FORT WORTH, Texas (AP) — Confidence in the US dollar often depends in part on what Treasury Secretary Janet Yellen says. On Thursday, the focus will be on what she writes as the government launches its first signature currency.
Yellen loops her capitals “J” and “Y” while the rest of her name flows in a rush that suggests handwriting may not have been a top priority for this trailblazing economist.
She made her reputation as a stoic chairman of the Federal Reserve and a shrewd forecaster, and now she is at the forefront of widespread efforts to use economic leverage to help stop Russia’s war in Ukraine, to apply tax policies to protect the planet against climate change and overseeing a massive effort to strengthen the beleaguered IRS.
That puts her at the center of domestic and global politics, inviting new levels of pressure and doubt from friends and foes alike. She is rising to the challenge as the United States suffers from inflation that hit a 40-year high this summer, fueling fears of a coming recession.
Even as Yellen plans to see the new bills with her signature rolled out at the Western Currency facility of the Bureau of Engraving and Printing in Forth Worth, Texas, her celebratory remarks focused on the policy performance of the Biden administration rather than on her status as the first woman to serve as Secretary of the Treasury.
On the Ukraine conflict sparked by Russian President Vladimir Putin last February, she said in prepared remarks: “Together with more than 30 countries, we have denied Russia revenues and resources it needs to fight its war.”
On the domestic economy, she said, pandemic relief and a new law to boost semiconductor manufacturing have put the US in a position “to take advantage of a wave of economic opportunity for the American people, including in communities often be overlooked.”
Now, two years into Joe Biden’s presidency, Yellen has quashed rumors that she may be ready to leave the administration early and is preparing for more economic — as well as political — battles ahead.
In addition to managing the Treasury’s role in the Ukraine war, she faces the mammoth task of reviving an IRS receiving an $80 billion funding boost, and enforcing an anti-money laundering effort that requires documenting. of the beneficial owners of tens of millions of American companies in hopes of stamping out corruption around the world.
It fulfills an increasingly politicized role in which Congress and foreign governments are just as important as financial markets.
Its Treasury Department is trying to hamper the Russian economy with an oil price cap as Republican House Leader Kevin McCarthy of California questions the level of US aid to Ukraine. The Treasury is also putting together tens of billions in tax incentives to tackle climate change, which have baffled some European allies and proved controversial with Republicans. And the wage increases in the most recent US jobs report suggest the economy may have to endure more pain than expected to bring inflation back to the Fed’s target of 2% a year.
Along the way, Yellen didn’t shy away from controversy or voice her opinion on issues that many Americans look at exclusively through a cultural lens.
When Senator Tim Scott, RS.C., told Yellen at a congressional hearing in May that she was being “tough” for talking about the positive economic impact of access to abortion for women, she replied, “This isn’t harsh, this is the truth.” She has also challenged the view that hidden money havens lie outside the US, stating instead that the US has become the “best place” to hide illegally obtained money.
Yellen caused some tension with the White House this year when she deviated slightly from Biden’s insistence that his $1.9 trillion in coronavirus relief package was not contributing to inflation. Republican lawmakers have drawn on analysis by major economists such as Harvard University’s Larry Summers to say the amount was excessive and led to inflation. Breach in the global supply chain and a rise in food and energy costs after Russia invaded Ukraine have also contributed to pushing prices to uncomfortable levels, putting the economy at increased risk of recession.
Yellen acknowledged on CNN in May that she was “wrong then about the path inflation would take”. Biden said he was made aware of the potential risks of inflation when the aid package was put together, but he told The Associated Press in an interview that “the idea that it caused inflation is bizarre.”
Yellen’s predictions at the Treasury about the financial markets have turned out to be correct on other points.
Her warnings about the risks of a deregulated cryptocurrency market foresaw the recent chaos. Crypto markets have seen at least two major crashes, dozens of scams, Ponzi schemes, and hundreds of billions of dollars made and evaporated overnight.
Yellen has also used her platform as a top civil servant to warn that despite women’s progress in the workplace, a glass ceiling prevents many from progressing to the very top positions.
Yellen, who is the only person ever to lead the Treasury Department, the Federal Reserve and the White House Council of Economic Advisers, continues to face criticism from members of both political parties for sometimes not being more dynamic and politically literate. being and being too direct in other times.
Anusha Chari, an economist who chairs the American Economic Association’s Committee on the Status of Women in the Economics Profession, called Yellen’s signature on the US currency “a huge milestone, but it also shows us how far we still have to go”. .”
The Treasury Department was established in 1789, and until Yellen, only white men had headed it.
Chari said “it’s an occasion we should be celebrating – seeing Janet Yellen’s name on currency – but I wish it wasn’t such a unique event for women.”
Yellen’s signature will appear next to the name of U.S. Treasurer Lynn Malerba, the first Native American in the role. The bills are expected to be delivered to the Federal Reserve in December and will be in circulation next year.
Yellen says of the moment: “This is really not about me or Treasurer Malerba. To me, these notes represent the hard, ongoing work of the Treasury Department to strengthen our economy and improve our economic position around the world.
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Bo reported from Washington.
