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Treasury Secretary Janet Yellen is finally ready to admit she may have gotten this whole inflation situation wrong; Yellen made the confession to Wolf Blitzer on Tuesday’s edition of The Situation Room.
“I think I was wrong then about the path that inflation would take,” Yellen told Blitzer when asked about her comments from 2021 that inflation posed only a “small risk.”
“As I mentioned, there have been unanticipated and large shocks to the economy that have boosted energy and food prices and supply bottlenecks that have affected our economy badly that I didn’t — at the time — didn’t fully understand, but we recognize that now,” she said.
Yellen and other White House officials once framed inflation as a temporary side effect of the economy returning to normal following the pandemic, pointing to snags in supply chains and demand outstripping supply.
Yet months later, inflation is running at a near-four-decade high.
Recent economic indicators have raised optimism that inflation may have peaked at 40-year highs in March, although economists warn it could take considerable time before inflation returns to healthy levels. In response, the White House is launching a month long effort to signal a heavy focus on the economy.
The push began on Monday with an op-ed from President Joe Biden published in The Wall Street Journal and continued Tuesday with an Oval Office sit-down among Biden, Federal Reserve Chairman Jerome Powell and Yellen.
In his WSJ op-ed, President Biden still seemed reluctant to own the inflation crisis, saying “The global economy faces serious challenges. Inflation is elevated, exacerbated by Vladimir Putin’s war in Ukraine. Energy markets are in turmoil. Supply chains that haven’t fully healed are causing shortages and price hikes.”
In response to Yellen’s admission, GOP voices torched her on twitter:
From The New York Post…
“Cool. Resign,” The Spectator contributing editor Stephen Miller reacted to Yellen’s comment.
“She forgot the part about the months and months of the feds printing money, more money than God has ever seen, and paying people to stay home. @SecYellen respect that you admitted you were wrong but you need to resign,” wrote Arizona state Rep. Walt Blackman, who is running for Congress.
Nevada GOP congressional candidate Noah Malgeri asked: “[If] you actually didn’t understand this most fundamental economic principle them why are you there?”
“‘Supply chain bottlenecks’ Ms. Yellen failed fully to ‘understand.’ Then Ms. Yellen shouldn’t be Treasury Secretary,” tweeted former New York Congresswoman Nan Hayworth. “Not that any other Democrat’d be better. We need veto-proof GOP majorities in Congress, folks. The Democrats are killing us–let’s keep that metaphorical.”
— New York Post (@nypost) June 1, 2022