Treasury Secretary Admits Biden Spending Programs “Feed” Inflation

Last week, Treasury Secretary Janet Yellen became the first member of President Biden’s administration to acknowledge its spending policies are feeding inflation in the U.S. economy.

That admission came during an interview with the Wall Street Journal‘s editor in chief Matt Murray. The video clip below is cued to start with the question he asked that led to her admission. The relevant portion of the exchange starts at the 7:30 mark and takes place in less than a minute.

In her continuing remarks, she point to other factors that contribute to today’s high inflation, which the Biden administration has blamed for months without acknowledging its own role. Until now.

I suppose that’s progress of a sort. What will President Biden do to fix the inflation problem his excessive spending is causing?

Letting Inflation Fester by Playing It Down

The editors of Issues and Insights have kept track of the Treasury Secretary’s comments about inflation throughout Joe Biden’s presidency. Here’s their summary:

  1. February 2021: “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.”
  2. March 2021: “I don’t think it’s a significant risk. And if it materializes, we’ll certainly monitor for it, but we have tools to address it.”
  3. May 2021: “I don’t think there’s going to be an inflationary problem, but if there is, the Fed can be counted on.”
  4. June 2021: “Supply bottlenecks have developed that have caused inflation. I believe that they’re transitory, but that doesn’t mean they’ll go away over the next several months.”
  5. October 2021: “I don’t think we’re about to lose control of inflation.”
  6. November 2021: “If we want to get inflation down, I think continuing to make progress against the pandemic is the most important thing we can do.”
  7. January 2022: “If we’re successful in controlling the pandemic, I expect inflation to diminish over the course of the year and hopefully revert to normal levels by the end of the year around 2%.”
  8. February 2022: “I think people heard ‘transitory,’ and to them it meant a couple of months. Maybe a better word could have been chosen.”
  9. March 2022: “We’re likely to see another year in which 12-month inflation numbers remain very uncomfortably high.”

Janet Yellen is an Ivy League economist and former Federal Reserve Chair. She should have known better. She probably did, but signed off on Joe Biden’s excessive spending plans anyway, minimizing its role in generating today’s high inflation. In doing so, she’s dug both herself and President Biden into a deep credibility hole.

Craig Eyermann is a Research Fellow at the Independent Institute.
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