Among the nominations, former Federal Reserve Chairman Janet Yellen, who was nominated by Biden as US Treasury Secretary, has attracted much attention. Economists believe that Yellen is the right person for the position, whether from the perspective of rich past experience or policy advocacy, or will reunite the two major agencies of the U.S. Treasury and the Federal Reserve.
Diversity becomes the main theme
On December 1 local time, Biden held a press conference in Delaware to announce the candidates for the next government economic team, among which former Federal Reserve Chairman Yellen was nominated as treasury secretary.
In addition, Brian Deese, who served as a senior economic adviser to the Obama administration and an executive of BlackRock group, an asset management company, has been nominated as chairman of the National Economic Council of the White House; Wally adeyemo, chairman of the Obama foundation and former international economic officer, has been nominated as Deputy Secretary of the Treasury, or will become the first African American vice secretary of the Treasury in the United States Neera tanden, a senior assistant and chairman of the center for American progress, a us think tank, has been nominated as director of the White House Budget Office; Cecilia rouse, Dean of the school of public and international affairs at Princeton University and an economist on education and peace, has been nominated as chairman of the Council of economic advisers (CEA), or will become the first in the history of the Department African American women leaders.
The White House National Economic Council and the White House Council of economic advisers are the White Houses many economic policy-making agencies. The National Economic Commission helps coordinate and formulate policies among federal agencies, while the Economic Advisory Council acts as a think tank within the White House to assess the costs and benefits of administrative proposals. It is generally composed of three academic economists. It is mainly responsible for the internal economic analysis of the White House, including contacting the Department of Commerce, the Department of labor and other federal government departments to report US economic data to the White House u3002
Biden also nominated Jared Bernstein, a senior fellow at the center for budget and priority policy, and heather boushey, CEO of the Washington Center for equitable growth, a us think tank, and economist on inequality issues, to serve on the Council of economic advisers. Among them, boushey, who is also a woman, currently serves as chairman of a think tank focusing on social inequality, advocating increasing government spending to stimulate economic growth, while Bernstein served as a consultant during Bidens tenure as vice president.
Biden said his economic team was first-class and that they would work together to help the recovery of the U.S. economy hit hard by the epidemic. With the help of this team and other members that will be added in the coming weeks, we will create a recovery for all and get the economy going again. We will create jobs, raise incomes, lower drug prices, promote racial equality in economic development, and restore the pillar of this country, the middle class.
According to the analysis, Bidens selection of consultants for his White House economic team includes a group of people with crisis management experience, strong policy ability and high attention to the labor market, focusing on issues such as how to raise wages, maximize employment and combat discrimination. In general, Mr. Bidens advisers agreed that the government should play a bigger role in raising wages and employment.
The candidates also showed that Bidens appointments reflected his commitment to a pluralistic government. According to relevant data, women account for 52% of the transition team between Biden and Harris, and there are more than 250 women in the Biden government agency review group.
Lu Xiang, an expert on American issues at the Chinese Academy of Social Sciences, said in an interview with the 21st century economic report that members of the economic team are basically Bidens old friends similar to those nominated by Biden before.
Jim Parrott, a former senior economic adviser during the Obama administration, said the nominees so far showed Biden wanted to build a team that was senior and able to take over the work quickly. They are dealing with a chaotic economy, chaotic logistics and chaotic governance. They are looking for staff who dont need three months to adapt.
Doug Holtz Eakin, the chief economist of CEA during the administration of former US President George W. Bush, said: these nominees are reliable and will be able to do a good job..
The deadlock between the Federal Reserve and the Treasury is expected to be broken
For Yellen, how to unite the Treasury and the Federal Reserve, both of which are on the front line of any economic crisis, will be her top priority.
She has a long history of working with current Fed chairman Colin Powell, which allows them to work together smoothly to support economic recovery. When Yellen was the chairman of the Federal Reserve, Powell served as the board member of the Federal Reserve. Later, under the nomination of U.S. President trump, Powell replaced Yellen.
Li Huihui told reporters that based on her experience as a core member of the government, she hoped that as a core member, she could promote the adoption and implementation of the new deal and reduce the friction of policy approval.
According to the analysis, Bidens choice of Yellen as Treasury Secretary indicates that he plans to take positive actions to revive the U.S. economy, because he has put a former Fed chairman who does not evade stimulus policy in charge of economic policy. Under the leadership of Yellen, Bidens treasury department may support Powells long-term low interest rate policy, while expanding fiscal spending.
Last week, U.S. Treasury Secretary manuchin refused to extend several crisis loan programs created by the new coronavirus aid, relief, and economic security act, which the Federal Reserve opposed. After Bidens team criticized Mr. mnuchins decision, Yellen is expected to change that approach early next year.
According to my prediction, the U.S. economy will shrink by more than 5% in 2020, which is higher than the level when the global financial crisis occurred in 2009, and the employment pressure is very high, Lu Xiang told reporters. In this case, Yellen will agree to low interest rates and wide volume, and there is basically no other choice.
Lu Xiang added that after Yellen takes office, the Ministry of Finance and the Federal Reserve may cooperate seamlessly, because the direction of both sides is basically the same.
How will Yellen run the Treasury?
Economists are enthusiastic about choosing Yellen as the next finance minister. In response, Nobel laureate Paul Krugman said the enthusiasm partly reflected the pioneering nature of her appointment. She will not only be the first woman to hold the post, but also the first to hold three traditional top policy positions in the U.S. economy - chairman of the Council of economic advisers, chairman of the Federal Reserve and Secretary of the Treasury.
Krugman stressed that Yellen was a serious researcher and an outstanding figure in New Keynesian economics. The economics is based on a key point: people are not stupid, but they are not completely rational and selfish. Based on the realism of human behavior, it is reasonable to adopt positive policies to fight against the recession.
Krugman added: the rigorous realism in Yellens academic research is directly related to her success as a policy maker. She has always been a person who understands the value of data and models. In such a crazy age, rigorous thinking becomes more important, not less important. But she will never forget that economics is about people. Its very reassuring that economic policy will be made by a person who knows what shes doing.
In addition, Lu Xiang told reporters that Yellens rich experience in the past is what Biden relies on. From an empirical point of view, Yellen is the right person. Biden himself has a lot of diplomatic experience, but he needs Yellens help in economic decision-making.
He added that Yellen had experienced the prosperity of the Clinton era and the great depression after 2009, which has helped the Obama administration recover its economy. Having experienced both positive and negative stages of the U.S. economy, her policies and experience are urgently needed by the U.S. economy.
However, Lu Xiang also pointed out that when Yellen took office, the difficulties facing the US economy were more severe than in 2009, and it was difficult to predict whether the old formula would work.
Li Huihui told reporters that Yellens policy is consistent with Bidens policy. Yellen stressed the importance of fiscal stimulus policy, advocated that fiscal policy and monetary policy should be coordinated, employment and recovery should be the primary objectives, and inflation tolerance should be large. This series is more consistent with the current US economic situation. Li Huihui also told reporters that Yellen will become an important part of China US economic and trade relations. In his previous speeches, Yellen expressed support for the opening up of the trading system and the global trading system, and expressed his doubts on various occasions about raising tariffs to deal with trade imbalance. But at the same time, she also raised concerns about some sensitive areas between China and the United States, such as intellectual property protection, competition and cooperation in high-tech fields, resource allocation in the industrial chain and supply chain, and subsidies from state-owned enterprises. Source: Chen Hequn, editor in charge of economic report in the 21st century_ NB12679
Li Huihui told reporters that Yellens policy is consistent with Bidens policy. Yellen stressed the importance of fiscal stimulus policy, advocated that fiscal policy and monetary policy should be coordinated, employment and recovery should be the primary objectives, and inflation tolerance should be large. This series is more consistent with the current US economic situation.
Li Huihui also told reporters that Yellen will become an important part of China US economic and trade relations. In his previous speeches, Yellen expressed support for the opening up of the trading system and the global trading system, and expressed his doubts on various occasions about raising tariffs to deal with trade imbalance. But at the same time, she also raised concerns about some sensitive areas between China and the United States, such as intellectual property protection, competition and cooperation in high-tech fields, resource allocation in the industrial chain and supply chain, and subsidies from state-owned enterprises.