CNN’s Jake Tapper questioned Treasury Secretary Janet Yellen about the possibility that the Biden administration’s spending endeavors will drive up inflation.

Yellen joined Tapper on Sunday for CNN’s State of the Union, where their back-and-forth turned to the $5 trillion President Joe Biden is looking to spend with his infrastructure and Build Back Better packages.

“Inflation is growing at its fastest pace in 30 years,” Tapper observed. “If the economy is already overheating, is spending even more money essentially pouring gas on the inflation fire?”

Yellen responded that the spending figures of both packages are the projected total “over 10 years, not in a single year.” She also referred to how unemployment dropped to 4.8 percent under the American Rescue Plan, even though the U.S. has seen disappointing levels of job growth in recent months.

Yellen denied that inflation is about to spiral out of control, and she attributed the economy’s ongoing strain to the lasting impact of the coronavirus pandemic. She also predicted that inflation and other economic factors will return to normal levels over time.

The size of the labor force is declined. It’s not moved back to pre-pandemic levels in part because of Covid, because of health concerns, because of child care concerns, school concerns. And so many firms are experiencing a shortage of labor. The Covid shock to the economy has caused disruptions that we’ll be working through over the next year, and, of course, Americans have not seen inflation like we have experienced recently in a long time. As we get back to normal, expect that to end. Already on a monthly basis, the inflation numbers are way down below their peaks.

Yellen also offered her prediction that America’s supply chain issues will resolve once the global economy works through the pandemic to the point that it opens up the “bottleneck” of traded goods.

Watch above, via CNN.

The post CNN’s Tapper Confronts Treasury Secretary: Isn’t Biden’s Spending Plan ‘Pouring Gas on the Inflation Fire?’ first appeared on Mediaite.

from Mediaite https://ift.tt/3puLROM