Affordability is on everyone’s mind as it becomes the justification for broad policy priorities. One example is the 2017 tax cuts preservation in the One Big Beautiful Bill. Speaker Mike Johnson has highlighted these measures as meaningful achievements in tax policy. But his further claim that they substantially address the affordability crisis is on less certain footing. The reality is that addressing the pain consumers are feeling will require more than marketing of existing policy priorities; it will require targeted solutions to address the real pain points.
From a data perspective, it is not immediately obvious why concerns about affordability have resonated so deeply. As The Economist has noted, consumers, on average, are not worse off than in prior decades. Bureau of Labor Statistics data show that real average income increased by more than $20,000 between 1985 and 2023. Real consumer expenditure rose by just over $10,000 between 1985 and 2024. By these measures, earnings growth has outpaced spending, leaving the average household objectively better off.
Yet, as The Economist also cautions, “beating voters over the head with economic statistics to assure them that they are doing better than they are feeling is not an effective electoral strategy.” Affordability is not just a matter of averages; it is shaped by lived experience. A more constructive response would focus on policies that preserve and extend the forces that have driven long-term gains, while directly addressing the sources of pressure consumers actually feel.
Some recent proposals move in the opposite direction. Price controls—long understood to create shortages—have resurfaced in ideas ranging from “most favored nation” drug pricing to a proposed 10 percent cap on credit card interest rates. Research from the American Consumer Institute suggests these policies would reduce access. Consumers who lose access to credit may face overdraft fees, delay essential payments like rent or groceries, or turn to illegal lenders. Similarly, importing European drug pricing models would likely replicate their outcomes: modest savings paired with slower access to new medicines.
Tariffs present another challenge. While often framed as a trade or industrial policy tool, tariffs function like a broad-based tax on consumers. Research cited by The Wall Street Journal finds that Americans bear roughly 96 percent of tariff costs. With tariffs totaling roughly $200 billion last year, their impact on household budgets likely exceeds that of most tax changes.
The data suggest that consumer anxiety is not unfounded, but also unevenly distributed. Housing and healthcare costs stand out. After adjusting for inflation, consumers are spending over $5,000 more annually on housing and nearly $3,000 more on healthcare than they did in 1985. Together, these categories account for a substantial share of overall spending growth and help explain why many households feel squeezed despite rising incomes.
What is missing from much of the political debate is a serious effort to apply the market forces that have raised living standards elsewhere to housing and healthcare. Instead, the most prominent proposals—rent freezes, drug price caps, and insurance subsidies—risk further distorting markets and constraining supply.
There are alternatives. Expanding access to telehealth, modernizing scope-of-practice laws, and reforming restrictive zoning regulations would help markets better meet consumer demand in healthcare and housing. These approaches are less visible than price controls, but more likely to deliver lasting relief.
Affordability is a politically powerful concern, and lawmakers are right to respond to it. But responsibility requires moving beyond policies that are easy to sell toward solutions that actually address the underlying cost drivers. Acknowledging positive economic trends does not mean dismissing consumer frustration—it means responding to it with care, realism, and policies that make affordability durable rather than fleeting.
Tirzah Duren is the President and CEO of the American Consumer Institute, a nonprofit education and research organization. Follow Tirzah on X @tzduren.