Economist Sam Peltzman argues that the United States, once a bastion of contentment, suffered a historic dip in happiness after COVID‑19. His analysis of the General Social Survey shows a 10‑15 point collapse that has persisted through 2024, marking a sharp reversal in well‑being that no prior decade has seen.

Parallel drops appear in other gauges: the Federal Reserve’s worker‑satisfaction index fell to its lowest 2014‑baseline level, while Michigan’s consumer‑sentiment survey hit an all‑time low. Even the World Happiness Report now ranks the U.S. last, chiefly because young respondents report a swift decline in life satisfaction amid rising inflation and supply‑chain shocks and uncertainty.

Peltzman’s findings contradict the narrative that solid employment and income growth shielded citizens from malaise. Despite unemployment staying below 5% and wages rising faster for lower earners, the uniform 10‑15 point slide cuts across age, race, and education, suggesting a systemic psychological blow rather than a simple economic trend that impacts decision‑making and economic resilience.

The crisis that began in 2020—pandemic, supply‑chain collapse, soaring inflation—has left a lasting scar on collective mood. As policymakers shape stimulus and monetary rules, they must reckon that public sentiment now drives consumer spending and electoral outcomes. Ignoring these soft signals risks repeating a cycle of discontent and eroding societal trust worldwide deeply.