Revisiting the Sabathia Trade

Throughout the offseason, I have worked toward developing a Benefit-Cost Analysis tool that monetizes MLB production and Overall Future Potential (OFP) in order to judge trades and assess franchise surplus value. Consistently testing this tool with Brewers rebuilding or counterbuilding moves, as well as problematizing the tool by assessing 2017 trades (such as the Brian McCann deal), shows that there are both benefits and shortcomings with assessing trades and franchise value in monetary terms. Additional narrative or normative tools can be used, placing franchise assessments in fuller perspective by considering professional / industry trends in the MLB, or the full context of a franchise’s outlook. Even these tools can be murky.

Related Reading:
Cashing Out OFP
Translating OFP

Anyway, it’s fun to continue testing the model, so let’s head back in time to assess one of Doug Melvin’s iconic moves. The Brewers’ previous President and GM famously went all-in on July 7, 2008 by trading for one of the very best arms in the game, and perhaps the best available trade asset in the MLB at that moment. To that point, franchise ace Ben Sheets had heroically paced a beleaguered pitching rotation with 96 K / 26 BB / 12 HR in 117.0 IP and 11 of 17 quality starts (including a shutout and two additional complete games). Given Sabathia’s monstrous second half for Milwaukee, where the southpaw almost seemed to will the Brewers to the playoffs, it’s easy to forget that Sheets was one of the elite pitchers that season (4.81 WARP, 3.37 DRA, and 0.3236 Post-Tunnel Break, good for twelfth best among MLB pitchers with 1000 pitchpairs); his efforts to win while pitching through a torn elbow ligament also cost him millions on the impending free agency market. On July 7, 2008, the Brewers were 3.5 games behind the division-leading Cubs, and they were outplaying a .513 Pythagorean Winning Percentage (based on Runs Scored and Runs Allowed). Something was going to give, but with Prince Fielder and Ryan Braun coming into their own, and Sheets’s free agency the first closing window for these Brewers, this was a great chance to improve the club.

For the day-of-trade analysis, I’ve priced out Michael Brantley as the PTBNL. Considering Taylor Green as PTBNL leads to different questions, although it is worth noting that neither Brantley nor Green made the Baseball Prospectus Top Prospects entering 2008. One could even argue that Green would have been priced similarly at this point and time. This model shows that in terms of Sabathia’s purest short-term value, Cleveland arguably undersold his OFP:

Sabathia Trade [Day Of] Three-Year WARP Contract Depreciated Value Full Value Prospect OFP
CC Sabathia 16.7 + 3.6 $9M expiring $13.4M $86.9M 65-75
Zach Jackson 0.0 Reserve $0.5M $0.5M $0.75 (40-45)
Matt LaPorta - - - - $43.7M (50-65)
Rob Bryson - - - - $0.1M (40)
PTBNL (M. Brantley) - - - - $7.0M (40-50)

Once again, the tricky aspect of Benefit-Cost Analysis is considering the window through which one constructs value. If an analyst is inclined to depreciate Sabathia’s three-year-plus-2008-first-half performance, a second half with the southpaw does not look thrilling for the Brewers. Here, the ace might add a win to the club, although given their proximity to the playoff race on July 7, one win could add as much as $20 million or more in revenue to Milwaukee. On the other hand, an analyst using Sabathia’s immediate performance would conclude that the ace was just the type of asset suited to add several wins to the Brewers. Certainly, Sabathia was the type of asset worth surrendering top prospects from the Milwaukee system, especially given that the farm was already on a downward trajectory after graduating that classic young contending core.

Obviously, one can apply this analytical rigor to the prospect assessments as well. Despite a top ranking for Milwaukee, Baseball Prospectus recognized that defensive and contact shortcomings could sidetrack LaPorta’s power/discipline package. Nevertheless, even those risks gave LaPorta a strong price (and entering 2009, LaPorta was even ranked ahead of Carlos Santana in Cleveland’s system!). Even on the day of the trade, Cleveland returned a relatively risky prospect package for a proven ace like Sabathia; Brantley was the most advanced and seasoned prospect by that point, and even he did not grade into the top rankings of a middling Brewers system. Green might have even been viewed as a more interesting prospect gamble at that point; Rob Bryson was a depth arm with very little professional experience; and even for all his glamor, LaPorta had just reached his 100th professional game at the time of the trade. Zach Jackson was interesting insofar as he had a very high ceiling for a lefty depth arm, and perhaps his best case scenario would be bolstering a pitching staff losing its ace during a 37-51 first half (as a fun aside, Cleveland actually outplayed Milwaukee after the trade!).

2008 Cleveland Milwaukee
Day of Trade 37-51 49-39
After Trade 44-30 41-33

Brewers fans could easily write off those prospects after Sabathia worked four consecutive quality starts to begin his tenure in Milwaukee, including a shutout and two additional complete games before the calendar even turned to August. When your team is the team that is trying to win MLB games, suddenly those risks look much steeper on those prospects, and the ceilings look less attainable. It may be an unjustifiable bias, but then again, there are many inputs, outputs, and interpretations necessary to run a Benefit-Cost Analysis. When the dust settled, Sabathia’s seven complete games (three shutouts!), 128 K / 25 BB / 6 HR, and 2.45 DRA drove a 4.5 WARP in the second half. Most importantly, Milwaukee actually made the playoffs, immediately paying out that prospect gamble with playoff revenue (which must be included in post hoc analysis).

The playoff revenue should not be underestimated: if one takes the harsh depreciation of Sabathia, and expected the trade to be a talent deficit for Milwaukee, the revenue (along with Sabathia’s WARP) covers the vast majority of any talent deficit in the trade. Adding in compensatory draft picks under the old, problematic draft-and-free-agency system made the trade look fantastic after one year:

Sabathia Trade [June 2009] Three-Year WARP Contract Depreciated Value Full Value Prospect OFP
CC Sabathia - - - - [Lost to free agency]
Supplemental Pick [#39] - - - - $6.7M [$33.3M / 247.9 WAR / 52 picks total value]
Supplemental Pick [#73] - - - - $1.3M [$6.4M / 47.7 WAR / 52 picks total value]
Zach Jackson 0.0 Reserve $0.5M $0.5M -
Matt LaPorta - - - - $43.7M (50-65)
Rob Bryson - - - - $0.1M (40)
PTBNL (M. Brantley) - - - - $7.0M (40-50)

It’s quite difficult to assess the value of a single draft pick. Historically, the Brewers had two strong picks to compensate for losing Sabathia. Yet, to say that the Brewers could potentially gain five wins from the 39th and 73rd picks does not seem quite right. Thus, in order to judge those compensatory picks, I steeply depreciated those picks against the odds that even the vast majority of 39th and 73rd picks fail to reach the MLB. Even this depreciated model makes those draft picks appear quite valuable. In addition to the production on the field and the playoff revenue, Milwaukee’s front office could reasonably gain an additional win in surplus through those compensatory picks. Given the short window and lack of prospect value leaps (or decline) for Cleveland to this point, the trade was swinging heavily in Milwaukee’s favor.

Marcum & Greinke Brewers Surrendered Brewers Received Outcome
Z. Greinke A. Escobar ($3.9M) / L. Cain $26.0M (45-60) / J. Odorizzi $10.5M (45-50) / J. Jeffress $1.4M (45) +Y. Betancourt (-$5.9M) / $100.3M total +$58.5M
S. Marcum B. Lawrie $34.2M (50-60) $32.3M -$2.0M

In hindsight, it’s easy to see Michael Brantley’s breakout as one of the factors that could potentially dig into the value Milwaukee received in the trade. However, it’s worth pushing back on this by noting that even after three-and-a-half years, the additional players involved in the Sabathia deal, as well as the Brewers’ compensatory picks, stalled. The Sabathia deal seemed to linger in the air of the front office, as Melvin clearly took the lesson to be a valuable one when he unloaded for Shaun Marcum and Zack Greinke to lead the 2011 and 2012 Brewers pitching staffs (both quite solid-to-great deals). Even Brantley appeared to be in a difficult position, failing to deliver defensively in centerfield, and not necessarily producing enough offense to offset that performance.

Sabathia Trade [Offseason 2011-2012] Three-Year WARP Contract Depreciated Value Full Value Prospect OFP
CC Sabathia - - - - [Lost to free agency]
Kentrail Davis - - - - $0.7M (40-45)
Max Walla - - - - $0.1M (40)
Zach Jackson - - - - [Sent to Toronto]
Matt LaPorta -2.8 Reserve $0.5M $0.5M -
Rob Bryson - - - - $0.1M (40)
PTBNL (M. Brantley) -0.2 Reserve $0.5M $0.5M -

Even three-and-a-half years are not sufficient for assessing some trades.

As an aside, it’s interesting to question how a market rate deal for Sabathia could have worked out in Milwaukee, especially with an opt-out clause as signed in New York. Looking back at the three-years after Sabathia’s tenure in Milwaukee, one could argue that pumping that playoff revenue back into a huge deal with the southpaw could have been beneficial for the Brewers. This would obviously have completely changed the timeline for contending in Milwaukee, however, and probably would have netted a completely different set of supplemental deals for the franchise. Anyway, never forget that Sabathia produced 17.8 WARP during his first three years with the Yankees, serving as one of the most valuable free agent pitchers in history (those three years alone were worth nearly $125 million for New York’s Junior Circuit club).

Looking at the final tab, the Brewers received incredible short-term surplus from Sabathia. In fact, the lefty actually produced surplus that matched nearly 70 percent of his highest day-of-trade value estimate: thanks to Sabathia’s performance, the Brewers actually cashed out surplus in on-field wins, which should bar none be considered successful. Sabathia’s production (at his contract rate!) and playoff revenue shredded the depreciated surplus estimate of $13.4 million for the ace. If one wants to be particularly bold, prorating this surplus from Sabathia’s half season to a full campaign gives the Brewers quite a trade return in annual terms. Of course, Michael Brantley’s breakout for Cleveland more than makes up for Matt LaPorta’s bust (and really, the non-return of Jackson and Bryson to boot), and technically, one could argue that Milwaukee’s failure to maximize those supplemental draft picks in 2009 ate into some of Sabathia’s value.

2017 Assessment Depreciated Surplus Full Surplus Prospect Value Production / Cost Total Value
CC Sabathia $13.4M $86.9M n/a 4.5 WARP / $2.7M $28.8M + Playoff Revenue Share [$60.3M surplus]
Kentrail Davis - - $6.7M - [-$6.7M]
Max Walla - - $1.3M - [-$1.3M]
Zach Jackson $0.5M $0.5M $0.7M 0.1 / $0.7M $0.0
Rob Bryson - - $0.1M - $0.0
Matt LaPorta - - $43.7M -3.1 / $0.7M -$0.7M [-$22.4M]
Michael Brantley - - $7.0M 12.5 / $14.8M [entering 2017] $72.7M [$20.0M current depreciated surplus to Cleveland]

56 percent of Brantley’s total value to Cleveland was produced in 2014. Let’s take a moment to appreciate the prescience of Cleveland’s extension offer to Brantley to avoid arbitration entering 2014. To that point, the outfielder claimed approximately 3.7 WARP on reserve contracts, providing relatively solid value to Cleveland. After moving to left field from center field, Brantley leapt from significantly below average FRAA to a serviceable 2.4 FRAA figure, bolstering that .271 TAv to drive a 2.5 WARP 2013 season. Depreciating that 2013 season against his previous performances, Brantley offered Cleveland approximately $22 million in surplus to the club entering arbitration for 2014, but the $17.5 million total value in 2013 perhaps added an exclamation point to that depreciated figure. Cleveland GM Chris Antonetti maximized every ounce of that surplus, handing it all to Brantley in a neatly wrapped four-year, $20.5 million deal with an additional signing bonus of $3.5 million and $1 million buyout on a 2018 option. Even with an injury-plagued 2016 and average 2015 campaign in the rearview, that huge .320 TAv, 20 HR / 20 SB 2014 season from Brantley pretty much completed the full extension.

With these positive figures, it must be emphasized that Brantley has the benefit of eight-and-a-half years from the day of the trade to reach this level of surplus for Cleveland; in this regard, the high monetary value produced must be prorated in much the same way Sabathia’s must be prorated, which leaves a lack of a satisfactory answer to the long-term-versus-short-term question in Benefit-Cost Analysis for MLB trades. It’s difficult to determine when and how teams succeed or fail in trades, especially given that short-term and long-term outlooks, not to mention specific teambuilding goals, can produce wildly fluctuating assessments. Nevertheless, it’s hard to imagine living in the universe where Sabathia was not a Brewers ace for those magical three months.

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