Perspectives: Record Quarterly Drop in GDP Drives Economic Speculation, Stimulus Talks

Headline Roundup July 30th, 2020

U.S. gross domestic product (GDP) dropped at an annual rate of 32.9% in the second quarter of 2020, the largest such drop on record. Speculation soon followed about how the fall could impact the country's economic rebound from the COVID-19 coronavirus pandemic, and in a more immediate sense, could impact the November presidential election and ongoing negotiations between lawmakers about a potential new virus relief package.

Some left-rated voices tied the numbers to President Trump's recent remarks about a possible election delay, framing his comments as an effort to distract voters from negative economic data. Some right-rated voices used the data to offer a look ahead at how the U.S. economic recovery will pan out, mentioning that some major industries such as construction and manufacturing are beginning to resume operations. Coverage on all sides of the spectrum noted the data's historic significance. Editor's Note: this post originally described the 32.9% drop as a quarterly rate, rather than the annual rate. We regret the error. Updated 7/30/20 at 8:53 p.m. ET

Perspectives: Record Quarterly Drop in GDP Drives Economic Speculation, Stimulus Talks

From the Center
302
ANALYSIS

The Commerce Department's initial estimate of U.S. gross domestic product (GDP) in the second quarter was, in a word, historic. The value of all goods and services purchased last quarter plunged at a 32.9% annual rate. This followed a 5% contraction in the first quarter of 2020.

The BEA offered the following assessment of this decline in GDP:

“The decline in second quarter GDP reflected the response to COVID-19, as ‘stay-at-home’ orders issued in March and April were partially lifted in some areas of the country in May and June,...

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From the Right
302
OPINION

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...

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From the Left
302
OPINION

Minutes after horrible economic numbers — a 32.9 percent annualized contraction in gross domestic product and 1.43 million new jobless claims — were released, President Trump tweeted out a statement suggesting we should delay the election. Clearly, he wants us to ignore the 32.9 percent annualized contraction in gross national product and 1.43 million new jobless claims. But we won’t ignore the 32.9 percent annualized contraction in gross domestic product and 1.43 million new jobless claims.

Do not get me wrong. Trump’s suggestion is anti-democratic and emblematic of his inability...

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