Worst Economic Year Since 1946

The U.S. economy shrank by 3.5 percent last year as COVID upended American businesses and households, making 2020 the worst year for U.S. economic growth since 1946.

In 1946, the economy shrank as the country demobilized from World War II. Hundreds of thousands of GIs were discharged, factories stopped making bombs and jeeps, shipyards went dormant. But President Roosevelt and Congress had anticipated the impact of demobilization and created the GI Bill. From 1944 to 1949, nearly 9 million veterans received close to $4 billion from the bill’s unemployment compensation program. (That’s over $53 billion in today’s dollars.) The GI bill not only guaranteed unemployment benefits for veterans, but also it guaranteed mortgages if they purchased homes or farms, it sent millions of former GIs to college while keeping them out of unemployment lines, and guaranteed healthcare. There was a housing boom, veterans hospitals sprouted up throughout the country, and colleges thrived.

Now, we’re watching Congress fight over whether each American should get a one-time payment of $600 or another $1400. And whether college should be affordable. This is pitiful.

The businesses that were hit hardest in 2020 disproportionately employ women, people of color, and workers without college educations.  Thus, the pandemic has exacerbated an already serious problem of income inequality.

We need the next COVID relief bill now. Moreover, the climate action proposals must move forward fully funded by Congress — these are jobs programs as well as climate protection programs. Switching the federal vehicle fleets to all-electric alone will create thousands of auto industry jobs.

In 2017 when the economy was on the rise and Republicans demanded a $1.5 trillion tax cut, none of them complained about its impact on the deficit. That cut largely went to the super-rich. Now that the rest of us need help, let’s not hear the GOP’s deficit-hawk objections. It’s time to act.

Read more: 2020 was the worst year for economic growth since the Second World War, Washington Post.

Update 1/31/2021: The last-minute Republican alternative is unacceptable.

Posted in Latest News.