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Yellen says U.S. must 'act big' on next coronavirus relief package

CoronavirusJan 18, 2021 07:15PM ET
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© Reuters. FILE PHOTO: U.S. President-elect Joe Biden announces members of his economic policy team in Wilmington, Delaware

By David Shepardson

WASHINGTON (Reuters) - Janet Yellen, U.S. President-elect Joe Biden's nominee to run the Treasury Department, will tell the Senate Finance Committee on Tuesday that the government must "act big" with its next coronavirus relief package.

Biden, who will be sworn into office on Wednesday, outlined a $1.9 trillion stimulus package proposal last week, saying bold investment was needed to jump-start the economy and accelerate the distribution of vaccines to bring the virus under control.

"Neither the president-elect, nor I, propose this relief package without an appreciation for the country’s debt burden. But right now, with interest rates at historic lows, the smartest thing we can do is act big," Yellen, a former Federal Reserve chair, said in a prepared opening statement for her hearing before the committee.

"I believe the benefits will far outweigh the costs, especially if we care about helping people who have been struggling for a very long time," she said in the statement, which was obtained by Reuters.

The proposed aid package includes $415 billion to bolster the U.S. response to the virus and the rollout of COVID-19 vaccines, some $1 trillion in direct relief to households, and roughly $440 billion for small businesses and communities particularly hard hit by the pandemic.

Many Americans would receive stimulus payments of $1,400, which would be on top of the $600 checks approved in a pandemic relief bill passed by Congress last month. Supplemental unemployment insurance would also increase to $400 a week from the current $300 a week, and it would be extended to September.

In her prepared testimony, Yellen also says the U.S. economy must be rebuilt "so that it creates more prosperity for more people and ensures that American workers can compete in an increasingly competitive global economy."

Senator Ron Wyden, a Democrat who is set to take over as chairman of the committee soon after Biden and Vice President-elect Kamala Harris are sworn in on Wednesday, said in a statement that "nobody is better qualified than Secretary-Designate Yellen to lead an economic recovery."

Wyden added that the hearing on Tuesday "will provide a great opportunity to hear about what worked and what didn’t during the Great Recession, and what we need to do to get this economy back on track."

Yellen will replace Treasury Secretary Steven Mnuchin if confirmed by the Senate. Mnuchin will step down on Wednesday.

A Biden ally said Yellen's confirmation is expected to be among the least controversial of Biden's picks to fill key roles in his administration, but that she would still be likely to face questions over his tax and spending proposals.

(This story refiles to fix typo in Kamala Harris name in paragraph 8)

Yellen says U.S. must 'act big' on next coronavirus relief package
 

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Comments (7)
Michael Wln
MichaelW Jan 19, 2021 1:03AM ET
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Yellen was terrible as Chairman of the Fed. Let’s hope she does a better job as Treasury Secretary.
Roger Miller
Roger Miller Jan 18, 2021 11:32PM ET
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Are people this naive?! Interest rates at record lows!! A direct result of money printing by the fed, which is just another arm of the government. This is what they keep doing and it has only made the 1% even richer while the rest fall behind!
Bob Collins
Bob Collins Jan 18, 2021 10:39PM ET
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She’s going to need to start buying SPY like she and Obama conspired to do in the old days. Otherwise, I fear a sustained bear market for the foreseeable future.
Neil Puskorius
Neil Puskorius Jan 18, 2021 10:10PM ET
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Monopoly money...
M. Turner
M. Turner Jan 18, 2021 9:08PM ET
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For making such a statement, she should be on trial for treason.  Money printing is endless and destroying the purchasing power of the USD.
cb cb
cb cb Jan 18, 2021 5:54PM ET
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"I believe the benefits will far outweigh the costs”. Thats probably true - for this year, but when all is said and done, the ponzi will crumble and the effects will be devastating. You cant print money forever based on nothing
Clinton Powell
Clinton Powell Jan 18, 2021 4:24PM ET
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What does she say about dollar devaluation?
 
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