U.S. Treasury Secretary Janet Yellen admits Joe Biden and his government failed to rein in the federal deficit—which ballooned to $1.92 trillion in 2024—and address concerns regarding fiscal sustainability. Yellen, who will leave office in January, made the remarks yesterday at the Wall Street Journal‘s annual CEO Council Summit.
“Well, I am concerned about fiscal sustainability. And I am sorry that we haven’t made more progress,” Yellen said, adding: “I believe that the deficit needs to be brought down, especially now that we’re in an environment of higher interest rates.”
The Treasury Secretary’s admission was prompted by a question posed by Greg Ip, the Journal’s chief economic commentator. Ip pressed Yellen on the significant budget deficit left by the Biden government and asked if she had any regrets regarding the Democratic leader’s fiscal decisions.
Over the course of her four-year tenure, Yellen has drawn controversy on more than one occasion. Early on in Biden’s term, the Treasury Secretary—a former Federal Reserve chief—insisted that the rampant inflation being experienced by Americans was merely transitory, implying it would quickly recede without intervention. However, that was not the case, and the Federal Reserve was forced to increase interest rates. This left Yellen acknowledging an inconvenient truth for the Biden government this last February: high prices will likely be persistent for the foreseeable future.
President-elect Donald J. Trump has named macro fund manager Scott Bessent as his government’s Treasury Secretary. Financial markets rallied following the announcement of Bessen’t nomination in late November.