US Treasury Secretary Janet Yellen attends an event on the Inflation Reduction Act after visiting the location of a latest paperless processing initiative in McLean, Virginia, on August 2, 2023.
Stefani Reynolds | AFP | Getty Images
WASHINGTON — Treasury Secretary Janet Yellen on Monday said the Inflation Reduction Act, the 2022 law that spurred major investments in infrastructure, manufacturing and climate goals, has propelled the U.S. economic recovery.
“Over the past yr, our task has been to transition the economy from rapid recovery to stable growth,” Yellen said. “Our path to this point shows that we’re on the precise track, whilst we remain vigilant about potential challenges and uncertainties.”
The Treasury chief touted the historic creation of over 13 million latest jobs since President Joe Biden took office, recovery from record inflation and an unemployment rate comparable to the bottom in 54 years, as she spoke before the International Brotherhood of Electrical Staff 357 Training Center in Las Vegas.
She partly attributed the progress to “Bidenomics,” the term used to explain President Joe Biden’s economic growth strategy that features the Bipartisan Infrastructure Law, the CHIPS and Science Act and the IRA, which was signed a yr ago this week.
The term emerged on the political landscape previously yr, first utilized by Republicans to explain high inflation and the rate of interest hikes that were meant to cure it.
But as economic indicators improved this spring on each fronts, Democrats saw a gap to flip the GOP attack line and embrace “Bidenomics,” very similar to former President Barack Obama did with Obamacare.
In her remarks Monday, Yellen touted steadying headline inflation numbers, which were up 3.2% in July from a yr prior, in comparison with a 9.1% yoy peak in June 2022 and average hourly earnings growth as evidence that “employees are higher off than they were last yr.”
“The continued strength of our labor market is especially impressive given our fight against inflation,” she said. “We all know that progress rarely moves in a straight line. But I still imagine that there’s a path to proceed reducing inflation while maintaining a healthy labor market.”
Yellen noted that U.S. corporations have committed to greater than $500 billion in manufacturing and clean energy investments since January 2021.
“The explosion in U.S. factory construction is a uniquely American story: one which we don’t see replicated in other peer countries,” Yellen said.
Nearly 80 clean energy manufacturing facilities or expansions have been announced previously yr, an amount exceeding the prior eight years combined, per the American Clean Power Association. Dozens of corporations have also declared plans to spend money on manufacturing facilities in greater than 20 states, in line with Senate Democrats.
Despite the strong economic numbers, Republicans have continued to pressure the administration on the economy, with Rep. Jason Smith, R-Mo., pointing to continued high prices for goods and services following the July jobs report.
“‘Bidenomics’ fueled a spike in the value of all the things from gas to groceries to homes, and fighting it with rates of interest, by design, puts the brakes on the economy, including the job market,” the chairman of the House Ways and Means Committee said.
Brian Deese, former director of the National Economic Council under Biden, said last week that it’s as much as Democrats to sell the economic impact of the IRA to voters within the leadup to the 2024 election.