Biden to name Yellen as US Treasury chief

WASHINGTON: Federal Reserve Chair Janet Yellen attends the 32nd Annual Group of 30 (G30) International Banking Seminar in Washington, DC. President-elect Joe Biden will nominate former Federal Reserve Chair Janet Yellen to head the US Treasury.-AFP

WASHINGTON: President-elect Joe Biden was poised to nominate former Federal Reserve chair Janet Yellen to head the US Treasury, a choice that, if confirmed by the Senate, would make her the first woman in the job. The 74-year-old, whose nomination was confirmed to AFP by a financial source close to the Biden administration, would be tasked with steering the world’s largest economy as it struggles with mass layoffs and a sharp growth slowdown caused by the COVID-19 pandemic.

“Yellen will be the next treasury secretary” and she could be formally announced early today, the source said, confirming news first reported by The Wall Street Journal. Yellen’s candidacy was supported by left-wing members of Biden’s Democratic Party, according to the source, and requires Senate confirmation. Yellen broke barriers when former president Barack Obama nominated her to serve as Fed chair in 2014, a position President Donald Trump ousted her from four years later. At the Fed, Yellen was seen as a “dove” inclined towards low interest rates to support employment.

She would succeed Steven Mnuchin, and likely be faced with breaking a months-long deadlock in Congress over passing a new stimulus spending bill for the US economy-assuming lawmakers don’t act before Biden’s inauguration in January. Chief economist at Grant Thornton Diane Swonk called Yellen “a highly talented and gifted economist” on Twitter. “She will make a great treasury secretary at a critical time and write yet another chapter in the history books,” she said.

‘Essential’ spending
The United States is home to the world’s largest COVID-19 outbreak, and as the economy convulsed Congress rallied in March to pass the $2.2 trillion CARES Act that expanded unemployment payments, supported small businesses and allocated money to hard-hit airlines to maintain their staff.

But those provisions expired over the summer, leading to 32,000 furloughs among major airlines alone and raising fears of a renewed economic slump. Congress has been deadlocked on passing more aid, with Democrats supporting another $2.2 trillion measure but Republicans insisting on a series of smaller bills.

Gregori Volokhine, president of Meeschaert Capital Markets, called Yellen a “friend of the markets” for supporting further spending that would boost equities, and noting her confirmation would mark a return of technocrats to the executive branch. “After four years of political appointments, we have appointments of professionals, not only political professionals but also professionals in their professions,” he said. Currently a distinguished fellow at the Brookings Institution in Washington, Yellen has signaled her support for more spending.

Trump may still be trying to overturn Joe Biden’s election win, but the business world-including some Trump backers-is looking ahead towards the new Democratic administration. Less than two months before the 78-year-old Biden takes the oath of office, corporate heavyweights are pushing him to lean on Congress to get a new economic stimulus plan, as the coronavirus pandemic drags on.

“The next two months are critical to our nation’s ability to successfully deal with twin crises: controlling the spread of Covid-19 and rebuilding the US economy,” the National Association of Manufacturers said. “There is no time to waste nor room for error,” the group added in a statement, calling on the Trump administration to start cooperating with Biden’s transition team.

But so far, Trump and his White House staff are not admitting defeat, meaning the resources normally at a president-elect’s disposal for a transition are blocked. Several key business leaders and industry organizations, such as United Airlines CEO Scott Kirby and the US Chamber of Commerce, quickly congratulated Biden once he was declared the projected winner on November 7.

Ten days later, Walmart CEO Doug McMillon took a break from an earnings conference call to offer the veteran Democrat his best wishes. “We look forward to working with the administration in both houses of Congress to move the country forward,” he said. Trump, a real estate mogul who often brags about his close ties with the corporate world, especially on Wall Street, has been left behind by some of those very contacts.

Steve Schwarzman, the billionaire co-founder of the Blackstone investment group who is a friend and informal advisor to the president, said Monday that Biden had won. “The outcome is very certain today, and the country should move on,” he said in a statement sent to AFP. “I supported President Trump and the strong economic path he built. Like many in the business community, I am ready to help President-elect Biden and his team as they confront the significant challenges of rebuilding our post-COVID economy.” – AFP

Back to top button