Teresa Marez has never heard of Janet Yellen, who may be the next US Treasury Secretary. But she and millions of other Americans are relying heavily on the decisions Yellen will make if and when she is confirmed next year.
The coronavirus has turned Marez’s life upside down. Her savings are almost depleted and she is worried about her unemployment benefits, which will run out next week. ” It is so hard. It’s such a mess, ”said the mother of two in San Antonio, Texas. “We just need Congress to make a decision,” Marez said. “As long as they’re in limbo, we’re in limbo.”
Marez, 45, is one of millions of Americans who still suffer from the economic devastation caused by the coronavirus pandemic and whose fate will be the top priority of new President Joe Biden and his choice of Secretary of the Treasury.
The situation is dire. About 20 million Americans are currently unemployed. For many, hunger has become a major problem. Government figures show that the week before Thanksgiving – America’s biggest holiday – 5.6 million households struggled to get enough food on the table. Huge haunting lines have formed at food banks across the country, and years of neglect and underfunding of systems to help those in need have made their plight worse.
Last week, Marez spent three and a half hours on hold to speak to someone at a Texas unemployment office to find out if she would get a new form of unemployment when her existing funds expired. The answer was perhaps without obligation. “Three and a half hours of waiting mid-morning just to get that answer,” she said.
According to the Century Foundation, 12 million Americans will be deprived of their unemployment benefits on December 26. A disproportionate number of those people will be women and Latinos, like Marez, or Black and young, the groups hardest hit by the economic recession.
Parts of the US economy have shown incredible resilience in the face of the health crisis, such as those that may shift to working from home. Stock markets have reached record highs. And the very rich have done very, very well. American billionaires added $ 1 billion to their wealth during the pandemic, according to a report by the Institute for Policy Studies (IPS).
But only one in four American workers has a job that allows them to work from home. And as coronavirus rates rise and more closures appear likely, those who have to leave their homes to work continue to suffer. About 778,000 people filed for unemployment last week alone, an increase of 30,000 from the previous week and nearly three times the pre-pandemic weekly average.
The unemployment rate peaked at an appalling 14.7% in April and has since fallen sharply. But, again, women and people of color still experience significantly higher unemployment rates and the pace of recovery has slowed.
Many economists are now talking about a “K-shaped recovery” where the better-off bounce off the upward K tick while the less fortunate slip further into poverty on the downward leg. “The economy is on the inequality autopilot right now,” said Chuck Collins, director of IPS, who called the situation “grotesque”. “This is a time when we need the government to act.”
Yellen, former chairman of the Federal Reserve, is an impressive choice for the position of treasurer. A senior scholar and policy maker with decades of experience, she was the first female Fed chairperson in the United States and arguably now the nation’s first female treasury secretary.
Cautious and collegial, she’s not the progressive many Democrats hope for, but she has always recognized the persistence of inequality in the United States, even if she has done little to address it.
At the Fed, she said the African-American unemployment rate in particular was too high, but argued the central bank was unable to fix the problem. As Secretary of the Treasury, the president’s main adviser on national and global economic and fiscal policy, she will have more influence.
More recently, she told Reuters: “There is really a new kind of recognition that you have a society where capitalism is starting to run wild and needs to be readjusted to make sure that what we are doing is sustainable and that benefits of growth are widely shared as they have not been. “
Senator Elizabeth Warren, a fiery brand who spoke out against Wall Street excesses and who was once seen as a potential treasury boss under Biden, praised her praise after Yellen’s appointment was announced. Warren called Yellen an “exceptional choice” and said she was “smart, tough and reasoned” and “stood up to the banks on Wall Street”.
Janet Yellen would be an exceptional choice for Secretary of the Treasury. She’s smart, tough, and principled. As one of the most successful Fed chairmen of all time, she has stood up to Wall Street banks, including holding Wells Fargo responsible for deceiving working families.
– Elizabeth Warren (@SenWarren) November 23, 2020
And as Secretary of the Treasury, she will have more power to act – in theory – than she did at the Fed, setting tax policy, regulating banks, and overseeing priorities as the country tackles its huge debt repayments. The Secretary of the Treasury employs 87,000 people and has a budget of $ 20 billion. Yellen will be fifth in line for the presidency and his cursive signature will appear on the country’s currency.
But the 2020 election gave Biden a divided Congress and Yellen will need to win Republican votes for any major moves. To this day, the omens do not bode well.
In March, Congress passed emergency legislation, the 2tn Cares Act, which pumped money into businesses, approved $ 1,200 stimulus checks to millions of Americans, and temporarily increased unemployment payments. weekly $ 600. Since then, negotiations on a new round of stimulus have stalled and once again stalled. The extra payments stopped, the money was spent. Republicans, happy to accumulate record debts under Trump, are now talking about the need for “austerity.”
“It is bordering on crime that nothing has been done,” said William Rodgers, former chief economist at the US Department of Labor and informal adviser to Biden’s transition team. “They hit a candidate for the Supreme Court but did nothing to help American families.”
Rodgers hopes Biden’s extensive Washington experience and Yellen’s expertise and seriousness will make a difference. “The optics and the evidence are such that they will be forced to concede,” he said. “Look at these car lines [for food banks]. It’s not just old failed cars, it’s very common.
Collins also believes the majority of Americans, regardless of political orientation, have woken up to inequality. Florida, which voted for Trump again this year, also passed a resolution raising its minimum wage to $ 15 an hour. “There is going to be a lot of pressure for change,” he said.
But for those on the brink of the Covid 19 recession, time is running out.
Before the pandemic hit, Kat Barron announced her job as a teacher in Florida so she could move to Colorado to be closer to her daughter. She was unable to qualify for unemployment as she voluntarily quit her job and lives with her daughter and boyfriend while she looks for work. “I would be homeless if they didn’t let me live here for free,” Barron said.
She had originally planned to work as a massage therapist in Colorado, but put this on hold as she is in a group at high risk for Covid-19. The $ 2,000 in savings she came to Colorado is drying up, and despite the health risks, she plans to follow her original work plan so that she can continue paying for her car and phone.
Barron has applied for over 100 jobs that would allow her to work remotely, but she believes people are reluctant to hire a 57-year-old like her.
“I guess my only option is to take a massage job,” Barron said. “I feel like I’m risking my life to pay my bills, but what am I going to do?
“Having money is almost like a protective cloak, and not having it is very, very scary,” Barron said.