By Kate Davidson
WASHINGTON -- Janet Yellen told lawmakers Tuesday she would make
the needs of America's workers her core focus if confirmed as the
next U.S. Treasury secretary and ensure the U.S. has a competitive
economy that offers good jobs and wages workers in cities and rural
"I will be focused on day one on providing support to America's
workers and to small businesses, putting into effect as quickly and
efficiently as I can, the relief in the bill that was recently
passed, and then over time working for a second package that I
think we need to get through these dark times," she told the Senate
Finance Committee at her confirmation hearing before a vote on her
Ms. Yellen said that additional spending that provides relief
for struggling families and businesses could provide the most "bang
for the buck" for the economy as a whole, including extended
jobless benefits and nutrition assistance.
Ms. Yellen also affirmed the U.S.'s commitment to
market-determined exchange rates, and she made clear the U.S.
doesn't seek a weaker dollar for competitive advantage. She added
that efforts by foreign countries to artificially manipulate their
currencies are "unacceptable."
She also took aim at China, saying the U.S. should address its
"abusive, unfair and illegal practices," including undercutting
American companies by dumping products, erecting trade barriers,
giving illegal subsidies to corporations and stealing intellectual
"These policies, including China's low labor and environmental
standards, are practices that we're prepared to use the full array
of tools to address," she said.
In her earlier prepared remarks, Ms. Yellen urged lawmakers to
"act big" to avert a protracted economic downturn and put aside
concerns about the mounting national debt.
"Economists don't always agree, but I think there is a consensus
now: Without further action, we risk a longer, more painful
recession now -- and long-term scarring of the economy later," Ms.
President-elect Joe Biden's $1.9 trillion coronavirus relief
package, unveiled last week, provides for another round of direct
stimulus payments, extended and enhanced jobless benefits, funding
for schools and first responders and the creation of a nationwide
vaccination program. The proposal also includes longstanding
Democratic priorities, such as raising the federal minimum wage to
$15 an hour and expanding paid leave for workers.
Republicans have decried the size and scope of the measure,
arguing it would spend more than the economy needs. Some
Republicans and Democrats have also expressed concern about the
growing national debt, which at $21.6 trillion exceeds the annual
output of the U.S. economy.
Ms. Yellen aimed to address those concerns in her testimony,
saying the government's long-term fiscal trajectory is a cause for
concern and will eventually need to be addressed.
"But it's also important for America to invest: Invest in our
infrastructure, invest in our workers, invest in research and
development -- the things that make our economy grow faster, make
it more competitive," she said.
She also reiterated that interest rates are at historic lows,
making debt more affordable. Though rates may eventually rise,
"right now our challenge is to get America back to work and to
defeat the pandemic," she added.
Asked whether the U.S. should revisit the possibility of issuing
50-year bonds, Ms. Yellen said she was open to the idea and would
study the market's appetite for such debt.
"There is an advantage to funding the debt, especially when
interest rates are very low, by issuing long-term debt," she
The Treasury last year began regularly issuing 20-year bonds for
the first time in decades, but decided against selling longer-term
debt after determining there wasn't sufficient investor demand.
Mr. Biden's advisers have argued that the low cost of borrowing
and weak economy call for larger short-term deficits to shore up
the recovery. But it isn't clear how much of their broader agenda
-- which includes investments in infrastructure, health care and
green energy -- they intend to finance through borrowing and how
much they would offset with new revenue, such as tax increases on
Ms. Yellen said that as Treasury secretary, she would face a
"dual mission." The first is to see Americans through the pandemic.
"But then there is the longer-term project. We have to rebuild our
economy so that it creates more prosperity for more people and
ensures that American workers can compete in an increasingly
competitive global economy."
Mr. Biden's nomination of Ms. Yellen positions the 74-year-old
labor economist to lead his administration's efforts to advance the
recovery from the destruction caused by the coronavirus pandemic
and related shutdowns. She will also play a key role in pushing the
administration's economic agenda on Capitol Hill, a job that starts
in earnest Tuesday, said Tony Fratto, a senior Treasury and White
House aide in the George W. Bush administration.
"She's a known quantity in terms of testifying there, but I
think this is the first time she has had to go to really be
something of a salesman on policy before," Mr. Fratto said. "She's
the primary spokesperson now."
The Senate confirmation hearing is Ms. Yellen's fifth during her
three decades at the forefront of economic policy-making. If
confirmed, she will be the first woman to serve as Treasury
secretary and the first person to have led the Fed, the Treasury
and the White House Council of Economic Advisers.
The hearing comes at a time of growing uncertainty over the
progress of the pandemic, which has killed close to 400,000 people
in the U.S., as well as the state of the economy. Retail sales fell
for the third straight month in December, and employers cut jobs,
ending seven months of employment gains.
Write to Kate Davidson at firstname.lastname@example.org
(END) Dow Jones Newswires
January 19, 2021 12:41 ET (17:41 GMT)
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