Yellen offers support for pension security reforms


Biden President-elect’s Treasury candidate Janet Yellen appeared before the Senate Finance Committee on January 19, answering questions on the economy, taxes and debt, as well as her take on various issues retirement security.

Yellen is expected to be largely confirmed by the Senate, possibly as early as this week, so the audience was, in large part, more of a formality, but the former Federal Reserve chairman and Treasury candidate shared some important ideas.

Asked by Senator Ben Cardin (D-MD), she indicated her support for efforts to help Americans save more for retirement. Cardin based his question by noting that due to COVID-19, many households are not saving anything for retirement and that he is working with Senator Rob Portman (R-OH) on bipartisan legislation in this current Congress. “I just urge you to be an active partner with us and find out how we can increase retirement security options for workers in this country,” Cardin said.

“I totally agree with the priority you place on this,” Yellen said in response. “Really, so many families are not prepared for retirement; they couldn’t save for it. It’s a huge problem and the pandemic is making matters worse as hard-hit families rush there to save. I think in this economy everyone needs to have access to a workplace retirement savings plan and I look forward to working with you to resolve this issue.

Efforts to improve access to pensions are expected to get a big boost in this Congress, as Biden takes office and Democrats take control of the Senate and maintain control of the House of Representatives. . In fact, House Ways and Means Committee Chairman Richard Neal (D-MA) presented an ambitious retirement policy agenda for the 117 last week.e Congress. Plus, as Cardin mentioned, he and Portman have already introduced legislation to strengthen the existing retirement security system.

Mixture of committee chairs

Until then, however, Republicans still control the Senate until both Georgia’s elected senators and former Sen. Kamala Harris’ replacement are sworn in. As such, Senator Charles Grassley (R-IA) opened the hearing as the current chairman of the committee, but because it will be time-limited to continue serving as chairman under Republican Senate rules, he handed the hammer to Sen Mike Crapo (R-ID), who presided over the remainder of the hearing. Crapo will serve as a rank Republican on the committee once Senator Ron Wyden (D-OR) takes the chair.

For his part, Wyden noted that his main economic priority for the future is “to avoid the mistake made by Congress during the last recession.” [in] take one foot off the gas pedal before the recovery sets in, “arguing that the Biden administration and Congress should approve another economic relief plan, including additional stimulus checks and extension of benefits unemployment, among others.

Wyden also noted, however, that he believes Congress needs to correct the “broken tax code” suggesting that “corporations, millionaires and billionaires should pay their fair share.” To that end, Wyden noted that he was developing a proposal to reform the taxation of capital gains for the top three-tenths of 1% of taxpayers. “My plan would equalize the tax rates on wages and capital income and minimize the benefit of tax deferral,” Wyden said.

Raise the taxes?

Amidst all the talk about economic recovery and rising debt levels, Yellen received many questions about his take on raising taxes during the pandemic, as well as the possibility of rights reforms. .

The Treasury candidate agreed that getting the federal budget back on a sustainable path is critical, but suggested the most immediate priority is to beat the pandemic, get people back to work, and make long-term investments. term to help the economy grow. As such, she hinted that she wouldn’t necessarily advocate for higher taxes now, but that future tax increases would be needed once the economy stabilizes.

“Tackling debt now would make us worse in the long run; the loss of small businesses would hurt the economy and it would be difficult to get back on the path to growth, ”Yellen said in response to a question from Senator John Thune. “I agree with you that the long-term physical trajectory is a concern, something that we will eventually have to deal with, but it is also important for America to invest in our infrastructure, to investing in our workers, investing in R&D and things that make our economy grow faster and make it more competitive, ”she said.

Yellen did not rule out raising some taxes as part of Biden’s ‘Build Better’ plan, but also said she would not push for a complete repeal of the 2017 tax cuts law. and employment.

Yellen also reiterated his support for protecting Social Security and Medicare, but observed that as the population continues to age, programs face growing shortages and Congress will eventually have to find a solution. way to remedy it. At the same time, she also stressed the importance of having incentives for people to save for retirement.

Lost and found

Senator Steve Daines (R-MT) asked Yellen if she would support the legislation he introduced with Senator Elizabeth Warren (D-MA) to create a national online “lost and found” database to help plan participants to keep track of their retirement accounts as they move from job to job. “I think this is an important goal that you described and if it becomes law, of course we will do everything we can to make sure it is implemented effectively,” she replied.

The members of the committee, including Sens. Debbie Stabenow (D-MI) and Sherrod Brown (D-OH), also stressed the need to find a solution to the multi-employer pension crisis.

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