Why Everything Costs More and Gets Worse

Natalie Brunell (0:00)

Hey, everyone, welcome to the Natalie Brunell Show. I've been wanting to cover something for a while because I hear the same frustration everywhere. We're paying more for pretty much everything, but in a lot of cases, we're actually getting less for our money, and the quality is getting worse. Our foods have more processed ingredients. The packaging is smaller. Airline seats are tighter, and everything comes with an extra fee. A 50-year-old house that needs major work costs many times what the first owner paid. And you used to be able to buy things, like say a piece of furniture and hold on to it for generations. But now everything feels like it's made so cheaply that it breaks and you have to replace it. More and more, I hear one explanation for all of it. Corporations got greedy, CEOs got rich, and capitalism has failed. Now I understand why people feel that way, but we're actually blaming the wrong thing. And I can relate because there was a time when I did too. Back then, I thought we lived in a truly free market, but I'm gonna show you why that's not exactly true. When the market is tied to a form of money that can be printed out of thin air, it benefits some people at the expense of everyone else. But first, let's take a step back and start with something as basic as ketchup. There's an old Heinz ketchup bottle preserved by the Smithsonian, and the label shows it was made from fresh ripe tomatoes, spices, cane sugar, vinegar, onions, and salt. The Heinz ketchup sold in America today is made from tomato concentrate, high fructose corn syrup, distilled vinegar, salt, spice, onion powder, and natural flavoring. And of course, it went from a glass bottle to a plastic one. A simple sauce made from recognizable ingredients became something much more processed and optimized for mass production. You can see this in products across the board. McDonald's fries have changed. For decades, they were cooked in beef tallow. Today, they're cooked in a blend of seed oils, and McDonald's actually uses beef flavoring to try to recreate some of that beef tallow taste. So you take something simple, change the ingredients, make it easier to produce at scale, and then you sometimes have to add chemicals to recreate the flavors that people love and miss. Then there's the part that you can actually see when you go to the grocery store. Packages have gotten smaller while prices went up. It's called shrinkflation, and you've probably experienced it with some of your favorite snacks. So you're not just paying more, you're paying more for less. Housing is an even more obvious example because a house doesn't magically get better every time its price goes up. A few decades ago, a typical house cost less than three years of a family's income. Today, it's close to six. And in the biggest urban areas, it can be 10 times median income. It's so crazy to think that in the 1970s and 80s, a US postal worker could afford a nice home in Venice, California. And today, multiple incomes aren't enough for that same house. You can work twice as hard and twice as long, and you're barely able to keep up. And airlines are the last example I'll give because I travel a lot. Over the years, the industry has consolidated into just a few giant carriers, and flying became an experience where you pay for the ticket, then the bag, then the seat you want, priority boarding and Wi-Fi. Meanwhile, we can see enormous money at the top. The CEOs of United and Delta received compensation packages in 2024 worth roughly $34 million and $27 million.

United CEO made about 380 times what its median employee made. So when people look at that and say, this is capitalism, I understand the anger. But companies have always wanted to make more money. So the bigger question is, what changed about the money itself and the incentives around it? That's why we talk so much about broken money. Because inflation matters.

It matters right alongside regulation, competition and executive incentives. Underneath all of it is the money we use to measure prices, wages, profits and wealth. And over the last few decades, the US money supply has been exploding, growing at about 7% a year. If your salary rises by 2% or 3%, while the pool of dollars is growing at 7%, well, you may feel richer, but relative to that expanding supply of money, you're actually falling behind. And if your paycheck buys less, you have to make adjustments. Maybe you switch brands or eat out less or put off buying a car. Businesses adjust too. They raise prices, shrink packages, change ingredients and reduce services. That pressure works its way into what everything costs, how things are made and what you actually get for your money. The growing money supply is this steady current, pushing more dollars into the system that are then chasing after things that can't be printed out of thin air. And people at the top adjusted by getting paid in something other than dollars. So it's not your imagination that CEO pay is astronomically high at so many public companies. In the 1990s, they actually tried to address CEO pay and Congress limited the tax deduction for executive pay above a $1 million salary, but exempted performance-based compensation, which encouraged more pay through stocks and options. The idea was that if shareholders did well, the CEO should do well too, but once a huge share of your personal wealth is tied to the stock price, the incentives change. Now cutting costs, increasing margins, buying another company, or doing something that lifts the share price can personally be worth millions for executives. And even when Congress finally scrapped that exemption in 2017, it didn't matter. Stock heavy pay was now the standard and it stayed the standard. That doesn't mean that CEOs are all terrible people. It just means that the system started rewarding different behavior. And that's the part I think we miss when we reduce all of this to just one word, greed. Well, greed didn't suddenly appear. What changed were the rules and incentives in the system. And I want to show you why I think what we call capitalism today has drifted so far away from true free market competition and how broken money helped tilt the playing field away from the average worker. Ledn just introduced their lowest rates ever. The larger the loan, the lower the rate on all new loans, refinances, and renewals. Your Bitcoin stays custody, never lent out, and you can repay any time with zero penalties. Get a quarter percentage point off your first loan at ledn.io/natalie. The future of AI and Bitcoin mining depends on access to energy. Bitdeer Technologies Group, publicly traded on NASDAQ under BTDR, has secured a three gigawatt global energy portfolio for AI and Bitcoin mining infrastructure.