Yellen Gets Cool Reception From Business on Infrastructure Plea

Business groups were unmoved by Treasury Secretary Janet Yellen’s call Tuesday for U.S. companies to accept higher taxes in return for a huge public investment in infrastructure aimed at boosting the American economy.

“The data and the evidence are clear: The proposed tax increases would greatly disadvantage U.S. businesses and harm American workers,” Suzanne Clark, president of the U.S. Chamber of Commerce, said following Yellen’s speech to the group Tuesday morning. “And now is certainly not the time to erect new barriers to economic recovery.”

The chamber has said it supports investment in infrastructure but favors paying for that largely through user fees.

In her speech, Yellen emphasized to the audience of business leaders that a bigger and “smarter” role for government was needed to deliver investments, ensure fair competition and ultimately drive higher economic growth. The Biden administration’s American Jobs Plan proposes a $2.25 trillion investment over eight years in infrastructure, workforce development, home care and green technology, alongside higher corporate taxes to help pay for it.

“The administration’s planned actions are not fiscal stimulus in the way we have seen in the past,” Yellen said. “Rather, we’re proposing smart investments to make our economy more competitive and sustainable.”

Clark’s rejection of Yellen’s plea was echoed by other business groups.

National Retail Federation spokeswoman Mary McGinty pointed to a letter the group had submitted to the Senate Finance Committee ahead of a Tuesday hearing. In it, the NRF argued against any hike in corporate taxes to pay for infrastructure.

Melissa Murdock, a spokeswoman for the Retail Industry Leaders Association, said the group’s position opposing tax increases for companies had not changed.

©2021 Bloomberg L.P.

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