Washington, DC – Today, Congressman Frank Lucas (OK-03) joined his colleagues on the House Committee on Financial Services for a hearing with Federal Reserve Chairman Jerome Powell and U.S. Department of Treasury Secretary Janet Yellen on the Federal Reserve’s and Treasury’s economic pandemic response.
Lucas discussed with Chairman Powell the threat of adding to an unsustainable and skyrocketing deficit while the economy experiences the highest inflation in more than thirty years.
Lucas, the Ranking Member of the House Committee on Science, Space, and Technology and longest serving Republican on the Financial Services Committee, also questioned Treasury Secretary Yellen about the Biden Administration’s use of financial regulation to advance a social agenda on climate change.
Click here to watch Lucas’ Q&A.
Lucas: “Since the onset of the pandemic, the United States has added more than $5 trillion to its total national debt- standing at about $29 trillion. And as the Secretary is alluded to, apparently, we need to raise the debt ceiling very soon to address that even. And that doesn’t count the extra trillions that have gone on the Federal Reserve systems balance sheet. The US is now set to exceed the debt to GDP ratio not seen since the end of the Second World War. Chairman Powell, speak to us from a macro-economic perspective, when’s the right time to prioritize the threat of US debt rapidly outpacing economic growth? We spent a lot of money in the last couple of years.”
Powell: “And you know, as I generally would say, as is appropriate, I think, for me to say in my role, the US needs to get back on a sustainable fiscal path. The right time to do that is when the economy is strong, when the taxes are rolling in, when employment is high. And the right way to do it is to have a longer-term plan to get to really to get the economy growing faster than the debt. By definition, it’s unsustainable to have the debt ultimately growing faster than the economy. And we have that now.”
On climate change:
Lucas: “Turning to you, Mrs. Secretary. As we’ve discussed, several of my colleagues have climate related issues. I am concerned coming from a District that produces lots of different forms of energy and consumes massive amounts of different forms of energy, that when the majority can’t pass a bill to outlaw certain forms of energy, and they can’t pass a bill to tax it to death, that the route they’re going to take is use regulatory policy to strangle the capital available to those industries. Could you touch on that for a moment? Is it the intention of the regulators to create standards such that banks cannot support any particular energy industry that that may ask for capital that may justify alone?”