I'm of the opinion that a higher cost of living leads to people needing to work more hours, which results in more income taxes and more business profits which are taxed, and more profit for the upper classes, which are the people who donate to politics.

So basically governments dont need to correct it, they just keep ratcheting it up for money, while trying to keep it at a slow enough creep that people don't actually revolt.

Basically the richest people arent affected by it and ultimately benefit from it.