Bessent defends faltering bond market intervention Treasury Secretary Scott Bessent testified before the House Financial Services Committee on Tuesday. Credit… Haiyun Jiang/The New York Times Treasury Secretary Scott Bessent defended his intervention in the U.S. bond market on Tuesday, telling lawmakers that a decision to buy back U.S. debt last week was successful, even as yields on 10-year Treasury bonds rose in the wake of the purchases. Bessent testified before the House Financial Services Committee that the yield on the 10-year Treasury bond, which influences a wide range of borrowing costs, surpassed 5 percent and hit its highest level in 19 years. Bessent suggested that bond yields could have risen even higher if he had not intervened. He also sought to portray Trump’s economy as a source of big gains for Americans, even though polls say voters are despondent about prices and the Iran war. Faced with repeated questions from Democrats about the high cost of living under President Trump, Bessent tried to blame the Biden administration for inflation even though Trump has been in office for nearly two years. “I tell people I feel like an emergency room doctor for people who have been hit by a truck,” Bessent said of the U.S. economy. “The patient had to be stabilized and now he is up, he can walk and he is going to stand up again.” Bessent also echoed Trump’s promise to deliver a $5,000 dividend to Americans if Republicans maintain control of Congress in November’s midterm elections. The plan could add more than $1 trillion to the national debt and stoke inflation, but Bessent declined to offer details about where the money would come from or how it would help the economy at a time when inflation remains high. “I think putting more money in the pockets of the American people should be a goal for everyone, and I think there are ways to do it that wouldn’t affect the deficit,” Bessent said. When asked if such a plan would need congressional approval, Bessent said the Treasury Department was studying that question and trying to determine where the money would come from. “I’m not ready to discuss it at the moment, but we at Treasury have been working on it for quite some time,” Bessent said. The Republicans won the midterm elections. Credit Credit… Haiyun Jiang/The New York Times The hearing, which became tense at times, came as Bessent has been in the spotlight for intervening in financial markets in an effort to lower interest rates. The Treasury secretary acknowledged Tuesday that the recent rise in yields reflects concerns about U.S. deficits, but offered no plan on how to address them. “We will talk about a fiscal consolidation plan that is coming,” Bessent said, referring to an upcoming government initiative to cut spending that he first referenced last month. Bessent’s ambitions to stimulate economic growth and reduce deficits have been undermined by Trump’s decision to go to war with Iran. The conflict has driven up energy prices around the world, stoking inflation and forcing the United States to increase military spending. The Treasury secretary, who was booed by protesters opposed to the Iran war, argued with lawmakers for three hours. When pressed by Democrats, he expressed doubts about his data, questioned his intelligence and said signs of economic malaise were the result of the policies of former President Joseph R. Biden Jr. “May I ask what the statute of limitations is on Joe Biden’s blame game?” asked Rep. Ritchie Torres, D-New York. “As if in doubt, blame Joe Biden. Is that the modus operandi of this administration?”Show more
