Yellen Tells Skeptical CNBC Host that America Needs $1.9 Trillion Stimulus: ‘We’re Digging Out of a Deep Hole’

Treasury Secretary Janet Yellen assured skeptical CNBC host Sara Eisen in an interview that generous stimulus measures were necessary to repair the American economy.

“One question, I think, that’s still out there, is whether we need $1.9 trillion of stimulus,” Eisen said, noting that sectors of the economy including manufacturing and housing had returned to pre-pandemic levels, and that retail sales had improved by 5.3 percent in January — more than four times greater than the 1.2 percent that had been expected.

“Is that an economy that screams $2 trillion needed in stimulus?” Eisen asked.

“Well, I think it does,” Yellen replied. “We have an unemployment rate that, if properly measured in some sense, is really close to 10 percent.”

Citing a Congressional Budget Office estimate that it would take until 2024 for employment to return to normal in the absence of stimulus measures, she added, “We think it’s very important to have a big package that addresses the pain this has caused — 15 million Americans behind on their rent, 24 million adults and 12 million children who don’t have enough to eat, small businesses failing.

“You know, I think the price of doing too little is much higher than the price of doing something big,” she added. “We think the benefits will far outweigh the costs in the longer run.”

The House is expected to vote next week on a $1.9 trillion package, with the goal of finalizing a package with the Senate and sending it to the White House before March 14. The package would include $1,400 direct stimulus payments, increase enhanced unemployment benefits to $400 per week, and provide $350 billion in aid to state and local governments, among other measures.

Eisen, whose network has been increasingly skeptical of stimulus measures, also asked Yellen to comment on the direct $1,400 payments. At congressional Republicans’ behest, Democrats are considering a plan to phase those payments out for people making more than $50,000. Previous payments had been phased out for those making more than $75,000.

“Where are you on stimulus checks, and particularly some of the concerns and criticisms around them, that they go to people who are earning a paycheck and might not need them, to people who are going to use those stimulus checks to trade stocks?” Eisen asked.

President Joe Biden “wants to make sure they are appropriately targeted so that they go to people in need, not to very high income people who don’t need it,” Yellen said. “But, you know, there’s so much pain in this economy, I think these checks really will provide relief. And they’ll help jumpstart our economy, giving people money to spend when we can get out again, and go back to our former lives.”

Watch above via CNBC.

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