Treasury secretary Janet Yellen pushed for stimulus checks
President Biden’s spending plans can offer a “big return,” Tres. Sec. Janet Yellen said Sunday. The measures should be paid for while interest rates sit at historic lows, she added. If inflation rises more than expected, the government “has the tools to address it,” Yellen said. See more stories on Insider’s business page.
Treasury Secretary Janet Yellen reiterated her support for President Joe Biden’s spending plans on Sunday, pitching the measures as strong investments in the country’s future.
The president on Wednesday rolled out a $1.8 trillion spending proposal that includes funding for paid family and medical leave, universal pre-K, and childcare. The measure follows the March passage of Biden’s $1.9 trillion stimulus package and joins the president’s $2.3 trillion infrastructure plan as his latest step in big-government economic policy.
Republicans and some moderate Democrats have balked at the follow-up plans cost, saying the measures would dangerously inflate the government’s debt pile. Yellen countered on NBC’s “Meet The Press,” saying it’s a better time than ever to spend on such projects.
“We’re in a good fiscal position. Interest rates are historically low… and it’s likely they’ll stay that way into the future,” the Treasury Secretary said. “I believe that we should pay for these historic investments. There will be a big return.”
That’s not to say the government shouldn’t offset the multitrillion-dollar price tag. The Biden administration rolled out a handful of tax hikes and stronger enforcement to cover the spending, but those proposals were swiftly rejected by Republicans. The GOP has criticized Biden’s public-works plan and a proposed corporate tax increase, calling it a “slush-fund” and a “Trojan horse” for Democratic priorities.
The economy is poised to rebound from the coronavirus pandemic throughout 2021 and, in turn, bring in greater tax revenues. That stronger growth justifies some spending, but the safest and most sustainable way to spend on infrastructure and care involves equitable tax increases, Yellen said.
Stricter tax compliance would also play