On March 16, 2023, the Senate Finance Committee hosted a full hearing with Treasury Secretary Janet Yellen regarding Biden’s Fiscal Year 2024 Budget. The hearing additionally took place days after the collapse of Silicon Valley Bank and Signature Bank, which inflicted federal regulators to close the banks to preserve public confidence in the U.S. banking system. Committee chairman Ron Wyden (D-OR) commenced the hearing by addressing this: “Nerves are frayed at the moment. One of the most important steps that Congress can take now is to make sure there are no questions about the full faith and credit of the United States.” This continued to be a prominent theme of the hearing as Yellen fielded questions from both parties of the committee and reassured them that the U.S. financial system is on a “solid footing.”
In regard to child wellbeing policy, one of the most significant parts of the hearing came from Wyden’s budget item highlight of the Child Tax Credit. This expansion was passed by Congress in 2021 within the American Rescue Plan and cut child poverty in half that year, to the lowest level in history. Wyden referred to the millions of working Americans that felt they could finally breathe for the first time in a long time due to such financial relief and assured that he would like them to have that feeling of relief once again. The President’s Budget calls for the restoration of the full Child Tax Credit and would expand the credit from $2,000 per child to $3,000 per child (ages six years old and above) and to $3,600 for children under six.
Secretary Yellen’s testimony to the Committee was marked by the Federal Reserve’s commitment to providing additional support to the banking system, the historic lows that American unemployment rates are now at, and the Treasury’s new task of navigating the economy’s transition from rapid recovery to sustainable growth. Regarding spending, the Secretary pointed to the suggested investments that would boost America’s long-term growth potential, which included “improving the availability of high-quality childcare, providing free and universal pre-school, and boosting the supply of affordable housing.” She closed her statement with the final proposal of restoring the Child Tax Credit and Earned Income Tax Credit expansions.
By Erin Weiss, Policy Intern