Minnesota Senator Tina Smith joins Yahoo Finance Live to discuss the Biden administration's strategies to alleviate inflation pressures through the Build Back Better plan, choose a Fed chairman, and tackle the debt ceiling.

Video Transcript

ALEXIS CHRISTOFOROUS: House Speaker Nancy Pelosi says a vote on President Biden's nearly $2 trillion Build Back Better plan could come as soon as this afternoon, while Republicans and at least one Democrat continue to criticize the measure amid the highest inflation in three decades. We are joined now by Senator Tina Smith from Minnesota. And senator, thanks so much for your time. I know that your chamber may vote on this social spending plan in the coming days. I guess my question is, how will you and your colleagues convince conservative Democratic Senator Joe Manchin to vote for it?

TINA SMITH: Well, I think we're going to convince Joe, and we're all going to vote for it, all 50 of us, because we need all 50 of us to support the Build Back Better Act. We're going to do it by talking about what it does for Americans. It is the biggest tax cut for families with children that we've seen in a long, long time. It's going to lower prescription drug prices and make child care more affordable. And we're going to pay for it by asking the biggest companies and the richest Americans to pay their fair share. This is what America elected Joe Biden to do. It's what they elected me to do in 2020. And I'm confident that we're going to get it done.

KARINA MITCHELL: I want to ask you, senator, to react to this please, if you will. Getting inflation under control is probably the biggest thing that the president needs to do. His approval ratings are sinking, and it's because Americans are paying so much, whether at the pump, in the grocery store. What does he need to do? And do you think that he needs to reserve-- release reserves of petroleum? He's asked China to do so, and they've agreed.

TINA SMITH: Well, look, I want to start by saying that I understand why people in Minnesota, my home state, and all around the country are feeling the pinch of rising prices. This is something that we haven't seen in a long time, and it's real and it's having an impact on families. Actually, this is why I'm so determined to make sure that we pass this Build Back Better Act, which is going to take concrete steps to lower prices for the things that keep Americans up at night, like prescription drugs and child care.

So, to me, that's the most important thing. In fact, economists say that passing the infrastructure bill that we just passed, as well as the Build Back Better Act, which is yet to come, will help us to address these inflationary issues, which are caused by the economy, in fits and starts, getting back to some semblance of normal after what has been an incredible, unprecedented disruption in demand and supply.

ALEXIS CHRISTOFOROUS: Senator, I'd like to get your thoughts on the Fed Chair nomination. We're expected to hear from President Biden in the next couple of days as to who he wants to nominate to that post. I'm wondering if you have a preference. Should Jay Powell stay in that position? What about-- there's been talk that Lael Brainard could take over. And I'm curious if you've spoken to either one of them recently.

TINA SMITH: Well, I've spoken with both Chair Powell and Lael Brainard in the last couple of months. I hold them both in high regard. I'm looking forward to seeing who the president nominates. And then I'm expecting that I'll be able to support that nominee. You know, this is a really important job right now, especially. The Fed is responsible for making sure that we get our economy back to full employment and that we keep a good eye on inflation. So I think it especially is an important job.

And I'm interested in a Federal Reserve president chair who is going to also be looking at what we need to do to minimize some of the systemic risks in our economy. For me, one of the biggest challenges that we have is the risks around climate change. So these are the kinds of questions that I'll be asking whomever the president nominates when that person comes before the Banking Committee.

KARINA MITCHELL: And then I want to ask you, when does the debt ceiling get resolved?

TINA SMITH: Well, that's the question that we're all wondering about. I mean, let's just say, first of all, that I think that this whole idea of the Senate having to vote on a debt ceiling, when we already passed laws that say we're going to spend this amount of money and then we're going to pay for it, to me, it's sort of ridiculous that we have to pass another resolution saying, yes, in fact, we are going to pay our bills.

I believe that the Treasury Secretary has said she expects the current debt ceiling limit to run its course sometime around the middle of December. And I'm glad to see that our leader, Majority Leader Schumer, and the Minority Leader are talking about a way to get this through because we ought to be able to agree that we're going to pay our bills without having Republicans in the Senate block our efforts to do so.

ALEXIS CHRISTOFOROUS: And senator, I know that this morning, you participated in the nomination hearing of Dr. Saule Omarova for comptroller. One of her critics, Republican Senator Patrick Toomey, is calling her radical. He says she has an aversion to anything like free market capitalism. What would you say to her detractors?

TINA SMITH: Well, I think that that is really nothing more than character assassination. I've spoken with Dr. Omarova. I spoke with her specifically about the issue of community banks. You know, Minnesota is-- I think has the third most community banks of any state in the country, very important to me. My grandmother was a community bank president. And I am persuaded by all of the conversations and everything that she said that she is going to be a strong defender of our banking system.

And she's going to make sure that this banking system is fair and that the big banks, who, often, in the past, have not always been held accountable by the OCC comptroller, will be held accountable. That is the kind of comptroller of the currency that I want to see. And I am going to do everything I can to make sure that she is confirmed.

ALEXIS CHRISTOFOROUS: All right, well, Senator Tina Smith of Minnesota, thanks a lot for making time for us today. We certainly appreciate it.