Planet Money

Right now someone out there is writing a new line in the Harmonized Tariff Schedule, a 35 percent tariff on Chinese tires. President Obama announced the new tariff last week, angering the Chinese, who quickly responded with promises to investigate tariffs on the US poultry and automotive industries. The tariff tussle has sparked fears of a trade war between the US and China. Arvind Subramanian, economist at the Peterson Institute, says the new tariff may add to messy trade relations, but it will have little impact on the marketplace. That's good news for poultry producer Eric Joiner, who says he depends on China for sales of his chicken paws.

Much of this economic crisis has been caused by strange financial products that fell between the cracks of regulatory agencies. As we now know, more regulators didn't always make things better, they often made things worse. Adam Davidson and Alex Blumberg tell the story of the SEC and the CFTC, two agencies that have fought hard to stay apart while the products they regulate grow more and more intertwined. Both Republicans and Democrats agree the two should become one, but former House Financial Services Committee chairman Mike Oxley says the chances of that happening are about as good as him beating Tiger Woods.

Highlights from our live debate on financial regulatory reform, hosted by Planet Money and the Pew Charitable Trusts - Bob Litan and Scott Talbott duke it out over what to do with financial institutions that are too big to fail. - Adam Levitin and Diane Casey-Landry sound off on a proposed Consumer Financial Protection Agency. - Darrell Duffie and Mark Brickell dispute the future of derivatives. With special appearances by Alice Rivlin, Martin Bailey, Charles Calomiris, Peter Wallison and Adam's dad, Jack Davidson.

Co-payments for prescription drugs are one of the ways health insurance companies try to contain costs. Co-pays for generic drugs are often cheaper than for brand name option, so consumers opt for the drug that's cheaper for the insurance agency. But some drug companies have come up with a way to undermine the system. They're handing out "co-pay assistance cards," which are basically like coupons for prescription drugs. They offer you a discount on the co-pay of a particular brand name drug, making the brand name effectively cheaper than the generic. It may sound like a great deal for consumers, but the Wall Street Journal's John Rockoff, says the coupons come with some hidden costs.

On today's Planet Money, Adam Davidson and Alex Blumberg spent the summer of 2008 working on the story that would launch Planet Money — a Chana Joffe-Walt report about the connection between Chinese windmills and U.S. airplanes. But a funny thing happened on the way to that first feature: in a terrifying series of financial calamities last summer, the global economy darned near died. What began as the month we all started thinking about Too Big Too Fail turned into Planet Money's first crazy, crazy year. You were there. Celebrate it with us in this anniversary podcast.

We've been talking lately with medieval historian Philip Daileader about how very little fun it was to live in 12th century France. Now, thanks to a nudge from listener Alan Munter, we're looking at the state of economic life in Asia. Historian Kenneth Pomeranz says pre-industrial China was no picnic, either. Life expectancy in the lower Yangtze River Valley was probably about 35 in the year zero, Pomeranz says, and it was probably about the same in 1800. At least from the 1,000 on, people began spending more time at work, but without much to show for it. Yet Pomeranz, author of the The Great Divergence: China, Europe, and the Making of the Modern World Economy, says it was one of the best places on the planet for poor people to live until the eve of the industrial revolution.

A listener wants to know why Ticketmaster charges a convenience fee if you want to print out the tickets you buy online. After all, it's your ink and paper, and you're not asking Ticketmaster to mail your purchase. Economist Emily Oster of the Chicago Booth School of Business has been decoding the universe for us, and she's got an answer for you. It's got to do with the network effect, locking up a market and — of course — supply and demand. If you've got an economic riddle for Emily Oster, e-mail it to us at planetmoney@npr.org.

Much of the debate over changing the U.S. health care system concerns the Americans who can't get care. But a majority of Americans have insurance of one type or another, and for them, the health care system often more closely resembles an all-you-can-eat buffet. As a consumer, you don't have to worry too a great deal about the price, to a point, because your employer pays much of your premiums and the insurer picks up much of the medical cost. David Goldhill, author of an Atlantic article called "How American Health Care Killed My Father," calculates that the average cost of a family's health insurance over a lifetime is $1.7 million. Goldhill proposes that Americans pay for routine care up to $50,000 over their lifetimes, and then be required to build health savings accounts that would cover the rest. Goldhill's idea strikes Richard Kirsch of Health Care for America Now as very dangerous proposition. He says you can't treat medicine like any other commodity.

If any single player is driving the process for reforming financial regulation on Capitol Hill, it's Rep. Barney Frank (D-Mass.). The chair of the House Financial Services Committee tells Adam Davidson that bipartisan consensus on the issue is beyond reach. As you'll hear in this interview, Frank is an intense lawmaker with very definite ideas about politics and the art of the possible.

China's all over the headlines these days, as its economy recovers faster than the U.S. one. World newspapers trumpet the communist nation's rise, with stories like "Asia recovery show's China's ascendance" and "China to surpass U.S. 'within a decade.'" Analyst David Gordon, head of research at Eurasia Group, says it's true that the Chinese responded to the global recession with a fast, effective stimulus program. The rest is hype, Gordon says, since the China's economy is nowhere near big enough or dynamic enough to save the rest of the world. Plus: Listener Aimee Ennis checks in from her interrupted subdivision in Clover, South Carolina, where the developer is — gasp! — building homes again.

If you find MySpace more chaotic than Facebook, that's no accident. Founders Chris DeWolfe and Tom Anderson wanted to create a site that's just as disorienting as your average nightclub, a crazy landscape of musicians and models and Hollywood desire, says Julia Angwin, author of Stealing Myspace: The Battle to Control the Most Popular Website in America. DeWolfe and Anderson came to their social networking juggernaut from the world of porn and spyware. Their greatest asset? Complete ignorance, Angwin says. Not knowing what to fear, the entrepreneurs just dove in. It gave them a great beginning — and an Achilles heel.

Doctors know plenty about you and your ailments, but what do you know about them?. Robert Krughoff, of Consumer Checkbook, has a new website, Patient Central, that uses detailed survey information obtained by actual patients to measure doctor performance. Sometimes a little bit of information can be too much. Naked Economist Charlie Wheelan says knowing our genetic makeup is good for us but bad for the insurance industry. Wheelan argues that as soon as our insurance pool is "corrupted" by this information, healthy people will begin to opt out and people likely to get sick forced to opt in at higher rates.

Before Bernie Madoff, there was the Antar family. The Antars ran the popular "Crazy Eddie" electronics chain, which was known for its frenetic commercials and low prices. The business was crooked from the start, but the fraud got more serious when the family took the company public in 1984. Eddie's nephew Sam Antar was one of the masterminds of the fraud. He explains how the family managed to cheat investors out of millions and why the scheme eventually fell apart.

We started our debate on financial innovation a few weeks ago with Mike Konczal and Charles Calomiris. Today Tyler Cowen of Marginal Revolution and Felix Salmon of Reuters join Mike to answer the question: has financial innovation in the last 25 years has been positive or negative? Felix Salmon says that financial innovation was a good thing — until about 25 years ago, when it became a way for bankers to get around regulation. Tyler Cowen says that it's not financial innovations that caused economic calamities — it's the leverage — banks being able to borrow huge amounts of cash with little money down. While Mike Konczal argues that it's all about competition: if a rival bank comes up with a new innovation, you need to compete whether it's dangerous or not.

Imagine two identical hospitals, side by side. One charges patients a little, and the other piles on the bills. Where do patients get better care? Researchers say that, overall, there's no connection between the intensity, quality or cost of treatment and how well patients fare. That's one of the biggest challenges in fixing health care — patients, doctors and insurance companies aren't all playing with the same information. As patients visiting a doctor, most of us are like drivers taking a car to the mechanic. If we had the know-how, we'd fix it ourselves, but we don't and so we have to rely on someone else's judgment. With appearances by Deborah Kimbell of the Dartmouth Institute for Health Policy and Clinical Practice, Chana Joffe-Walt's mom, a sunglasses vendor in Manhattan, and mechanic Ari Cohen.