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- Treasury Secretary Yellen on Friday said the US needed to “go big” with its economic stimulus.
- “We can afford to go big,” Yellen said in a PBS NewsHour interview broadcast late Friday.
- McConnell on Friday said the stimulus would add debt for “our kids and grandkids” to pay off.
- Visit the Business section of Insider for more stories.
The US treasury secretary Janet Yellen on Friday said the US government needed to “go big” with its coronavirus stimulus relief.
Yellen spoke in favor of President Joe Biden’s planned $1.9 trillion stimulus package, which is working its way through Congress.
“Well, it’s a big package, but I think that we need to go big now, and that we can afford to go big,” Yellen told PBS NewsHour anchor Judy Woodruff in an interview broadcast late Friday.
She added: “And the most important thing is to get our economy back on track and help people get their lives back, in order to make sure that this pandemic doesn’t permanently scar our workforce.”
Yellen said the nonpartisan Congressional Budget Office (CBO) estimated that without the $1.9 trillion stimulus package – which has been approved by the House – the country wouldn’t get back to full employment until 2024.
"And I think it's very important to have that occur sooner," she said.
If the Senate approves Biden's proposed stimulus plan, the country could get back to nearly full employment next year, Yellen said. After sitting for the interview on Friday, Yellen was scheduled to brief Biden on the state of the economy.
"We can't afford one step forward and two steps backwards. We need to beat the virus, provide essential relief, and build an inclusive recovery," Biden told the press before the briefing.
Biden's stimulus plan has been hit with resistance by Republican senators, including Minority Leader Mitch McConnell. Speaking on the Senate floor on Friday, McConnell called the plan an "ideological spending spree packed with non-COVID-related policies."
McConnell said: "This isn't a pandemic rescue package. It's a parade of left-wing pet projects that they are ramming through during a pandemic."
The CBO in February said the total federal debt was expected to exceed the country's economic output for 2021. That estimate didn't even include the $1.9 trillion stimulus, which was expected to add to the debt.
McConnell said on Friday that the stimulus plan would pile the country's debt higher, causing problems for "our kids and grandkids."
Yellen on Friday addressed those concerns, saying the stimulus plan would put the economy back on track, leading to higher tax revenue, and "arguably helping our debt path."
"And so it just isn't the case that our failure to spend a dollar to help people would lower the debt that much," she said.