The Senate confirmed Janet L. Yellen, a labour economist and former Federal Reserve chair, to be treasury secretary on Monday, putting in place a key lieutenant to President Biden at a perilous economic moment, as the new administration tries to revive an economy that has been battered by the coronavirus pandemic.

By a vote of 84 to 15, the Senate confirmed Yellen, making her the first woman to hold the top job at treasury in its 232-year history. Her quick bipartisan confirmation underscored the support she has from both Republicans and Democrats given her previous stint as Fed chair from 2014 to 2018.

Yellen now faces a new and considerable challenge. As treasury secretary, she will be responsible for helping Biden prepare the $1.9 trillion stimulus package he has proposed, steer it through Congress and — if it is approved — oversee the deployment of trillions of dollars of relief money.

The magnitude of the task became clear over the weekend, as a bipartisan group of senators met virtually with senior White House officials on Sunday and expressed doubt that such a large package was necessary.

Lawmakers in both parties raised the prospect of curtailing elements of the proposal, including the eligibility for a suggested round of $1,400 checks to individuals and ensuring that a more targeted distribution of additional aid, according to multiple people familiar with the discussion.

They also asked the White House to provide data that would justify the proposed spending, which includes $350 billion in state and local aid and $130 billion to reopen schools shuttered by the pandemic.

Now, Yellen will be thrust into the middle of the talks, responsible for convincing many Republicans and some Democrats that the economy needs another multi-trillion dollar spending package.

At her confirmation hearing and in written responses to lawmakers, Yellen echoed Biden’s view that Congress must “act big” to prevent the economy from long-term scarring and defended using borrowed money to finance another aid package, saying not doing so would leave workers and families worse off.

“The relief bill late last year was just a down payment to get us through the next few months,” Yellen said. “We have a long way to go before our economy fully recovers.”

Yellen also argued that “near-term fiscal support is not inconsistent with long-term fiscal sustainability,” explaining that a healthier economy would ultimately generate more revenue for the government.

The Biden administration has said that it hopes a package can win bipartisan support in Congress. However, Democrats have signalled a willingness to turn to a budgetary mechanism known as reconciliation that would allow them to pass the legislation with a simple majority and bypass the usual 60-vote threshold needed.

David Wessel, a senior fellow at the Brookings Institution, where Yellen most recently worked, said that she is likely to play a key role in working with Congress given her credibility with both Republicans and progressive Democrats. He suggested that, because of Biden’s long history in the Senate, Yellen could be less involved in haggling with lawmakers.

New York Times News Service