Sen. Kennedy DESTROYS Treasury Sec. Janet Yellen Over Biden's Proposed Budget

P. Gardner Goldsmith | March 27, 2023
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U.S. District Court Judge Kato Crews could not have looked worse when he was summarily embarrassed by Republican Sen. John Kennedy during a confirmation hearing last week, where Crews tried - and utterly failed - to answer one of the most basic questions a sitting judge could possibly be handed.

But as cringeworthy as that moment was for both Crews and anyone watching, he might not have looked as embarrassingly bad as Treasury Secretary Janet Yellen, when she faced Senator Kennedy and the Appropriations Committee on March 22.

First, the former head of the Federal Reserve – this purported sorceress of economic scoring – looked about as lost as a sailor stripped of a compass, sun, and stars when Kennedy asked her the fundamental question:

“Madam Secretary, isn’t it a fact that the President’s proposed budget for next fiscal year is a half-trillion dollars more than this fiscal year?”

Yellen’s look of alarm as she searches papers is stunning.

“This – on the spending side?” she asks – as if it wasn’t the nature of the question.

Senator Kennedy’s patience is admirable. “Yes,” he replies. “That’s what a budget is.”

“Yup,” she mumbles, as she ramps up her paper-thumbing. “It—it is about 400 billion dollars.”.

“500 billion more, is that right?”

She nods, “About that.”

And Kennedy continues:

"Isn’t it a fact that the President’s proposed budget proposes $4.7 trillion in new taxes?"

The answer should be obvious to BIDEN’S TREASURY SECRETARY.

But for Yellen, it was “deer-meet-headlights.” She fumbled with papers, desperately looking for something -- perhaps a clue – and, finally, offering this equivocation:

"It does, it does propose significant additional taxes, yes."

And since her “answer” was not really anything of the sort, Kennedy pressed”

"$4.7 TRILLION?"

To which Yellen replied:

"Something like that, yes."

Oh, man.

But that was just part of her parsing parsimony – just a portion of her statistically solipsistic sojourn – all of which was exposed by Senator Kennedy, who not only shed light on her inability to answer a straight question, but who also exposed the fraud of so-called “baseline budgeting” for what it is.

“Isn’t it a fact that, under President Biden’s proposed budget, that gross debt will rise from 32.7 trillion dollars at the close of this year, to 51 trillion dollars in 2033?”

Yellen asked for him to repeat the numbers, then offered, “Well, debt held by the public, which is—”

“No, ma’am” Kennedy corrected. “That’s gross debt. Isn’t that a fact?”

Finally, Yellen admitted the truth.

“That’s probably a fact.”

After a moment he had to press her, “How can you go from $33 trillion to $51 trillion and call that a reduction in the deficit?”

Related: Treasury Secretary Yellen: 'I Think I Was Wrong...About the Path That Inflation Would Take' | MRCTV

This is where Yellen brings in the false world of “baseline budgeting,” wherein the politicians and their wizard-like underlings initially propose budgets that stretch nearly to infinity, then, when the final versions of the budgets rise, but not to that height, they claim they are “cuts,” when, in fact, they aren’t CUTS at all.

“Because,” she says, “That’s a calculation for which you need a baseline, and then you compare the budget and the deficits and debt in the budget with the baseline in which there are no--  none of the changes, either in revenues or in spending -- that are proposed in the budget…”

Kennedy was done with her foolishness.

“Here’s my baseline. At the end of this year, we project – people a lot smarter than me, probably not than you, but smarter than me – say that gross debt’s 33 trillion, they say that if the President’s budget is implemented, by 2033, it’ll be 51 trillion dollars, isn’t that a fact?”

But Yellen continued to pretend that the proposal was a good deal, and she added her satisfaction that it raises taxes.

On the overall concept, Kennedy shot back:

“In what world is that an improvement, other than Washington, and La-La Land?”

The exchange offers observers a stark reminder, a clear lesson in reality versus Washington’s La-La Land realtors.

Sadly, Yellen is one of those realtors, and she wants all of us to live in her fantasy world. Thank goodness a guy like Kennedy is willing to call her out her economically disastrous dreamscape. Because she and others in DC are recklessly eager to create it.

And it’s a nightmare.