“Climate change presents new challenges and opportunities for the US economy,” Yellen said Monday. “The dire consequences of our actions demand that the Treasury Department make climate change a top priority.”
News of Yellen’s choice immediately angered environmental activists who want the Biden administration to take a tougher line with the Wall Street companies that fund fossil fuel producers. Many of them had urged the Treasury to hire former Assistant Secretary of the Treasury and Fed Governor Sarah Bloom Raskin, who called for greater regulation of the climate-related activities of financial firms.
“Preventing US banks, insurers and asset managers from fueling climate risk will require decisive use of all available regulatory tools and the experience necessary to thwart Wall Street’s pullback,” said Jason Opeña Disterhoft, senior climate and energy activist at Rainforest Action Network. “By choosing someone with no regulatory background, the Biden administration seems to have stumbled over the first hurdle.”
Why is this important: The long-awaited hire, which Yellen pledged to make at his Senate confirmation hearing in January, is the latest example of President Joe Biden’s “whole-of-government” approach to tackling climate change.
The Treasury has timed the news with an international climate summit Biden is hosting on Thursday and Friday, which is expected to focus on the role of the financial system in global warming and potential risks.
On Monday, the Treasury also presented the department’s climate objectives, including:
– “Mobilize financial resources for climate-friendly investments at home and abroad, and prioritize the accelerated transition of high-emission sectors and industries”
– “Take advantage of economic and fiscal policies to support the construction of climate resilient infrastructure and ensure the transition to a carbon-free economy with net zero rate”
– “Ensure that considerations of environmental justice are at the center of programs, policies and activities”
– “Ensure that policies designed and implemented to assist the transition to a low-carbon economy are broadly fair and equitable and support well-paying jobs”
– “Understanding and mitigating the risks that climate change poses to the stability of the US and global financial system and economy”
And after: Biden plans to issue a sweeping executive order outlining steps federal agencies must take to address climate-related financial risks to government and the economy.