U.S. Treasury Secretary Janet L. Yellen delivered a significant address at the Council on Foreign Relations, outlining the Biden-Harris Administration’s international economic policy and its integration with domestic economic strategies.
According to a press release, Yellen emphasized the administration’s commitment to fostering a robust global economy, which she believes is vital for supporting American families and businesses. She underscored the administration’s goal of reducing costs for American families, explaining that they are pursuing a strategy termed “modern supply-side economics,” which aims to expand production capacity while reducing inequality.
“U.S. GDP growth is strong, our unemployment rate is near historic lows, and inflation has declined significantly,” Yellen said.
As she prepares for the upcoming IMF and World Bank Annual Meetings, Yellen reiterated the interconnectedness of the U.S. economy with the global market and emphasized the need for cooperative economic policies that bolster global growth.
“American businesses and families have a tremendous amount to gain from our connections to the global economy,” Yellen said.
Yellen criticized protectionist measures, asserting that “sweeping, untargeted tariffs would raise prices for American families and make our businesses less competitive.” She warned against isolating the U.S. from international partnerships, arguing that it would hinder efforts to address significant issues such as supply chain disruptions and global security challenges.
To address these challenges, Yellen discussed the administration’s initiatives aimed at strengthening supply chains and fostering international cooperation. She highlighted the importance of initiatives like the CHIPS and Science Act and the establishment of the Minerals Security Partnership and explained the administration’s commitment to collaboration with trusted allies.
“We’re supporting the Partnership for Resilient and Inclusive Supply-chain Enhancement and working with the Inter-American Development Bank to find opportunities to enhance competitiveness and support key supply chains in Americas Partnership for Economic Prosperity countries,” Yellen said.
Yellen also addressed pressing global challenges, such as climate change and pandemics. She emphasized the administration’s role in launching the Pandemic Fund and increasing climate financing through multilateral development banks.
“No matter what we do at home, without addressing critical gaps in the global health infrastructure… a future pandemic could negatively impact many economies, with significant spillovers to ours,” Yellen said.
On the topic of national security and competitiveness, Yellen stressed the need for a balanced economic relationship with China and highlighted the need to address unfair trade practices and industrial overcapacity issues.
“Trade and investment with China can bring significant gains to American firms and workers and must be maintained. But we must also have a healthy economic relationship based on a level playing field,” Yellen said.
Yellen concluded by highlighting the necessity of strategic global engagement and warned that retreating from international cooperation would lead to adverse outcomes.
“America’s economic well-being depends on the world’s,” Yellen said. “American isolationism and retrenchment will leave all of us worse off.”
