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On today's Planet Money, listeners suggest ways to cut the federal budget — and experts evaluate their suggestions.

Courtesy of Joshua Gans

Joshua Gans and his three children. B. is the one next to Gans.

The first opportunity Joshua Gans had to really test the power of economic incentives came when his daughter was 2 years old.  Gans is an economist — an expert in incentives. He talks about them all the time in the classroom at the University of Melbourne in Australia, where he's a professor.

So when the time came to potty train his daughter, B., he designed what seemed like an economically rational incentive: B. would receive a jelly bean every time she went to the toilet.

Once the new policy was in place, B. suddenly had to go to the toilet really, really often.

Today's jobs report isn't as bad as experts predicted. But that doesn't mean it's good.

The jobs numbers don't suggest the nation is falling back into recession. But neither do they show an economy charging back to health.

Instead, they reveal a job market that is largely stuck.

Yes, the nation is adding private-sector jobs, which is the key to a recovery. But the rate of job growth is too low to make a dent in the unemployment rate, which has remained very high — and essentially unchanged — since May.

Les Cook/NPR

The government's "cash for clunkers" program boosted auto sales by 360,000 during the two months it was in place, according to a new study.

But in the seven months that followed, sales were down by 360,000 compared with what they would have been without the program, the study found.

The implication: The program didn't bring new buyers into the market. But it encouraged people who would have bought a car anyway to make their purchase a few months sooner.

Jerome De Perlinghi/for NPR

Consumer prices and average hourly wages are both nearly four times as high as they were 30 years ago. College tuition and fees are more than 10 times as high as they were 30 years ago, the Economist noted today.

Why has the cost of college risen so much faster than the cost of everything else?

Here are three possibilities.

In a speech yesterday, Christina Romer, departing chairman of Obama's Council of Economic Advisers, wasn't shy about how much economists don't understand about the nation's economy.

It's always refreshing to hear experts admit uncertainty — even if it's a way to explain earlier predictions that didn't pan out. Here's Romer on how businesses' responded to the recession:

To this day, economists don’t fully understand why firms cut production as much as they did, and why they cut labor so much more than they normally would, given the decline in output.

... we, like virtually every other forecaster, failed to anticipate just how violent the recession would be in the absence of policy, and the degree to which the usual relationship between GDP and unemployment would break down. ...

In the speech, Romer also called for more short-term tax cuts and spending increases. That's in keeping with the Obama Administration line.

In other econ heavy-hitter news, Ben Bernanke spoke today to the Financial Crisis Inquiry Commission.

iStockphoto.com

Nationwide, women who work full time still earn about 20 percent less, on average, than men.

But there's one demographic where women outearn men: people who are single, childless, and between the ages of 22 and 30.

Within that universe, U.S. women earn 8 percent more than men, on average, according to a new report from the research firm Reach Advisors.

Here's a meta-indicator, courtesy of Cleve Rueckert of Birinyi Associates: the number of "important" economic indicators released every month (and every day).

Birinyi Associates

The meta-indicator is way up over the past several years. So now we know way more about the economy, right?

Chip Somodevilla/Getty Images

Fuld: "This loss of confidence, although unjustified and irrational, became a self-fulfilling prophecy ... "

Lehman Brothers' bankruptcy had nothing to do with Lehman Brothers, according to Dick Fuld, Lehman Brothers' former CEO.

Instead, Fuld argued at a public hearing today, Lehman went bust because the financial world wrongly lost confidence in the bank, and the government failed to effectively intervene.

He doesn't mention Repo 105, the accounting gimmick that Lehman used to hide billions of dollars in debt, according to a court-ordered postmortem of the bank.

In fact, in 1,680 words of prepared testimony, Fuld devotes exactly 15 words to what Lehman did wrong. And those 15 words are immediately followed by an explanation of why Lehman's errors didn't contribute to the bankruptcy:

In retrospect, there is no question we made some poorly timed business decisions and investments, but we addressed those mistakes and got ourselves back to a strong equity position ... There is nothing about this profile that would indicate a bankrupt company.

Here's the story of the Lehman bankruptcy, according to Fuld:

Democrats want more economic stimulus. Republicans are unlikely to back new spending programs. The middle ground may be temporary tax cuts.

The basic idea would be to target the cuts to encourage businesses to hire more people and people to spend more money.

So it's no surprise to read in this morning's WSJ that the Obama Administration is looking at a number of possible tax cuts, including cutting the payroll taxes businesses have to pay for each employee.

In his NYT column this morning, David Leonhardt lays out tax cuts that might stimulate the economy:

David Kestenbaum/NPR

The New York Fed's Julie Remache and Nathaniel Wuerffel, in front of the trading room. That's the table-tennis trophy in the background.

Over the past few years, the Fed bought $1.25 trillion* of mortgage bonds.

It was a big move for the central bank, intended to prop up the housing market. But in all the discussion about the program, we never heard anybody explain how you actually buy all those bonds.

On today's Planet Money, we go inside the Fed to find out.

The answer involves a plain room with four small cubicles, a Nerf hoops net and a table-tennis trophy.

For more, read our post from last week.

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*Actually, the Fed was 61 cents short of the goal; they bought $1,249,999,999,999.39 of mortgage bonds.

The FDIC put out its latest quarterly update today. A couple striking facts:

There are 829 "problem banks" in the U.S., the most since 1993, according to the FDIC. (They don't say which banks are on the list.) Forty-five insured institutions failed between April and June.

American banks made $21.6 billion in profits in the second quarter this year — the most since late 2007, and way up from losses of $4.4 billion a year ago.

The dollar amount of overdue loans fell for the first time since early 2006. (The decline was really small — 0.6 percent. But still.)

An inside look: Last year, Planet Money’s Chana Joffe-Walt told the story of what happens when the FDIC takes over a failed bank. Earlier this year, we revisited the bank, the FDIC guy, and the bank workers a year after the closing.

It's not always obvious how to make money from fancy new technology — like, say, the printing press. Or the web.

"What you've got to do once you’ve got 300 identical copies of a book is you’ve got to sell it to people who don’t even yet know they want it," Andrew Pettegree, a historian who just wrote a book on the early days of printing, tells the Boston Globe.

Alyson Hurt/NPR

In the Case-Shiller index, the median home price in January, 2000 is equal to 100. The index isn't adjusted for inflation.

Home prices continued to creep upward in June, even as a bunch of other indicators this summer have suggested trouble in the housing market.

Prices rose 1 percent between May and June, and 4 percent over the previous year, according to this morning's Case-Shiller numbers.

It's a reminder of how sticky home prices are: People who are selling can often afford to be patient, waiting through a soft market to hold out for a higher price.

But there's a limit.