Watch a Columbia Professor Decimate Jasmine Crockett
There's Been a Massive Shakeup at the National Security Agency
Senate Republicans Appear to Have the Votes to Push Through Trump's Budget Reconciliation...
Pentagon Watchdog Launches 'Signalgate' Investigation Into Pete Hegseth
United Kingdom Weighs Striking Back Against US Tariffs, and It's Asking Businesses for...
An Ivy League Professor Flees to Canada and You Will Be Made to...
'Designed for Battle' Isn't a Valid Argument for Gun Control
Did '60 Minutes' Put Out Their Worst Segment With Lesley Stahl Providing Cover...
Kamala Harris Did More Than Just Endorse New WI Supreme Court Justice
Trump Weighs In on Proxy Voting Proposal, and It Looks Like There May...
Bernie Sanders Once More Tries, Fails Miserably to Get His Anti-Israel Resolutions Passed
Is AOC Really the Democratic Party's Leader? Here's What These Polls Say.
Senate Votes on Confirming Dr. Oz for Role in Trump Administration
We Will Hold Rogue Judges Accountable, Rep. Gill Says
Will the Liberal Media Cover This Horrific Crime Story?
Tipsheet

Treasury Secretary Yellen: There's Something Far Riskier Than Inflation From Biden's Relief Plan

AP Photo/Carolyn Kaster

Treasury Secretary Janet Yellen on Sunday acknowledged the increased risk of inflation should Congress move forward and pass President Joe Biden's $1.9 trillion American Rescue Plan. According to Yellen, the benefits outweigh the risks, especially as Americans continue to suffer from the Wuhan coronavirus pandemic.

Advertisement

The secretary said that with 10 million Americans unemployed and another four million dropping out of the workforce, relief is needed to help them make ends meet. She also pointed out that a number of women who have dropped out of the workforce have done so because of childcare issues, which is another reason kids need to be sent back to school.

"People are on the verge of losing the roofs over their heads. The package provides rental assistance," she said. "We have 24 million adults and 12 million children that are going hungry everyday. We need to provide them with food."

The goal is to make sure there is no "permanent toll" on Americans, particularly low-wage and minority workers. 

"We need a package that's big enough to address this full range of need and I believe the American Rescue Plan is up to the job," Yellen said. "My predecessor has indicated that there's a chance this will cause inflation to rise. And that's a risk that we have to consider. I've spent many years studying inflation and worrying about inflation and I can tell you, we have the tools to deal with that risk if it materializes."

Advertisement

"We face a huge economic challenge here and tremendous suffering in the country. We've got to address that. That's the biggest risk," she explained.

The comments come after President Bill Clinton's Treasury Secretary, Larry Summers, penned an opinion piece in The Washington Post about the "admirably ambitious" stimulus plan, saying it brought "big risks." Specifically, Summers warned that the gap between actual and estimated economic output would be significantly higher than what was seen during the 2008 recession. That would mean inflation would be worse under this one economic package alone (not including the previously-passed relief bills).

"In 2009, the gap between actual and estimated potential output was about $80 billion a month and increasing. The 2009 stimulus measures provided an incremental $30 billion to $40 billion a month during 2009 — an amount equal to about half the output shortfall," he explained. 

Advertisement

"In contrast, recent Congressional Budget Office estimates suggest that with the already enacted $900 billion package — but without any new stimulus — the gap between actual and potential output will decline from about $50 billion a month at the beginning of the year to $20 billion a month at its end. The proposed stimulus will total in the neighborhood of $150 billion a month, even before consideration of any follow-on measures. That is at least three times the size of the output shortfall."

Join the conversation as a VIP Member

Recommended

Trending on Townhall Videos

Advertisement
Advertisement
Advertisement