well as most of the other current managers) and indeed from that perspective the Indians' spring was a success.

But a distressed room doesn't suddenly get a makeover just because you move a few lamps around. When the season started this team was still the uneven mess it looked like on paper in the off season and thus it shouldn't have surprised anyone that April again was miserable. It was bound to be.

Then again, we're likely to be saying the same thing at the end of May, June, July and August as well. By September fans will be so focused on the Browns that they won't notice whatever fate awaits the Indians' then.

The Indians 9-13 record at the end of April projects to a 66 win season. Since most figure this team to win about 70 games anyway, it seems like they are right on pace.

It would be one thing if this team was built with the intent of taking its lumps early while it gels into a competitive unit late. That's just not the case. It's a team that seems to have been built with only one unifying theme: don't lose too much money.

Even that task isn't going to be easy, not with a lineup featuring the Big Six.

The Indians as constructed are mostly a mess. Of the seven players on the roster making over $1 million this season, 6 of them are among the least productive. Unfortunately, three of those six look to be around for a few more years. The Indians have no other choice.

What it all adds up to is a cringe-worthy lineup with only the occasional bright spot or, in mathematical terms, a team that deservedly is on pace to win 66 games, for years to come.

I've railed against Russell Branyan being on this team plenty of times so no need to turn over those shovels of dirt again. Nothing he's done since his return changes that assessment. The best that can be said is that he's not guaranteed any money for next year. All he's doing on this team is eating up space and inhibiting the development of players that might actually have a chance to be on this team a year from now. His $2 million dollar salary is essentially a gift that Branyan would be wise to put in a CD. I hope he sends a thank you note.

You could say the same thing about Travis Hafner, except that his salary is now in the multi-millions, 11.5 of them to be exact.

It's actually hard to watch Hafner these days because so much of what he isn't now is wrapped up in what he used to be. It may be that injuries have robbed him of his ability to be productive any longer. It also may be that his lack of productivity at the plate is exacerbated by his contract, with 3 years remaining, that has become the millstone around this franchise that prevents it from putting a more cohesive lineup on the field. Hafner not only is collecting $11.5 million this season, which equates to about $100 per bad swing at this point, but the Indians are also on the hook to pay him $13 million each of the next two seasons. Hafner is like that stock you bought at $85 a share and held on to even as the company went bankrupt. What else could you do?

The sad fact is that the Indians could be as productive with Andy Marte and pick a player making the minimum as they are with Branyan and Hafner in the same lineup at about 1/12th the cost. This alone goes a long way to explaining the mess that is this lineup.

Yet if these two were the only problems then maybe things would look brighter. But then I watch Jhonny Peralta slumber through his existence at third base like the kid in the back of your high school science class who, when he was there at all, was usually sleeping.

Peralta, with his $4.85 million salary, is like a trust fund baby just gliding through life hoping the money never runs out. Fortunately, it might. He's due $7 million next season, but that's a club option which, if exercised, means Peralta has some incriminating pictures of someone stored in a safety deposit box. If neither Shapiro nor his hand-picked successor Chris Antonetti can't find someone to be as productive as Peralta for 1/10th the price then the Dolans should sue for malpractice.

You could make the case, weakly, that Peralta is still pouting over being moved to third base. But really he wasn't any better at short, either. He has occasional streaks where he's semi-hot at the plate followed by long streaks where he looks like he'd rather be any place else. Mostly though he continues to occupy a spot in the heart of a very weak offensive lineup because his guaranteed salary makes it impossible for the Indians to put anyone else there.

Branyan, Hafner and Peralta are mostly old stories at this point. Unfortunately another player that's becoming an old story is Grady Sizemore. Like Hafner, Sizemore's high water mark was 2006. Since then he's been on a steady and mystifying decline.

That might be fine if Sizemore were still earning league minimum. Instead he's making $5.7 million this year and is scheduled to make $7.6 million next season. In fact Sizemore's salary and productivity make a perfect “X” on the chart with the crossover point being that 2006 season.

There's no question that Wedge had trouble grooming Sizemore in the same way that Wedge had trouble developing most players. Yet at this point the problems with Sizemore seem to be beyond the grasp of nearly everybody. Except for the occasional spectacular play in center field, he looks nothing like the player that was poised to become the Indians' next superstar to be traded. Right now he looks like just another spare part among the many cobbled together in order to field a line up each day.

You can blame Shapiro for giving Hafner an outsized contract and for placing too much faith in a player like Peralta who never quite deserved it. You can find a healthy number of baseball executives that would agree with you, too. When it comes to Sizemore, though, there probably isn't an executive in baseball that would yet turn his back on him. And yet, where he seems to be headed is for a career that mirrors that of Rick Manning. That isn't awful, but it you shouldn't pay nearly $8 million a year for it either.

Then there's the money being chewed up by Kerry Wood as he sits in the spot where he's apparently most comfortable, the disabled list. But his $11 million for next season is a club option which means that if he somehow survives the whole season in Cleveland he won't survive the off season.

The same applies to pitcher Jake Westbrook, with his $11 million salary. He is the last of the Big Six as he's a free agent next season. His injuries caused him to miss all of last season but let's be honest, before that he was a career .500 pitcher anyway with an ERA well over 4.00. His history indicates he would never have received full value from what they were paying him anyway.

Fausto Carmona is the last of the 7 players making at least $1 million this season. Of the group he's been far and away the most productive. He's also the most mercurial of the group and always on the verge of being a few pitches away from the mess he's been the last two seasons or, stated differently, on the verge of making the Big Six the Big Seven.

Which means, of course, that as long as the majority of this group stays in tact, and it will, for the next few seasons, there's really no reason to think that April 2011 or 2012 is going to be any better.

The End of the Beginning or...

Cleveland Indians fans, having had a few days now to fully absorb their latest disappointment, have been left to wonder whether the loss to the Boston Red Sox in the American League Championship Series was the end of the beginning or the beginning of the end.

The popular theory is that the 2007 Indians, particularly the version that stormed its way to the best record in the American League with a late season surge, is a young team on the come with even better days on the horizon. There certainly is enough young talent to justify the perception, which only suggests that the loss brought merely a sudden end to what looks to be a good two or three year run, at least.

But whether that ultimately turns out to be the case is far less certain than it might otherwise appear on the surface.

The problem with baseball economics as practiced in markets like Cleveland is that every season is ultimately a crapshoot. You enter with a hundred questions that only money, properly allocated, can solve. The problem, of course, that major league baseball is not played on a level field. A lack of revenue sharing and a salary cap ensures that’s the case. Consequently the Indians are not ever going to be funded in the same way that George Steinbrenner funds the Yankees. In the first place, the Dolans don’t have that kind of money. In the second place, they don’t have the same inclination toward deficit spending.

Given this double whammy, which is experienced in other cities as well, fans can never be quite sure what kind of team they’ll have entering a given season. Whereas the Yankees or the Red Sox, for example, can keep an already good team intact by simply spending, they can also go out and acquire whatever else they need, unconstrained are they by such pedestrian concepts as budgets or prudence. The Red Sox paid over $50 million just for the right to then pay Daisuke Matsuzaka another $50+ million in salary and didn’t give up any player in the process. It may be an insane way to run a business, especially when you consider the Red Sox were already deficit spending to the tune of $18.5 million a year before that deal, but it’s the reality in which major league baseball operates.

Of course not every investment turns out particularly well, but a bad decision in Cleveland can have tragic consequences. In Boston or New York, it’s often a rounding error. That’s why teams like the Indians, the Colorado Rockies, the Oakland As, and several others, are forced to rely on young talent far enough from free agency to play for minimal salaries to fill out the bulk of the roster and then spend what limited funds they have left on a few veteran pieces to round out the team.

The problem with this formula is that it can be very volatile for reasons almost completely out of anyone’s control. For example, the progression of a young player is not always a straight line. Sometimes there are setbacks, long stretches lasting weeks or months when the player looks overmatched. It takes time and experience to understand and then execute the adjustments that must be made in order to deliver on potential. As for the kinds of free agents that economically-challenged teams end up signing, mostly it’s based on hope. In Cleveland, for example, we’ve seen an endless parade of free agents over the last few years who might as well been inhabitants of the Island of Misfit Toys, banished there by their former clubs for ineffectiveness, injury histories or both. Some of these signings work, many do not. For every Joe Borowski or Kevin Millwood, there’s an Aaron Boone or a Roberto Hernandez.

If you’re unconvinced how truly volatile the formula is as practiced in Cleveland, just look at the last three seasons. The 2005 Indians finished 93-69. A final week collapse is all that stood between then and the playoffs. A team on the come? Well, it didn’t quite work that way in 2006 when the Indians were worse by a full 14 games! A team on the decline? Well, it didn’t work that way either as the Indians of 2007 improved by 18 games!

The pattern that emerges, really, is that which is dictated by the economics of the times, seasons defined by how well the homegrown talent progressed and the fractured free agents performed.

In truth, offensively the 2006 team was far better than the 2007 team. It had a much higher average (.280 to .268), a better on-base percentage (.349 to .343), scored more runs (870 to 811) and had more home runs (196 to 178). The difference, as everyone knows, was pitching and particularly the bullpen and particularly the middle relievers. The 2005 team, on the other hand, was similar offensively as this year’s team. Again, where they succeeded and the 2006 failed was pitching and particularly the bullpen and particularly the middle relievers.

When GM Mark Shapiro decided, for example, not to sign Bobby Howry going into the 2006 season, he cut the legs out of the bullpen. The young talent did not perform as hoped and the free agents were a disaster.

On the other hand, the 2007 team was aided immeasurably by relatively homegrown talent such as Rafael Betancourt, Rafael Perez, and later Tom Mastny and Jensen Lewis, performing beyond expectations at the same time that the free agent acquisitions of Joe Borowski and Aaron Fultz were doing likewise.

But in the larger sense, the story of these teams was simply a case of one year the formula working another year, not so much. That’s why it’s so difficult to project where the Indians really stand on the heels of this past season. All this year’s stability does is ensure that the Indians are likely to go into next season relatively intact in the bullpen and hope it works out just as well. The flaky nature of relief pitching, particularly when dominated by such young talent, makes that far from a sure thing.

It’s why, ultimately, Shapiro will find himself tinkering. Despite his 45 saves, would anyone be surprised if Shapiro decided he could do without the rollercoaster ride that is Borowski and instead went with Betancourt, particularly when Betancourt seems to be developing into the same kind of lockdown reliever as the Yankees’ Mariano Rivera, a pitcher who, when he has to, can come in the game in the eighth inning and still get the save in the ninth. But if Betancourt finds himself in the closer role, can Lewis or Mastny pitch as effectively over an entire season as Betancourt did this year? Will that force Shapiro to sign another middle reliever or hope someone else also emerges from the minors?

The questions, though, are hardly confined to the bullpen. Is Fausto Carmona the real deal or a one-year wonder? Who is the real Cliff Lee anyway? Can Paul Byrd really be counted on for 15 wins next season? Will Jake Westbrook return to the kind of form that earned him that huge contract? And what about C.C. Sabathia? He is entering his free agent year and decisions need to be made. No player has yet given Cleveland the “hometown discount” whatever that means and there’s no reason to believe that Sabathia will be the first. Besides, do the Indians even want to keep Sabathia beyond next season? There is talent just waiting its turn in the minors that works much more cheaply. But will they be as effective? What’s the right trade-off, 13 wins at minimum wage vs. 20 wins at $1 million per win?

You could spin yourself into knots just thinking of all the questions that are dictated by the Indians economics, despite how relatively tranquil and stable things otherwise seem with this team. And you can be sure, too, that’s just what Shapiro’s doing. How these turn out, however, are the key to whether or not the Indians are entering into another golden age for the difference between right and wrong is the difference between the 2006 and 2007 seasons.

Making Moves

In baseball, it’s always best not to try and draw too many conclusions from any one game. But a series, particularly a four-game series, is a decent gauge of the state of a team. That being the case, there was much to draw from the Indians recently completed home series against the surging Boston Red Sox.

Because the series featured so little that was positive for the Indians, discussing what went right first seems appropriate, if only to get it out of the way. First, Franklin Gutierrez continues to show he belongs in the major leagues both with his glove and his bat. If that means less playing time for Trot Nixon, all the better. Second, the only other positive to be gleaned were the performances of C.C. Sabathia and Fausto Carmona. Each proved that he can well handle the best the league can throw at him. Sabathia, in his 1-0 loss to Daisuke Matsuzaka, was as much a tough luck loser as Carmona, in his 1-0 victory over Josh Beckett, was a good luck winner. But the bigger picture was that when you throw four of the best pitchers in baseball on the field, the hitting is going to suffer on both sides. And it did. Offense was in scarce supply for two games that ended up being two of the most compelling games of the season anyway.

But when you push back from those two games, the series also showed that if the playoffs started tomorrow, they’d be over quickly. The Indians, as the wild card, would be matched against the Red Sox and the gap between the two seems significantly wider than, say, the one between the Indians and the Kansas City Royals.

That may have to do, in large part, to one of the biggest disappointments about the series, the performances of pitchers Jake Westbrook and Cliff Lee. It’s become apparent to everyone, but particularly their teammates, that when either Westbrook or Lee pitches there is little chance of a victory. On Monday night, Westbrook’s first inning meltdown was eerily reminiscent of Lee’s performance against Texas a few nights earlier. The conventional wisdom is that if you’re going to give up runs, give them up early in order to give the offense a chance. But that wisdom is seriously being challenged in the case of both Westbrook and Lee as they are giving up runs early and often.

Thursday night, Lee was able to get through the first inning unscathed, but it proved to be only a tease. In the second inning, Manny Ramirez sent Lee’s first pitch of the inning to dead center field. When it finally landed about 20 minutes later it measured as the third longest home run in Jacobs Field history, which seems dubious because it disappeared behind the trees that sit well behind the center field wall and was probably hard to accurately measure. Put it this way, you’re more likely to see Britney Spears singing opera at the Met than to ever see a ball hit further than the one Ramirez hit against Lee.

And that was just the beginning. From that point, Lee couldn’t have been more ineffective if he was throwing batting practice, and often it looked like he was, except for the fact that most batting practice pitchers get the ball over the plate more often. If Red Sox hitters weren’t actually sending the ball screaming back up the middle, they were standing with the bat on their shoulders watching one ball after another land about a foot short of the plate before casually walking to first. Mercifully, Lee was finally gone after failing to record an out in the fifth.

Which leads to another disappointment about the series, the performance of the Indians bullpen. Tom Mastny’s entry into the game Thursday in the seventh inning was the microcosm. Jason Standford was hardly dominating after taking over for Lee and was spent after giving up singles to Jason Varitek and Coco Crisp in the seventh. Mastny came on and Willy Mo Pena, who was barely hitting .200 at the time (and was actually under .200 when the game started but got “healthy” feasting on Lee in the first few innings) sent the first pitch over the left field wall for a three-run home run. A good many in the crowd, meaning most of those who were not Red Sox fans, began the slow walk to the parking lot thereafter, eschewing the opportunity to sing “Take Me Out to the Ballpark” during a seventh inning stretch that seemed, at that point, still hours away.

There will be a tendency by the apologists among us to see some positive in the fact that the Indians did score nine runs Thursday night. But the fact is the Indians offense scores runs in the same way that Joe Carter used to collect RBI, often when they don’t matter.

For example, despite Lee’s intent to put the game as far out of reach as possible, the Indians were actually only one swing of the bat from tying the game in the fifth. When Ryan Garko came to bat with the bases loaded and four runs already in, a grand slam would have tied the game at nine. That’s a tall order, particularly for a team like this with an uncanny inability to get hits when they’d have the most impact, but it was doable. Unfortunately, Garko flied out to center field and the rally was over.

Ultimately, of course, the Indians did score nine runs, just not when it would have meant something. A Garko slam and the game played from that point forward would have been significantly different. For one, Stanford would never have started the seventh inning. Even if Mastny would have come in at that point, he’s much more effective starting an inning than coming in with runners on base. More likely, though, Rafael Bentancourt comes into the game and he would have stood a much better chance of shutting down Boston than anyone else in the bullpen at that point. But if there is anything else positive to be taken from all of this, it’s that the good arms in the bullpen should be well rested for the start of the Minnesota series.

What the series revealed is that right now anyway even if the Indians can hold on to their position and make the playoffs, they have significant holes to fill before they can be considered serious threats to win a World Series.

Going into the Minnesota series and unless GM Mark Shapiro moves either Lee or Westbrook, 40% of the rotation is reliable, 40% of it is unreliable, and the remaining 20%, in the form of Paul Byrd, is giving up nearly 4.5 runs per game. The question is what to do about the 40% that is unreliable. Barring a trade, manager Eric Wedge is going to have to consider moving either Lee or Westbrook to the bullpen. Of the two, Lee seems to be the more likely candidate, although a sinker ball pitcher like Westbrook, who gets a lot of ground ball outs, might be an interesting choice for just that reason.

The truth though, is that though Lee has more victories than Westbrook, he seems further away from returning to form. Frustration seemed to ooze from every pore on Lee Thursday night. He takes to the mound expecting bad things to happen and the prophecy is fulfilled more times than not these days. He may privately grouse about a shaky defense Thursday night that could have helped him out a bit more, the truth is that given the way he’s pitching it’s no wonder the players behind him are back on their heals. If Lee isn’t traded, it would be a mistake for him to take his next turn in the rotation.

The same is true, unfortunately, for Travis Hafner. Right now, he’s really hurting the team. As detailed earlier this week (see article here) Hafner’s overall batting average isn’t just down, so too is his situational average. He’s not hitting with the bases loaded and he’s not hitting with runners in scoring position and two outs. In fact, he’s not hitting with runners in scoring position, irrespective of the number of outs. His lack of production, given his position in the lineup, is the main reason that the Indians offense appears so anemic. Put it this way, as lost as Josh Barfield has looked at the plate all season, he’s got the same average as Hafner.

For Wedge, he has very limited options regarding Hafner but that shouldn’t stop him from making a move anyway. First, he can put Hafner on the shelf for three or four games in a row, perhaps more, and alternate Garko and Victor Martinez as the DH. This would require more playing time for Kelly Shoppach but in the near term it’s hard to see how this hurts the Indians either offensively or defensively. Alternatively or possibly in combination with, Wedge can move Hafner lower in the line-up. Switching him with Garko might be a good move near term. Either way, or maybe a third way, Hafner can’t keep hitting in the middle of the lineup while he struggles like this.

The trading deadline is looming and it appears as though the Indians are poised for Kenny Lofton’s third tour of duty. But that move is hardly an answer to what is currently hurting this team most. Even if a more significant move can be made it won’t be the complete answer anyway. Whatever else they do, it’s become increasingly clear that Wedge and/or Shapiro need to re-deploy some of the players they currently have in order get different and hopefully better results.

The Real Value Analysis

The signing yesterday by the Cleveland Indians of free-agent-to-be pitcher Jake Westbrook is undoubtedly seen by many as proof that owners Larry and Paul Dolan are not the cheapskates that they often are portrayed to be. To be sure, the size of the contract suggests an unusually robust commitment to payroll that the Dolans, to this point, have been reluctant to demonstrate. But an article in Saturday’s Wall Street Journal, while not specifically mentioning this signing, nonetheless puts it into context and provides perhaps the best insight into the way GM Mark Shapiro really operates. And to those who still believe baseball is just a game and not a multi-billion dollar business, the way he operates may not bring them much comfort. (Note: The article is considered “premium content” and thus not available on the Journal’s web site without an on-line subscription. A copy can be obtained by purchasing the Saturday edition.)

According to the article, Shapiro and a former Pepsi executive turned baseball consultant, Vince Gennaro, are using a cutting edge analysis that places its focus directly on not just the player’s value to his results in the box scores, but to his potential impact on the team’s bottom line. It is the kind of analysis, as Russell Adams, the article’s author notes, that can easily result in a team being satisfied with profitable mediocrity rather than unprofitable success.

It’s not secret, as Adams writes, that teams these days are using all manner of statistical analysis to determine a player’s performance and hence his worth. That’s why teams chart everything from where fly balls land to “calculating complicated data-heavy metrics like ‘Wins Above Replacement Player (“WARP”).’” Call it the further outgrowth of the analysis Billy Beane and his “Moneyball” approach has brought to the game.

But to Cleveland fans, it is the use of this new analysis that is most intriguing, both because of its unusual nature and because Cleveland appears to be the only team currently fully engaged in the process. Adams notes in his article that the process was really an outgrowth of Gennaro’s time with Pepsi’s Midwest bottling operations headquartered in Cleveland. Apparently as the Indians were moving into Jacobs Field, Gennaro signed a contract with the Jacobs to have Pepsi replace Coke as the exclusive drink offered at the park. The contract was for $850,000 per year which was seen then as an above-market deal. However, with the Indians success in the early and mid-‘90s greatly increased its attendance and hence its revenue. When the contract came up for renewal, having exclusivity was now even more important because the on-field success would generate more sales. Pepsi ultimately paid nearly double, or $1.6 million a year, under its new contract.

This apparently validated a theory that Gennaro, a part time M.B.A. candidate, was working to develop—that there is a direct and quantifiable link between winning and revenue. That sounds simplistic enough, but as applied by Gennaro, who is now working directly with Shapiro, to players both on the roster and in the free agent market it allows the Indians to determine how the value of what they offer to a player will impact the team’s overall profitability. It’s not just a question of direct payroll costs as much as it is the embodiment of how much profit might be realized by investing in a particular asset, in this case a player. In this way, then, it’s not merely a question of whether the team’s payroll can sustain the signing of a particular player but whether that signing will ultimately improve or at least sustain profitability.

According to the article, Gennaro builds upon the widely accepted WARP formula (available at www.baseballprospectus.com Note: Baseball Prospectus has some free content but is generally a subscription-based site). WARP attempts to quantify how many wins a team may realize by having a certain player rather than a theoretical below-average player. But Gennero then takes this statistic and translates it into revenue to determine the real dollar value to attach to a player. For example, if Player X can add 5 wins per the WARP formula and that means an extra $5 million in additional revenue, you then compare that to the cost of the player in the first place in order to determine his real value to the club. If his salary is less than the extra revenue his presence generates, you have an undervalued player. On the other hand, if a player’s salary exceeds the additional revenue his presence brings, then he’s overvalued. Thus, it is not just the salary of the player that is important; the key is the delta between salary and additional revenue.

While Adams’ article goes into a fair amount of depth about several players, he notes that Gennaro would only speak to him on the condition that they not discuss any players currently on the Indians roster, which is too bad. But in terms of the players they did discuss, Gennaro identified Derek Jeter as severely undervalued and Alex Rodriguez as overvalued. For example, Jeter’s WARP number is 10, meaning his presence contributes to an additional 10 wins vs. the theoretical replacement player. Each extra Yankee win is worth about $2.92 million (although how this number was reached is not disclosed) and thus Jeter’s value overall is $29.2 million. Because his salary is $22 million per year, he his undervalued per the formula at $7.2 million. A-Rod, on the other hand is worth about 6 wins, according to his WARP number. That translates to $19.3 million in additional revenue against a salary of $27 million, meaning that he is overvalued by $7.7 million.

Gennaro’s groundbreaking work has a great many implications, as Adams notes. For example, the differences in revenue between baseball teams are driven by two main components: attendance and broadcasting. If it’s true, and it certainly seems to be, that wins translates into greater interest in the team, then greater interest translates into increased attendance and higher ratings for both the team’s radio and television partners. When a team like Cleveland also owns the network broadcasting the games, higher ratings allows it to charge more for advertising. From there, it’s just a matter of calculating total revenue per win. Then if a player can be expected to contribute more wins then his theoretical replacement, you can then calculate how that translates into additional revenue to determine his real value to your ball club. Of course, the economics of each team vary greatly and, accordingly, so does the theoretical value of any given player.

To what extent Shapiro is using these metrics to make his decisions is left unsaid by the article but it is clear that it is a key component in his thinking. In Westbrook’s case, according to Baseball Prospectus, his expected win total is 13 a year but even more telling is that the team’s expected win total in games he starts is 17 and that the Indians should expect to win 54% of the games he starts. This means that Westbrook not only is a consistent winner but he also keeps his teams in the game even when he doesn’t get a decision. His WARP is in 2006 was a relatively high 6.4. What is unknown is the revenue per win number the Indians are using but one can easily conclude that the $11 million a year that Westbrook will receive provides an ample profit margin for the Indians. In other words, it is unlikely Shapiro would have signed Westbrook had his expected WARP in relation to his new salary projected him being overvalued out of the gate.

If you extrapolate this to two other key potential free agents, C.C. Sabathia and Travis Hafner, there are additional conclusions to draw. With respect to Sabathia, according to the Baseball Prospectus analysis, his win total is only expected to be one higher than Westbrook’s and the team’s expected win total in games he starts is the same, 17. But the team does tend to win 60% of the games started by Sabathia, which is 6% more than Westbrook. This translates into a couple more wins overall, assuming a similar number of starts. Not surprisingly, then, his WARP is higher than Westbrook, 7.0 to 6.4.

Unquestionably, then, Sabathia’s presence on the roster generates a few more wins for the Dolans and therefore can be expected to generate even more revenue than will Westbrook but that doesn’t necessarily mean that signing Sabathia is a more profitable move. The key will be the difference in salary that Sabathia might command. Considering Sabathia’s status, the Indians can realistically project that signing him will cost anywhere between $3-9 million a year more than Westbrook. This difference clearly eats into the additional revenue that would result from the additional wins Sabathia would generate and may ultimately make him overvalued and thus cause the Indians to take a pass on signing him. In fact, the argument could be made that finding another Westbrook at a similar price is the much better move, something that certainly must have crossed Shapiro’s mind.

Travis Hafner presents a similar dilemma for Shapiro. His VORP, or value over a replacement player, according to Baseball Prospectus, is 79, meaning he can be expected to generate about 79 more runs than the theoretical replacement. His WARP is even higher than Sabathia, at 7.2. Again, though, the key is the salary he can command measured against the additional revenue that would be generated from the wins that result if he remains with the club and performs as he has. Projecting this essentially two years in advance for either Sabathia or Hafner is a difficult task, one made even more difficult by the crazy signings by several teams this last off season.

And that is where the rub in this analysis lies. It helps one draw conclusions about which players to sign but it also creates as many questions as it answers. The Adams article points out that other teams are somewhat skeptical of this analysis for all the reasons that most would be skeptical of a purely analytical view of a player. As Adams notes, a team’s fortunes and thus its underlying economics vary from year to year and players who might otherwise be overvalued do bring other intangibles that may pay dividends even after a player is signed. Adams quotes J.P. Ricciardi, general manager of the Blue Jays, who while seeing some merit to the analysis, said that teams still have to occasionally bite the bullet in order to realize long-term revenue and win goals and “even to create a culture of winning.”

And that’s exactly the situation that Shapiro faces as he relies more and more on these kinds of metrics. The decision to sign Westbrook or anyone else is no longer just about Westbrook. It’s also about what Shapiro projects for the rest of the team during the years Westbrook will be in the fold. His current value is so much a product of the current make-up of the team. Change any of those parts and the economic analysis changes as well. For example, if neither Hafner nor Sabathia is signed and their replacements fall well below their productivity, the Indians will win less no matter how well Westbrook personally pitches. Thus what may look like a good value today could easily turn into a nightmare in a year or two. And that assumes that everyone remains healthy and performing as they have. Any number of injuries or other failures, whether by Westbrook or others, will also determine whether the Westbrook contract makes sense.

Today, many fans are rightly applauding the commitment by the Dolans to someone like Westbrook. But behind the scenes the signing wasn’t so much a feel good move by the Dolans to let the fans know that they are committed to winning so much as an icy business move that their best analysis tells them will make the team profitable. The questions that really need to be asked, though, relate to what the Dolans and Shapiro project the rest of the team to look like during Westbrook’s tenure. While Shapiro isn’t likely to offer anything more than generalities to such questions, it is the key to the signing and, ultimately, to whether Hafner and Sabathia will be retained as well.

But one thing is for certain. With Shapiro himself recently signed to a new 5-year contract, it signals that this is the way the Indians intend to conduct business going forward. Get used to it.