Janet Yellen, outgoing Treasury Secretary and former Federal Reserve Chair, expressed regret over the nation’s fiscal challenges during her tenure, even as she oversaw a staggering $15.2 trillion increase in U.S. debt. Yellen’s comments came during a Wall Street Journal event where she also cautioned against encroaching on Federal Reserve independence.
Yellen spoke with Scott Bessent, President Donald Trump’s nominee for Treasury Secretary, ahead of Thanksgiving. She emphasized the scope of the role and lauded the Treasury Department’s staff. However, her remarks about fiscal sustainability have sparked criticism given the unprecedented rise in U.S. debt under her leadership.
During her time at the Federal Reserve and later as Treasury Secretary under the Biden administration, U.S. debt soared, making up 42% of the total debt ever issued by the country. Much of this growth occurred while interest rates were kept low, policies that critics say prioritized political objectives over long-term economic stability.
Yellen acknowledged the impact of higher interest rates on the deficit, saying, “I am sorry that we haven’t made more progress.” Her tenure has been marked by significant spending initiatives, including trillions allocated to domestic programs and foreign aid, further exacerbating the fiscal crisis.
The Biden administration’s final months have seen government spending reach record highs while tax revenues have stagnated. Interest expenses now rank as the second-largest federal expenditure, trailing only Social Security. With debt rolling over at higher rates, analysts warn of an impending financial crisis.
As the U.S. faces mounting economic challenges, Yellen’s acknowledgment of regret has been met with skepticism. Critics argue that her policies played a significant role in creating the unsustainable fiscal trajectory she now laments.
