Consumer sentiments about the American economy have reached a 7-month low and now maintain a baseline at the lowest levels since the Great Recession. This is despite historic economic gains following the COVID-19 pandemic that have resulted in an economy that is the envy of the world and the strongest economy in modern American history.
This divide between the sentiments of consumers and the hard economic data pored over by analysts has been called the ‘vibecession’. But why is there such a profound disconnect between the impressive economic data and the pervasive cynicism felt by many Americans?
One explanation is rooted in exploitative pricing practices that have become all too common. The American economy may be thriving according to indicators used by economists to measure the economic health and well-being of the country, but those economists ignore a fundamental component that drives so much of the discontent: Power.
New technologies and business practices have reshaped the landscape of pricing. Corporations use their vast troves of consumer data to create deceptive and exploitative pricing strategies that may benefit their bottom line, at the expense of consumer choice and autonomy.
One of the key issues in this context is the proliferation of junk fees. These are hidden charges that consumers often only discover after they have committed to a purchase. Airlines, hotels, and banks are well-known for tacking on such fees, which can significantly inflate the final cost of a product or service. But junk fees can also be found on your rent and utility bills, your check at restaurants, and even your propane distributor, as one egregious example outlines.
These fees, loaded on at or near the end of a transaction, lead consumers to believe they are getting a great price only to find out right before they complete the transaction that the price has drastically increased. People hate junk fees so much that an overwhelming 83% of likely voters say they would vote for a legislator that would end the practice, and 79% of voters say they support state legislation to ban the use of junk fees.
My price is not the same as your pric …
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