Domestic Report, Part 1:
The Affordability Crisis

March 23, 2026

Both the Democratic and Republican parties have been focusing their upcoming election campaigns on what they call the Affordability Crisis. In fact, the very term “affordability crisis” trivializes what is really happening, making it appear as if it’s simply a problem of cutting back on a morning latte or a Netflix subscription. But by citing this crisis, the politicians give themselves an opportunity to make all kinds of empty promises facing the elections.

In reality, price hikes have exploded on the very basics of what people need to survive, including housing, food, transportation and healthcare, putting them increasingly out of reach for large parts of the working population. Housing is one of the most important indicators of the problem. Over the last four decades, the increase in rents has drastically outpaced wages. Currently, over 12 million U.S. households are considered “severely cost-burdened.” That means they spend half, if not more, of their income on rent and utilities, leaving little left to pay for other necessities. These rent increases have also led to a big increase in homelessness. Millions of workers in sectors like construction, services, or retail no longer have stable housing. They live in cars, shelters, or motels, along with their families. Close to two million children are counted as homeless by school districts around the country—a number experts consider to be the tip of the iceberg. And more than half of the homeless are now the elderly. When low wage workers are no longer able to work, most lack adequate retirement savings that would allow them to rent an apartment.

One reason for this crisis is that it is not profitable for companies to build new affordable housing. And this crisis is made much worse because much of the housing stock that does exist is being bought up by huge financial groups, such as hedge funds, private equity funds, and real estate investment trusts. That includes millions of single-family homes, as well as apartment complexes and trailer home parks. At the same time, what little remains of affordable housing in most cities is being knocked down in order to make way for luxury real estate developments and playgrounds for the rich, leaving people with few if any choices of where to live.

There is also a terrible crisis in healthcare, as healthcare costs have also exploded upward at a rate that is three times faster than wages. This has left approximately 16 million people, ages 18–64, without any health insurance coverage, with higher rates of uninsured workers in such highly profitable industries as agriculture, construction, and hospitality. But the crisis doesn’t stop there, since having insurance coverage is not a guarantee of actually getting healthcare. The number of workers with “inadequate” insurance exceeds 100 million. So, millions—who do have health insurance—often delay medical care due to high out-of-pocket costs or deductibles relative to their income, and they often face high medical debt and terrible financial hardship. This forces one-third of U.S. adults to cut back on food, utilities and gas in order to cover health care costs. And one-half of all adults have put off life events, such as changing jobs or having children, because of escalating medical costs.

Increasingly, healthcare is nothing but a giant suction pump for money controlled by a handful of companies. These include UnitedHealth Group, Elevance Health (formerly Anthem), CVS (Aetna), and Centene Corporation. These companies started as insurance companies, and then transformed themselves into vertically integrated monopolies that dominate almost every aspect of healthcare. The biggest of these companies, UnitedHealth Group, for example, has risen to become the fourth largest company in the country, based on sales, and the seventh largest in the world. UnitedHealth Group’s tentacles extend from insurance to its pharmacy, clinical, data and other operations through no less than 3,000 subsidiaries. One of these subsidiaries, Optimum Health, is a for-profit company now employing 10% of all the doctors in the country.

Food prices have also skyrocketed over the last five years at rates that are much higher than inflation. Almost 50 million people, including 15 million children were considered by the U.S. government to be “food insecure,” that is, they do not have enough to eat on a regular basis. These price increases are imposed by a handful of companies that dominate agricultural production, distribution and sales, including seeds, fertilizer, pesticides, machinery. And those monopolies themselves are dominated by global investment firms like BlackRock and Vanguard that are top shareholders across nearly all major agribusinesses, further consolidating power through institutional ownership.

Finally, 104 million U.S. residents do not have access to reliable transportation, since they cannot afford a car in a country where there is almost no public transportation and at a time when housing costs are forcing more workers to live far from economic centers where they can find work or go to school. The cost of a new car, at an average of over $50,000, is so high, especially adding in interest payments, it is now unaffordable for about 80% of the population. Even used car prices are now averaging $25,000, pushing them out of reach for most people. Today, the average price of a used car is more expensive than what new cars cost just 15 years ago! Besides that, all the other costs of owning a car have gone up just as fast: the monopolies and financial companies that dominate auto parts, insurance, tires, accessories, and fuel have imposed huge price increases.

This means that in 2026, tens of millions of workers, working long hours, can no longer afford the bare essentials. Most of the rest of the working class is facing an increasingly uphill battle not just to stay afloat, but if one ill-timed crisis hits, to stay alive. The very class that produces everything and makes everything run is increasingly being thrown into the pit of pauperism.

Meanwhile, the capitalist class has greatly increased its profits and wealth. “Soaring Profits and Stocks Funnel More of GDP Toward Companies, Their Top Employees and Shareholders…” announced the headline in the Wall Street Journal on February 12. The article goes on to show that profits now gobble up twice as much of the overall economy as they did in 1980. The article also shows that those profits were taken directly out of what the article calls “labor compensation,” whose share of the economy has dropped precipitously.

Today, a tiny, tiny minority has accumulated unimaginable wealth. According to The New York Times (March 2), the wealth of the richest one percent of the population in the U.S. has now reached over 55 trillion dollars, which is more than the entire economies of the U.S. and China combined. At the top of the heap stand the billionaires, whose numbers have grown from 269 in 2000 to more than 900 in 2025, with 88 billionaires added in just the last year, a real Billionaire Boom. The wealth of the very richest of the billionaires, Elon Musk, is now closing in on a trillion dollars.

This stupendous growth in wealth of the capitalist class is the flip side to the rapid impoverishment of the working population. The capitalists continue to build their fortunes by cannibalizing the living standards of the working population, leading to ever greater decay and decline for most of the population and for the society as a whole.

Such a worsening of the workers’ situation is caused by the very workings of the capitalist system. This is what Marx concluded in his pamphlet, entitled, “Value, Price and Profit,” when capitalism was still in its ascendency: “… the very development of modern industry must progressively turn the scale in favor of the capitalist against the working man, and that consequently the general tendency of capitalistic production is not to raise, but to sink the average standard of wages, or to push the value of labor more or less to its minimum limit.…” And while Marx said that the workers should never give up resisting against “the encroachments of capital,” he added that “the working class ought not to exaggerate to themselves the ultimate working of these everyday struggles. They ought not to forget that they are fighting with effects, but not with the causes of those effects; that they are retarding the downward movement, but not changing its direction; that they are applying palliatives, not curing the malady. They ought, therefore, not to be exclusively absorbed in these unavoidable guerilla fights incessantly springing up from the never ceasing encroachments of capital or changes of the market. They ought to understand that, with all the miseries it imposes upon them, the present system simultaneously engenders the material conditions and the social forms necessary for an economic reconstruction of society. Instead of the conservative motto: “A fair day’s wage for a fair day’s work!” they ought to inscribe on their banner the revolutionary watchword: “Abolition of the wages system!””

How much more true Marx’s conclusion is today, in this period of capitalism’s degeneration, reminding workers of the inability of reforms, of “guerilla fights” to overcome the miseries the system imposes on them, at the same time looking toward the possibility that the working class can reconstruct society.

Artificial Intelligence and Jobs

One of the big attacks against the working class is said to be coming from the introduction of Artificial Intelligence (AI), which is already being blamed for mass layoffs.

In fact, numerous studies over the last months show that companies are using AI just as an excuse to cut their workforces. As a research briefing from Oxford Economics that came out in January concluded, “By framing layoffs as a technological pivot, companies can present themselves as forward-thinking innovators rather than businesses struggling with cyclical downturns.” By falsely trumpeting their use of AI, companies want to get speculators in the stock market to bid up their stock market price. Of course, they also use it as an excuse to hold down hiring, and spread fear in the workforce in order to get workers to accept an increased workload.

Just as false are all the reports from the news media blaming AI for what they call “the jobless expansion,” that is the lack of available jobs, especially for young people trying to break into the job market, while profits and the wealth of the capitalist class continue to soar.

The problem is not the technology itself, but the fact that the capitalist class controls the technology for its own interests, for its own power, for its own wealth, at the expense of the working class and the whole population. A gun can be used to kill people, or it can be used for self-defense or liberation. It’s just a tool, and how it is used depends on who is using it. And so is AI. It’s just a tool. And it is really too early to know how effective a tool it will be. But right now, workers have every reason to fear how the capitalists will use AI, that whatever happens, they will pay for it with their jobs.

Certainly, that’s what happened in the past. Capitalists used new technology to cut jobs to the bone in one branch of the economy and workers didn’t just lose their jobs, but their lives were ruined. But that didn’t mean that jobs disappeared. New jobs opened up in other branches. As Marx wrote in the 1850s: “As soon as machinery has set free a part of the workers employed in a given branch of industry, the reserve men are also diverted into new channels of employment and become absorbed in other branches; meanwhile the original victims, during the period of transition, for the most part starve and perish.”

This is what has happened over and over again in the U.S. In the early 20th century, for example, more than half the U.S. population still lived on the land. Then as more modern machinery was introduced into farming, the farmers, the farm hands, and tenant farmers either left the farms, or were driven from the land. Many might never have found a steady job. But those who did most often found jobs in sectors that didn’t exist before, starting with growing basic industry and manufacturing in the big cities. When the capitalists took advantage of big productivity gains by shedding industrial manufacturing jobs, jobs in the growing service sector opened up. Today, 60% of the people with jobs are working jobs that didn’t exist in 1940.

This process is not automatic, not especially in this day and age of worsening economic crisis, with its specter of economic collapse, overlaid with growing militarism and the threat of global war. The big problem is not the technology, but who controls it. Today it is controlled by the capitalist class.

This is the dead end in which capitalism has put its own society, and with it, those who produce the goods and services the whole population needs. But it’s not enough for the working class to be aware of the disasters that capitalism prepares for it. It needs to feel its own capacity to extricate itself and all of society from capitalism’s trap.

As insignificant, as minuscule as we are today, this necessity is what justifies our existence, and the existence of all those who strive today to bring a revolutionary party into being.