Janet Yellen
Janet Louise Yellen (born August 13, 1946) is an American economist serving as the 78th United States secretary of the treasury since January 26, 2021. She previously served as the 15th chair of the Federal Reserve from 2014 to 2018. She is the first woman to hold either post, and has also led the White House Council of Economic Advisers. Yellen is the Eugene E. and Catherine M. Trefethen Professor of Business Administration and Economics at the University of California, Berkeley.
Janet Yellen
Barack Obama
Stanley Fischer
Barack Obama
Donald Trump
Robert T. Parry
Bill Clinton
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Born and raised in Bay Ridge, Brooklyn, Yellen graduated from Brown University in 1967 and earned a Ph.D. in economics from Yale University in 1971. She taught as an assistant professor at Harvard University from 1971 to 1976, was a staff economist for the Federal Reserve Board from 1977 to 1978, and was a faculty member at the London School of Economics from 1978 to 1980. Yellen is professor emeritus at the Haas School of Business at the University of California, Berkeley, where she has been a faculty member since 1980 and became the Eugene E. and Catherine M. Trefethen Professor of Business Administration and Professor of Economics.
Yellen served as a member of the Federal Reserve Board of Governors from 1994 to 1997 and was nominated to the position by President Bill Clinton, who then named her chair of the Council of Economic Advisers from 1997 to 1999. She subsequently returned to academia, before serving as president and chief executive officer of the Federal Reserve Bank of San Francisco from 2004 until 2010. Afterward, President Barack Obama chose her to replace Donald Kohn as vice chair of the Federal Reserve from 2010 to 2014 before nominating her to succeed Ben Bernanke as chair of the Federal Reserve three years later. She was succeeded by Jerome Powell after President Donald Trump declined to renominate her for a second term. Following her departure from the Federal Reserve, Yellen joined the Brookings Institution as a distinguished fellow in residence from 2018 until 2020, when she again went into public service.[2]
On November 30, 2020, President-elect Joe Biden nominated Yellen to serve as secretary of the treasury; she was confirmed by the U.S. Senate on January 25, 2021, and took office the next day.[3]
Early life and education[edit]
Yellen was born on August 13, 1946,[4] to a family of Polish Jewish[5] ancestry in the Bay Ridge, Brooklyn, neighborhood of New York City, and grew up there.[6] Her mother was Anna Ruth (née Blumenthal; 1907–1986), an elementary school teacher who gave up her teaching job to become a stay-at-home mother. Her father was Julius Yellen (1906–1975), a family physician who worked from the ground floor of their house. Janet has an older brother, John (born 1942), who is a program director for archaeology at the National Science Foundation.[7][8]
In a speech at the POLIN Museum of the History of Polish Jews, Yellen said that her father's family immigrated to the United States from Sokołów Podlaski, a small town about 50 miles outside of Warsaw. She said further that nearly the entirety of its Jewish population, including many of her relatives, was deported or murdered during the Holocaust.[9]
Yellen attended the local Fort Hamilton High School, where she was an honor society member and participated in the booster club, the psychology club, and the history club.[8] She also served as editor-in-chief of The Pilot, the school newspaper, which continued its 13-year streak as the first-place winner of the prestigious Columbia Scholastic Press Association contest under her leadership.[10] She earned a National Merit commendation letter and was admitted to a selective science honors program at Columbia University to voluntarily study mathematics on Saturday mornings. Yellen was one of 30 students to win state Regents scholarships for college and one of a select few to win the mayor's citation for a scholarship.[10] She graduated in 1963 as the valedictorian of her class. In line with school tradition, for the editor to interview the valedictorian, she interviewed herself in the third person.[11][8][10]
Yellen enrolled at Pembroke College in Brown University, initially intending to study philosophy. During her freshman year, she switched her planned major to economics and was particularly influenced by professors George Herbert Borts and Herschel Grossman.[12] In the spring of 1964, she also joined the business staff of The Brown Daily Herald, but soon afterward she left the paper to focus on her academic studies.[13] Yellen graduated summa cum laude and Phi Beta Kappa with a bachelor's in economics from Brown University in 1967,[14] and earned her master's and PhD in economics from Yale University in 1971.[15] Her dissertation was titled Employment, Output and Capital Accumulation in an Open Economy: A Disequilibrium Approach under the supervision of James Tobin,[16] a noted economist who would later receive the Nobel Memorial Prize.[17] As a teaching assistant, Yellen was so meticulous in her note-taking during Tobin's macroeconomics class that her notes became the unofficial textbook and were referred to as "Yellen Notes" while being circulated among generations of graduate students.[17] Her former professor and Nobel Prize in Economics laureate, Joseph Stiglitz, has called her one of his brightest and most memorable students.[18] She later described Yale professors Tobin and William Brainard as "lifelong mentors" who laid the intellectual groundwork for her economic views.[19] Yellen was the only woman among the two dozen economists who earned their doctorates from Yale in 1971.[18]
Federal Reserve (1994–1997)[edit]
On April 22, 1994, President Bill Clinton announced his intention to nominate Yellen as a member of the Federal Reserve Board of Governors, alongside Alan Blinder, who has been designated as vice chairman. They were the first Democratic appointees to the Board since 1980.[33][34] In an issued statement, the president praised her as "one of the most prominent economists of her generation on the intersection of macroeconomics and labor markets."[35] President Clinton played an indirect role in the selection process, delegating most of the responsibility to NEC Director Robert Rubin, Treasury Secretary Lloyd Bentsen, and CEA Chair Laura Tyson, who was a colleague of Yellen's at Berkeley. The group settled on her candidacy after an exhaustive search that at one point included nearly 50 names.[33] In July 1994, during her confirmation hearing before the Senate Banking Committee, Yellen said that Fed policies should keep the economy growing as much as possible without accelerating inflation but avoid taking a clear position on the prospect of further increases in interest rates.[36] The Senate panel approved her nomination without much Republican opposition, by a vote of 18 to 1; the only dissenting vote came from Senator Lauch Faircloth (R-NC), who said that her concerns should be limited to inflation.[37] The nomination was confirmed in the full United States Senate by a vote of 94–6.[38] On August 12, 1994, Yellen was appointed to a full 14-year term and assumed the seat vacated by Republican Wayne Angell.[37] She was installed as the fourth female governor, joining Susan M. Phillips, which marks the first time that two women have sat on the Federal Reserve Board simultaneously.[39]
In July 1996, the Federal Reserve resisted pressure to raise interest rates as unemployment dropped. Yellen marshaled academic research to dissuade Chairman Alan Greenspan from committing the Fed to a zero inflation policy and demonstrate that the central bank should seek to moderate inflation rather than eliminate it. According to the study, a low inflation rate of around 2 percent provided a better foundation for reducing unemployment and increasing economic growth than the goal of zero.[40]
Upon her confirmation as chair of the Council of Economic Advisers, she resigned as a member of the Board of Governors of the Federal Reserve System on February 17, 1997.
Return to the Federal Reserve (2004–2018)[edit]
Federal Reserve Bank of San Francisco[edit]
On April 12, 2004, the Federal Reserve announced that Yellen would replace Robert T. Parry as president and chief executive officer of the Federal Reserve Bank of San Francisco, taking office on June 14.[48] She was the first woman to hold this position.[18] While serving as Federal Reserve District president, she sat on the policy-setting Federal Open Market Committee (FOMC) and was a voting member once every three years on a rotating basis, with her first being in 2006.[48] During her time at the San Francisco Fed, the largest of the 12 Federal Reserve Banks in terms of population and economic output, Yellen publicly downplayed concerns about the potential consequences of the boom in housing prices; at FOMC meetings, on the contrary, she sounded the alarm on banks' heavy concentration in risky construction and home-development loans.[49] On the other hand, she did not lead the San Francisco Fed to "move to check [the] increasingly indiscriminate lending" of Countrywide Financial, the United States' largest lender.[50][51]
On June 5, 2009, Yellen said that the Federal Reserve should consider raising interest rates earlier to prevent another housing bubble. She argued that higher short-term interest rates probably went against the expansion of a bubble in certain circumstances, like restraining the demand for housing and high-risk mortgages.[52]
In July 2009, Yellen was mentioned as a potential successor to Chairman Ben Bernanke when his term was set to expire before he was re-nominated for a second four-year term.[53] She eventually emerged as the leading contender for vice chair of the Federal Reserve Board in March 2010,[54] and following her Senate confirmation, she resigned from the San Francisco Fed in October of that year.[55]
Economic philosophy[edit]
Yellen is widely considered to be a "dove" on monetary policy (i.e., more concerned with unemployment than with inflation) and, as such, generally favors lower rather than higher Federal Reserve interest rates.[180][181][182] She was overall in favor of more stringent financial regulation to lessen systemic risks brought on by flaws in the financial system.[183] Yellen was arguably the most liberal Federal Reserve leader since Marriner S. Eccles, who was appointed by President Franklin D. Roosevelt amidst the Great Depression in 1934.[7] On fiscal policy, publications frequently refer to her as "sort of" a deficit hawk.[182][184] She expressed concern about the United States fiscal path prior to the COVID-19 recession, particularly about the national debt; in 2018, she said, "If I had a magic wand, I would raise taxes and cut retirement spending."[182] The following year, she again suggested that she favored both raising revenue and making changes to the Medicare, Medicaid, and Social Security programs to control spending.[182] In September 2021, at a House Financial Services Committee hearing, Yellen lent support to efforts for the complete removal of the debt ceiling, arguing that the borrowing cap is "very destructive" and poses an unnecessary threat to the American economy.[185]
In January 2019, Yellen was among the 45 original signers of the Economists' Statement on Carbon Dividends, which was eventually signed by over 3,500 prominent American economists promoting a carbon dividends framework for the U.S. policy on climate change.[186] In October 2020, the Group of Thirty's Steering Committee Working Group on Climate Change and Finance, which Yellen co-chaired with Mark Carney, prepared a report that developed a robust and inclusive strategy to amplify and mainstream the global transition to a net-zero emissions economy.[187] The study calls upon governments, businesses, and financial institutions to assess climate risks and supports a phase-in of carbon pricing to accelerate a shift to carbon neutrality.[188]
Yellen is a Keynesian economist and has been described as a "Keynesian to her fingertips".[189] In April 1999, Yellen discussed her views on the application of Keynesian economics to policymaking at the Yale economics department reunion. She stated that while most economists "appreciate the value of markets and incentives," Yalies "can recognize when they are not operating correctly and have higher concern for policies to remedy them."[190] During the 2007–2008 financial crisis, she "warned against an over-hasty removal of stimulus," and "believes the state has a duty to tackle poverty and inequality."[191] When her appointment as treasury secretary was announced, Yellen was viewed by Wall Street as a "Treasury secretary who will push hard for expansionary policies aimed at boosting growth, profits and share prices," although the ability of Yellen to push through her preferred fiscal policies was seen as likely to be constrained by congressional gridlock.[191]
Personal life[edit]
Yellen is married to George Akerlof, an economist who is a university professor at the McCourt School of Public Policy at Georgetown University and Koshland Professor of Economics Emeritus at the University of California, Berkeley, as well as a 2001 Nobel Memorial Prize in Economic Sciences laureate.[22][240] The couple met in the fall of 1977, became engaged by that December, and married in June 1978, less than a year after meeting.[241][21] Their son, Robert Akerlof (born 1981), is a fellow economist. He received a bachelor's summa cum laude in economics and mathematics from Yale University and earned his PhD in economics from Harvard University, where he was a Presidential Scholar. Robert is an associate professor of economics at the University of Warwick.[242]
Yellen and George Akerlof have often collaborated on research, including topics such as poverty, unemployment and a paper on the costs of out-of-wedlock childbearing. One of their most discussed papers at Berkeley, on why lower wages sometimes lead to lower employment, came from the personal experience of hiring a nanny for the first time.[241] Yellen says Akerlof has been her biggest intellectual influence.[241] Both frequently state that their lone disagreement is that she is a bit more supportive of free trade than he is.[21][22]
Yellen has an estimated net worth of $20 million, accrued from stock holdings, speaking engagements, and various government and academic positions.[243] Upon taking office as U.S. Treasury Secretary, she divested her shares including those in Pfizer, ConocoPhillips, and AT&T, among others.[244]
Yellen inherited from her mother a collection of postage stamps worth between $15,000 and $50,000.[245][115] She doesn't collect them on her own.[246]
In popular culture[edit]
"Who's Yellen Now?" is a song by Dessa, a member of the indie hip-hop collective Doomtree and contributor to The Hamilton Mixtape. Marketplace commissioned the song after then-President-elect Biden announced his intention to nominate Yellen as the nation's first female Treasury Secretary and joked that Lin-Manuel Miranda should write a Hamiltonesque musical about her.[247] In addition, The Late Show with Stephen Colbert premiered a parody of Hamilton's opening song about Yellen.[248]
On NBC's sketch comedy show Saturday Night Live (SNL), Yellen was parodied by SNL cast member Kate McKinnon in 2021.[249]