The Exchanges

Q What was the process of writing this book like? Cause I wrote a book a couple of years ago, and I think about the timeframe. You go from the World Series to this book coming out a few weeks ago, and that's pretty compressed.

A It was compressed. It was. I guess what I would say is that I have been reporting the book and living the book in some ways since 2014. I had tons of reporting that I never used over the years as well, like notebooks filled with it. I maintained my relationships with the people in the book, like the players, Front office guys over the years checked in as these various things were happening, 2015, 1016, 2017. I certainly had some more reporting to do after Jose Altuve through to Uli Gurriel to clinch that final out on November first. And I did a lot more, but you know, it was really go time right then. So kind of sold the book about two and a half weeks later on, I wrote a 10,000 word proposal, I should say, and then sold the book off of that about two and a half weeks later. And then I essentially gave myself, you know, I'm a magazine writer, so I, I structured it as you have 10 long magazine features, about six or 7000 words, which are pretty long, to do in 10 weeks. So, you know, one feature a week and you're done. It was not easy. It was Tom and the family, but that's how I did it.

AI assessment note: “I structured it as you have 10 long magazine features... to do in 10 weeks.”

Q All right, Ben, as you look back on this whole experience, what have you learned that you wish you knew at the beginning?

A A lot. I wish, I don't want to say, Ted, that always look twice at things that seem to be too good to be true. But I admit that I, along with everybody else, might have been a little caught up in this rise, this, like, exciting rise of the Astros. And, you know, we predicted on the cover of Sports Illustrated in 2014, this terrible team's gonna win the World Series in 2017. And then they actually did, and it was fun, and what they did was new, and it was, like, intoxicating in some ways. And it wasn't all BS, right? Like, they did make a lot of really positive Innovations in Major League Baseball, and they are a model organization in that, and they helped people, too. Like, they helped a lot of players get the best out of themselves who might not have anywhere else. They brought a World Series to a city that had been thirsting for one for 56 years, so there are a lot of positives to this story, but just always be more critical and always look under the hood, especially when something kind of seems Like a fairy tale, because, uh, it usually isn't.

AI assessment note: “always be more critical and always look under the hood”

Q Yeah. You know, I was looking back and the last time we recorded on the podcast, it was August of 2018. Astroball had probably just hit the bestseller list and things were riding high. So why don't we dive into what happened?

A Things have changed a little bit since August of 2018, Ted. I would argue that the Astros remain a model organization. Right? An organization that we can learn from. But now we can learn a lot of different things, besides how to turn the laughing stock of sports into a champion in a few short years. We can learn about some of the pitfalls that such organizations might encounter along the way. For people who haven't followed this story, essentially, last fall, exactly a year ago, The Athletic came out with a story revealing that the Astros 20 17 championship had been underpinned by cheating, by sign stealing, specifically that they had players watching a video feed behind the dugout and cracking the opposing catcher's signs, which are the finger sequences he uses to tell the pitcher what pitch to throw on any given delivery, and transmitting that information to hitters at the plate by the very new school high-tech method of banging on a trash can. So this obviously undercut in a significant way all that I had written about the Astros. It undercut the Astros story of success, and it made me immediately feel a deep responsibility to go back into this story and to get to the bottom of it, to understand how this cheating scheme, this science-stealing scheme, played into this broader story of innovation and embracing of technology and success that I had told. So I very quickly dove b…

AI assessment note: “The Athletic came out with a story revealing that the Astros 20 17 championship had been underpinned by cheating”

Q Why do you think the commissioner did that, right? So what are the incentives as the commissioner that would lead him to absolve the head of the organization when something like this happens?

A There are a few. I think he wants to limit the damage. And Luna says this pretty extensively. You want to say, these are the perpetrators. And this has happened throughout baseball history, right? Whenever there's a systemic problem. And one of the things I explore is that sign stealing was not at all limited to the Astros, right? Nobody believes they're the only team doing it. They might've been pushing it farther than anybody else, but they weren't alone. But if you can hold some public executions, you can suggest, Hey, we're taking this seriously. And also we've dealt with the problem. So I think that was part of it. And also, quite frankly, a lot of people think of the commissioner as this almost like judge like figure presiding over the game, looking out for the good of the sport above all else, like a steward. That's not what he is. I mean, Rob Manfred has even described himself as almost a CEO and the board members slash shareholders, if you will, are the owners. The owners are the ones who hire him. The owners are the ones who can fire him. The owners are the ones whose pockets he's trying to fill increasingly more every year. So it's not an impartial judge. It's somebody who works for the guy, or at least, you know, this is one of 30 guys he works for. And it would be very, very unusual for a commissioner to, uh, come down hard on an owner, except in a really, really, …

AI assessment note: “The owners are the ones who hire him. The owners are the ones who can fire him.”

Q How did you come about writing this book?

A It really started in 2014. You know, I was drawn to the story, the Astro story, by the same thing that everybody else was drawn by, which is that they were just so unbelievably, historically, ludicrously bad. Right. Total train wreck. Worst team over a three year stretch since the expansion met. Not nearly as lovable as the lovable you lose. It just seemed like a total disaster. Dumpster fire almost down in Houston, but I knew something else. I didn't know them well, but I knew that the guys who were running the front office, particularly Jeff Luno, had had a lot of success in St. Louis in overhauling that scouting department. Some say that by some metrics, he was the best scouting director in the seven years he was there of any scouting director, as far as picks he made that turned into big leaguers. There's a count of that. So I wanted to see how it added up. How does a guy who seems to know what he's doing, Oversee such a terrible team. And what is the big idea here? Is there even a big idea here? Well, I didn't think I would write any sort of story about such a team unless we had some sort of unusual access to it, you know, unless they kind of let us in to what they were doing, let us into their front office to a degree that most wouldn't. So it took about a year of negotiations. The only thing I promised them was I'm going to come in. I'm going to be open-minded. You know,…

AI assessment note: “It really started in 2014. You know, I was drawn to the story”

Q As you looked at the Astros and thought about creating the story of this podcast, there are plenty of examples of highly effective organizations that then crossed the line. And you could think back in the financial world. Some say Michael Milken did that. Some say Bernie Madoff did that. What did you find In the culture that led the Astros to doing that?

A It's many things. To sum it up, I'll say that The ethical backbone of the organization was not always apparent. Jeff Luno, the general manager, as we know, took the fall. And I've talked to people and they said, I've never ever thought of Jeff as a cheater. He would never encourage the breaking of rules. He was kind of a by the book guy. He'd certainly push the rules as far as they can go and find all sorts of loopholes. But he'd never break the rules, but that's different from insisting and instilling a culture of rule following. It's actually quite different when you think about it. His guys would send him emails and there would be little mentions on like page five of things like the system and the dark arts and Luna's defense. And granted, these are like two emails the league found that Luna actually turned over to the league. Out of like, 60,000 that something like this was mentioned in, right? And Luna's defense is, everybody knows that I don't read past the first paragraph of emails, and I didn't see these things, and if I had, I wouldn't actually know that they were related to rule breaking anyway. And that could be true. I've talked to people who said, I do not personally believe that Jeff Luno knew that this was happening, right? Like people within the organization. It's very hard to find somebody who says otherwise, but that doesn't mean that everybody knew like we be…

AI assessment note: “The ethical backbone of the organization was not always apparent.”

Q So what was that plan at the time?

A The plan is, strangely, almost exactly, at least from a, a larger scale, what they ended up doing. You know, yes, they had the most advanced analytics department I'd certainly ever been around. I'm sure it's, it remains up there with any in baseball, probably any in, you know, many industries, right? They have a team of PhDs and people from all sorts of disciplines Who operate in the nerd cave is what they've called it, right? This dark room. I shouldn't go in the nerd cave. I stood outside the nerd cave. It's very dark, a lot of blinking lights in there, but that's their analytics department, right? So they can parse every number that you have, and they were ahead of the game for a long time. The part that was really intriguing to me though, was that they weren't just parsing performance data. You know, this is beyond Moneyball stuff. Everybody knew by now that, you know, OBP is better than batting average. Things like that, but there's a lot more data to handle, and they were doing it, but they were bringing in source of information that had been kind of overlooked recently, especially in sports, which was information that comes from humans, you know, human observation, human gut, human instinct. After Moneyball, we were taught to think that numbers are far superior to describe almost any situation than human intuition, because humans are biased, humans are flawed, can't be t…

AI assessment note: “properly process those observations and incorporate them with the performance data”

Q How much of ultimately winning the playoffs, the World Series ends up being luck?

A Well, ultimately, right, I mean, look, the fact is the playoffs in baseball, there's a lot of luck to begin with, because even a best of seven series, any team can beat any team in a best of seven series. It's not like the NBA, right, where, I don't know, the Pelicans are, I guess they're pretty good now, the Mavericks this year are not going to beat the Warriors this year in a seven game series. You could play those a thousand times, the Warriors would win every time. But it's certainly possible that the Padres can beat the Astros in a seven game series. Maybe it would happen, I don't know, I'm spitballing, but 30% of the time, something like that, they could do that. So yeah, there's certainly luck all the way through. When you come down to game seven, a one game playoff essentially has happened last year between the Astros and the Dodgers. You know, Sig Meidel, the data guy, calls it a coin toss competition, right? But it's a coin toss competition to decide What history was going to remember and which team history is going to remember. I think there's a little more to it than coin than a coin toss. You know, there, there, these, again, these kind of intangible qualities that allow people to perform in certain situations and others not to, but I don't know, maybe it's 51% to 49%. It certainly is a toss up when you get all the way there.

AI assessment note: “the fact is the playoffs in baseball, there's a lot of luck to begin with”

Q Yeah. I'll second that on the daily Metro North. What's the riskiest thing you've ever done?

A It's not like personal risk, but I, I think in some ways writing this book as I did was a significant risk. Cause I'd never written a book before and here I am signing on to write something that, you know, it was going to do really my professional reputation is going to pen depend on a lot. And I'm going to have to trust myself to be able to write this book and make it good in essentially three months. And I'm going to contractually agree to do this. And it was really a new world for me. So, Professionally, anyway, you know, writing this book is certainly the biggest risk I've taken, even though in some ways it was kind of, I had no choice, because fate seemed to command it.

AI assessment note: “writing this book as I did was a significant risk”

Q infield shifts and home runs and strikeouts, which makes the game much less interesting to look at. But then when you compare it to other sports, there are these evolved rules, like in basketball, you have the key and they move back You know, three point line, and so at what point in time does Major League Baseball think about changing the rules to make the game better to watch?

A I was talking to someone who's very smart on this stuff the other day, and he pointed out that baseball's not the only sport that's currently being driven to be the most efficient, perfect version of itself. It so happens that in some of the other sports, like, that actually results in a better entertainment product, arguably, right? In the NBA, it means it's more run and gun. It's more threes. It's like a more open game. Same thing in the NFL, really, aided by some rule changes, but it's kind of opened up offenses. It's like high scoring. It's more exciting. The most perfect, efficient base version of baseball means nothing happens, essentially. As you say, it's a lot of strikeouts. Hitters sell out to hit home runs. Fielders shift so that when hitters don't hit home runs, they'll be in perfect position to catch the ball. Very little athleticism in a given game. So I don't know if it's just like the specific nature of baseball's rule set that results in this, but it's certainly a problem that the commissioner is going to have to address probably via rule changes very soon, but we've seen this so many times, especially in baseball. There's always this like butterfly effect. Like, they change a rule, and then all these other things happen that are probably not as good and not as anticipated. So, baseball is very traditional, but it's traditional as far as changing its rules for …

AI assessment note: “the commissioner is going to have to address probably via rule changes very soon”

Q So in the last decade or so, we've had this wave in baseball. We had the whole steroid scandal. Now we have this. Maybe the culture of Major League Baseball hasn't changed, and so as you look out, what do you think will be the next surprise?

A The next edge. I think there's going to be a lot coming as far as health. Health is a big thing that teams have still not really cracked as far as, especially how to keep pitchers healthy. If you want to look at it from an asset perspective, which I don't really like doing anymore, and I think journalists should get away from that. How do you maintain this asset's value over the course of your investment? So things like that. But frankly, if I look ahead... I think on a labor front, baseball's in for a really rough time coming ahead, because I think that players are just seeing things as less and less equitable. You see a season in which the ownership, the commissioner, really put the screws on the players during the COVID season, as far as, you know, like, salaries and how much we're going to play. There were, like, months of back and forth. We're losing all this money. And then, like, two months later, the Mets are sold for two and a half billion dollars. If you're a player, you're like, wait, wait a minute. Like, this is actually what this industry is valued at, and yet suppressing salaries, you're firing employees all over the place, you're crying poor. I think that that might just be fuel on the fire of a labor battle that's probably been coming for a while.

AI assessment note: “I think on a labor front, baseball's in for a really rough time coming ahead”

Q firms moving to Ridgeline gain a decided advantage. That's why customers call it miraculous, game-changing, and an awakening. If that's not how you would describe your investment management tech, request a demo at ridgeline.ai. And now back to the show. You mentioned fan pressure, media pressure. You said, what are the other pressures that an owner would face in, you know, being a team like the Mets are this year?

A Well, the Mets aren't bad on purpose, right? Unfortunately, but, uh, certainly there was probably pressure from around the league because of what he was doing. Maybe not the other owners. They tend to act as a club, as we know, more or less, but yeah, fighting a Off the union and media who are kind of ripping him for running a payroll that was under thirty million dollars at one point, like embarrassingly low. His argument would be, we're saving for the future when we, we're not going to waste money on a team that's going to lose anyway. We're going to pay money to a team that's going to win, and to his credit, that's what he's done. I mean, the payroll has, you know, it's still around the league median, but there's room to grow, and it certainly will have to grow as a lot of these young stars as it comes time for them to get paid. But yeah, I mean, there's pressure from everywhere. There's social pressure. There's business pressure. No one's coming to the park. I don't know if you're losing money because the perils are so low, but you're certainly not making a lot of it either.

AI assessment note: “There's social pressure. There's business pressure. No one's coming to the park.”

Q world of investing and investment managers and rooting for them as a fan would, or maybe in your case, a journalist to do well. I'm curious in that period of time, as you look back, are there questions that you think you could have asked that you might've had an instinct to ask, but didn't, that might have pulled the thread to what ultimately ended up in crossing the line?

A I would think it's less about asking questions and more about framing the framework through which I'm looking at this story. There were some people at the time, including Evan Drellick, who was a Houston Chronicle reporter back in 2014, 2015, a beat writer for the Astros, ended up being one of the two reporters, along with Ken Rosenthal, who broke the sign stealing story in 2019. He was probably the biggest critic of what the Astros were doing. Turning people into numbers. Viewing players not as humans, but as assets. Maybe he was onto something in some measure. Part of me says, look, baseball's always been a very brutal business, right? Baseball's always been a business in which a player could lose his job in an instant, just like Mike Bolsinger did. So wouldn't you rather, if you were a player, know that there were like very strong analytical reasons. Here's the evidence why you were being sent down to the minors as opposed to The coach didn't like you, or something like that, the way it used to happen. There's something to be said for that, right? And in some respect, we're all numbers. Like, we all receive compensation, or we're all valued, like this valuation approach to everything in baseball. Interrogating those trends a little, with a little bit of a more critical eye at the time, is something that I wish I'd done.

AI assessment note: “Interrogating those trends a little, with a little bit of a more critical eye”

Q And as you walk through these interviews, what did you find as you went through the ranks of who was involved and the managers and the general manager and the ownership?

A A big part of my mission, Ted, was to find out or determine who's to blame for this. The commissioner's report, Commissioner Rob Manfred, issued a nine page report in January of 2020, in which he largely pinned the blame on the general manager of the team, kind of the visionary architect of this whole program, whose name is Jeff Luno, and also the manager, AJ Hinch. This was the clear takeaway from the commissioner's report. These were the two guys who were suspended for a year. The players, even though it was characterized as a player-driven scheme, they were given immunity in exchange for testifying, so they were not punished at all. The commissioner, in the very first paragraph, actually, which stuck out like a red thumb to me, the very first paragraph of this nine-page report completely absolved the owner of the team, Jim Crane, from any responsibility or accountability whatsoever. So I really wanted to take my time and go into this and figure out who is to blame. And is it really just Jeff Luna or AJ Hinch? Does it go broader than this within the organization? Does it go broader than this within Major League Baseball? That was a big motivation of mine to figure out exactly why this happened and who deserves accountability for it.

AI assessment note: “That was a big motivation of mine to figure out exactly why this happened”