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My theory is that social media has given people this skewed perspective of reality where everyone else appears to be rich and living in luxury.

This makes their own lives, in which they are still better off than 99.9% of the history of humanity, feel worse.

When your lifestyle suddenly has to change in drastic ways because of a rapid increase in prices none of this makes anyone feel any better. "Think about how much worse it COULD be, kids!"
>When your lifestyle suddenly has to change in drastic ways because of a rapid increase in prices

Where's the evidence this is happening for a majority (or even something vaguely resembling one) of people? I've already posted official statistics that show inflation adjusted median wages are up.

Ok, well, my wages aren't up, and everybody I know's wages aren't up either. Being told this over and over again, that everything is great, despite what's obvious to our own personal experience is why you got the result you got today.
or you know, wages stagnated for 40 years and haven't kept pace with productivity gains, and it was inevitable that this would wear most American citizens down and we'd feel it more and more over time.

The most recent wage gains failed to make up for this fact

https://www.cnbc.com/2022/07/19/heres-how-labor-dynamism-aff...