BREAKING: Treasury Nominee Yellen Warns of 'Self-Reinforcing' U.S. Downturn, Vows To Aid Needy

Photo: Reuters

(Reuters) - President-elect Joe Biden's treasury secretary nominee Janet Yellen said on Tuesday the United States (U.S.) is experiencing a historic crisis due to the coronavirus pandemic and its economic fallout that requires urgent action to avert a "self-reinforcing" downturn.

Yellen, who previously served as U.S. Federal Reserve Chair, spoke at an event in Delaware where Biden formally introduced his top economic policy advisers as he prepares to take office on Jan 20 amid a battered economy and large-scale job losses.

Yellen said the pandemic has disproportionately impacted the most needy Americans. Yellen said it is important to make sure the economic recovery leaves out no one as she pledged to "find collective purpose to control the pandemic and build our economy back better than before."

Earlier on Tuesday, outgoing Treasury Secretary Steven Mnuchin urged the U.S. Senate to support $300 billion in new grants to small businesses to keep them from failing amid the intensifying public health crisis.

Mnuchin defended his action to end some Federal Reserved (Fed) lending programs, a move that will limit Yellen's options in backstopping credit markets if she is confirmed to the post by the Senate after being nominated by Biden.

Mnuchin said his action was not an "economic decision" but one based on the aid law passed by Congress.

It remains unclear whether Yellen would be the main negotiator for future coronavirus aid, a role that Mnuchin played this year for Trump's administration in talks with House of Representatives Speaker Nancy Pelosi.

Yellen and other Biden advisers have expressed support for government stimulus to maximize employment, reduce economic inequality and help women and minorities, who have been hurt disproportionately by the economic downturn.

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