Newsletter: The economic crater

A record collapse in U.S. gross domestic product points to challenges for an economic recovery — and for President Trump.

TOP STORIES

The Economic Crater

No matter how you look at it, the news is bad: U.S. economic output fell at a 32.9% annual rate in the second quarter — a level not seen since the Great Depression and by far the largest drop since government record-keeping began in 1947, according to data released Thursday.

The sharp contraction, reflected in the government’s report of gross domestic product — the sum of all goods and services produced in the country — include data from the mini-recovery that occurred before the latest surge in the COVID-19 pandemic.

Now with the coronavirus rampaging over large areas of the country, measures of consumer spending, small-business activity and job openings are slowing again, casting a shadow over economic conditions many Americans will face as election day draws near.

A separate report from the Labor Department showed new unemployment claims rose last week to 1.43 million. It brought the total number of people who have applied for jobless benefits since mid-March to more than 54 million, which is about a third of the American labor force.

Taken together, the new economic reports point to significant hurdles for President Trump in his reelection bid and lend fresh urgency to lawmakers who are wrangling over provisions to provide another round of support to the economy.

Election Day Is Nov. 3

In a desperate bid to resuscitate his reelection campaign, Trump has tried ignoring the coronavirus crisis, spreading racist fears about poor people bringing crime to the suburbs and promising that an economic miracle is right around the corner.

None of it has worked, so he’s attempted a new tactic — suggesting that widespread voter fraud could require delaying the Nov. 3 election. No U.S. presidential election has ever been postponed, even during the Civil War, World War II and other times of national crisis.

Nor does the president have the power to change the date; only Congress can do so, per the Constitution, and Republican leaders swiftly rejected the idea.

There’s also no evidence that mail-in ballots have led to significant voter fraud, as Trump claimed. Interestingly enough, one of the biggest supporters of voting by mail is the Republican secretary of state in Washington state.

‘Reinventing How Reentry Works’

Missteps by corrections officials handling releases from state prisons are fueling fears in some California counties that thousands of inmates eligible for early release could spread the coronavirus in their communities.

County probation officials and others on the front lines of the release of as many as 8,000 inmates by the end of August have complained that prisoners were recently freed with little notice to local authorities and without appropriate transportation or quarantine housing — and in some cases, no clear indication they were virus-free.

Local officials’ concerns stem in part from the ill-fated transfer in late May of 121 inmates from a coronavirus-ridden prison in Chino to San Quentin, triggering an outbreak there that has killed at least 19 inmates and sickened more than 2,000 others.

The growing numbers of expedited releases, combined with shutdowns of programs because of the virus, have upended how local authorities deal with newly freed prisoners.

More Top Coronavirus Headlines

— California is approaching another coronavirus milestone: 9,000 deaths, after a major surge in infections.

— Men are less likely to wear masks. They are also dying of the coronavirus at higher rates in L.A. County.

— USC is dealing with an outbreak of the coronavirus spread across the university’s Greek row.

— Herman Cain, a former Republican presidential candidate who went on to become an ardent Trump supporter, has died of complications from COVID-19 at 74.

For more, sign up for Coronavirus Today, a special edition of The Times’ Health and Science newsletter.

Spiking Pension Spiking

The California Supreme Court has unanimously upheld a provision in a 2013 law that prohibited many county employees from pension spiking — the practice of padding their future pensions by cashing in years of vacation or sick pay or working longer hours usually at the end of their careers.

Unions and public employee groups challenged the ban on spiking, contending it conflicted with decades of court decisions that created what is known as the California Rule. That rule guarantees government workers the pension they would be due under the rules that were in place on the day they were hired.

Instead, the court crafted a narrow decision applying to spiking but not the California Rule as a whole.

Praying for Chicago

Donovan Price, a 53-year-old self-described street pastor, has found a calling in consoling the families of victims of gun violence in Chicago.

He scans his phone — waiting for texts, Twitter messages, phone calls — and then drives to street corners or hospitals. He searches for grace, but it seems like every day word of another shooting finds him.

“We who live in this city,” he said, “have to figure out how to end this now.”

This troubled city cannot be fixed, Price said, unless the underlying causes of violence are addressed and locals, not outside federal forces, provide the answers.

FROM THE ARCHIVES

On Aug. 2, 1960, then-Vice President Richard Nixon traveled to Whittier to officially launch his campaign after winning the Republican presidential nomination in Chicago the week before.

The next morning’s Los Angeles Times reported that Nixon, who “flew into Los Angeles from Reno, landing at 5:10 p.m., managed to crowd into his busy schedule a planeside reception.”

Nixon would lose to Massachusetts Sen. John F. Kennedy in the presidential race and in his 1962 run for California governor (saying, famously, “you don’t have Nixon to kick around any more”) before winning the presidency in 1968.

Want more of the Los Angeles Times archives? We’re on Instagram.

YOUR WEEKEND

— Seventeen picks for weekend culture, including a “Hamilton” cast reunion to fight racism, a virtual dance festival, a star-studded Tennessee Williams celebration and the annual Broadway Bares burlesque show.

— Get takeout comfort food from a Times-honored restaurant. The Times has named Orsa & Winston its restaurant of the year for “the delicious ways it reflects the cultural mosaics of our city” and given Post & Beam the Gold Award, calling it “an essential Southern California experience.”

— Plant a vegetable garden, no matter how small. A Pomona farmer offers inspiration and tips.

— These cool walks in L.A. will let you easily get in 10,000 steps.

CALIFORNIA

— Federal prosecutors say L.A. City Councilman Jose Huizar, who was arrested and charged with racketeering last month in an ongoing pay-to-play probe, now faces additional charges including bribery and money laundering.

— State lawmakers lashed out at a plan that would take two months to resolve a backlog of nearly 1 million unemployment benefit claims, warning at a legislative hearing that many jobless people are struggling to pay for food and rent.

— More than a dozen L.A.-area veterinarians and others who care for animals say Marc Ching, founder of a Hollywood-backed animal rescue charity, endangered pets by treating them with his own products.

— After missing DACA, 19-year-old Beatriz Basurto resented her U.S.-born siblings. Now, she is among tens of thousands of immigrant youth whom the Trump administration has effectively kept out of the program.

NATION-WORLD

— At the funeral of Rep. John Lewis, three former presidents eulogized a man who spent his life fighting for civil rights. And in an essay he wrote shortly before he died and that was published posthumously in the New York Times, Lewis implores younger generations to keep fighting, telling them, “Now it is your turn to let freedom ring.”

— Hong Kong authorities have barred pro-democracy candidates from running in upcoming elections and arrested four pro-independence activists, giving substance to fears that a contentious new national security law imposed by Beijing is being used to silence dissent.

— Another casualty of the pandemic: the Mexican fiesta. Says one mariachi singer who hasn’t performed at one since March: “Everything is sad and tense.”

— A full Washington, D.C., federal appeals court will review a decision ordering the dismissal of the Justice Department’s case against former Trump national security advisor Michael Flynn, after a three-judge panel ruled last month that a lower court had overstepped its bounds by not granting prosecutors’ request to dismiss it.

HOLLYWOOD AND THE ARTS

— Four women tell The Times they were mistreated by comedian Bryan Callen, describing troubling sexual incidents ranging from assault to misconduct to disturbing comments. Their stories suggest a pattern of behavior that spans decades, going back at least as far as 1999. Callen has denied all accounts.

— “Mrs. America” gets its history wrong and is bad for women, feminist activists Gloria Steinem and Eleanor Smeal write. The ERA’s defeat was the product not of a catfight but of a coordinated effort by corporate lobbying, they say.

— Two Black women have taken top jobs at book publishing titans in recent weeks. We talked with Dana Canedy and Lisa Lucas about their new roles and the industry’s long overdue reckoning.

— “Clueless” may be a quintessential ‘90s teen classic, but at 25, its wit, charm and one-liner-studded script haven’t aged a day, Times film critic Justin Chang and TV reporter Yvonne Villarreal say.

BUSINESS

— People are stuck at home. So is their spare change. The resulting coin shortage is hitting small-business owners, big retailers and everyday shoppers — especially those who don’t have credit or debit cards, and they’re responding with free drinks, store credit and cries for help.

— California Pizza Kitchen has filed for bankruptcy and is looking to restructure, as unpaid rent on its closed restaurants piles up.

SPORTS

— LeBron James put back his own missed pull-up jumper in the final minute to give the Lakers a 103-101 victory over the Clippers in the second game of the NBA restart doubleheader. We took a look at the detailed safety protocols for its bubble environment, including coverings for referee whistles.

— Is Angel Stadium historically significant? No, according to the city of Anaheim. But the Big A sign is a different matter.

OPINION

— Atty. Gen. William Barr insists he doesn’t speak with or take orders from the president, but it’s clear he knows what Trump wants and needs, writes Harry Litman in an op-ed. “That’s what makes him so valuable to Trump, and so dangerous to democracy.”

— Art critic Christopher Knight says it’s time to chop down the “lynching tree” from the city logo of Placerville, Calif.

WHAT OUR EDITORS ARE READING

— The Department of Homeland Security reportedly produced “intelligence reports” on two journalists who published leaked documents related to the protests in Portland, Ore. (Washington Post)

— Geologist and oceanographer Marie Tharp created maps of the seafloor that changed the way people imagine two-thirds of the world. (Atlas Obscura)

ONLY IN L.A.

Fifty-one miles of territory. Thousands of years of evolution. How to grasp the complexity of the Los Angeles River, its history and its geological diversity in a single sitting. Well, there’s an augmented reality app for that called Rio de Los Angeles. Point it at a flat surface and a 3-D map of the Los Angeles Basin materializes on the screen. From there, a menu of options walks you through the river’s history, from the shifting waterway on a broad flood plain to the channelized water body encased in concrete.

Comments or ideas? Email us at [email protected].