Yellen agreed with [Larry] Summers that too much government money was flowing into the economy too quickly.

June 6, 2022

Yellen makes her excuses

Did Joe Biden ignore the advice of his treasury secretary when compiling the $1.9 trillion American Rescue Plan in the early days of his administration? That is what a new biography of Janet Yellen suggests.

On Friday Bloomberg reported that, according to Yellen biographer Owen Ullmann: “Privately, Yellen agreed with [Larry] Summers that too much government money was flowing into the economy too quickly.” According to an advance copy of the book, out in September and titled Empathy Economics: Janet Yellen’s Remarkable Rise to Power and Her Drive to Spread Prosperity to All, Yellen told the White House that the Covid spending package should be scaled back by a third.

According to the book, Yellen “worried that so much money in the pockets of consumers and businesses would drive up prices at a time when the pandemic had caused severe shortages of goods that were in unprecedentedly high demand.” Given that the White House is bending over backwards to deny any causal link between its spending and inflation, it is no wonder this tidbit has caused such a stir. A disagreement between president and treasury secretary on such an important question would be big news whatever the circumstances, but here the claim is especially damaging — to both Yellen and Biden — because the former was instrumental to the latter’s efforts to sell the need to go big to lawmakers at the time.

On Saturday, Yellen disputed the account. “I never urged adoption of a smaller American Rescue Plan package, and I believe that ARP played a central role in driving strong growth throughout 2021 and afterwards,” she said in a statement. Ullmann says he had “unfiltered” access to Yellen during the writing of the book. If its subtitle is anything to go by, Empathy Economics doesn’t exactly sound like a hard-hitting take down of the first female treasury secretary.

But before the administration loses itself in recriminations and finger-pointing over past mistakes, it might want to stop making new ones. Top of the list: college debt forgiveness. The administration now admits that it underestimated the threat of inflation last year, when it was busy spending trillions. But even as it claims to take the problem seriously, the White House is poised to deliver an unnecessary and unfair boost to the incomes of college graduates that could make the inflation problem worse. Asked about the debt decision on CNBC last week, Yellen made clear that no decision had been taken on student debt, adding that, “There are discussions taking place and of course, the impact on the economy and equity are part of those discussions.” Let’s hope she tells the president what she thinks this time.

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The Doctor versus the patient in PA

It’s official: Mehmet Oz will be the Republican candidate for US senate in Pennsylvania. Dave McCormick conceded Friday, putting the celebrity TV doctor one step closer to becoming the first Muslim senator in US history, in part thanks to the endorsement from Donald Trump.

Meanwhile, the Democratic candidate who cruised to victory in his primary has more to worry about than the victor in the Republican nail-biter. It’s been three weeks since John Fetterman suffered a stroke and, as he himself has admitted, “almost died” after ignoring a heart condition for years.

For now, then, the all-important Pennsylvania race comes down to a choice between the heart surgeon and the heart patient. But Fetterman is yet to return to the campaign trail. “It’s frustrating — all the more so because this is my own fault — but bear with me,” he said in a recent statement. “I need a little more time. I’m not quite back to 100 percent yet, but I’m getting closer every day.” Everyone will be hoping Fetterman makes a speedy recovery — but nervy Pennsylvania Democrats may also be checking the candidate-replacement rules in the state.

Jan 6 committee prepares for prime time

The House’s January 6 committee will present its findings on Thursday. If you are expecting a sober-minded and methodical account of what happened at the Capitol that day, prepare to be disappointed. In a move in keeping with the blurring lines between politics, media and showbusiness, the committee has hired James Goldston, former ABC News president and documentary filmmaker, to help them make the most of their primetime slot. Axios reports that Goldston will help “hone a mountain of explosive material into a captivating multimedia presentation.” According to Mike Allen, Goldston “is busily producing Thursday’s 8 p.m. ET hearing as if it were a blockbuster investigative special.” Just the sort of cool-headedness we need from our lawmakers.

Casey Chalk: The reviled Woodrow Wilson

Taylor Millard: Is stagflation in America’s future?

Cam Harless: No one should be punished for retweeting my jokes

Josh Kraushaar, National Journal: Meet the six House Republicans still sweating re-election

Jeff Stein and Tyler Pager, Washington Post: How the White House lost Joe Manchin

John Fund, National Review: Tear down that Covid testing wall

President Biden job approval
Approve: 40.6 percent
Disapprove: 54.1 percent
Net approval: -13.5 (RCP Average)

2022 generic Congressional ballot
Democrats: 40 percent
Republicans: 48 percent (Rasmussen)