Planet Money

Recently we learned from a group of reporters at the Sarasota Herald-Tribune that one of the mortgages in Toxie, our toxic asset, was part of a real-estate scheme being investigated by the FBI. It's a scheme that allegedly involves $200 million in fraudulent loans. So we traveled to Florida to find out how the scheme worked. The reporters there told us it all centered around a man named Craig Adams, who was flipping houses back and forth among a circle of friends and business associates. The people in the circle would buy homes for higher and higher prices, taking out larger and larger loans from the bank and then divide that money amongst themselves.

Our latest payment from Toxie was supposed to arrive this week. Once again, we got zero dollars and zero cents. Our little toxic asset isn't quite dead yet. But it's been months since we've seen a payment. So before she's gone, we figured we'd try to learn what she's all about -- not just loan-to-value ratios and unpaid mortgages, but actual houses and actual people. People who aren't paying us back.

Max Marion-Spencer is 18 and unemployed -- despite having applied for jobs at Quizno's, McDonald's, Arby's, Food Lion and Dollar General. His grandmother, Alice Terry, is 62, and works as a high school teacher. On today's Planet Money, Max and Alice join us to interview for a fake job. Fake-job title: Human manifestation of an economic trend. The trend: In the U.S. workforce, teenagers are now outnumbered by people who are 65 or older.

A decade ago, Philip Morris commissioned a study that found smokers in the Czech Republic were actually saving society money. A big part of the savings: Smoking tends to kill people while they're still young, saving society the long-term costs of caring for them as they get older. Perhaps not surprisingly, this finding blew up in the company's face. On today's Planet Money, we tell the story of the study. And we look more broadly at the economics of this stuff.

That big finance bill everybody's been talking about since forever is about to become law. But as it turns out, the bill doesn't answer some fundamental questions. How much money will banks have to hold as a safety cushion? Unclear. Which big companies (besides banks) will be subject to new regulations? The bill doesn't say. On today's podcast, we talk to Rep. Barney Frank, one of the guys whose name is on bill. He argues that Congress has to leave lots of issues to the regulators' discretion. And, he says, the bill's effectiveness is largely in the hands of future leaders. "In democracies, there are no guarantees," he told us.

On today's Planet Money: the criminal underworld, the nature of human happiness, and the economics of LeBron James. With special guest Mike Pesca, insight from Tyler Cowen, and a Planet Money Indicator on China's currency.

On today's Planet Money, we meet Jonathan Bush -- former ambulance driver, former co-owner of a birthing center, and cousin of a former President of the United States. More to the point: He's also the CEO of athenahealth, a public company that doctors pay to manage their billing. Medical billing is ridiculously complicated. Each insurance company has its own set of rules. The industry still seems stuck in the '80s in some ways: The average doctor gets about 1,000 faxes each month, according to Bush. In some ways, health care just is complicated. Still, some insurers seem to make it more complicated than it has to be. Athenahealth deals with more than 1,700 different insurance companies. And it's put together a "Pain-in-the-Butt index" that ranks insurers based on how hard it is to deal with them

First, we hear from Yvrose Jean Baptiste, the Haitian businesswoman left destitute by the earthquake. When we first met her in February, all she had to her name was a tub of chicken necks she was selling for a few pennies each. Now, she has money in the bank and her own stall in a bustling market. Then: mangoes. Earlier this year on This American Life we told the story of how hard it was to build a little place where farmers could wash and store their mangoes. We thought it would never happen. But -- right after that story aired -- construction began. A local leader even convinced the young men in the village to dig up 27 miles of unused pipe - for free - and move it so that it can supply water to the center.

Mervyn's a tire repairman in a Kingston slum. He took scrap parts from an old Lincoln and turned them into a machine that retreads tires. It works great. Mervyn's shop is a shack, and he's totally outside the formal economy. If he wanted to get a loan -- say, to expand his business -- he'd be out of luck. Michael Lee-Chin's a billionaire. He's the chairman of a big Jamaican bank, a guy who flies in on a helicopter for an interview. On today's Planet Money, we talk to both guys. And we explain why it's so rare for guys like Mervyn to get loans from guys like Lee-Chin.

We wade into the economics of the art world to find out why a dead shark costs $12 million, and a photo of steel wool that looks like a tornado costs $1,265. Plus, we talk about some of the last-minute changes to the big finance bill that cleared a conference committee today.

Today on the Planet Money Deep Read, we talk with Raghuram Rajan, former chief economist at the IMF, about his new book Fault Lines: How Hidden Fractures Still Threaten The World Economy.

Alex Blumberg reports from Jamaica, where low-tech tomato farmers struggle to compete.

You remember the natural resource curse. It's the idea that being rich in natural resources -- oil, gold, lithium, whatever -- can actually harm a country's economic development. On today's Planet Money, we talk to a couple economists who are pushing what sounds like a simple way to break the curse: Give the money directly to the people. They recently took the idea on a road show to Africa, to try to convince a couple oil-rich countries to give it a try. It didn't go so well.

The people selling rice in Port-au-Prince say business is terrible. So we travel to l'Artibonite, Haiti's rice country, to learn more. There are lots of problems with Haiti's rice market. Since the earthquake, free rice from foreign aid groups has made it harder for Haitian farmers to sell what they grow. Even before the earthquake, they had a hard time competing with foreign rice, which is produced using high-output, modern farming techniques that aren't available in Haiti.

Economists have been writing for decades about "regulatory capture" -- the idea that regulators are "captured" by the industry they're supposed to be watching over, and wind up serving industry's interests. In a famous paper published in 1971, the economist George Stigler wrote: ...as a rule, regulation is acquired by the industry and is designed and operated primarily for its benefit. That notion still holds sway. In the years leading up to the savings and loan crisis of the late '80s and early '90s, for example, the industry persuaded Congress to make the regulations more lenient. A decade later, Congress went along with another industry push to leave many derivatives largely unregulated, and to allow consolidation in the finance industry.