FORT WORTH, Texas (`) – Confidence in the U.S. dollar has often depended in part on what Treasury Secretary Janet Yellen said. On Thursday, the focus will be on what she writes when the government issues its first signature currency.
Yellen writes her capital letters ‘J’ and ‘Y’ while the rest of her name flows in a hurry that suggests handwriting may not have been the top priority for this pioneering economist.
She made a name for herself as a stoic Federal Reserve Chair and a shrewd forecaster, and now she’s at the forefront of far-reaching efforts to use economic leverage to stop Russia’s war in Ukraine and use fiscal policy to save the planet from climate change protect and oversee a massive effort to bolster the beleaguered IRS.
This puts them at the center of domestic and world politics and invites new pressure and doubts from friends and enemies. It is taking on this challenge as the United States suffers from inflation that hit a 40-year high this summer, fueling fears of a coming recession.
Although Yellen plans to watch as the new bills are launched with her signature at the Bureau of Engraving and Printing’s western currency facility in Forth Worth, Texas, her solemn remarks should tie in with the political accomplishments of the Biden administration rather than deal with her status as first woman to act as treasurer.
Regarding the Ukraine conflict instigated by Russian President Vladimir Putin last February, she said in prepared remarks: “Together with over 30 countries, we have denied Russia the revenue and resources it needs to wage its war.”
As for the domestic economy, she said pandemic relief and a new law to boost semiconductor production have positioned the U.S. “to capitalize on a surge of economic opportunity for the American people, including in communities that are often overlooked.”
Now, two years into Joe Biden’s presidency, Yellen has quashed rumors she might be ready to leave government early and is gearing up for more economic — as well as political — struggles.
In addition to managing the Treasury Department’s role in the Ukraine war, she faces the herculean task of reviving an IRS that receives an $80 billion funding boost and enforcing anti-money laundering measures that have been stripping documentation of beneficial owners of tens of millions of U.S. companies require hopes of crushing corruption around the world.
It is taking on an increasingly politicized role in which Congress and foreign governments are as important as the financial markets.
Your Treasury Department is trying to weaken Russia’s economy with an oil price cap, while Republican House Speaker Kevin McCarthy of California is questioning the extent of US support for Ukraine. The Treasury Department is also putting together tens of billions of dollars in tax stimulus to address climate change, which has angered some European allies and proved controversial among Republicans. And wage gains in the latest 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 has not shied away from controversy or voicing her opinions on issues that many Americans view only through a cultural lens.
When Senator Tim Scott, RS.C., told Yellen at a congressional hearing in May that she was “harsh” for speaking about the positive economic impact of women’s access to abortion, she replied, “It’s not harsh, that’s the truth. She has also challenged the view that havens for hidden money lie outside the US, arguing instead that the US has become the “best place” to hide illicit money.
Yellen stirred up some tension with the White House this year when she backed away from Biden’s insistence that his $1.9 trillion coronavirus relief package was not contributing to inflation. Republican lawmakers have drawn on analysis by great economists like Harvard University’s Larry Summers to say the figure was excessive and fueled inflation. Disruptions in the global supply chain and a spike in food and energy costs following Russia’s invasion of Ukraine have also helped push prices to uncomfortable levels, putting the economy at increased risk of recession.
Yellen admitted on CNN in May that she was “wrong at the time about the path inflation would take.” Biden said he was briefed on the possible inflationary risks when putting the aid package 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 Department about the financial markets have proved correct on other counts.
Their warnings about the risks of a deregulated cryptocurrency market foreshadowed 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 vaporized overnight.
Yellen has also used her platform as a senior government official to warn that despite the advances women are making in the workplace, a glass ceiling is preventing many from rising to the very highest positions.
Yellen, who is the only person to have ever headed the Treasury Department, the Federal Reserve and the White House Council of Economic Advisers, still faces criticism from members of both political parties for sometimes not being more dynamic and politically savvy and too direct to others times.
Summers, Secretary of the Treasury under President Bill Clinton, said in a statement to The Associated Press that Yellen “is pursuing a distinguished career in economic policy at the US Treasury Department. No other finance minister has championed social justice as a central goal of macro and fiscal policy.”
Anusha Chari, an economist who chairs the American Economic Association’s committee on the status of women in business, called Yellen’s signature on US currency “a huge milestone, but it also shows us how far we have to go.”
The Treasury was established in 1789 and was headed only by white men until Yellen.
Chari said: “It’s an occasion we should celebrate – to see Janet Yellen’s name on the currency – but I wish it wasn’t such a unique event for women.”
Yellen’s signature will appear next to the name of US Treasurer Lynn Malerba, the first Native American woman in the role. The bills are expected to be delivered to the Federal Reserve in December and start circulating next year.
Yellen says of the moment, “This really isn’t about me or Treasurer Malerba. To me, these notes represent the Treasury Department’s hard, ongoing work to strengthen our economy and improve our economic standing around the world.”
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Boak reported from Washington.
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