Yellen cites Treasury-Fed coordination in new crisis campaign

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(Bloomberg) – Treasury Secretary Janet Yellen highlighted past coordination between her new department and her previous stronghold, the Federal Reserve, as she sought to rally agency staff to tackle a range of crises hitting the country.

“Economics isn’t just something you find in a textbook,” she wrote in a note to the Treasury Department’s 84,000 employees that was released Tuesday. “Economic policy can be a powerful tool for improving society. We can – and should – use it to fight inequality, racism and climate change, ”which along with Covid-19 are the four crises identified by President Joe Biden, she said.

Yellen, who was confirmed by the Senate on Monday evening, is spending her first full day in power in virtual meetings with both career and political leaders, and plans to do a “listening tour” of the department she now lead.

While Fed and Treasury staff “weren’t exactly” colleagues during the global financial crisis, “the two teams came closer,” she said in the memo.

“I remember participating in countless late night conference calls and admiring the dedication and creativity of Treasury experts. Your work has helped save the economy from its worst crisis since the Depression, ”Yellen said.

“Now,” she said, “we have to start over.”

She is the first woman to lead the Treasury in 231 years of history – she broke the Fed’s glass ceiling when she became its first female president in 2014. She had been head of the San Francisco Fed, then vice-president. president of the central bank, during the financial crisis and its consequences from 2007.

Yellen is now responsible for a department with responsibilities ranging from fiscal policy and public spending to financial stability, economic sanctions and foreign exchange policy. It was confirmed by the Senate 84-15 Monday evening.

Yellen pledged in his memo to lead an “inclusive” department, with plans to meet with each office over the next few weeks.

She also highlighted the economic imbalances that preceded the pandemic.

“People are worried about a K-shaped recovery to the pandemic – and that’s a cause for concern,” she said, “but long before Covid-19 infected a single individual, we lived in a K-shaped economy, one where wealth built on wealth while certain segments of the population fell further and further behind. “

© 2021 Bloomberg L.P.

© Bloomberg. Janet Yellen, Chairman of the U.S. Federal Reserve, listens to a question during a press conference following a Federal Open Market Committee (FOMC) meeting in Washington, DC, the United States, Wednesday, June 14, 2017. Federal Reserve officials have moved ahead with higher interest rates and further plans to tighten monetary policy despite growing concerns over low inflation. Photographer: Andrew Harrer / Bloomberg

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