Yellen Urges Congress to Raise Debt Ceiling, Praises Biden’s Economic Policies
By US Treasury Secretary Janet Yellen expressed confidence on Monday that the US economy can avoid a recession despite the rising tide of corporate layoffs and the looming debt limit battle.[0] During an interview on ABC's “Good Morning America,” Yellen said the economy remains “strong and resilient” and noted that the US economy added an impressive 517,000 jobs in January and the unemployment rate fell to a 54-year low of 3.4 percent.[1]
Yellen also praised President Joe Biden’s economic policies ahead of the Tuesday State of the Union address, saying that his ability to reduce gas prices using the Strategic Petroleum Reserve and drug prices using the Inflation Reduction Act has helped combat inflation.[1] She argued that President Biden's “trifecta of legislation”, consisting of the CHIPS Act, the Inflation Reduction Act, and the Infrastructure Investment and Jobs Act, is an illustration of “investing in America again” that will reap dividends.[2]
The consumer price index, which refers to the cost of goods and services, dipped 0.1 percent in December, but rose 6.5 percent in 2022—a figure Yellen said “remains remains too high,.”[3] The pace of increases in the consumer price index, which peaked at 9.1 percent in the year through June, has since declined to 6.5 percent in December.[4] Janet Yellen noted that the unemployment rate is still “remains too high,” and that reducing it is President Biden's top priority.[4]
Yellen urged Congress to raise the U.S. debt ceiling of $31.4 trillion, which was reached last month. The Treasury took on “extraordinary measures” to prevent default, which Yellen warned would bring about “an economic and financial catastrophe.” In an interview with “Good Morning America,” Yellen discussed the potential disagreement in Congress regarding raising the debt ceiling before it reaches its limit this summer.
On Monday at 5:30 p.m., House Speaker Kevin McCarthy will be giving a speech regarding the debt ceiling.[5] [5] McCarthy and President Joe Biden have held numerous discussions in a friendly manner, yet no agreement has been established.[5] Yellen strongly encouraged lawmakers to reach a consensus on the debt ceiling, warning of the potential consequences for the U.S. should they fail to do so.
0. “Janet Yellen: ‘You don't have a recession' with unemployment at 50-year low” Fox Business, 6 Feb. 2023, https://www.foxbusiness.com/economy/janet-yellen-you-dont-have-recession-unemployment-at-50-year-low
1. “Treasury Secretary Janet Yellen rejects recession fears, says economy is ‘strong'” ABC News, 6 Feb. 2023, https://abcnews.go.com/Business/treasury-secretary-janet-yellen-rejects-recession-fears-economy/story?id=96919098
2. “The Treasury secretary says the red-hot labor market means the U.S. can avoid a recession: ‘You don’t have a recession when you have 500,000 jobs and the lowest unemployment rate in more than 50 years’” Fortune, 6 Feb. 2023, https://fortune.com/2023/02/06/janet-yellen-no-recession-jobs-low-unemployment
3. “Yellen Downplays Recession Fears After U.S. Unemployment Reaches 54-Year Low” Forbes, 6 Feb. 2023, https://www.forbes.com/sites/saradorn/2023/02/06/yellen-downplays-recession-fears-after-us-unemployment-reaches-54-year-low
4. “U.S. Treasury Secretary Yellen touts gain in jobs, playing down recession danger” Press Herald, 6 Feb. 2023, https://www.pressherald.com/2023/02/06/u-s-treasury-secretary-yellen-touts-gain-in-jobs-playing-down-recession-danger
5. “Failure to raise U.S. debt ceiling would lead to ‘economic and financial catastrophe,' Yellen says” CNBC, 6 Feb. 2023, https://www.cnbc.com/2023/02/06/failing-to-raise-us-debt-ceiling-would-lead-to-economic-and-financial-catastrophe-yellen-says.html
