Treasury Secretary Janet Yellen speaks during a daily press conference in the James Brady Press Briefing Room of the White House on May 7th in Washington, DC.
Alex Wong | Getty Images
Treasury Secretary Janet Yellen on Tuesday called on business leaders to pay higher taxes to support government stimulus spending, and supported stronger unions and removing barriers to foreign competition.
Speaking to the US Chamber of Commerce, Yellen reiterated the White House’s intention to levy taxes on businesses and the highest earners as part of an ambitious infrastructure spending plan.
The administration is also aiming for a global minimum tax for companies to prevent companies from relocating their bases to avoid higher taxes domestically.
“With corporate taxes at an all-time low of 1 percent of GDP, we believe the corporate sector can contribute to these efforts by doing its fair share: we simply propose to simply bring corporate taxes back towards historical norms,” Yellen said in prepared Comments for the Chamber’s Global Forum on Economic Recovery.
Yellen added that President Joe Biden’s American family plan is being paid in part through a “series of tax reforms that ensure high net worth individuals pay their fair share”. She said the government is also trying to stop tax evasion which “has piled the deck for decades against responsible and compliant taxpayers”.
Along with the position on taxes and infrastructure, Yellen spoke about inequality, saying this is partly fueled by a lack of bargaining power by workers, a potential pain point for entrepreneurs at a time when just over 10% of all workers were employed to unions.
“Workers, especially low-wage earners, have seen wage growth stagnant for several decades, even though productivity and national income have increased overall,” she said. “There are several reasons for this worrying trend, but one important factor is an erosion of workers’ bargaining power.”
She also spoke about the benefits of global competition.
Former President Donald Trump had pushed measures such as tariffs, fought against Chinese theft of American technology and other intellectual property, and pulled the US out of several global trade deals. However, Yellen said foreign competition should be welcomed.
“Let others innovate and move forward. Let’s try to move faster and further forward. We ultimately benefit from the positive effects of innovation wherever it occurs,” she said. “As in any competition, when you lose one competition, work harder to win the next. The better the competition, the stronger you get. That was the American way.”
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