Janet Yellen, who has overseen the largest debt increase in U.S. history, expressed regret this week over the nation’s fiscal trajectory. Critics, however, argue that her policies contributed directly to the $15.2 trillion rise in debt during her tenure at the Federal Reserve and as Treasury Secretary.
Speaking at a Wall Street Journal event, Yellen said she was “concerned about fiscal sustainability” and wished more progress had been made in reducing the deficit. Her remarks came shortly after speaking with Scott Bessent, President Donald Trump’s pick to replace her as Treasury Secretary.
Under Yellen’s leadership, the nation’s debt ballooned, accounting for 42% of all U.S. debt ever issued. Much of this occurred during a period of historically low interest rates, which critics claim were maintained to enable excessive government spending. Yellen’s tenure under the Biden administration saw record increases in both federal spending and the deficit.
The federal government’s interest expenses have now surpassed defense and health spending, reaching $1.2 trillion annually. With tax revenues flatlining, experts warn the U.S. is on the brink of a financial crisis. Many blame Yellen’s policies for creating a fiscal environment increasingly dependent on borrowing.
Critics also point to the Biden administration’s spending priorities, which included substantial domestic programs and aid to Ukraine, as exacerbating the issue. In its final months, the administration has overseen a record two-month deficit increase, highlighting the unsustainable trajectory Yellen acknowledged.
While Yellen’s comments signal concern, they have done little to quell frustrations. Observers argue that her policies created the very crisis she now laments, leaving her successor to navigate a daunting fiscal landscape.
