If you think public policy doesn’t really affect you or your family, take a quick glance at your retirement account—but you may want to sit down first. Those accounts have taken a beating lately because of the misguided policies emanating from Washington, D.C., and the result is a dramatic reduction in wealth for the average American family.

Public policy debates about spending, regulation, taxation and Federal Reserve policy can make people’s eyes glaze over. They’re often filled with jargon and ivory-tower talking points that are irrelevant to most Americans.

But here’s something very relevant indeed: In the first nine months of last year, the average 401(k) retirement plan lost a quarter of its value. And that’s before adjusting for inflation.

In October of last year, I estimated that the average 401(k) plan had fallen from $135,000 at the start of 2022 to $101,000—a 25% drop and a total loss across all plans of $2.1 trillion. To add insult to injury, inflation had effectively further reduced the value of 401(k) plans by another $6,000, since the dollars in those plans can buy less than before.

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With 2022 in the rearview mirror, Fidelity Investments has published their statistics on the average decline of those 401(k) plans in the first nine months of last year, and the loss turned out to be 26%, one percentage point worse than my earlier estimate.

But what caused these drastic losses for Americans? The answer is unwise public policy from Congress, the White House and the Federal Reserve.

For the last two years, the federal government has spent trillions of dollars it didn’t have, and the Federal Reserve responded by creating that money out of nothing. That devalued the dollar, sending false price signals to consumers and businesses alike, and caused inflation. Stocks repeatedly set records as consumers and the government, both flush with cash, drove business revenues to new highs.

But costs exploded too, and eventually people realized that their additional dollars were not actually able to buy additional goods and services, even though they were spending more. After inflation raged for far too long, the Federal Reserve belatedly raised interest rates, which sent stocks and bonds alike straight down.

Higher interest rates increased borrowing costs for both consumers and businesses, slowing economic activity and sales at those businesses. Since stock prices are ultimately dependent on future revenue, stocks were revealed to be overvalued and began tumbling.

The bond market is more complicated, but the simple reality is that bond prices and interest rates move in opposite directions. When interest rates rise, the price of existing bonds goes down, and that is exactly what happened in the first nine months of 2022.

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The drop in both the stock and bond markets was not unprecedented, but it is extraordinarily rare. Including 2022, it has only happened four times in the last 95 years, and two of those occurrences were during the Great Depression.

This is largely, though admittedly not exclusively, the consequence of runaway spending, borrowing and printing of money by the federal government.

Sadly, there are Americans who planned on retiring right now but find themselves unable to do so because their retirement savings have shrunk while their anticipated cost of living in retirement has increased drastically. The average American’s cost of living under the Biden administration, as measured by the consumer price index, has increased almost 14% in the last two years.

If a person previously planned on retiring with $1 million, he or she now needs an extra $140,000 to cover today’s higher prices. Existing retirees may also be in trouble since they might exhaust their savings in the coming years due to higher-than-anticipated prices.

And although people now need more savings to last them through retirement, they aren’t actually able to save as much because more of their incomes are being eaten by the hidden tax of inflation. The savings rate is near a historic low and monthly savings have fallen 88% since Biden took office.

If you don’t think public policy can drastically affect your life, think again. Misguided policy may very well have robbed your retirement, making you work extra years to compensate. The federal government sowed the wind, and now American savers are reaping the whirlwind.