Episode 759: What's It Worth To You? : Planet Money Three short stories about putting a price on something hard to value precisely. We go from $4.66 under a pillow all the way up to $1 trillion across every inch of highway in America

Episode 759: What's It Worth To You?

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There's a hard and fast rule in radio, and maybe you've noticed this. The rule is don't use numbers. Don't use very many numbers because the idea is you're listening to this and, actually, probably doing something. You're walking somewhere, working out, doing the dishes. And it gets confusing if I say, nine, five, six, six, two, one, four, five, two because you have no idea what I just said. So that's the rule.

But today, I'm going to reveal a secret. I actually love to hear numbers on the radio. It's a sort of like rhythm-poetry thing. Like, I could listen to numbers - and I do - for hours. In fact, sometimes in the morning, I will listen to Bloomberg Business radio. Drives my family nuts. But I just let the numbers wash over me.


UNIDENTIFIED WOMAN: Let's check in on how the markets are trading. The Dow is down by 65 points, the S&P lower by 0.4 percent. The NASDAQ is trading down by one-tenth of one percent. In the bond markets, you're seeing some buying going on in treasuries, that yield coming down about three basis points - 2.72 percent is where the yield is on the 10-year note.

SMITH: And yeah, afterwards, I do not remember any of those numbers. But, you know, I can feel the numbers. And it makes me feel like someone has measured something, calculated something, taken a note of a particular moment.

Every number has a story. And so today on the show, we're going to break the radio rules and just take a sheer delight in numbers - three numbers in particular - three price tags. Give me the big sound.


SMITH: Ba-da-dum (ph), ba-da-dum, ba-da-dum. One trillion dollars, $10 million and $4.66. The trillion dollars represents the dream for America. Ten million dollars is the price of a single punctuation mark. And $4.66 - that number involves a magical fairy that visits in the middle of the night.

SMITH: Oh, I'm Robert Smith. This is PLANET MONEY.


SMITH: On the show we're going to talk about what different things cost, starting with the very small and cheap to the inconceivably expensive. So let's just start with a handful of change.


SMITH: This right here - around a dollar and change - was what I used to get when I was a child for a tooth placed underneath my pillow at night from the tooth fairy.

Now, I didn't think much about how much I got, just I wanted a lot of coins. But now that I'm a father, like, this has actually been a discussion I had late into the night. How much should a child get for a single tooth from the tooth fairy? And the more you think about it, the more you realize this is an overlooked economic indicator. So we brought in reporter Kenny Malone to tell us - one tooth, one child - how much is it worth?

KENNY MALONE, BYLINE: I have an answer, $4.66

SMITH: That's very specific.


SMITH: Four dollars and 66 cents. And we know this how?

MALONE: We know this because there is strikingly good data on what people are giving their kids for teeth.

SMITH: Done by the tooth industry or the dental industry?

MALONE: It is big tooth. Well, let's call it big tooth. Every year for just about the last 20 years, Delta Dental, the insurance company, has been conducting the tooth fairy poll, a nationally representative survey. And currently, a tooth is pulling in $4.66.

SMITH: So $4.66 on average.

MALONE: Which is more than I got as a kid.

SMITH: Yeah, me, too.

MALONE: And, Robert, the more I looked into this, the more I realized that there is something very strange going on with the tooth fairy right now. This sounds a little silly, but I can give you an example of just how serious this can get.

Let me set a scene for you. It's the Obama White House. Members of the economic team - they're in the West Wing. They're sitting around a table. Brilliant economists, including Betsey Stevenson, who was a member of his Council of Economic Advisers.

BETSEY STEVENSON: We are sitting around the table waiting for Jack Lew, the treasury secretary, to walk over. And honestly, I can't even tell you what the meeting was about.

MALONE: Well, we know what it became about, don't we?

STEVENSON: (Laughter).

MALONE: She's laughing because what it became about was a sort of national economic consensus on what the tooth fairy should pay Betsey Stevenson's daughter for a tooth.

SMITH: I'm guessing first child.

MALONE: First kid, first tooth.

STEVENSON: And I think she had lost it that morning.

MALONE: It was a crisis. So she turns to the room. And she says does anyone know what the tooth fairy is paying these days? And the room lights up. Even people without kids start jumping in with their ideas. Betsy Stevenson, her approach is, well, what did the tooth fairy give me as a kid? Fifty cents.

SMITH: I'm guessing mid-'70s or so.

MALONE: Yeah, mid-'70s. And fifty cents doesn't buy what it used to. So the question is can we adjust that for inflation? This is a room full of our nation's top economists.

SMITH: They can do it.

MALONE: Betsy just figures it out. What is 50 cents from the '70s worth now?

STEVENSON: An inflation-adjusted number might put you something closer to $3 a tooth.

MALONE: Three dollars a tooth. That's the inflated number. But she asks the other economists what are your kids actually getting? And they say...

STEVENSON: Five to $20.


SMITH: Some kid got $20 for a tooth?

MALONE: There's general consensus that probably the tooth fairy didn't have any change on that particular night.

SMITH: (Laughter) That does happen. But in all seriousness though - I mean, as serious as this particular story can get - I'm looking here at that study that you gave me about the average tooth fairy gift. And it is going up faster than inflation, faster than you might think it would.

MALONE: Yeah. And this, Robert, this is the mystery. Over the last 10 years, according to that Delta Dental study we were looking at, the price of a tooth has skyrocketed. Dental inflation, let's call it, has averaged over 10 percent per year.

SMITH: Which it never does anywhere in the economy.

MALONE: Inflation - that's an insane number. And so I figured we needed an expert to get to the bottom of this.

ALAN BLINDER: Yep. This is Alan Blinder, professor of economics at Princeton University.

SMITH: He must have loved getting this call.

MALONE: So Alan Blinder's not just some economist. In the 1990s, he was vice chair of the Federal Reserve Board. And as you know, Robert, one of the most important jobs of the Fed is to monitor inflation.

SMITH: And keep it low.

MALONE: And keep it low. And I explained to him that teeth had been going up at this crazy rate, around 10 percent per year.

BLINDER: Teeth, you say?

MALONE: Yeah, teeth.

BLINDER: I can't think of anything that's gone up at 10 percent.

MALONE: And for comparison, he said actual inflation over the last decade...

BLINDER: Must be right around 2 percent.

SMITH: Two percent. So, I mean, I guess the obvious question is what is so special about a tooth that makes it go up so rapidly?

MALONE: That was the question that I had. And I thought maybe we could find an answer in the way we calculate inflation. That 2 percent number, that's the inflation for everything, everything from fuel to bananas to a house. And that's not stuff kids buy. They only care about a tiny little section of that.

So one theory I had was what if we asked kids, what do you actually care about? And maybe that stuff has gotten more expensive at a really high rate. Broad strokes of what these kids around New York said - toys, electronics and candy.



UNIDENTIFIED CHILD #3: Rock 'n' roll guitar.

UNIDENTIFIED CHILD #4: Pokemon cards.

UNIDENTIFIED CHILD #5: Fruit snacks.

MALONE: Alan Blinder said actually a lot of that stuff has gotten cheaper over the last decade.

SMITH: Sure because toys are manufactured overseas in China. Electronics are way more powerful. You can put chips into anything. And stuff just gets cheaper.

MALONE: Yeah. And so by economic logic, maybe the tooth fairy should actually be bringing less than a decade ago.

BLINDER: Yeah. I think the kids are making out like bandits here.

MALONE: Do you think an intervention is necessary from your...

BLINDER: No. I wouldn't efficate (ph) government intervention.

SMITH: So the mystery deepens. It's not like kids are getting more money for more stuff. Then what explains that $20 bill?

MALONE: Yeah. This is the question that I took to my final economist, Justin Wolfers, who's a professor at the University of Michigan.

JUSTIN WOLFERS: If you want to work some economic jargon into this, economists talk about something called the income elasticity of demand.

MALONE: We do want to work some economic jargon into this.

SMITH: We definitely want to talk about the income elasticity of demand. Go.

MALONE: So let's say that you get a raise - 10 percent. If all of a sudden you started making 10 percent more, that doesn't mean that you're going to suddenly spend 10 percent more on every single part of your life. You're not going to spend 10 percent more necessarily on food, for example. But there are these categories of things that we might spend more than 10 percent more on now that we have the money. And Wolfers suspects that children are one of those things we like to splurge on.

WOLFERS: And so it doesn't surprise me to hear that the tooth fairy has outpaced inflation because the tooth fairy is one of those vehicles with which we give more to our kids.

MALONE: One more thing about Justin Wolfers. So you remember at the beginning of this we talked about the White House, the tooth fairy summit.

SMITH: Betsey Stevenson, the economist.

MALONE: Yes. Justin Wolfers is her partner. That kid who lost her tooth, that's Justin's daughter.

SMITH: So together they figured it out.

STEVENSON: We're a family that - we take in data. And the median seems to be a great place to be. And that's exactly where our family was with the tooth fairy. We're at $5.

SMITH: Five dollars. I feel like my kids have never gotten $5.

MALONE: But, Robert, that is the going rate, man.

SMITH: I just can't do it.

MALONE: Does it make you a bad father?

SMITH: I'm sorry, I can't help it. I think of it as pocket full of change.

MALONE: I think of it as change, too, but this particular argument always ends up with being back in my day, I walked uphill three ways to get my tooth fairy money. I just feel like you can't talk about this without just sounding like a super old person.

SMITH: (Laughter) All right, $5 it is.

MALONE: Five dollars.

SMITH: Kenny Malone, one of the newest correspondents for PLANET MONEY. Thank you, sir.

MALONE: Thank you. Do we thank? Is that a thing we do?

SMITH: You're welcome.

MALONE: You're welcome.


SMITH: All right, let's take a huge leap from pocket change to our next number.

NOEL KING, BYLINE: Ten million. Ten million dollars.

SMITH: Ten million dollars. That is the voice of Noel King, who has the story of a very unusual court case.

KING: Yes. It is a group of dairy truck drivers up in Maine who are suing their bosses for unpaid overtime. These guys were working long days - 12, 16 hours. Their bosses were only paying them for eight. So they say, you owe us a bunch of money.

SMITH: So far a very normal case.

KING: Yes. This court case hinges on a comma that is in a statute - or actually, it's a comma that is not in a statute in Maine state law.

SMITH: The $10,000,000 comma.

KING: The $10,000,000 comma.

SMITH: Explain.

KING: An Oxford comma. OK. So you know what an Oxford comma is, right?

SMITH: Yes. I'm a firm believer in the Oxford comma. If you have a list of items - like, you say, I like desert, soup and oranges, you put a comma after the soup and before the and. It's that comma in a list of items.

KING: The last comment in a list of items. But there's a fierce debate over this. Some people think the Oxford comma is totally unnecessary, which brings us back to this case in Maine. I'm going to give you a little primer on what Maine law says. Maine law says everybody gets overtime except for certain people. There are groups that just don't get paid OT. Those people include people who work, who handle or ship perishable foods. They don't, for some reason, make overtime. But the statute spells it out really clearly. It says the following. It says, any worker who is involved in, quote, "canning, processing"...

SMITH: Got it.

KING: ...Preserving"...


KING: ..."Freezing, drying"...

SMITH: Makes sense.

KING: ..."Marketing...


KING: ..."Storing"...

SMITH: Absolutely.

KING: ..."Packing for shipment or distribution of perishable foods." And there are commas between all of the words...

SMITH: OK, yes.

KING: ...On that list except packing for shipment or distribution. So there's no Oxford comma, no last comma between shipment and distribution.

SMITH: So that raises the question - does it refer to packing for shipment or distribution or packing for shipment or distribution?

KING: That was radio magic, what you just did. Yes.

SMITH: Did I do the - that was a radio comma, yes.

KING: This is such an easy thing to see in print, but it is a very hard thing to say. But yes, that's exactly it. And what the workers' lawyer said it's because there's no Oxford comma it is packing for shipment or distribution, meaning distribution itself - driving the milk to stores and uncrating it - that is not an exempt profession. You get overtime.

SMITH: And so did this court case go before an eighth grade teacher who decided the whole thing?

KING: Actually, everyone kept referencing their 10th grade teachers, which I just think is so weird.

SMITH: Because that's when that happens, yeah.

KING: This case went before three different judges five different times. And here is where it has landed - a judge in the 1st Circuit Court of Appeals said because there is no Oxford comma the wording is too ambiguous for him to come down on the side of the company. The judge is essentially saying if the state wanted to make it clear that distribution is one of the things for which you don't make overtime, they probably should have put an Oxford comma in that list.

SMITH: So for want of a comma, the court case was won.

KING: The court case actually has not been won just yet. What the judge said is that it can proceed.

SMITH: Thank you, Noel.

KING: Thanks, Robert.

SMITH: We are now going to ratchet this up five - five - decimal places, up to a trillion dollars, after the break.


SMITH: Our final number today is $1 trillion. I kind of want to do a Dr. Evil. One trillion dollars.

AILSA CHANG, BYLINE: (Laughter) Kaboom.

SMITH: That laughter comes from Ailsa Chang, who until very recently was NPR's Senate correspondent, now a new member of PLANET MONEY. Welcome.

CHANG: Yay, thank you.

SMITH: And $1 trillion is in the news right now because...

CHANG: Because President Trump has said that he wants to spend a trillion dollars to build infrastructure all across the United States.

SMITH: Now, he probably picked this number because it sounds amazing, a trillion dollars, but we had the question - is that a lot of money when it comes to infrastructure? It seems like a lot of money. But there's a lot of different ways to look at this.

CHANG: And it is a lot of money if you think about what we're already spending on infrastructure. We're spending 2.5 trillion over the next 10 years. So a trillion on top of that more is a 40 percent jump.

SMITH: Which would put it up there with the sort of historic levels of spending on infrastructure the country has seen.

CHANG: It would be a moment in history. President Eisenhower spent roughly that scale of money when he started the interstate highway system. And, you know, if you wanted to rebuild the entire interstate highway system today, it would actually take half a trillion, just half of Trump's infrastructure budget.

SMITH: But Donald Trump did not say he wanted to spend a trillion dollars on roads. He said he wanted to...

CHANG: Do everything everywhere.


PRESIDENT DONALD TRUMP: We will rebuild our roads, our bridges, our tunnels, highways, airports, schools, hospitals. We will...

SMITH: You get a sewer system. You get a highway. You know - what? - you want new elevators in your municipal building? You got it.

CHANG: (Laughter) Exactly. So you start to think, well, if Trump wants to do everything everywhere, how far does a trillion dollars actually go? What does it actually buy you in real terms? And that's what I set to find out just boppin' around New York City.

SMITH: Yeah, obviously the most expensive place...

CHANG: Absolutely.

SMITH: ...To built in the country.

CHANG: Absolutely.

SMITH: But the money doesn't go very far if you walk around.

CHANG: All right, I'm riding the Second Avenue Subway right now.

OK, so this is the new subway line on the East Side of Manhattan. It cost $4.5 billion dollars just to add three subway stops to that line.

I just rode the subway one stop, which means I just burned through a billion and a half dollars. That took about 73 seconds.

Or go down to the newly built transportation hub down by the World Trade Center. It's called the Oculus.

SMITH: It is a gorgeous, gorgeous place.

CHANG: I'm standing in basically a giant hallway right now. It's like the lobby for a train station. And this whole place cost $4 billion.

SMITH: And it is basically just the entrance to a train station, we should say.

CHANG: That's right. And if you look at a list of planned projects for New York City, you see, like, how quickly this money can be depleted. Another 10 billion would be needed to rebuild the Port Authority bus terminal. Another 20 billion would be needed to build a Amtrak tunnel under the Hudson River. If you want more community centers, you want to rebuild housing, hospitals, water mains and sewers, all that money quickly adds up. You can get to 100 billion in a blink of an eye.

SMITH: And that's just one city in the entire country.

CHANG: Yeah. The biggest city, but just one city. And I should say this. When Donald Trump says $1 trillion for infrastructure, you need to keep in mind two caveats. First of all, we're talking about a trillion dollars over 10 years. So that's 100 billion per year for the entire country. And secondly, most of this money, the idea is, is going to come from private investors.

SMITH: Yeah, this was the fine print on the infrastructure plan, which was that the government was going to offer tax breaks for private industry to build a lot of these things.

CHANG: And the concern about that is that maybe private investors would be incentivized to invest in projects that would provide big revenue streams.

SMITH: Big, shiny things they can brag about, or things like toll roads they can make money off of.

CHANG: Exactly, instead of, say, building sewer systems.

SMITH: Yeah, no one wants to do a ribbon cutting in a sewer system.

CHANG: (Laughter).

SMITH: Thanks, Ailsa.

CHANG: You're welcome.


CHANG: Do you have a number you want us to explain? Write us at planetmoneynpr.org. Or check us out on Twitter or Facebook.

SMITH: Today's episode was produced by Nick Fountain and Sally Helm. And now that you're done listening to PLANET MONEY, may we suggest another fine podcast? I don't know if you've been listening, but Embedded is back for a special three-episode podcast miniseries about police shootings. You should check it out, Embedded on the NPR One app or wherever you get your fine podcasts. I'm Robert Smith.

CHANG: And I'm Ailsa Chang. Thanks for listening.


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