Furore for the stories of an Economy Minister to manage a crisis

The year in which the United States has the highest inflation rate of the last 40 years and a slowdown in activity (for many even a recession), Yanet Yellen takes the stares of those who closely follow economic and political issues.

Is that the United States Secretary of the Treasury (there, the Minister of Economy) is the subject of a story in two books that tell specific scenes of the task that economists face at the head of a government and how they make decisions.

Both editions were written by business journalists. Nick Timiraos, Young Editor-in-Chief of Economics at The Wall Street newspaperis the author of “Triage of trillions of dollars” (something like “Trillion Dollar Stabilization”). Owen Ullmann, a veteran reporter, posted “Empathy Economics: The Rise of Janet Yellen” The Economics of Empathy: The Rise of Janet Yellen.

Timiraos’ work recounts the tasks performed by the Treasury and the Federal Reserve (the Central Bank of the United States) when it comes to injecting liquidity to offset the sharp contraction in US activity. at the beginning of the pandemic, early 2020.

The strength of Timiraos’ book lies in his detailed and snappy account of those weeks in 2020 when Washington decided to foresee a financial, commercial and industrial catastrophe. Its central bank nearly doubled its holdings of assets from around $ 4 trillion to nearly $ 8 trillion. Basically what he did was buy mortgages and government bonds to secure the payment chain of the economy did not stop in the midst of the crisis. It injected a level of liquidity never seen before. For many, perhaps today a mistake because it has woken up inflation.

The Treasury, for its part, sent a check for $ 1,000 to each citizen during the pandemic. It implemented a $ 1.9 billion aid package.

Yellen was the Secretary of the Treasury. He still is (see more in ‘Nonfiction Economics’ on 5/6). She had previously been Reserve 1. In both books there are scenes of how he worked.

“Trillion Dollar Triage” begins with a brief history of the Federal Reserve, from its beginnings to the time of Donald Trump. Although little of this story is new, the narrative weaves an important context for understanding from Argentina the steps the bank later took to maintain its independence from the executive. Sometimes Timiraos’ book resembles the recent one by Ben Bernanke, former Fed chairman, who wrote ‘Monetary Policy of the 21st Century: The Federal Reserve, from Great Inflation to Covid 19’, where he recounts how the presidents of states United with central banks over time (see more in ‘Economic Nonfiction’ on 29/05).

Trump was never sold on Yellen. The American was in office from 2014 to 2018, a period that coincided with the administrations of Barack Obama and Donald Trump. She is an economist with a solid academic background and identifies with the Democratic Party.

Timiraos recounts Trump’s appointment of Powell to get rid of Yellen. Powell is a Republican and held a Fed post under Yellen. The book also chronicles the president’s “insane” attacks on Powell, which raised the rate six consecutive times between 2018 and 2019. Trump was sitting next to Powell at the 2019 Jackson Hole conference when Trump tweeted: “Who is our greatest enemy, Jay Powell or President Xi?”. Timiraos brings nothing new about this incident, except for the news at the moment, but even so it is enlightening for those who study and follow economics to see another episode about how political leaders advance in the exercise of economic policy.

For its part, Ullman’s book presents a fundamental difference from that of Timiraos. It is an exclusive analysis of his individual management while that of Timiraos recounts the ideas and turning points of the entire conduct of economic policy with the pandemic. Ullman conducted several in-depth interviews with Yellen. And Timaraos surpassed 100 conversations with Washington actors.

Ullman’s book will go on sale in September (Timiraos’s book is already available for download on Kindle or via bookdepository.com to purchase a print edition that will arrive in 20 business days). However, a pdf of “The Economics of Empathy: The Rise of Janet Yellen” was released in which the economist expressed his concern about the size ($ 1.9 trillion) during the pandemic. Yellen “tried unsuccessfully to cut the $ 1.9 trillion relief plan by a third in early 2021,” Ullmann wrote.

Yellen released a statement on June 4 stating that he never urged Biden to downsize the plan for fear of future inflation.

The economist is the first woman to lead the US economy. Meanwhile, Silvina Batakis has been named here in place of her equivalent of hers in Argentina. Will the books on La Griega arrive?