Solving the Affordability Crisis Begins with Giving People More Control of Our Economy

This past weekend, my daughter expressed her anguish as she filled up her gas tank to drive home from college. The total price was sky-high. 

Recently, Tre’, a 26-year-old organizer from North Carolina, told me that he and his friends don’t think they will be able to own a home ever in their lifetimes.  

While visiting with a friend in Chicago, I watched her open her utility app to monitor the hourly electricity rate. She called to her partner when she saw a sharp uptick. It was time to turn out the lights. 

And don’t get me started about the cost of chicken and my grocery bill.  

People all over the United States are struggling to find an affordable place to live, to pay their utility bills, to put food on the table, to pay for childcare. Millions of Americans are going without healthcare because they can’t afford the premiums. The struggle is borne disproportionately by Black and brown people, whose paychecks are lower and whose costs are higher than their white counterparts due to the discrimination in our economy. 

What does the future hold for people when costs are rising, paychecks stay flat, and aspects of the American dream and economic opportunity seem far out of reach? Economic precarity is the byproduct of an economy that is out of whack, and we can fix it by giving more power to people who make our economy run. 

Politicians across the spectrum are campaigning on reducing prices. However, if they hope to follow through on their campaign promises, they are going to have to confront the real cause of this crisis.  

Next week, in collaboration with our colleagues at People’s Action, my team at Dēmos will be releasing a new report on the affordability crisis. Spoiler alert: We find that we can’t work our way out of this crisis by making tweaks to our oil supply. We will need, instead, to change the distribution of power in the economy. 

There's one thing I know for certain: We will never direct-service our way out of poverty. 

Let me explain what I mean by that. I’ve spent decades working to alleviate poverty in this country, and there’s one thing I’ve learned for certain: We will never direct-service our way out of poverty. Yes, we need to provide support during the proverbial rainy day, but in the United States it is always raining. We need structural changes to the tax code, we need to pay people enough to live, we need to stop letting corporations write the rules of the game. Until we change the institutions and the values they reflect—until we rebalance power—we won’t be able to transform structures to solve this affordability crisis.

Let’s get more specific. Your electric bill is high. You are not alone. Utility companies shut off household power 13.4 million times in 2024. Black and brown households are particularly hard hit by high prices: Someone living in a majority-Black census tract is likely to spend about five percent of their income on their utility bill, compared to three percent for someone who makes the same amount of money but lives in a majority-white tract.  

Why? A lot of reasons, but one sticks out in particular to me. Seventy-two percent of households in the United States purchase their energy from investor-owned utility companies (for-profit electric utility companies whose shares are traded on the stock market). The largest ones have profit margins between 19 and 27 percent, huge compared to more typical margins. These companies use their resources to influence the regulatory decision-makers that govern them. Their lobbyists work to shape regulation and tamp down competitive threats. Over the last three years, the prices charged by shareholder-owned utility companies have outpaced inflation by nearly half. Publicly owned utility companies? They’re increasing prices far more slowly than the general rate of inflation.  

So, the market power of a handful of corporations is driving your utility bill. What about your childcare bill? Here’s a powerful statistic: While the United States government contributes about $500 per year for a child’s care, other wealthy nations spend nearly $14,000. Zooming out, we see wealthy corporations holding enough economic power to extract big profit from the energy market, at the same time as we see families lacking the power to demand that the government invest a reasonable amount in the childcare that supports our working families and fuels the economy. 

At this point, I hope you are fired up and asking, “What do we do from here?” I won’t spoil the whole report (let me tell you, though, all five policy solutions are GOOD), but I’ll leave you with my three favorites: