The parts of the economy with the least affordability also happen to be the parts of the economy that have the most government involvement.
There are 3 sectors of the economy where prices have consistently outpaced inflation:
- Health care/health insurance/prescription drugs
In other sectors, prices have kept pace or lagged inflation.
Is this correlation or causation? Causation.
The idea that these things are so important that we can’t leave them to the whims of the market is what gets the government involved to begin with.
That causes distortions in the market, which causes problems.
Few recognize those problems were caused by government distortions, so they call for more government involvement, which causes more problems.
The cycle continues. Very rarely, if ever, do we ever revisit the initial root causes of the problems — the initial government involvement — and try to correct those.