Coffee

There's two coffee companies, by far the most popular in town. The catch? They both sell the most bland, most unoriginal, most uninspired coffee you could possibly sell, and at an unreasonably high price. They get away with this by the way the town's coffee system works: instead of each person getting to choose their preferred coffee, everybody casts ballots for a brand of coffee, and whichever one wins, everybody in the town must drink that brand of coffee for the entire day. At the beginning, there were lots of different types of coffee being sold in town; some brands sold basically hot chocolate or coffee-infused water. But eventually, people started realizing that some brands would never win the daily election; they were just too small to compete. So, many people started switching their votes to bigger-name brands, that were at least less objectionable to them compared to some of the other choices. This process continued until there were basically only the two are still around today. Every year or so, these brands will change flavors, and swap styles, but very few people will bat an eye if they do so slowly. And in recent years, the brands have avoided pushback to this system with an ingenious trick: mob mentality. As people chose the same brand day after day and then had their children choose the same brand, people eventually began to identify strongly with whichever brand suited them the best. They began to slander anyone who did not support their brand of coffee and even refused to associate or respect anyone who did not buy into their brand of coffee. This way, even though the two brands were essentially the same with minor cosmetic differences (both cared far more about appeasing other companies and enriching themselves than about the quality of their coffee or the treatment of their workers or customers), the two brands were able to pull through even during these recent setbacks and emerge basically unscathed.

Now, replaced "coffee brand" with "political party", and you have political polarization in a nutshell.