Not so. If a retailer is selling garbage, some people may buy it, but those people will promptly figure that out, stop buying those brands and leave them bad reviews. And the retailer has incentives not to carry bad products even if they don't accept returns because getting burned doesn't make for repeat customers.

The cost in forcing returns is that it requires you to buy insurance you may not need, which costs money even if all of the products are functional because people return things for reasons other than defects and the retailer will command a risk premium. If someone buys the wrong product, it costs the retailer money to have to process the original transaction, then the refund, then restock the product at a lower price because it's open box. Someone who knows they won't need to return the product doesn't need that insurance, but you're forcing them to pay a premium to cover it anyway.

Forcing the retailer to accept returns also makes it riskier for them to accept new suppliers into their stores. If the supplier starts providing low quality merchandise, the retailer has to eat the cost of the 10,000 items it has in stock, plus the value of wasted shelf space, plus the cost of processing all the returns -- so they stop buying from upstart suppliers, even if the new supplier would have provided good quality products. Which harms competition and allows the incumbent suppliers to charge higher prices.

> Prices haven't gone up.

There has been inflation rather than deflation, consumer products that used to be 16 ounces are now 10, the percentage share of value that goes to business investors rather than employees or customers (i.e. wealth inequality) has increased, by what metric have prices not gone up?