The Cantillon Effect Explains the Persistent Affordability Crisis

That difficulty in detecting the true cause gives the monetary authorities and the politicians and industries that benefit a lot of room to operate. Money printing is less visible than taxes or government borrowing. It has become one of the primary ways the political class funds expensive programs. The Fed printed trillions of new dollars during the pandemic and injected most of them straight into the economy. That is the reason the affordability crisis exists. Voters are right that something is deeply wrong.

Neither party wants to talk about it. Solving the problems caused by the Fed's money printing is not in the interest of the people in power. What is in their interest is using the money spigot for their own ends while obfuscating the issue in public and redirecting people's anger toward a scapegoat.

The same pattern repeats. Voters can tell the economy is weaker than the official metrics suggest. They vote for the party closest to echoing that sentiment and promising change. The sense that something is off persists. The people who were voted in call the complainers liars, lazy, or bad at managing their money. The gaslighting continues.

The Trump administration faces no pressure to address the true cause of the problem and every reason to keep the money spigot running. The expensive policies it is pursuing require federal spending. The other party, with its calls for massive increases in social spending, will be in the same position when it wins back some power.

The gaslighting will continue unless and until people wake up to the scheme or grow used to the jump in prices caused by the government's historic monetary expansion.