The worst of the coronavirus recession is past. Now what?

When the Department of Commerce announced on Thursday that the advanced estimate for second-quarter GDP growth came in with a bone-chilling 32.9% decline on an annualized basis, Congress was debating the details of another multitrillion-dollar relief package for America’s beleaguered, coronavirus-fatigued population. An extended federal supplement for the more than 20 million unemployed people, along with perhaps another round of cash payments for families, will almost surely be finalized before Congress goes on recess.

But while our legislators deliberate and the coronavirus surges, GDP growth (which until the pandemic was weak but improving) seems to be caught in a downdraft. Another shipment of money from Washington may help us weather the storm, but GDP growth will continue to disappoint unless the money actually gets spent.

The latest report on coincident economic indicators from the Federal Reserve Bank of Philadelphia helps to put some dimension on how things looked through June across the 50 states. The June estimate indicates that economic conditions improved in 42 states. This was up comfortably from the May estimate, when 34 states showed improving conditions, and up a huge amount from April’s numbers when not one single state showed improvement. To put it mildly, the data showed a happy, positive trend.