U.S. Treasury Secretary Janet Yellen said the Biden administration can and should continue to move forward with important legislation to help lower costs for American consumers, despite a blow to a broader fiscal package from Democratic Sen. Joe Manchin. West Virginia, according to Bloomberg.
While Manchin has so far rejected several tax and climate measures proposed by President Joe Biden and his party’s leadership in Congress, the outspoken senator said he would support a prescription drug pricing package tied to a two-year extending Affordable Care Act subsidies;
“These are very important initiatives to contain costs and address the high cost of living for American families,” Yellen told reporters as she left the Group of 20 finance ministers meeting in Bali, Indonesia.
Yellen’s remarks follow a difficult day in Washington for what remains of the Biden administration’s tax, spending and climate agenda. On Friday, Manchin, who last year blocked the proposed $2 trillion Build Back Better bill, said he would not agree to advance an economic package that includes tax and climate provisions before Congress’s August recess.
That leaves Democrats in a position to accept an even smaller plan that lacks nearly all of their long-term ambitions from a year ago, or nothing at all.
Manchin’s stance also hurts prospects for Yellen’s biggest achievement as Treasury secretary, a deal backed by nearly 140 governments last year to overhaul how multinational corporations around the world are taxed.
Implementation of this agreement in the US requires that Congress approve both components – a minimum tax of 15% and a new formula to redistribute part of the taxes to the largest multinationals. As these prospects fall, other countries are likely to pause, potentially paralyzing the plan.
But Yellen sounded undeterred, saying officials at the G-20 meeting were still signaling their support for the plan.
“I think there is tremendous political momentum to move forward and other countries are moving forward,” he said. “Whether we go first, second, or later, the incentive is there for the United States to join this deal, and we’re going to push forward every chance we get.”
He said he expected the European Union to “in the not too distant future” override Hungary’s veto of a directive that would apply the minimum tax across the trading bloc.
Yellen also spoke briefly about growing concerns in Europe that Russia may shut down a key natural gas pipeline known as Nordstream 1.
“It would be a serious blow to Europe and, I think, a significant impact on its economy if these flows stopped,” he said, though he did not predict it would lead Europe into recession.
Yellen spent much of her time at the G-20 summit blasting the Russian government for its invasion of Ukraine in February.
Source: Capital
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