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DealBook DC Policy Project Live Updates: Janet Yellen on Rebooting the Economy

Letitia James, the New York state attorney general, will speak today at the DealBook DC Policy Project about how states can shape national policy, starting at 2:30 p.m. Eastern time.

Treasury Secretary Janet Yellen opened the DealBook DC Policy Project on Monday, moderated by The New York Times’s Andrew Ross Sorkin, about the prospects for a post-pandemic recovery.

Highlights from the discussion:

  • “We need to make sure that those who have been most affected aren’t permanently scarred by this crisis,” Ms. Yellen said. “There are a lot of different metrics we can use to judge success,” she said. “Success, to me, would be if we could get back to pre-pandemic levels of unemployment, and see the re-employment of those who have lost jobs in the service sector particularly.”

  • “Of course, a key job for a Treasury secretary is to make sure our country is on a sound fiscal course,” she said. “If you don’t spend what is necessary to get the economy quickly back on track, that has a fiscal cost as well.” Although U.S. debt levels are much higher than they were during the 2008 financial crisis, because of lower interest rates, the share of interest payments as a share of G.D.P. today is roughly the same, she noted. “I think we have more fiscal space than we used to because of the interest rate environment, and I think we should consider using it.”

  • A so-called digital dollar, maintained by the Federal Reserve and based on a blockchain, could result in “faster, safer and cheaper payments,” she said. There are also issues to resolve first. “What would be the impact on the banking system? Would it cause a huge movement of deposits out of banks and into the Fed? Would the Fed deal with retail customers or try to do this at a wholesale level? Are there financial stability concerns? How would we manage money laundering and illicit finance issues? There’s a lot of things to consider here, but it’s worth looking at.”

  • “I don’t think that Bitcoin is widely used as a transaction mechanism,” Ms. Yellen said. “It’s an extremely inefficient way of conduction transactions and the amount of energy that’s consumed in processing those transactions is staggering.”

  • “I find it exciting that so many American companies are recognizing the climate change is something we really have to deal with meaningfully in the coming decade,” Ms. Yellen said. The same goes for diversity in corporate America. “I don’t know if there needs to be a law,” Ms. Yellen said, but, “first of all, I think it’s unfair. And second of all, in terms of the performance of organizations, there’s a great deal of research that shows that organizations that are diverse do perform better in a whole variety of ways. So this is an important goal and it’s top of mind to me at Treasury where promoting diversity and inclusion will be a key objective.”

  • “We need to understand and detail the facts of the matter,” she said of the trading frenzy around GameStop’s shares, noting that the Securities and Exchange Commission is preparing a report that could inform potential regulatory action. “Are investors sufficiently well-informed and protected? I think that’s a really important question and it’s too soon to draw conclusions,” she said.

  • And finally, why is it taking so long to add Harriet Tubman’s portrait to the $20 bill? “It’s a complicated manufacturing process, so it takes longer to issue a new set of bills than you would imagine,” she said. “But I promise I will do everything I possibly can to expedite this and I would love to see Harriet Tubman honored on our currency.”

It’s the first day of the DealBook DC Policy Project, in which top policymakers and business leaders gather to debate the priorities for moving the country — and the world — forward. Today, speakers consider the shape of the economic recovery, how to hold power to account, the future of travel and where to focus stimulus funds. Register here to attend, free of charge from anywhere in the world.

Today’s lineup (all times Eastern):

9 a.m. – 9:25 a.m.

On top of the $1.9 trillion economic aid plan that is working its way through Congress, the White House is raising the prospect of another big spending package focused on infrastructure. Although the economy is recovering faster than expected, it remains fragile and uneven. Navigating this path is Janet Yellen, the former Federal Reserve chair who took over as Treasury secretary last month.

2:30 P.m. – 3 P.m.

Letitia James has more prominent cases and investigations on her plate today than most lawyers will manage in a lifetime. The way she uses her power — from suing Amazon over worker safety to uncovering the underreporting of nursing home deaths, investigating former President Donald J. Trump’s business dealings and many other actions — also highlights how states can shape national policy.

3:30 P.m. – 4 P.m.

Last year was “the toughest year in Delta’s history,” according to Ed Bastian, the airline’s chief executive. The carrier reported a loss of more than $12 billion as travel ground to a halt during the pandemic. In addition to feeling the pandemic’s economic effects, the airline industry is at the center of health policy debates, like whether to make masks mandatory and require coronavirus tests before travel.

4 P.m. – 4:30 P.m.

Since stepping down as Microsoft’s chief executive in 2014, Steve Ballmer has kept busy as an National Basketball Association team owner and founder of USAFacts, a nonprofit group dedicated to presenting data about the United States in easy-to-read formats. The group aims, in his words, to “figure out what the government really does” with taxpayers’ money, and highlight the areas where spending may have the greatest effect.

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