Cooking has never been my comparative advantage. In grad school, my motto was, “As long as I have a tortilla, anything can be a burrito.” This led to much trial and error in my apartment kitchen with (mostly) edible results. When I splurged on takeout, burritos gave me a large quantity of good food at a decent price.

　　More than a decade later, my beloved burritos have taken center stage in the affordability debate. On X, Andrew Kolvet of Turning Point USA quoted a college student’s take that “a burrito shouldn’t cost $20.” Critics were quick to lash out against the claim and Kolvet’s support for it. Congressman Dan Crenshaw even weighed in, accusing young adults of being spendthrifts and arguing, “The market doesn’t care what you think something ‘should’ cost.”

　　Crenshaw and others are right that prices best direct time, talent, and resources to their most valuable uses when they’re not constrained by what someone thinks they “ought” to be. Their responses, however, miss the larger point that affordability is more than just prices. A free society needs an affordability agenda grounded in what affordability means and what produces it.

　　What Does “Affordability” Mean Anyway?

　　My colleague Peter C. Earle recently offered a useful definition: “Something is affordable when the resources required to obtain it—whether we measure those in money, labor, time or some combination of those—are reasonably proportional to the value we receive from it and our income.”

　　The definition asks, “Affordable to whom?” The answer depends on the buyer’s purchasing power, the good’s price relative to other goods, the cost of devoting resources to producing it, and the value the buyer expects to receive. That last element is subjective: a person may be able to afford a $20 burrito yet reasonably decide that it is not worth the price.

　　Three forces shape the cost side of affordability: the value of money, relative prices, and real scarcity. Income and productivity provide the often-forgotten denominator.

　　Inflation and the Value of Money

　　Inflation denotes an ongoing rise in the general level of prices or, viewed from the other direction, an ongoing decline in the purchasing power of money. If avocados become more expensive after a poor harvest, that is initially a change in one relative price. If dollars command fewer goods and services across the economy, that is inflation.

　　The inflation rate measures how fast the price level is rising, not the price level itself. When inflation falls from 8 percent to 3 percent, prices are still rising, albeit more slowly. Consumers who remember the old price level may continue to feel poorer after inflation moderates.

　　That distinction also sets realistic expectations for policy. Tackling inflation means slowing the rate at which prices rise, not automatically returning the general level of prices to an earlier level. Forcing the whole price level back down would require deflation and could disrupt wages, debts, and contracts. Affordability ordinarily recovers when incomes and output catch up.

　　The most common measurement of inflation is the Consumer Price Index (CPI), which follows a representative basket rather than any particular household’s purchases. A renter spending heavily on housing, food, and energy may feel their budgets stretched more thinly than a homeowner with a fixed mortgage. Neither experience invalidates the CPI; the index just answers a different question. AIER’s Everyday Price Index offers a complementary perspective by emphasizing the prices consumers encounter most visibly in ordinary life, helping explain why everyday experience may feel more inflationary than the headline figure suggests.

　　Sustained inflation is ultimately monetary. The dollar’s purchasing power depends on the relationship between spending power and goods and services available. If spending power grows substantially faster than production, prices will tend to rise broadly. Droughts, wars, and broken supply chains can make particular goods scarce, but cannot by themselves explain a continuing rise in prices across most of the economy.

　　Pandemic inflation was not a choice between monetary and supply-side explanations. Production and transportation were disrupted just as federal transfers sustained demand and accommodative monetary policy made money and credit readily available. Scarcity helps explain which prices rose first; expanded spending power helps explain why the increases spread and persisted.

　　Inflation also damages the institutions of a free economy. Even when anticipated, it erodes cash balances, forces businesses to revise prices, and taxes nominal rather than real capital gains. When unexpected, it transfers purchasing power between lenders and borrowers and makes it harder to distinguish genuine scarcity from monetary depreciation. Unstable money impairs contracts, obscures market signals, and redistributes wealth without transparent legislation.

　　Understanding Relative Price Changes

　　Relative price changes describe shifts in the value of one good compared with another. Even in a stable monetary environment, prices will move unevenly. Demand increases, technologies improve, consumers find substitutes, and local conditions (including taxes and regulations) alter the costs of time, talent, and resources.

　　Inflation is often identified too quickly whenever a conspicuous price rises. As economists warn, reasoning from a price change risks getting the story wrong.

　　The rise in beef prices, for example, reflects inflation as well as cattle herds and feed availability strained by drought and longstanding import quotas that limit foreign supply. Monetary stability, while helpful, would not make those latter constraints disappear.

　　Nor are we always comparing like with like. A delivered $20 burrito is more than just an expensive version of a $9 counter-service burrito. It also bundles delivery, platform services, convenience, and saved time. Changes in portion size, ingredient quality, and customization further complicate comparisons over time.

　　There is no objectively correct price for a burrito.

　　Housing can become expensive where construction is restricted; restaurant meals can rise where labor and commercial space are scarce. Calling every such increase “inflation” invites the wrong remedy. Monetary policy can stabilize inflation, but only competition, entry, substitution, and greater production can address a sector-specific constraint.

　　Relative prices tell buyers and sellers what has become more expensive compared with other goods and services. To understand why, it is important to examine the real availability of goods and productive capacity.

　　Dealing With Supply Shocks and Real Scarcity

　　A supply shock makes the economy suddenly less capable of producing a specific good or service. A drought reduces a crop, disease diminishes livestock herds, war interrupts energy supplies, and a pandemic closes factories and ports. Tariffs can have similar effects by separating consumers from foreign suppliers.

　　These events create real scarcity. If fewer avocados are available, society has fewer avocados to consume. Government can influence how that loss is distributed, but it cannot make the missing fruit reappear.

　　Rising prices encourage conservation and substitution while attracting new production. Preventing a price from rising only causes the burden to reappear as shortages, queues, smaller portions, reduced quality, or business closures. A one-time shock may lift the measured price, but continuing economy-wide inflation requires repeated shocks or spending that continues to outrun production.

　　The appropriate response is open trade, flexible prices, open market entry, faster permitting, and freedom to substitute. Targeted assistance might protect some subsets of the population from a loss, but it can’t eliminate the loss altogether.

　　Resilience also matters before the next shock arrives. Diverse suppliers, inventories, spare capacity, and access to global markets can reduce the damage when one source fails. Policy should avoid rules that force households and businesses to depend on a single source.

　　The Missing Denominator: Income and Productivity

　　The first three ingredients explain costs, but not affordability by themselves. A price can rise while a good becomes more affordable if incomes rise faster; it can become less affordable without changing price if earnings fall or other expenses consume more of a household budget.

　　One useful measure is the time price: how long someone must work to buy something. A reported Chicago Chipotle receipt priced a chicken burrito at $6.50 in July 2015; a same-location online comparison put it at $9.35 in July 2025. At the national average hourly earnings of private-sector employees, that represented approximately 15.6 minutes of work in 2015 and 15.4 minutes in 2025. By this national-average “time price” measure, this particular burrito was about as affordable in 2025 as it had been a decade earlier, despite its roughly 44 percent higher sticker price.

　　Averages, however, conceal different experiences. A worker whose wages stagnated, a young renter facing rapidly rising housing costs, and a retiree living on a fixed income confront different burdens. Even if the burrito-to-wage ratio remains stable, the change in prices of goods and services that people cannot easily adjust from one month to the next can leave less income for everything else.

　　An Affordability Agenda for a Free Society

　　There’s no single policy that can fix affordability because there is no single cause of affordability struggles.

　　General inflation calls for monetary stability. A trustworthy currency allows households to save, businesses to plan, and lenders and borrowers to enter long-term contracts without guessing how rapidly the unit of account will depreciate. Fiscal policy should not place continuing pressure on monetary authorities to accommodate spending beyond the economy’s productive capacity.

　　Adverse relative price changes require attention to particular markets. Housing will not become abundant while zoning and permitting prevent construction. Medical care will not become more competitive while licensing and entry restrictions protect incumbents. Energy and transportation will remain costly where infrastructure cannot be built. The proper questions are where competition is restricted, entry is blocked, or subsidies have increased demand without allowing supply to respond.

　　Supply shocks require flexibility. Prices must be free to communicate scarcity, consumers must be free to substitute, and producers must be able to expand output. Trade barriers and rigid regulations make adjustments more difficult.

　　Weak purchasing power ultimately requires productivity and income growth. Secure property rights, capital formation, innovation, labor mobility, and open competition are the foundations of rising real wages. They rarely produce the instant relief promised by subsidies or controls, but they are the only durable means of making society generally more prosperous. History shows that prosperity is created by producing better goods and making former luxuries ordinary.

　　A free society can provide sound money, open entry, and freedom to adapt. Affordability policy should make production easier and money more reliable, not try to guarantee successful production or cheap goods.

　　Wrapping Up the Affordability Debate

　　A $20 burrito proves less than either side of the online debate imagined. It’s far from clear evidence of national impoverishment nor is it proof of personal irresponsibility.

　　It is necessary to know what the price includes, how it compares with substitutes, what happened to production costs, how much the buyer earns, and what value the buyer places on convenience.

　　The burrito itself is an artifact of ordinary abundance: ingredients transported from afar, meat kept safe by refrigeration, clean water, dependable energy, and digital technology that summons a meal to one’s door. That helps place the complaint in its proper context.

　　There is no objectively correct price for a burrito. Public institutions nevertheless must still preserve reliable money, avoid obstructing production, permit prices to communicate scarcity, and maintain the conditions under which productivity and real incomes can grow.

　　The ultimate goal is to enable ordinary people to obtain more value from each hour of labor.