Math note - record GDP "growth" will not get us back to pre-COVID normal

On Thursday, we will get our first read on Q3 GDP. And watch for TrumpWorld to constantly flog this report, as it comes off the depths of COVID lockdowns, and is almost certain to report the highest one-quarter jump in GDP in the nation's history. The Atlanta Fed estimates that Q3 will have an annualized growth rate of 36.2%, and it would come on the heels of a Q2 decline of 31.4% and a Q1 drop of 5.0%.

I will bet that Trump and other GOP hacks will point to this GDP report and say " Minus 5 and Minus 31.4 is Minus 36.4. Now with this 36.2% growth, we're basically back to normal!" NO. Just.....NO.

This graph projects 2020Q3's GDP relative to pre-pandemic 2019Q4 GDP depending on Q3's annualized growth rate.

35.0% growth => GDP 3.1% smaller than in 2019Q4 (index = 96.9) & 1.9% smaller than in Q1.

Growth just above 45% implies true V-shape, Q3 fully offsets Q2's loss. pic.twitter.com/VE59xqDsLe

— Aaron Sojourner (@aaronsojourner) October 26, 2020

And that's 3% of TOTAL output. It means that we'd have to get 3 more quarters of growth near 4% just to get back to where we were at the end of 2019.

Of course that's GDP, which measures the amount of output. But fewer people and fewer companies are the ones cranking out the products, as let's not forget that we are still down more than 10.7 million jobs compared to where we were in February. And those individuals have lost significant amounts of their unemployment benefits in recent weeks, and the potential demise of the ACA looming to cause even more disruption in people's lives.

Even if people haven't lost their jobs, many of us are not able and/or willing to spend in places and levels that we did at the start of this year, as COVID is as bad as ever with weather turning colder. And so if Trump/GOP try to say "What a great American comeback!", I think it'll piss off more people than it'll trick, because no one that's looking at our economy in any honest way can think that things are back to normal. Not by 2019 standards, and not even by 2016 standards.