Why We Can’t Solve the Affordability Crisis

If there's a constant in modern American political cycles, it's that voters are furious over affordability.

They were furious when inflation devoured their wages and Covid-era stimulus checks. They stayed furious when oil and gas prices rocketed following Russia's invasion of Ukraine. As prices ballooned — for houses, for cars, at the grocery store, at the doctor's office — their anger brought President Donald Trump back from the political wilderness.

Now, Trump is on the receiving end of that fury. Consumer sentiment is more depressed than when Wall Street melted down and joblessness soared following the 2008 financial crisis. Nearly three-quarters of Americans believe economic conditions are worsening, according to Gallup , and they identify rising living costs as the biggest impediment to their finances.

This next part is important, and it's also been a constant. Americans never stopped spending . They spent when their paychecks weren't keeping up with prices. They spent when high interest rates eroded their purchasing power. They spent when retailers hit them with tariff costs, and they spent through the longest government shutdown in history.

American paychecks are larger now than before the pandemic, even after five years of elevated inflation . When the Iran war pushed gas prices above $4 per gallon, people kept their wallets open. And when they claimed that rising prices had forced them to pull back, Federal Reserve researchers found they were actually buying more .

Voters are broadly dissatisfied with both the economy and the political leaders who brought us to this moment. It is foolish to say that anger is misplaced, or dismiss any sign of strain. But fury hasn't slowed consumption. And most people haven't been budgeting as if financial ruin is at hand.

Affordability is a political crisis. But right now, it's not an economic crisis. At the same time, millions of Americans really are struggling to get by amid deep structural issues in our economy. And that's not something that Trump or any elected official can solve easily.

"Economists find the word 'affordability' almost a nonsensical word," Betsey Stevenson, a former economic adviser to President Barack Obama and now a professor of public policy at the University of Michigan, told me.

It boils down to the fundamental elements of economics, she added. There are finite resources for meeting everyone's demands. Everyone's demands are different, everything comes at a cost, and "people always want more."

"You can afford anything," Stevenson said. "The question is just: What do you have to give up to get it?"