Appearing on the Sunday talk shows, Treasury Secretary Janet Yellen advocated for President Biden’s American Rescue Plan partially in response to an op-ed written last week by former Treasury Secretary Larry Summers.
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In the piece, Summers warned that the $1.9 trillion proposal could cause economic harm, such as unwarranted inflation. While she acknowledged that inflation is “a risk that we have to consider,” Yellen said the most significant threat is inaction from Congress. Should inflation rise to concerning levels, Yellen, who previously served as Chair of the Council of Economic Advisers and Chair of the Federal Reserve Board of Governors, insisted that the U.S. government has the tools to address such a risk.
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She spoke specifics of the package, including the income threshold for Economic Impact Payments, saying that while President Biden is open to negotiation, he would not think those earning above $300,000 a year should receive the payments. Yellen estimated that, if the American Rescue Package is enacted, full employment would be realized sometime next year.
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