If you drop a ball from a very high window, you can expect a big bounce. The ball, however, has still been dropped.
Thursday’s release of the US’s gross domestic product (GDP) figures are Donald Trump’s last chance to claim he has been a great president for the economy before the election. And boy did he claim it.
Trump has long led Joe Biden in opinion polls on his handling of the economy. While that lead is slipping, the news may be enough to win him back votes he needs as he continues to trail in the polls.
But no matter what Trump says the headline GDP figures do not show an economy that has escaped the ravages of Covid-19. Rather they illustrate, once again, how unfair the US economy has become – especially for poor people, minorities, women and the young.
GDP shot up 33% on an annualized rate in the third quarter after dropping 31% in the second quarter. The percentage increase is on a smaller economy, and the economy is still 3.9% smaller than it was at the end of 2019. For comparison US GDP fell 4.3% from its peak at the end of 2007 to its trough in spring of 2009, what was then the largest decline in the postwar era. Never before have we seen such a huge slump in economic activity in such a short time nor such a surge back.
Much of the bounce has been fueled by consumer spending from those lucky enough to have been able to ride out the pandemic working from home and by the huge government stimulus package agreed in the early days of the pandemic.
Read more of our US business editor Dominic Rushe’s analysis here: For most Americans the crisis is far from over whatever the GDP numbers may say