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3/10/2022 Remarks by Secretary of the Treasury Janet L. Yellen on White House Call with U.S. Mayors Marking the Anniversary o… Remarks by Secretary of the Treasury Janet L. Yellen on White House Call with U.S. Mayors Marking the Anniversary of the American Rescue Plan March 9, 2022 As prepared for delivery Thank you all for joining us. This is an important week. As you know, Friday marks the one-year anniversary of President Biden signing the American Rescue Plan into law. This bill has loosened the pandemicʼs grip on our country in countless ways over the past year. Today, I wanted to take a moment and look back at one of the billʼs more significant programs – the State and Local Fiscal Recovery Fund – and talk about what itʼs done. As this group knows better than anyone, the first year of the pandemic decimated government budgets, forcing states and communities to layo or furlough a collective 1.3 million workers. These were the employees we rightly called “essential” – teachers, first responders, public health o icials. How is a city supposed to weather a pandemic if it canʼt keep on its first responders? How are you supposed to bring kids back to school if you are facing the prospect of laying o teachers? Those are the questions we havenʼt had to answer this past year – or at least have had to answer much less frequently – because of the ARP. The bill kept our societyʼs everyday institutions working. Hawaii, for instance, had planned to furlough 10,000 employees, but on the day President Biden signed the Rescue Plan into law they cancelled the layo s. Nor did the program only rehire public workers. Over the past year, more than 740,000 essential workers – teachers, nurses, police o icers and grocery clerks – have received bonus pay on top of their regular wages. They deserve to be compensated for keeping society running during the pandemic, and they are. https://home.treasury.gov/news/press-releases/jy0646 1/3 3/10/2022 Remarks by Secretary of the Treasury Janet L. Yellen on White House Call with U.S. Mayors Marking the Anniversary o… In some ways, the ARP also acted like a vaccine for the American economy, protecting our recovery from the possibility of new variants, like Omicron and Delta. The pandemic produced a highly unusual economic crisis – one tied not to the movements of markets but to the spread and evolution of microbes. It hit di erent places in di erent ways at di erent times. The state and local fund was designed with that in mind, too. Rather than one burst of money that could only be spent in certain ways, it called for sustained and flexible funding. We wanted local o icials to be able to channel resources to wherever the problems were as they arose. With Omicron and Delta, that meant public health. Local governments funded nearly 2,000 distinct projects with state and local money to fight COVID-19. Theyʼve bought PPE, conducted immunization campaigns, expanded testing, protected nursing homes, and many other e orts. But itʼs been broader, like on housing. Last summer, many of the mayors here saw that two trends were colliding: the spread of new variants and the expiration of the nationʼs eviction moratorium. There was a risk that people were going to lose the roofs over their heads, something that would not only complicate our e orts to stop the spread but also complicate peopleʼs lives for years to come. Thatʼs why many communities used state & local funding to supplement emergency rental assistance. Today, eviction filings have remained well below their pre-pandemic levels in large part because of those decisions. In fact, according to a new analysis by Princeton Universityʼs Eviction Lab published today, millions of renters avoided the threat of eviction last year due to the federal governmentʼs serious and unprecedented interventions, in significant part through the American Rescue Plan. Still, thereʼs a good argument that without the American Rescue Plan in general – and the State & Local Recovery Fund in particular – our economy wouldʼve been much weaker for much longer. And it mightʼve stayed that way for some time to come. That was the lesson of 2008. During the Great Recession, when cities and states were facing similar revenue shortfalls, the federal government didnʼt provide enough aid to close the gap. It was a profound error. Cities had to slash spending, and that undermined the broader recovery. One study concludes that for every $1 local governments cut in spending during a recession, there is a corresponding drop in GDP of more than $1 – and possibly as much as $3. A er 2008, state government employment didnʼt recover from the Great Recession until 2019. Today, I can state unequivocally: That history will not repeat itself. https://home.treasury.gov/news/press-releases/jy0646 2/3 3/10/2022 Remarks by Secretary of the Treasury Janet L. Yellen on White House Call with U.S. Mayors Marking the Anniversary o… We are no longer in the grips of this pandemic. We have helped millions of families and businesses escape from COVID with their finances intact. That was never a sure thing. Itʼs due, in large part, to the bill we celebrate this week. Thank you for having me. ### https://home.treasury.gov/news/press-releases/jy0646 3/3
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