Andrew Yamakawa Elrod in Phenomenal World:
The Biden administration first embraced the slogan of “modern supply-side economics” six months before anyone uttered the phrase “Inflation Reduction Act.” Speaking before the World Economic Forum in January 2022, Treasury Secretary Janet Yellen explained that what distinguished the Biden administration’s “modern supply-side economics” from the Reagan-era variety was its program to raise labor-force participation and productivity through government spending and increased taxation of capital—to create a “supply-side expansion…that distributes expanding national income more equally.” “Three aspects of the Biden agenda” would address “longer-term structural problems, particularly inequality”: reform of key social-service industries such as elder and childcare, increased public expenditure on education, and corporate taxes. All that remained, Yellen declared, was passage of “the Build Back Better legislation that remains under consideration in Congress.”
Six months later, congressional reality parlayed “modern supply-side economics” into something else entirely. Speaking in Detroit in September 2022, Yellen outlined three different pillars that defined the administration’s “modern supply-side” approach. In place of increasing labor-force participation through paid-leave requirements, child-care price caps, public pre-K classes, and nursing-home reform, there was “resilience to global shocks.” Where there had been community-college funding to raise labor productivity, there were now business subsidies for “expanding productive capacity.” Rather than raising corporate taxes, there was now “economic fairness.” The meaning of “modern supply-side economics,” Yellen explained, was about “reducing economic and national security risks” posed by “countries like China.”
How did this transformation occur?
More here.
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