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Prices are crashing for consumer electronics and entertainment due to rapid technological change and low regulation. Conversely, prices for housing, education, and healthcare are skyrocketing. These sectors are held back by heavy government regulation, which stifles technological adoption and productivity growth.

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An analysis of price changes reveals a stark trend: sectors with heavy government involvement and funding, such as college tuition and healthcare, have seen prices skyrocket. In contrast, free-market sectors like consumer electronics and software have become dramatically cheaper, suggesting government intervention stifles market competition and drives inflation.

While deregulation has made consumer goods like TVs drastically cheaper, essential family needs like healthcare, education, and housing have seen costs skyrocket. This suggests market dynamics that work for consumer electronics fail to provide affordable necessities for the average family.

A paradoxical market reality is that sectors with heavy government involvement, like healthcare and education, experience skyrocketing costs. In contrast, less-regulated, technology-driven sectors see prices consistently fall, suggesting a correlation between intervention and price inflation.

It's misleading to cite a single inflation number. There's massive deflation in globally competitive sectors like electronics (touched by China and the internet). Simultaneously, hyperinflation exists in state-regulated, protected domestic sectors like US education, healthcare, and housing.

Runaway costs in education, housing, and healthcare stem from government intervention. When the government promises to provide a service (e.g., student loans), it becomes a massive "buy-only" force with no price sensitivity, eliminating natural market forces and causing costs to balloon.

An analysis of price changes shows that sectors with heavy government subsidies and regulation (healthcare, college, housing) experience rampant inflation. In contrast, highly competitive, less-regulated technology sectors (computers, cell phones) have seen significant price decreases, suggesting government intervention is a primary driver of inflation.

Government programs like unlimited student loans, acting as a single-payer in healthcare, and home ownership policies have artificially inflated demand and removed price constraints. This direct intervention, intended to help, is the root cause of runaway costs in housing, education, and healthcare, making them unaffordable.

The economy is split. Technology drives down prices in unregulated "blue sectors" (e.g., electronics), but heavily regulated "red sectors" (healthcare, education, housing) see prices skyrocket. These red sectors consume an ever-larger share of the economy, nullifying overall productivity gains from technology.

The "American Dream" has bifurcated. Productivity gains made manufactured goods cheaper, but services (healthcare) and assets (housing) became prohibitively expensive because their productivity is harder to improve. This redefines what is achievable for many.

Our economy has fractured into two. One part, driven by technology (electronics, media), is hyper-deflationary. The other, dominated by regulation that constrains supply (housing, education, healthcare), is hyper-inflationary. This explains why 'fun' gets cheaper but life's necessities become unaffordable.

America Has a Two-Speed Economy: Deregulated Sectors Deflate While Regulated Sectors Inflate | RiffOn