Yellen says the US economy is stronger than it was before the pandemic, but inflation is a threat

DETROIT, Sept 8 (Reuters) – US Treasury Secretary Janet Yellen said Thursday that President Joe Biden’s agenda has made the economy stronger than it was before the COVID-19 pandemic, but said more work is needed to get the Protect profits, particularly by fighting inflation.

Yellen traveled to Detroit to announce the impact of recent legislative gains ahead of November’s congressional elections, including hundreds of billions of dollars in investments in semiconductors, research, healthcare, green energy and infrastructure as economic priorities.”

“Our plan worked,” Yellen said in a campaign speech ticking off job gains and economic equality improvements at Ford Motor Co (FN) Rouge’s electric vehicle plant in Dearborn, a city outside Detroit. “By any traditional measure, we have experienced one of the fastest economic recoveries in modern history.”

She said the recently passed CHIPS Act, the Inflation Reduction Act and last year’s infrastructure package would expand the US economy’s productive capacity and put Biden’s goal of halving US carbon emissions by 2030 from 2005 levels “well within reach.” bring, in part due to North American tax credits, American-made electric vehicles like Dearborn’s Ford F-150 Lightning pickup truck.

“The most immediate challenge is to return to an environment of stable prices without sacrificing the economic gains of the past two years,” Yellen said, adding that the Federal Reserve has the primary responsibility for taming inflation. “To ensure our long-term economic stability, we must keep our public finances on solid footing.”

TAX, EXPENDITURE PLANS

Yellen said the government will continue to push for additional tax hikes beyond a new alternative minimum tax of 15% for large companies, as well as the implementation of a global tax reform deal that was omitted from recent legislation.

“This includes closing loopholes and bringing high-income and corporate tax rates back to historical norms,” ​​she said, noting that the administration still wants to reverse the 2017 tax cuts enacted by former President Donald Trump and his Republicans — an attempt thwarted by the Democrats’ narrow majority in Congress.

Yellen also said the administration will continue to seek to increase funding for childcare to attract more women into the workforce, another initiative that would require Democrats to win more seats in Congress.

Biden’s party is trying to retain control of Congress in November, and Yellen’s speech in Detroit, the birthplace of America’s auto industry, is part of a month-long speaking tour to herald improvements in the economy. Continue reading

Yellen’s comments made no mention of Biden’s order to forgive up to $20,000 in student loan debt for individuals earning up to $125,000 or $250,000 for a married couple. The plan answers calls for debt relief from progressives on the Democrats’ left flank but has been criticized for helping some wealthy earners, possibly increasing inflation and creating hundreds of billions of dollars in new debt. Continue reading

A Treasury official said the purpose of Yellen’s speech was to focus on the economic implications of the recent legislation, which meant some material had to be trimmed.

Yellen said the green energy, technology and infrastructure investment plans would shift investment more broadly across the United States, not just to wealthy coastal cities.

The Treasury chief has previously described Biden’s economic agenda, including earlier unrealized plans for more childcare and education spending, as “modern supply-side economics.” Continue reading

In contrast to the term popularized in the 1980s to describe the Reagan administration’s focus on tax cuts and deregulation to encourage productive investment, Yellen argued that Biden’s version would focus on a range of investments to boost productivity in more “sectors, people and places”. “

“We know that a disproportionate amount of economic opportunity has been concentrated in the big coastal cities. Investments from the Biden economic plan have already begun to change that dynamic,” Yellen said. Continue reading

Reporting by David Lawder; Edited by Paul Simao and Chizu Nomiyama

Disclaimer: The views expressed in this article are those of the author and may not reflect those of the author Kitco Metals Inc. The author has made every effort to ensure the accuracy of the information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is for informational purposes only. It is not an invitation to exchange goods, securities or other financial instruments. Kitco Metals Inc. and the author of this article assume no responsibility for any loss and/or damage resulting from the use of this publication.