And so it begins. As Donald Trump’s court battles continue to nosedive like slack dominoes, president-elect Joe Biden has started to weave together the threads of his administrative fabric. While Obama alumnus Antony Blinken has been given the nod to serve as secretary of state, the appointment of Capitol Hill stalwart John Kerry as climate tsar signals that the Democrats have serious intentions – at least in the coming four years – to tackle the issue.
But it is Biden’s nomination of Janet Yellen, the former chair of the Federal Reserve, as US treasury secretary that has been most extolled.
If approved by the Senate, the 74-year-old veteran economist from Brooklyn will become the first woman to hold the role in the department’s 231-year history, and her arrival will coincide with one of the most volatile and tumultuous economic periods to date, due to the ongoing public health crisis and subsequent shutdowns. In April, during the first wave of the Covid-19 pandemic, US unemployment reached a postwar high of 14.7% and, although the job market has seen a steady improvement, the overall trajectory has stalled as a result of increasing infection rates, with women and people of colour being hit the hardest.
In her new role, Yellen will not only oversee the federal purse strings, but will also guide Biden on economic, fiscal, tax and trade policies, including rolling out stimulus packages that will provide relief. The administration’s economic focus will also be on building bridges between the US and its primary trading partners, following the souring of rapports owing to Trump’s “America first” canon.
A specialist in labour markets, one of the few women in the male-dominated discipline of economics, a former staffer at the University of California at Berkeley, Harvard and the London School of Economics, and a lead policymaker for three decades, Yellen will bring a hinterland of experience and stability to the Biden White House. A shift away from the chop-change, mercurial approach that has defined the outgoing administration.
Following years as a renowned professor of economics, and after her first stint at the Fed, Yellen came to national attention in 1997, when, during the Clinton years, she was appointed to chair the Council of Economic Advisers. In this role she led a landmark report into the gender pay gap, with the study’s analysis finding that women earned 25 per cent less than men. Although an improvement on the 40 per cent gap two decades prior, Yellen stated in a news conference at the time: “We’ve come a long way toward greater equality in the pay received by men and women, but there is still too big a gap that remains.”
But it was perhaps between 2014 and 2018, in her role as chairwoman of the Federal Reserve – the first woman to hold the position – that her star shone brightest. She is widely credited, not only for navigating the US out of the horrors and devastation caused by the financial crisis of 2007, but also for the way in which she tilted the spotlight on how inequality and individuals would be affected by banking policies.
In her mic-drop of a final act at the Fed, Yellen left Wall Street jaws agape when she slapped major sanctions on scandal-ridden Wells Fargo, preventing the bank from growing its assets indefinitely, due to what she called “widespread consumer abuses”, including a fake accounts scandal.
Distinguished for her calm, and known for being one of the first federal policy makers to sound the housing bubble, Yellen is venerated among many circles. Businesses and markets trust her. The Dow climbed on news of her nomination. And in a nation whose political polarity has never been more pronounced, Yellen is one of the few figures that appeals to both red and blue, given that she has been confirmed by the Senate four separate times, including in 2014 for Fed chair, where she received 11 Republican votes. She is currently viewed as the safer choice for Biden, as other rumoured names in the frame, including the left-leaning senator Elizabeth Warren, may not have been been so well received by a Senate that is currently held by the opposition. That the current Wells Fargo chief, Charlie Scharf, has backed Biden’s appointment of Yellen despite her history with the bank, underlines the esteem in which she is held.
But not all have taken kindly to the Brooklynite. In September 2016, Trump said that Yellen should be “ashamed” of her actions as Fed chair, arguing that the central bank’s resistance to introducing higher interest rates was done in order to secure Barack Obama’s legacy.
To unlock this article, please subscribe. Benefits include:
- Offers, benefits and access to exclusive clubs, restaurants, bars, gyms, hotels and handpicked brands
- 2 Bookazines delivered to your door each year
- 15% off selected brands online with the Gentleman's Journal Shop
- Events — invitations to member-only events each year
- Paywalled content — access to member-only password-protected online features
- Your own Clubhouse membership card to redeem all the perks