Ya, because the same item was way more at other stores and people didn't understand why. Most of it was logistics at first and not just cheap items. That and buying in very very large lots. It was over time that the hunt for more profits started chasing cheap items.

Really the mom and pop store was set to die in the US because of car culture. You'll pay a bit more to walk to the closest store, but if you're already driving there is very little cost in driving to a store a little farther is almost nothing.

Or did stagnant wages drive Americans to buy what they could afford instead of products that would last?

We also have many US manufacturers moving sourcing their subcomponents from overseas to save a few cents per unit, there's no way to prevent that, nobody is going to check the BOM from everything they ever buy.

I think collective behavior is a large component but it is not quite right to declare it as the primary driver.