Janet Yellen is an icon waiting to happen. With her signature silver bob, single-strand pearl necklace, and seemingly infinite supply of jewel-toned jackets (collar popped, always), it’s easy to imagine the new Treasury secretary’s image emblazoned on T-shirts and her silhouette outlined on inspirational Instagram posts. She’s a natural fit as an emblem of the #Girlboss movement that has so finely boiled down modern feminism into a shallow yet marketable vestige of unadulterated capitalism—a conceit used to describe the relentless rise-and-grind schedules of business leaders like Marissa Mayer and Sheryl Sandberg, and to help sell “Notorious RBG” merch to young women. Yellen’s Q score with Gen Y should soon be on the rise.
On Wall Street, meanwhile, Yellen is seen as a known quantity. The former Fed chair is someone who doesn’t make surprise decisions—who says what she’s going to do and then does just that. Big Finance is optimistic that she’ll be a business-oriented leader at Treasury and a friend to markets. That confidence is only bolstered by the fact that Yellen collected more than $7 million in speaking fees from the likes of Goldman Sachs and hedge fund Citadel since leaving the Fed two years ago—a revelation that stirred a bit of controversy among Democrats.
Progressives like to think of Yellen as an advocate for underrepresented Americans. They see her as someone who will push for a higher minimum wage, more regulation of shadow banking, and new legislation in the mode of DoddFrank to protect consumers. To liberals, Yellen is someone who will at last put the guardrails on Wall Street.
But no matter what persona is projected onto Yellen— feminist hero, Wall Street saviour, progressive darling—the magnitude of her new day job dwarfs all of them in consequence. As Treasury secretary, she is running point for the Biden administration’s efforts to stabilise a teetering U.S. economy that has been rocked by the COVID-19 pandemic. Her decisions over the next few months will have a profound impact on how quickly the economy can rebound.
The challenges facing Yellen and the rest of President Joe Biden’s economic team are daunting. Though the U.S. unemployment rate has fallen from its COVID peak of 14.7% last April, it plateaued at 6.7% in the final months of 2020, nearly twice as high as a year earlier. The Federal Reserve has already taken rates down to near zero. Thousands of small businesses have closed for good during the pandemic, which continues to ravage the country. And there is rising concern in Washington about continued borrowing to stimulate the economy. The U.S. national debt grew by a stunning $7.8 trillion over the past four years under the Trump administration, driven in part by Trump’s signature 2017 tax cuts and the $3 trillion in stimulus funding Trump signed into law last year. Some Republicans are now using the spectre of further debt to push back against President Biden’s proposed $1.9 trillion stimulus bill, dubbed the “American Rescue Plan”.
Yellen is also taking the reins at a Treasury Department that has been greatly reduced in size and capacity under her predecessor, Steven Mnuchin. Between 2016 and 2019, the Treasury’s main offices, including domestic finance, economic policy, and international affairs, saw staffing drop by about 25% as budgets fell. Those departments control responses to the economic recovery, financial policy, and grant programmes. Mnuchin operated without a deputy for two years and left the division of domestic finance without an official leader. Yellen will have to bring in a number of people, and quickly, to fill empty positions.
But it’s hard to imagine a leader with more sparkling credentials—or a better demeanour—for the work at hand than the 74-year-old Yellen. Each career peak on her résumé has been seemingly followed by another, higher summit—a mountain range of firsts. Yellen was the only woman in her class to earn an economics Ph.D. at Yale University, and she was then (for quite some time) the sole female economics professor at Harvard University. She served under President Bill Clinton as chair of the Council of Economic Advisers (a rare non-first moment; she was the second woman to serve in that role). In 2014, she was confirmed as the first female chair of the Federal Reserve, under Barack Obama. Now, under President Biden, she’s achieved yet another title: the first woman secretary of the Treasury.
Her new job also makes Yellen the first person—of any gender—to complete the holy trinity of the U.S. finance circuit: Council of Economic Advisers chair, Fed chair, and Treasury secretary.
Yellen has hit the ground running, working with Biden to get his COVID-19 relief bill passed by Congress quickly. In a conversation with Fortune, she underscores the new administration’s top priorities: a successful distribution of at least 100 million doses of vaccine within 100 days; reopening schools; making sure Americans are able to remain in their homes without fear of eviction; and providing a $1,400 stimulus cheque to a majority of Americans and emergency funding for state and local governments. “It’s a priority to help get us through the pandemic, to get our economy functioning again,” she says of the stimulus legislation.
The new Treasury secretary also echoes President Biden’s calls for both parties to dial back politics in the interest of problem-solving. “I hope very much that we can work in a bipartisan way, Democrats and Republicans, to get beyond this sort of stalemate that has been around for a number of years now,” says Yellen. “I think that many people agree on both sides of the aisle. We need to invest in our people and our infrastructure. We need to solve our competitiveness.”
The business world may be comfortable with Yellen, but she’s no businessperson herself. Unlike Hank Paulson or John Snow , Wall Street execs turned Treasury heads, Yellen is a career economist. And the direction of the stock market is not her North Star. Yellen’s perspective, says Ben Bernanke, the former Federal Reserve chair and now distinguished fellow at the Brookings Institution, isn’t to please any particular interest group. Rather, it’s “how do we get the economy going, and how do we make sure the benefits are spread as widely as possible?”
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