Yellen on Trump’s tariffs-taxes idea: It would ‘make life unaffordable’
“It would require tariffs well over 100%,” she said.
U.S. Treasury Secretary Janet Yellen said former President Donald Trump’s plan to replace federal income taxes with tariffs would “make life unaffordable” on Sunday morning.
“It would require tariffs well over 100%,” Yellen said when Jonathan Karl asked about the plan on ABC’s “This Week.” “The impact would be to make life unaffordable for working class Americans and would harm American businesses.”
During private meetings with GOP lawmakers on Capitol Hill last week, former president Trump proposed eliminating federal income taxes and instead implementing high tariffs on imports to replace the lost revenue. The cost of the tariffs, however, would undoubtedly be passed on to consumers, resulting in significantly higher prices on any type of product that is imported.
Yellen defended the Biden administration’s economic policies during the interview, including when she was pressed on why Americans are still feeling high price levels despite the slowing of inflation.
“It is true that over the last roughly three years there has been a significant increase in the price level. It is now rising at a very slow, close to normal rate,” Yellen said when asked about the still high inflation. “But yes Americans see that and mainly it comes on top of concern about costs that were making life very difficult. So it’s something the Biden administration absolutely wants to address.”
When asked why polls show Americans trusting Trump on the economy more than Biden, Yellen said “the pandemic was a profoundly difficult time” and that Americans are still feeling the effects of that.
“In the years leading up to the pandemic, Americans were really, many of them, working class families just struggling with things like health care costs, the cost of energy, education costs, child care costs, and so they — they really feel the cost of living,” Yellen said. “I think the inflation that we experienced after the pandemic just compounded this feeling for them that life isn’t affordable.”
She added, “It is the Biden administration’s top priority to address these costs where we possibly can.”