A Yellen Treasury Department is Good News for the Climate

By Marcela Mulholland and Danielle Deiseroth

After nearly four years of a Treasury Department led by Wall Street hedge fund manager Steven Mnuchin, all signs are pointing toward Janet Yellen, a renowned economist and former Chairwoman of the Federal Reserve, being President-Elect Biden's nominee for Treasury Secretary. This appointment will have significant implications for what climate policy looks like under a Biden Administration and whether future coronavirus relief bills include funding for new clean energy projects. Yellen has a long history of speaking out about the role that financial regulations and central banking should play in tackling the climate crisis. As early as 1997, she testified before the Senate Committee on Environment and Public Works about the economic risks of climate change. She is also part of the Climate Leadership Council and recently co-published a report on the role of finance in transitioning to a net-zero economy. 

A recent Demand Progress survey conducted using Data for Progress infrastructure found that a majority of voters (57 percent) support Yellen as a nominee in Biden’s cabinet. An overwhelming majority of voters who self-identify as Democrats (73 percent) and independents (67 percent) support Biden appointing Yellen to his cabinet, though a plurality of Republicans (50 percent) oppose her prospective Cabinet nomination.

The same survey also found that a majority of voters would want their senators to confirm Yellen as Treasury Secretary should she be the nominee. Similarly, support for the Senate confirming Yellen as a Cabinet member falls along party lines, with a majority of Democrats (79 percent) and independents (62 percent) wanting their senators to vote to confirm Yellen’s potential nomination. However, a plurality of Republicans (46 percent) say they would disapprove of their senators voting to confirm Yellen to Biden’s cabinet.

After four years of the Trump Administration eroding climate and environmental policies across the federal government, there will be an increased emphasis on agency-level climate action in the Biden Administration. On a recent national survey, Data for Progress asked likely voters whether they support or oppose Biden appointing Cabinet secretaries who will prioritize actions on climate change across the government. A majority of all voters (55 percent), including a majority of those who self-identify as Democrats (86 percent) and independents (57 percent), support Biden Cabinet appointees that will prioritize climate change. That said, a majority of voters who self-identify as Republicans (69 percent) oppose a Biden cabinet that will prioritize actions on climate change. However, these Republicans are in the minority, as it is clear that the majority of voters support the Biden Administration creating a Cabinet that will ensure federal agencies play a critical role in combating the climate crisis.

We’ve also tested voter attitudes around the government providing financial incentives for the fossil fuel industry, and it’s clear that voters support federal financial institutions taking actions to transition away from fossil fuels and toward clean energy. According to our polling, a plurality (49 percent) of voters agree that American taxpayers should not spend billions of dollars each year subsidizing the fossil fuel industry and should instead invest that money to create new jobs in clean energy. A majority of Democrats (67 percent) and a plurality of independents (50 percent) want to end fossil fuel subsidies and invest in clean energy. Unsurprisingly, though, a majority of Republicans (58 percent) would prefer keeping fossil fuel subsidies.

While the fossil fuel industry received billions of dollars in government funds as part of federal coronavirus relief packages, a Yellen-led Treasury Department can stop bailing out the fossil fuel industry in future relief packages. A majority of voters (55 percent), including a majority of Democrats (65 percent) and independents (53 percent) oppose bailing out the fossil fuel industry as part of future coronavirus economic relief packages. Though a plurality of Republicans (44 percent) agree fossil fuel companies should receive more bailout money, nearly a third (32 percent) think the fossil fuel industry should not receive more federal coronavirus relief. 

It’s clear that Yellen would be wise to prioritize tackling climate change as Secretary of the Treasury. She should help ensure that future coronavirus relief packages prioritize delivering aid to the clean energy industry, working families, and small businesses, not bailing out fossil fuel corporations. She should also look to use the full scale of her powers through the Dodd-Frank Act to crack down on the financial risks of continuing to prop up the fossil fuel industry. If this isn’t the approach she initially chooses, climate activists and advocates should feel comfortable pushing Yellen to act boldly on climate with confidence that the public has their back.