Treasury Secretary <a href="http://dailywire.com/topic/janet-yellen" target="_blank" rel="noopener">Janet Yellen</a> lauded the <a href="http://dailywire.com/topic/biden-administration" target="_blank" rel="noopener">Biden</a> administration’s efforts to provide the Internal Revenue Service (<a href="https://www.dailywire.com/topic/internal-revenue-service-irs" target="_blank" rel="noopener">IRS</a>) with an $80 billion raise.
The Inflation Reduction Act provides funds to hire 87,000 new IRS employees over the next decade — <a href="https://www.dailywire.com/news/bidens-inflation-reduction-act-would-allow-irs-to-hire-up-to-87000-new-employees-raise-taxes-report" target="_blank" rel="noopener">more than doubling</a> the agency’s size. During a Thursday <a href="https://home.treasury.gov/news/press-releases/jy0952" target="_blank" rel="noopener">speech</a> at the New Carrollton Federal Building in Maryland, Yellen remarked that “adequately funding the IRS is core to our success.”
“It raises the revenue for us to make important investments in our economic strength,” she said. “It makes sure that all Americans are playing by the same rules. It avoids misallocation of resources in the economy at large. And it does so by deterring taxpayers from shifting their activities toward more opaque sources or engaging in tax evasion.”
Yellen repeated her promise that the new funding will not be directed to increase audits for Americans households earning less than $400,000 per year “relative to historical levels.” However, she <a href="https://www.dailywire.com/news/janet-yellen-vows-irs-audits-wont-rise-for-middle-income-americans-but-theres-a-catch" target="_blank" rel="noopener">failed to clarify</a> that “historical levels” of audits were far higher as recently as one decade ago. According to a <a href="https://www.gao.gov/assets/gao-22-104960.pdf" target="_blank" rel="noopener">report</a> from the Government Accountability Office, audit rates for Americans earning between $25,000 and $200,000 fell 76% between 2010 and 2019, while those earning less than $25,000 saw audit rates fall by 61%.
“In all, a strong IRS is critical to the economic success of this country — and I am heartened that we are finally reflecting that in our funding decisions,” Yellen added.
A <a href="https://www.cbo.gov/publication/57444" target="_blank" rel="noopener">report</a> from the Congressional Budget Office based on an earlier proposal to hire 87,000 new agents found that audit rates “would rise for all taxpayers,” even as higher-income taxpayers “face the largest increase.” According to Republican members of the House Ways and Means Committee, the new agents would be <a href="https://gop-waysandmeans.house.gov/americans-chances-of-audit-more-than-doubles-as-newly-supercharged-irs-targets-lower-middle-income-earners/" target="_blank" rel="noopener">capable</a> of carrying out 1.2 million more individual audits per year, with nearly half impacting Americans earning less than $75,000.
Noting that the average American takes 13 hours to file a tax return, Yellen said that many of the new resources will exist to decrease wait times and facilitate access to IRS services. Beyond increasing the number of staff available to answer phones, Yellen emphasized in-person help centers. “By next year, every single center will be fully staffed,” she said. “As a result, we will triple the number of Americans served at these centers.”
Yellen also discussed the need to make &#8220;sure that everyone pays their fair share” — observing that wealthy Americans were estimated to have underpaid their taxes by $160 billion in 2019. Accessing the funds would allow for higher levels of investment in government programs.
The economic agenda of President Joe Biden has indeed hinged upon the creation of new federal initiatives and a higher degree of government intervention into the economy. A <a href="https://www.dailywire.com/news/white-house-releases-massive-document-detailing-bidens-economic-achievements" target="_blank" rel="noopener">handbook</a> recently published by the White House emphasized the administration’s legislative victories and claimed that they are responsible for a purported economic recovery.
“President Biden’s agenda has contributed to the strongest and most equitable economic and labor market recovery in modern history, and catalyzed a resurgence in public investment that will help ensure a strong, innovative, clean energy future that is made in America,” the report said. “Together with generational investments in infrastructure, clean energy, and advanced manufacturing, the Biden economic agenda has coupled historic job creation with a long-term strategy to ensure that good jobs of today and tomorrow are created in America.”

President Biden Meets With CEOs And Remarks On The Economy

Janet Yellen: ‘A Strong IRS Is Critical To The Economic Success Of This Country’

Janet Yellen Celebrates $80 Billion In New IRS Funds

Biden Administration

Economy

Internal Revenue Service (IRS)

Janet Yellen

Taxes

Have you ever seen former <a href="https://www.dailywire.com/topic/new-england-patriots" target="_blank" rel="noopener">New England Patriots</a> star Julian Edelman&#8217;s <a href="https://www.youtube.com/watch?v=4SiUNdkIwzQ" target="_blank" rel="noopener">unbelievable catch</a> as part of the team&#8217;s 25-point comeback in Super Bowl 51? It undoubtedly took &#8220;great skill&#8221; and &#8220;good luck&#8221; — thanks, in large part, to his years of practice and determination.
Unfortunately for the United States economy, the Federal Reserve is also going to need the same level of preparation and serendipity to avoid economic ruin, and U.S. Treasury Secretary Janet Yellen is no Julian Edelman.
On Sunday, Yellen <a href="https://www.businessinsider.in/stock-market/news/yellen-says-the-fed-will-need-good-luck-and-great-skill-if-its-going-to-pull-off-a-soft-landing-for-the-us-economy/articleshow/94157337.cms" target="_blank" rel="noopener">told</a> CNN, &#8220;The Fed is going to need great skill and also some good luck to achieve what we sometimes call a soft landing.&#8221;
More precisely, she is referring to an economy where inflation falls below 2% and unemployment remains low. If the American economy does not achieve that &#8220;soft landing,&#8221; it is likely we will be plunged into a recession after a hard landing.
While Yellen might seem confident that America can avoid such economic pain, Fed chairman Jerome Powell appears to disagree. Since the spring, the Fed has attempted to usher America toward economic success by hiking interest rates.
Yet, Powell maintains that not raising the rates would bring about more &#8220;pain.&#8221;
“While higher interest rates, slower growth, and softer labor market conditions will bring down inflation, they will also bring some pain to households and businesses,” Powell <a href="https://www.dailywire.com/news/jerome-powell-vows-to-restore-price-stability-even-though-federal-reserve-must-first-bring-some-pain" target="_blank" rel="noopener">said</a> at the annual policy speech at Jackson Hole, Wyoming. &#8220;These are the unfortunate costs of reducing inflation. But a failure to restore price stability would mean far greater pain.&#8221;
It is expected that the Fed will announce another round of rate hikes, something tech billionaire Elon Musk warns could cause deflation. Musk holds such dire predictions because he, alongside economist David Branchflower, believes that inflation has peaked.
Branchflower recently <a href="https://www.politico.com/news/magazine/2022/09/08/dangerous-groupthink-at-the-federal-reserve-00055324" target="_blank" rel="noopener">wrote</a> in Politico that &#8220;policymakers are forgetting their history, and now they’re basically winging it&#8221; and risking raising rates when inflation is already cooling.
Other economists, like Goldman Sachs&#8217; Tim Moe, argue that more effort is needed on closing the gap in the labor market.
&#8220;The real sticky bit of inflation is, of course, in the labor market, and that&#8217;s where there&#8217;s some progress that&#8217;s been made. But a lot more that has to be accomplished,&#8221; Moe <a href="https://markets.businessinsider.com/news/stocks/inflation-peak-fed-labor-market-jobs-soft-landing-goldman-sachs-2022-9" target="_blank" rel="noopener">told</a> Business Insider.
&#8220;One of the issues or the indicators that we look at is the gap between job openings and the labor force,&#8221; Moe said. &#8220;That&#8217;s coming down. And that&#8217;s actually the key to a soft landing.&#8221;
Yet, according to the Fed&#8217;s Vice Chair Lael Brainard, the board&#8217;s main concern remains inflation and they feel confident in the labor market.
“Monetary policy will need to be restrictive for some time to provide confidence that inflation is moving down to target,&#8221; she said recently. &#8220;The economic environment is highly uncertain, and the path of policy will be data dependent,&#8221; she <a href="https://www.federalreserve.gov/newsevents/speech/brainard20220907a.htm" target="_blank" rel="noopener">added</a>.
So according to some of the smartest folks in the room — at least according to popular opinion — America’s options are either a hard landing and subsequent recession, deflation, or throwing our hopes on a wing and a prayer. 
At this point in the column, readers might be feeling pretty uneasy about our nation&#8217;s experts&#8217; ability to solve inflation.
When the treasury secretary is incorporating &#8220;good luck&#8221; and &#8220;great skill&#8221; into her economic remedies to avoid a hard landing or deflation, that uneasiness is entirely reasonable.
Just a reminder, here&#8217;s a metaphor for what that looks like:
<blockquote class="twitter-tweet" data-width="500" data-dnt="true">
Still don’t know how Julian Edelman made this catch. An All-Time great catch to help complete the greatest comeback in NFL history&#8230; legendary stuff. <a href="https://t.co/REB1JAQ28k">pic.twitter.com/REB1JAQ28k</a>
&mdash; Pats Buzz (@PatsBuzz) <a href="https://twitter.com/PatsBuzz/status/1294059895919083520?ref_src=twsrc%5Etfw">August 13, 2020</a></blockquote>
<script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
The views expressed in this piece are the author’s own and do not necessarily represent those of The Daily Wire.

Janet Yellen Says America Needs ‘Great Skill’ And ‘Good Luck’ For A Soft Landing. We Are Screwed.

Janet Yellen Says American Economy Needs 'Good Luck' And 'Great Skill' For A Soft Landing. We Are Screwed.

Federal Reserve

Interest Rates

Treasury Secretary <a href="http://dailywire.com/topic/janet-yellen" target="_blank" rel="noopener">Janet Yellen</a> noted on Sunday that there remains a “risk” of <a href="http://dailywire.com/topic/gas-prices" target="_blank" rel="noopener">gas prices</a> spiking again this year.
<a href="http://dailywire.com/topic/europe" target="_blank" rel="noopener">Europe</a> is presently grappling with an <a href="http://dailywire.com/topic/energy" target="_blank" rel="noopener">energy</a> crisis emerging from limited oil and natural gas supplies due to the <a href="https://www.dailywire.com/topic/ukraine-russia-war" target="_blank" rel="noopener">Russian invasion of Ukraine</a>. In an <a href="https://www.cnn.com/2022/09/11/politics/janet-yellen-inflation-risk-cnntv/index.html">interview</a> with CNN anchor Dana Bash, Yellen indicated that the situation could also lead to higher prices in the United States.
“Well, it’s a risk. And it’s a risk that we’re working on the price cap to try to address,” she said. “This winter, the European Union will cease, for the most part, buying Russian oil. And, in addition, they will ban the provision of services that enable Russia to ship oil by tanker. And it is possible that that could cause a spike in oil prices.”
The national average price of gasoline was $2.38 per gallon when President Joe Biden assumed office and <a href="https://www.dailywire.com/news/gas-prices-are-1-50-higher-since-biden-took-office-cnn-business-america-got-a-raise">increased</a> to $3.53 per gallon by the start of the Russian invasion. After surpassing <a href="https://www.dailywire.com/topic/gas-prices">$5.00 per gallon</a> in early June, prices have subsided to $3.72 per gallon as of Monday, according to <a href="https://gasprices.aaa.com/">data</a> from AAA.
Finance ministers representing the G7, which includes Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States, <a href="https://www.dailywire.com/news/g7-finance-ministers-commit-to-russian-oil-price-cap-will-help-ukraine-for-as-long-as-it-takes">committed</a> earlier this month to pursue a joint price cap on Russian oil. The ministers affirmed that the bloc “will continue to stand with Ukraine for as long as it takes” by banning the sale of Russian oil above a given rate.
“Our price cap proposal is designed to both lower Russian revenues that they use to support their economy and fight this illegal war, while also maintaining Russian oil supplies that will help to hold down global oil prices,” Yellen told CNN. “So I believe this is something that can be essential, and it’s something that we’re trying to put in place to avoid a future spike in oil prices.”
However, energy ministers representing European Union member states failed to reach a consensus on the price cap during a Friday meeting. The nations may instead compel fossil fuel companies to pay a “solidarity contribution” that would ease soaring energy prices, which have increased <a href="https://www.dailywire.com/news/back-to-the-dark-ages-tucker-carlson-details-europes-self-induced-energy-crisis">more than tenfold</a> for some households and businesses.
After the finance ministers announced the price cap, Russia severed natural gas flow through the Nord Stream 1 pipeline. Meanwhile, Russian President Vladimir Putin doubled down on the restricted shipments, remarking at the Eastern Economic Forum that he is <a href="https://www.dailywire.com/news/let-the-wolfs-tail-freeze-putin-doubles-down-on-halting-natural-gas-flow-to-western-europe">prepared to ignore</a> existing supply agreements. “Will there be any political decisions that contradict the contracts? Yes, we just won’t fulfill them. We will not supply anything at all if it contradicts our interests,” Putin said. “We will not supply gas, oil, coal, heating oil — we will not supply anything.”
Several member nations of the European Union, which abide by the official <a href="https://ec.europa.eu/clima/eu-action/climate-strategies-targets/2050-long-term-strategy_en">policy</a> of becoming “a climate-neutral society” by 2050, are now implementing energy use policies of varying stringency. France has <a href="https://www.dailywire.com/news/french-president-calls-for-10-cut-in-energy-use-will-ration-power-as-a-last-resort">called</a> for a 10% reduction in energy consumption, while Spain and Switzerland (which is not part of the EU but has close economic ties to the bloc) are introducing <a href="https://www.dailywire.com/news/switzerland-may-jail-people-who-turn-heat-above-66-degrees-this-winter">regulations</a> for thermostat levels.
In a departure from other European officials, however, British Prime Minister Liz Truss reversed the nation’s ban on fracking and proposed a <a href="https://www.dailywire.com/news/british-prime-minister-liz-truss-unveils-package-to-cut-soaring-fuel-prices-offers-reforms-so-we-are-never-in-this-position-again">return to oil and gas</a> drilling in the North Sea. Meanwhile, Biden has leased less government land for oil and gas drilling than any of his predecessors since World War II at this point in his first term, according to an <a href="https://www.dailywire.com/news/biden-administration-severely-cuts-back-on-oil-and-gas-leases">analysis</a> conducted by The Wall Street Journal.

6E4B23DD-6B3E-48B5-B4FC-493529DB25EF_1_201_a

‘Well, It’s A Risk’: Janet Yellen Admits Gas Prices Could Spike Again This Year

Janet Yellen Notes 'Risk' Of Gas Prices Spiking Again This Year

Europe

Gas Prices

Ukraine-Russia War

Total household <a href="http://dailywire.com/topic/economy" target="_blank" rel="noopener">wealth</a> in the United States fell $6.1 trillion dollars in the second quarter of 2022, according to <a href="https://www.federalreserve.gov/releases/z1/dataviz/z1/balance_sheet/chart/#units:usd;series:balance-sheet">data</a> released on Friday by the <a href="http://dailywire.com/topic/federal-reserve" target="_blank" rel="noopener">Federal Reserve</a>.
The central bank’s Financial Accounts of the United States <a href="https://www.federalreserve.gov/releases/z1/20220909/z1.pdf">report</a> showed that wealth held by households and nonprofits dropped from $149.9 trillion at the end of March to $143.8 trillion at the end of June, representing a 4% decline.
Although the value of real estate increased $1.4 trillion, the value of directly and indirectly held corporate equities fell $7.7 trillion. Household debt, meanwhile, increased at an annualized rate of 7.4%. Indeed, the ratio between net worth and disposable income fell from 824% to 778%.
The United States recently met the rule-of-thumb definition of a recession — two consecutive quarters of negative growth — since the economy <a href="https://www.dailywire.com/news/united-states-economy-shrinks-in-the-first-part-of-2022">shrank</a> at a 1.6% annualized rate in the first quarter and <a href="https://www.dailywire.com/news/u-s-in-a-recession-after-second-straight-quarter-of-negative-growth">contracted</a> at a 0.6% pace in the second quarter. Year-over-year inflation reached 8.5% in July 2022, according to <a href="https://www.bls.gov/news.release/cpi.nr0.htm">data</a> from the Bureau of Labor Statistics, with a slight moderation from the 9.1% reading in June 2022 <a href="https://www.dailywire.com/news/white-house-starts-victory-lap-amid-slightly-less-dismal-inflation-reading">driven</a> by lower energy prices — even as costs for food, new vehicles, medical care, and shelter continue to rise.
In reaction to persistent inflationary pressures, the Federal Reserve has adopted a <a href="https://www.dailywire.com/news/federal-reserve-hikes-interest-rates-again-to-combat-bidenflation">hawkish</a> approach to raising interest rates — a policy that tends to restrict economic output as the cost of borrowing money increases. Monetary policymakers’ current target is between 2.25% and 2.5%.
“Price stability is the responsibility of the Federal Reserve and serves as the bedrock of our economy,” Federal Reserve Chair Jerome Powell said in a <a href="https://www.dailywire.com/news/jerome-powell-vows-to-restore-price-stability-even-though-federal-reserve-must-first-bring-some-pain">speech</a> delivered at the central bank’s annual symposium in Jackson Hole, Wyoming. “Without price stability, the economy does not work for anyone. In particular, without price stability, we will not achieve a sustained period of strong labor market conditions that benefit all. The burdens of high inflation fall heaviest on those who are least able to bear them.”
Officials in the Biden administration, however, have dismissed potential inflationary impacts arising from a series of recent federal stimulus packages. Treasury Secretary Janet Yellen <a href="https://www.dailywire.com/news/janet-yellen-we-have-experienced-one-of-the-quickest-economic-recoveries-in-our-modern-history">praised</a> the business climate under President Joe Biden as “one of the quickest economic recoveries in our modern history.”
“Our plan has worked,” she commented. “The United States experienced the fastest pace of job creation in our history. Household balance sheets are strong. Businesses continue to invest. Our broad and inclusive recovery has outpaced that of many other large economies.”
An <a href="https://www.dailywire.com/news/most-top-biden-officials-have-0-years-of-business-experience">analysis</a> from the Committee to Unleash Prosperity, a conservative think tank, found that the top 68 individuals in the Biden administration have spent an average of 2.4 years in the business world, with only one in eight boasting “extensive business experience.” The median length of business experience for Biden officials is zero years — a significant departure from the median of eight years among top members of the Trump administration.
“Surely we want our political class to have a diversity of backgrounds. We want lawyers, grassroots activists, those with political and policy experience, scientists, health experts, and academics with required specialties,” the report argued. “But we also want people who have experience running large operations with hundreds and thousands of employees and who understand logistics.”

Ariel Skelley / The Image Bank / Getty Images

American Households Lost $6 Trillion In Three Months

American Households Lost $6 Trillion Of Wealth In The Second Quarter Of 2022

Inflation

Treasury Secretary <a href="https://www.dailywire.com/topic/janet-yellen" target="_blank" rel="noopener">Janet Yellen</a> lauded the <a href="http://dailywire.com/topic/business" target="_blank" rel="noopener">business</a> climate under President <a href="http://dailywire.com/topic/biden-administration" target="_blank" rel="noopener">Joe Biden</a> as “one of the quickest economic recoveries in our modern history.”
During a Thursday <a href="https://home.treasury.gov/news/press-releases/jy0939">speech</a> at Ford’s electric vehicle factory in Dearborn, Michigan, the official pinned the blame for crises like <a href="http://dailywire.com/topic/inflation" target="_blank" rel="noopener">inflationary</a> pressures, <a href="http://dailywire.com/topic/supply-chain" target="_blank" rel="noopener">supply chain</a> bottlenecks, and high <a href="http://dailywire.com/topic/energy" target="_blank" rel="noopener">energy</a> costs on factors outside of the administration. Yet she praised the $1.9 trillion American Rescue Plan, the $740 billion Inflation Reduction Act, and other landmark packages signed by the commander-in-chief as causes for purportedly strong <a href="http://dailywire.com/topic/economy" target="_blank" rel="noopener">economic</a> conditions.
“Our plan has worked,” she commented. “The United States experienced the fastest pace of job creation in our history. Household balance sheets are strong. Businesses continue to invest. Our broad and inclusive recovery has outpaced that of many other large economies. And measured by gross domestic income, our economy continues to expand and is operating above levels that would have been predicted pre-pandemic.”
As measured by the far more often cited gross domestic product, however, the United States met the rule-of-thumb definition of a recession — two consecutive quarters of negative growth — last month as the economy <a href="https://www.dailywire.com/news/united-states-economy-shrinks-in-the-first-part-of-2022">shrank</a> at a 1.5% annualized rate in the first quarter and <a href="https://www.dailywire.com/news/u-s-in-a-recession-after-second-straight-quarter-of-negative-growth">contracted</a> at a 0.6% pace in the second quarter. Yellen’s remarks appear to be a pivot from her earlier <a href="https://www.dailywire.com/news/yellen-were-not-in-a-recession-were-in-a-transition-in-which-growth-is-slowing">claim</a> that the nation is not in a “recession,” but rather a “period of transition in which growth is slowing.”
“It’s fair to say: by any traditional metric, we have experienced one of the quickest economic recoveries in our modern history,” Yellen nevertheless said on Thursday.
Meanwhile, the personal saving rate — the share of disposable income Americans devote to savings — was 5% in August, according to <a href="https://fred.stlouisfed.org/series/PSAVERT">data</a> from the Bureau of Economic Analysis. Although households saved between 10% and 35% of their income in the months that followed the lockdown-induced recession, the personal savings rate is currently well below the 7% or more Americans typically saved through much of the last decade.
With respect to inflation, which may be causing Americans to <a href="https://www.dailywire.com/news/three-quarters-of-americans-say-they-are-tightening-their-belts-to-deal-with-recession">reduce spending</a>, Yellen deflected blame from the White House — although <a href="https://www.dailywire.com/news/biden-says-his-spending-agenda-took-america-from-an-economic-crisis-to-an-economic-recovery">reports</a> indicate that the American Rescue Plan worsened <a href="https://www.dailywire.com/news/unemployment-rate-edges-upward-for-the-first-time-in-months-as-more-americans-return-to-work">labor shortages</a> and contributed to other phenomena behind rising price levels.
“Now, Americans are rightfully concerned that higher prices are squeezing their day-to-day budgets and their longer-term savings,” Yellen continued. “The causes of inflation are largely global. But the pain of inflation is personal. This administration’s top economic priority is to combat inflation, even as we know the Federal Reserve has the primary role to play in restoring price stability.”
Biden has formerly pinned inflation on <a href="https://www.dailywire.com/news/biden-says-exxon-made-more-money-than-god-this-year-blames-them-for-gas-price-spike">corporate price gouging</a> and “<a href="https://www.dailywire.com/news/president-biden-blames-vladimir-putin-for-record-high-inflation">Putin’s Price Hike</a>.” As year-over-year inflation reached its highest levels in June, the commander-in-chief <a href="https://www.dailywire.com/news/biden-claims-inflation-is-worse-everywhere-but-here-thats-not-even-close-to-true">falsely claimed</a> that rising price levels are “worse everywhere but here” — though developed nations such as Germany, the United Kingdom, Canada, South Korea, and Japan had been experiencing lower inflation than the United States.
Yellen, who recently <a href="https://www.dailywire.com/news/janet-yellen-vows-irs-audits-wont-rise-for-middle-income-americans-but-theres-a-catch">argued</a> that an expanded Internal Revenue Service will not impact middle class Americans’ audit rate, also expressed her willingness to pursue more tax increases.
“This includes closing loopholes and returning tax rates for high earners and corporations to historical norms,” she said. “By making everyone pay their fair share, these reforms will provide our government with additional fiscal room to make critical investments.”

Treasury Secretary Janet Yellen Gives Economic Address At Ford’s Rouge Electric Vehicle Center

Janet Yellen: ‘We Have Experienced One Of The Quickest Economic Recoveries In Our Modern History’

‘Our Plan Has Worked’: Janet Yellen Gives Rosy View Of Biden Economy In Landmark Speech

Business

<a href="http://dailywire.com/topic/g7" target="_blank" rel="noopener">G7</a> finance ministers committed on Friday to jointly pursue a price cap on <a href="http://dailywire.com/topic/russia" target="_blank" rel="noopener">Russian</a> <a href="http://dailywire.com/topic/russia" target="_blank" rel="noopener">oil</a>.
Members of the forum, which includes Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States, <a href="https://www.dailywire.com/news/biden-and-other-world-leaders-want-a-global-price-cap-on-russian-oil">announced</a> the policy three months ago during a conference in Austria. A <a href="https://www.gov.uk/government/news/g7-finance-ministers-statement-on-russias-war-of-aggression-against-ukraine">statement</a> from the nations’ finance ministers published on Friday affirms that the bloc “will continue to stand with Ukraine for as long as it takes” by banning the sale of Russian oil above a certain price.
“We seek to establish a broad coalition in order to maximize effectiveness and urge all countries that still seek to import Russian oil and petroleum products to commit to doing so only at prices at or below the price cap,” the statement explained. “We reaffirm our own measures to phase out Russian oil and products from our domestic markets and underscore that the price cap measure aims to relieve pressure on global oil prices and support oil-importing countries globally by enabling continued access to Russian oil at or below the price cap for countries that continue such imports.”
The initial price cap will be established based upon “a range of technical inputs,” according to the statement, which acknowledged that each of the 27 nations in the European Union must unanimously affirm the plan.
Treasury Secretary Janet Yellen said in a <a href="https://home.treasury.gov/news/press-releases/jy0936">statement</a> that the price cap is “one of the most powerful tools we have to fight inflation” caused by future geopolitical events. “By committing to finalize and implement a price cap, the G7 will significantly reduce Russia’s main source of funding for its illegal war, while maintaining supplies to global energy markets by keeping Russian oil flowing at lower prices,” she remarked. “While we’ve seen energy prices ease in the United States, energy costs remain a concern for Americans and continue to be elevated globally.”
The national average price of gasoline was $2.38 per gallon when President Joe Biden assumed office, according to <a href="https://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&amp;s=EMM_EPMR_PTE_NUS_DPG&amp;f=W">data</a> from the Energy Information Administration, and increased to $3.53 per gallon by the start of the Russian invasion. Prices surpassed <a href="https://www.dailywire.com/topic/gas-prices">$5.00 per gallon</a> in early June before subsiding to $3.81 per gallon as of Friday, according to <a href="https://gasprices.aaa.com/">AAA</a>.
Natural gas prices in some parts of Europe have <a href="https://www.dailywire.com/news/back-to-the-dark-ages-tucker-carlson-details-europes-self-induced-energy-crisis">increased tenfold</a> compared to normal levels, prompting various countries to introduce energy consumption quotas ahead of the winter months. Germany — the largest economy in Europe — imported roughly 55% of its natural gas from Russia before the invasion and has since <a href="https://www.dailywire.com/news/germany-poised-to-shut-down-last-nuclear-plants-despite-gas-shortage-ahead-of-winter-months">reduced its dependence</a> to 35%, although German gas supplies are slated to last only three months if Russia decides to end all exports.
The European Union has adopted the official <a href="https://ec.europa.eu/clima/eu-action/climate-strategies-targets/2050-long-term-strategy_en">policy</a> of becoming “a climate-neutral society” by 2050 in accordance with the European Green Deal and the Paris Agreement. Earlier this week, Tesla and SpaceX CEO Elon Musk <a href="https://www.dailywire.com/news/civilization-will-crumble-elon-musk-issues-dire-warning-about-rapid-shift-to-green-energy">cautioned</a> that the global economy places itself at risk by pursuing a rushed transition to renewable power.
“Realistically I think we need to use oil and gas in the short term, because otherwise civilization will crumble,” Musk told reporters at an energy summit in Norway. “One of the biggest challenges the world has ever faced is the transition to sustainable energy and to a sustainable economy. That will take some decades to complete.”

GERMANY-UKRAINE-RUSSIA-G7-ECONOMY-FINANCE

G7 Finance Ministers Commit To Russian Oil Price Cap, Will Help Ukraine ‘For As Long As It Takes’

Finance Ministers Of World's Largest Economies Agree To Cap Russian Oil Prices

Oil and Gas

Russia

Ukraine

Treasury Secretary <a href="http://dailywire.com/topic/janet-yellen">Janet Yellen</a> vowed on Wednesday that Internal Revenue Service (<a href="https://www.dailywire.com/topic/internal-revenue-service-irs">IRS</a>) <a href="http://dailywire.com/topic/taxes">audit</a> rates for Americans earning less than $400,000 per year would not increase — at least according to “historical levels,” which are far higher than current levels.
The Biden administration official’s promise comes as the Inflation Reduction Act — a $740 billion proposal that includes $80 billion for the IRS to hire 87,000 more employees — advances through Congress. In a <a href="https://home.treasury.gov/system/files/136/JLY-letter-to-Commissioner-Rettig-Signed.pdf">letter</a> to IRS Commissioner Charles Rettig, Yellen argued that the funding would help the IRS “improve taxpayer service” and “increase equity in the tax system” rather than allow the agency to target middle-income Americans.
“I direct that any additional resources — including any new personnel or auditors that are hired — shall not be used to increase the share of small business or households below the $400,000 threshold that are audited relative to historical levels,” Yellen told Rettig. “This means that, contrary to the misinformation from opponents of this legislation, small business or households earning $400,000 per year or less will not see an increase in the chances that they are audited.”
Yellen failed to mention, however, that “historical levels” of audits were significantly higher as recently as one decade ago. According to a report from the <a href="https://www.gao.gov/assets/gao-22-104960.pdf">Government Accountability Office</a>, audit rates for Americans earning between $25,000 to $200,000 fell 76% between 2010 and 2019, while those earning less than $25,000 saw audit rates fall by 61%. Taxpayers earning between $200,000 and $500,000 — representing those at the upper end of the Biden administration’s vow to not raise taxes for those earning less than $400,000 — saw a 92% decline in audits.
Indeed, the report said that IRS officials “attributed the overall decline in audit rates to decreased funding, and therefore reduced staffing to conduct audits” — constraints which are directly addressed by the Inflation Reduction Act.
Another report from the <a href="https://www.cbo.gov/publication/57444">Congressional Budget Office</a> based on an earlier proposal to hire 87,000 new IRS agents found that audit rates “would rise for all taxpayers,” even as higher-income taxpayers “face the largest increase.” According to Republican members of the <a href="https://gop-waysandmeans.house.gov/americans-chances-of-audit-more-than-doubles-as-newly-supercharged-irs-targets-lower-middle-income-earners/">House Ways and Means Committee</a>, the new agents would be capable of carrying out 1.2 million more individual audits per year, with nearly half impacting Americans earning less than $75,000.
Despite leaving room for higher audit rates relative to “historical levels,” Yellen argued that information technology updates funded by the bill would help Americans avoid audits in the first place. “The result of this resource infusion will be a lower likelihood of audit by an agency that has the data and technological infrastructure in place to target enforcement resources where they belong—on the high end of the income distribution, where the top 1% alone is estimated to not be paying $160 billion in owed taxes each year,” Yellen wrote. “That’s important as a matter of revenue-raising, but it’s also essential as a matter of fairness.”
The IRS employed nearly 79,000 full-time employees as of fiscal year 2021, according to the <a href="https://www.irs.gov/statistics/irs-budget-and-workforce">agency</a>, which also reported $13.7 billion in operating costs.
Yellen also referenced a letter Rettig <a href="https://www.dailywire.com/news/irs-we-will-absolutely-not-target-everyday-americans-with-new-army-of-agents">addressed to lawmakers</a> last week, in which he vowed that the agency would “absolutely not” use its 87,000 new employees to target taxpayers by “increasing audit scrutiny on small businesses or middle-income Americans.”
“As an extremely proud American, I’m grateful for your support of the IRS and our dedicated employees,” Rettig added. “I cannot be forceful enough in emphasizing that these resources will be transformative for the agency and for American taxpayers.”

President Biden Delivers Remarks On The Economy

Janet Yellen Vows IRS Audits Won’t Rise For Middle-Income Americans, But There’s A Catch

Yellen Vows IRS Audits Won't Rise More Than 'Historical Levels,' Which Turn Out To Be Pretty High

Former late-night host <a href="https://www.dailywire.com/topic/conan-obrien">Conan O&#8217;Brien</a> mocked the <a href="https://www.dailywire.com/topic/white-house">White House</a> on Wednesday, making a crack about the administration downplaying and denying the <a href="http://dailywire.com/topic/economy">economic</a> <a href="http://dailywire.com/topic/recession">recession</a> hurting Americans.
Treasury Secretary <a href="http://dailywire.com/topic/janet-yellen">Janet Yellen</a> turned heads over the weekend when she denied that the U.S. economy is in a recession, instead saying we&#8217;re in a “period of transition in which growth is slowing,&#8221; <a href="https://www.dailywire.com/news/yellen-were-not-in-a-recession-were-in-a-transition-in-which-growth-is-slowing">The Daily Wire</a> reported.
&#8220;The White House now says it’s only a recession if you see a salamander wearing a top hat,&#8221; O&#8217;Brien mocked on Wednesday.
<blockquote class="twitter-tweet" data-width="500" data-dnt="true">
The White House now says it’s only a recession if you see a salamander wearing a top hat.
&mdash; Conan O&#39;Brien (@ConanOBrien) <a href="https://twitter.com/ConanOBrien/status/1552358211986006019?ref_src=twsrc%5Etfw">July 27, 2022</a></blockquote>
<script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
Despite the White House denial, the U.S. has suffered two consecutive quarters of negative growth, which most economists widely define as a recession, The Daily Wire <a href="https://www.dailywire.com/news/u-s-in-a-recession-after-second-straight-quarter-of-negative-growth">reported</a> Thursday morning.
“This is not an economy that’s in recession,” Yellen contended, speaking to NBC host Chuck Todd on Sunday. “But we’re in a period of transition in which growth is slowing and that’s necessary and appropriate and we need to be growing at a steady and sustainable pace. So there is a slowdown and businesses can see that and that’s appropriate, given that people now have jobs and we have a strong labor market.”
Again trying to deny the economic reality, a White House <a href="https://www.whitehouse.gov/briefing-room/press-briefings/2022/07/07/press-briefing-by-press-secretary-karine-jean-pierre-3/">post</a> last week told Americans that the nation is “stronger economically than we have been in history.&#8221;
“While some maintain that two consecutive quarters of falling real GDP constitute a recession, that is neither the official definition nor the way economists evaluate the state of the business cycle,” the White House <a href="https://www.whitehouse.gov/cea/written-materials/2022/07/21/how-do-economists-determine-whether-the-economy-is-in-a-recession/">insisted</a>. “Instead, both official determinations of recessions and economists’ assessment of economic activity are based on a holistic look at the data — including the labor market, consumer and business spending, industrial production, and incomes. Based on these data, it is unlikely that the decline in GDP in the first quarter of this year — even if followed by another GDP decline in the second quarter — indicates a recession.”
Further, on Tuesday, Director of the National Economic Council Brian Deese said, “two negative quarters of GDP growth is not the technical definition of recession,&#8221; seemingly trying to bail out the Biden administration.
“It’s not the definition that economists have traditionally relied on,” the Biden economic adviser said, appearing at a White House press briefing, the New York Post <a href="https://nypost.com/2022/07/27/white-house-takes-heat-after-biden-adviser-accused-of-redefining-recession/">reported</a>.
However, by Wednesday, comments from Deese back in 2008 resurfaced online.
“Economists have a technical definition of recession, which is two consecutive quarters of negative growth,” Deese said in 2008, according to RNC Research.
<blockquote class="twitter-tweet" data-width="500" data-dnt="true">
THREAD
Biden’s economic advisors know a recession is defined as two quarters of negative GDP growth. They’ve said so:
Biden’s NEC Director Brian Deese in March 2008: “economists have a technical definition of recession, which is two consecutive quarters of negative growth.” <a href="https://t.co/RnoWSGbJrE">pic.twitter.com/RnoWSGbJrE</a>
&mdash; RNC Research (@RNCResearch) <a href="https://twitter.com/RNCResearch/status/1552369806413905923?ref_src=twsrc%5Etfw">July 27, 2022</a></blockquote>
<script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
Related: <a href="https://www.dailywire.com/news/u-s-in-a-recession-after-second-straight-quarter-of-negative-growth">U.S. In A Recession After Second Straight Quarter Of Negative Growth</a>

WarnerMedia Upfront 2019 – Show

Conan O’Brien Posts Tweet Mocking White House Dodge On Recession

Conan O'Brien

Recession

White House

President Joe Biden dismissed talk of a potential recession Monday, ahead of upcoming GDP numbers that many experts anticipate will point to a recession.
Speaking to reporters after a press conference on the $52 billion &#8220;CHIPS Act&#8221; currently making its way through Congress, Biden was asked by Fox News White House reporter Peter Doocy about fears of a potential recession, as many economists expect second-quarter Gross Domestic Product growth to decline for the second consecutive quarter, indicating that the U.S. economy is in recession.
&#8220;Mr. President, we&#8217;re getting GDP numbers on Thursday,&#8221; Doocy called out. &#8220;How worried should Americans be that we could be in a recession?&#8221;
&#8220;We&#8217;re not gonna be in a recession, in my view,&#8221; Biden replied, speaking over Zoom because of his recent <a href="https://www.dailywire.com/news/president-joe-biden-has-covid-white-house-announces">diagnosis of COVID-19</a>. &#8220;The [un]employment rate is still one of the lowest we&#8217;ve had in history, it&#8217;s in the <a href="https://www.bls.gov/news.release/pdf/empsit.pdf">3.6 [percent] area</a>. We still find ourselves with people investing. My hope is we go from this rapid growth to steady growth, so we’ll see some coming down. But I don’t think we’re going to, God willing, I don’t think we’re going to see a recession.&#8221;
<blockquote class="twitter-tweet" data-width="500" data-dnt="true">
Biden: &quot;We&#39;re not gonna be in a recession.&quot;<a href="https://t.co/TylryJ5Jp8">pic.twitter.com/TylryJ5Jp8</a>
&mdash; Daily Wire (@realDailyWire) <a href="https://twitter.com/realDailyWire/status/1551659755894095872?ref_src=twsrc%5Etfw">July 25, 2022</a></blockquote>
<script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
Biden&#8217;s comments come as his administration scrambles to do damage control, as the economy moves toward a possible recession. The standard rule of thumb in identifying a recession is two back-to-back quarters of negative GDP growth; that rule was <a href="https://www.nytimes.com/1974/12/01/archives/the-changing-business-cycle-points-op-view.html">created</a> in 1974 by economist Julius Shiskin.
But in recent days, members of the Biden team have been pushing a broader definition of recession from the nonprofit National Bureau of Economic Research, which the White House has called &#8220;the official recession scorekeeper.&#8221; The NBER <a href="https://www.nber.org/research/business-cycle-dating">defines</a> a recession as &#8220;a significant decline in economic activity that is spread across the economy and lasts more than a few months.”
The White House began its damage control campaign in a <a href="https://www.whitehouse.gov/cea/written-materials/2022/07/21/how-do-economists-determine-whether-the-economy-is-in-a-recession/">blog post</a> published on its official website Thursday. &#8220;While some maintain that two consecutive quarters of falling real GDP constitute a recession, that is neither the official definition nor the way economists evaluate the state of the business cycle,&#8221; White House officials wrote. &#8220;Instead, both official determinations of recessions and economists’ assessment of economic activity are based on a holistic look at the data — including the labor market, consumer and business spending, industrial production, and incomes. Based on these data, it is unlikely that the decline in GDP in the first quarter of this year — even if followed by another GDP decline in the second quarter — indicates a recession.&#8221; The White House referenced the NBER definition of recession in its post.
Treasury Secretary <a href="https://www.dailywire.com/news/treasury-sec-yellen-us-economy-isnt-necessarily-headed-for-a-recession-might-not-meet-the-technical-definition">Janet Yellen</a> also dismissed the common definition during an appearance on &#8220;Meet the Press&#8221; Sunday. “A common definition of recession is two negative quarters of GDP growth, or at least that’s something that’s been true in past recessions,&#8221; Yellen said. &#8220;When we have seen that, there has usually been a recession. And many economists expect second-quarter GDP to be negative. First-quarter GDP was negative. So we could see that happen, and that will be closely watched. But I do want to emphasize: what a recession really means is a broad-based contraction in the economy. And even if that number is negative, we are not in a recession now, and I would, you know, warn that we should be not characterizing that as a recession.”

President Biden Holds A Press Conference At The White House

‘We’re Not Gonna Be In A Recession’: Biden Downplays Recession Fears

'We're Not Gonna Be In A Recession': Biden Downplays Recession Fears

Joe Biden

Treasury Secretary <a href="http://dailywire.com/topic/janet-yellen">Janet Yellen</a> claimed that the United States <a href="http://dailywire.com/topic/economy">economy</a> is not in a <a href="http://dailywire.com/topic/recession">recession</a> but rather a “period of transition in which growth is slowing.”
When pressed by NBC host Chuck Todd over the weekend, Yellen <a href="https://www.whitehouse.gov/briefing-room/statements-releases/2022/07/24/icymi-treasury-secretary-yellen-says-us-economy-not-in-recession/">said</a> that “growth is slowing” — even though output appears to be turning negative for a sustained period of time. The remarks come ahead of the Bureau of Economic Analysis <a href="https://www.bea.gov/news/schedule">publishing</a> an advance estimate of second quarter Gross Domestic Product (GDP) growth later this week — a reading that is expected to show that the economy <a href="https://www.atlantafed.org/cqer/research/gdpnow">shrank</a> at a 1.6% annualized pace from April to June.
Because the economy likewise <a href="https://www.dailywire.com/news/united-states-economy-shrinks-in-the-first-part-of-2022">contracted</a> at a 1.5% rate in the first quarter, the United States may have experienced two consecutive quarters of negative growth — meeting the <a href="https://cals.ncsu.edu/news/you-decide-are-we-already-in-a-recession/#:~:text=There%20is%2C%20however%2C%20a%20%E2%80%9C,%2C%20that%20is%2C%20six%20months.">rule-of-thumb definition</a> for a recession. Yellen — who <a href="https://www.dailywire.com/news/janet-yellen-admits-she-was-wrong-about-inflation-being-small-risk">admitted</a> last month that she was “wrong” about the “path that inflation would take” — dismissed such claims.
“This is not an economy that’s in recession,” she told Todd. “But we’re in a period of transition in which growth is slowing and that’s necessary and appropriate and we need to be growing at a steady and sustainable pace. So there is a slowdown and businesses can see that and that’s appropriate, given that people now have jobs and we have a strong labor market.”
Yellen also pointed to low joblessness as an indicator of strong economic performance. Although unemployment remains at 3.6% — a significant improvement from the 14.7% level <a href="https://fred.stlouisfed.org/series/UNRATE">seen</a> in April 2020 — labor force participation has not recovered from pre-recession levels, contributing to <a href="https://www.dailywire.com/news/americans-continue-to-opt-out-of-the-workforce">worker shortages</a> that increase expenses for businesses and prices for consumers.
Arguing that “you don’t see any of the signs” of a broad-based economic contraction, Yellen referred to “solid” consumer spending figures. Although a report from the Department of Commerce shows that <a href="https://www.dailywire.com/news/retail-sales-surge-faster-than-expected-as-inflation-rattles-economy">national retail sales</a> grew by 1% last month, the Consumer Price Index (CPI) rose 1.3% over the same period — implying that higher price levels played a significant role in the higher spending rather than true gains in economic activity.
Indeed, the White House — which <a href="https://www.dailywire.com/news/white-house-again-claims-u-s-stronger-economically-than-we-have-been-in-history">repeatedly insisted</a> in recent weeks that the nation is “stronger economically than we have been in history” — has been laying out its economic case ahead of the Bureau of Economic Analysis growth report.
“While some maintain that two consecutive quarters of falling real GDP constitute a recession, that is neither the official definition nor the way economists evaluate the state of the business cycle,” the White House said in a Thursday <a href="https://www.whitehouse.gov/cea/written-materials/2022/07/21/how-do-economists-determine-whether-the-economy-is-in-a-recession/">blog post</a>. “Instead, both official determinations of recessions and economists’ assessment of economic activity are based on a holistic look at the data — including the labor market, consumer and business spending, industrial production, and incomes. Based on these data, it is unlikely that the decline in GDP in the first quarter of this year — even if followed by another GDP decline in the second quarter — indicates a recession.”
As President Joe Biden’s approval rating continues to plummet, news of a recession would serve to worsen Democrats’ chances in the upcoming midterm elections. CNBC’s All-America Economic Survey, for example, recently <a href="https://www.dailywire.com/news/bidens-economic-approval-is-now-double-digits-lower-than-trumps-worst-rating">showed</a> a meager 30% of Americans approving of Biden’s economic performance, and Republicans are <a href="https://www.dailywire.com/news/new-polling-cnn-analysis-spells-disaster-for-democrats-in-midterm-elections">positioned</a> to gain up to 70 seats in the House of Representatives.

Yellen: We’re Not In A ‘Recession,’ We’re In A ‘Transition In Which Growth Is Slowing’

Yellen Dismisses Recession Claims, Says Economy Is In A 'Transition' Toward Lower Growth

Treasury Secretary Janet Yellen said Sunday that the U.S. economy is not necessarily headed for a recession even if the gross domestic product experiences two consecutive quarters of decline.
Appearing on NBC&#8217;s &#8220;Meet the Press,&#8221; Yellen acknowledged that many economists generally define a recession as two consecutive quarters of negative GDP growth but emphasized, &#8220;That is not the technical definition.&#8221;
&#8220;There is a ton of data coming out this week; it&#8217;s probably a fun week for an economist because we are going to have consumer confidence survey, inflation numbers for June,&#8221; host Chuck Todd said. &#8220;Which is the indicator? What’s the number you’re most focused on that will give you a better indication of where this economy is headed?&#8221;
&#8220;Well, I look at all the data, and GDP will be closely watched,&#8221; Yellen replied. &#8220;A common definition of recession is two negative quarters of GDP growth, or at least that’s something that’s been true in past recessions. When we have seen that, there has usually been a recession. And many economists expect second-quarter GDP to be negative. First-quarter GDP was negative. So we could see that happen, and that will be closely watched. But I do want to emphasize: what a recession really means is a broad-based contraction in the economy. And even if that number is negative, we are not in a recession now, and I would, you know, warn that we should be not characterizing that as a recession.&#8221;
&#8220;I understand that, but you&#8217;re splitting hairs,&#8221; Todd challenged. &#8220;If the technical definition is two-quarters of contraction, you’re saying that’s not a recession?&#8221;
&#8220;That’s not the technical definition,&#8221; Yellen retorted. &#8220;There is an organization called the National Bureau of Economic Research that looks at a broad range of data in deciding whether or not there is a recession. And most of the data that they look at right now continues to be strong. I would be amazed if the NBER would declare this period to be a recession, even if it happens to have two-quarters of negative growth.&#8221;
According to <a href="https://www.forbes.com/advisor/investing/what-is-a-recession/">Forbes</a>, economist Julius Shiskin created several &#8220;rules of thumb&#8221; to help identify a recession in 1974; the most popular, which became the standard definition, was two consecutive quarters of declining GDP. But the National Bureau of Economic Research (NBER) has its own criteria for determining a recession, which is: “a significant decline in economic activity spread across the economy, lasting more than a few months, normally visible in real GDP, real income, employment, industrial production, and wholesale-retail sales.”
NBER, a nonprofit, is &#8220;generally recognized&#8221; as the body that defines the beginning and end of recessions in the United States, according to the outlet.

Treasury Sec Yellen: US Economy Isn’t Necessarily Headed For A Recession, Might Not Meet ‘The Technical Definition’

Treasury Sec Yellen: US Economy Isn't Necessarily Headed For A Recession, Might Not Meet 'The Technical Definition'

Meet the Press

Treasury Secretary <a href="http://dailywire.com/topic/janet-yellen">Janet Yellen</a> said on Monday that she is working to reduce American dependence on the <a href="http://dailywire.com/topic/china">Chinese</a> <a href="http://dailywire.com/topic/supply-chain">supply chain</a> for semiconductors.
Yellen is meeting with Asian allies in an effort to “friend-shore” trade ties with trusted <a href="http://dailywire.com/topic/economy">economic</a> partners, according to <a href="https://www.reuters.com/markets/us/us-wants-end-dependence-china-rare-earths-yellen-2022-07-18/">Reuters</a>. In an interview with the outlet, Yellen said that the U.S. has “real concerns with respect to China” and its willingness to threaten exports of manufactured goods bound for other countries.
&#8220;Resilient supply chains mean a diversity of sources of supply and eliminating to the extent we can the possibility that geopolitical rivals will be able to manipulate us and threaten our security,&#8221; Yellen explained. Although U.S.-China trade relations are not &#8220;totally negative or escalating into tremendously hostile territory,” Yellen noted that the communist nation has “used coercion to pressure a number of countries whose behavior they have disapproved of” — including Japan, Australia, and Lithuania.
<a href="https://www.dailywire.com/topic/taiwan">Taiwan</a>, China, <a href="https://www.dailywire.com/topic/south-korea">South Korea</a>, and <a href="https://www.dailywire.com/topic/japan">Japan</a> maintain nearly 80% of global semiconductor manufacturing capacity, according to the <a href="https://www.brookings.edu/blog/order-from-chaos/2022/04/12/ensuring-a-stronger-us-taiwan-tech-supply-chain-partnership/">Brookings Institution</a>, with Taiwanese companies like TSMC producing over 90% of cutting-edge chips smaller than 10 nanometers — the class of chips used in cell phones and computers.
Yellen — who plans to tour facilities run by South Korean consumer electronics company LG during her visit — remarked that the nation has “tremendous strengths in terms of resources, technology, abilities” and a “substantial capacity to produce advanced semiconductors.”
Many Asian economies enacted harsh lockdown measures in response to COVID, causing bottlenecks in the global semiconductor supply chain. Some automotive companies, for example, have been forced to limit or pause production, worsening inflationary pressures as vehicle prices <a href="https://www.dailywire.com/news/here-are-the-products-making-your-wallet-lighter-as-inflation-hits-new-highs">surge</a> at the highest rate in decades. According to the most recent Consumer Price Index (CPI) report from the U.S. <a href="https://www.bls.gov/news.release/cpi.nr0.htm">Bureau of Labor Statistics</a>, new and used vehicles are 11.4% and 7.1% <a href="https://www.dailywire.com/news/here-are-the-products-making-your-wallet-lighter-as-inflation-hits-new-highs">more expensive</a> since June 2021, respectively.
Lawmakers have <a href="https://www.dailywire.com/news/plans-for-new-semiconductor-factories-across-america-hit-major-roadblock">proposed</a> the $52 billion CHIPS for America Act — but because the funding has not yet reached chipmakers, companies such as Intel, TSMC, and GlobalFoundries recently issued “public warnings” that they might “scale back their plans to make semiconductors” in the United States, according to the U.S. <a href="https://www.commerce.gov/news/press-releases/2022/06/icymi-three-companies-warn-about-delayed-chip-funding-globalwafers">Department of Commerce</a>.
Intel CEO Pat Gelsinger said at a recent panel event that his firm could increase chip production in Europe due to legislative delays in the U.S. “The rest of the world is moving rapidly despite the inability of Congress to get this finished,” he remarked, noting that Asian countries are also passing new incentives.
The U.S. <a href="https://www.dailywire.com/news/onshoring-semiconductor-capacity-is-crucial-to-national-security">represents</a> 12% of global semiconductor manufacturing and 25% of global semiconductor demand, according to Radford University management professor Zachary Collier.
In reaction to high inflation, National Economic Council Director Brian Deese <a href="https://www.dailywire.com/news/top-biden-adviser-called-out-for-saying-more-spending-will-finally-stop-inflation">said</a> on CNBC last week that the U.S. can address the cost pressures by passing new incentives for the semiconductor industry. Yet the official was pressed on the notion that higher spending is a sustainable answer to the record inflation, which follows $6 trillion in <a href="https://www.dailywire.com/news/with-6-trillion-in-covid-relief-the-government-could-have-given-every-taxpayer-41000">federal stimulus packages</a> enacted in response to COVID.
“I think you have to look at the unique situation that we’re in as an economy and think about how do we build more supply, how do we increase the productive capacity of our economy, so that we actually can supply more goods, bring prices down,” said Deese, who formerly worked as a senior adviser to President Barack Obama. “We know the answer on semiconductors exactly. We need more supply of those goods.”

Treasury Secretary Yellen And Fed Chair Powell Testify Before House Financial Committee On Coronavirus And CARES Act

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