The Life and Leadership of Janet Yellen with the WSJ’s Jon Hilsenrath

[Transcript]

Jan Griffiths: 00:08

Welcome to the automotive leaders podcast, where we help you prepare for the future by sharing stories, insights and skills from leading voices in the automotive world with a mission to transform this industry together. I'm your host, Jan Griffiths, that passionate, rebellious farmer's daughter from Wales, with over 35 years of experience in our beloved auto industry, and a commitment to empowering fellow leaders to be their best authentic selves. Stay true to yourself, be you and lead with Gravatars the hallmark of authentic leadership. Let's dive in.

Jan Griffiths: 00:58

It's a cold wintry morning in Michigan. And I'm enjoying a nice hot cup of coffee. And in the background, I've got MSNBC Morning Joe playing on the TV. And, I hear Mika talk about a new book that's just come out. And it's about Janet Yellen. And that grabs my attention immediately. I am a huge fan of Janet Yellen. I actually met her once. I'm a fan of Janet Yellen because of her leadership, her warmth, her capability, and her complete total and utter mastery of facts and data. And so I pay attention and make it introduces the author of the book. And it's Jon Hilsenrath. For those of you who subscribe to The Wall Street Journal, you will know Jon. He's a senior writer for the journal. He was a Pulitzer Prize finalist in 2014. For his coverage of the Federal Reserve. He has won numerous awards and honors. His colleagues twice voted him among the nation's most influential financial journalists, and nonpartisan. He's been a contributor to all the major news outlets. And guess what he's here today to talk about his book, and what Janet Yellen's leadership means for the automotive industry. Jon Hilsenrath, welcome to the show.

Jon: 02:24

Hi, Jan, Thanks so much for having me.

Jan Griffiths: 02:26

John, let's go right in. I got to ask you, Janet Yellen, why did you write a book about Janet Yellen. And what is Janet Yellen got to do with the auto industry.

Jon: 02:37

In terms of why I wrote it, I'll tell you a little bit about how the idea not only of the book, but the structure of it came into my head like most good ideas. It happened to me in the shower. It was shortly after President Elect Biden nominated her to be the treasury secretary. Now I had covered Yellen, for the Wall Street Journal when I was covering the Federal Reserve. And she was the chair of the Federal Reserve, back from 2014 to 2018. When she became Treasury Secretary, she had done something that no person in American history had ever done. She became the first human in American history to be the Treasury Secretary, the Fed chair, and the chair of Council of Economic Advisers, no less the first woman to hold those roles. And so clearly, to me, this was a historic figure. And I wanted to take a look at her and I was familiar with her, having written about her, but what I asked myself is okay, so how do I make this a story that people actually want to read. And what came to me in the shower was that this was a love story, actually, a story that involves not just Janet Yellen, but her husband, George Akerlof, who won a Nobel Prize in Economics himself. So this is a power couple of economics that forged the full partnership. And I realized that between the two of them, given the history that they had had in the field, they were in the middle of every major economic debate over the last 50-60 years, going back to the great post depression debates about John Maynard Keynes and the role of government in the economy. And so I thought I could tell a much bigger story, which leads me to the second part of your question is why would anyone in the automotive industry care about this? I would think that people in the automotive industry would care about this as much as anyone because this is a story of the economic backdrop for the last 60 years, which has been such a major influence on the business cycle for the auto sector, in fact, by going back to the creation of muscle cars and the Mustangs in the 1960s, and how that led George Akerlof to writing about used cars through the financial crisis of 2008, which hit not only demand for cars, but also the financing of cars. I would say there's a lot to be taken from this book on the economic story. and how it can affect any cyclical industry, especially in history. So important. so central to the American story is the auto story.

Jan Griffiths: 05:07

I learned so much from the book about the economy. And it's a bit of a history lesson too. But what really, really fascinates me is the leadership. And when you think about Janet Yellen, you don't necessarily necessarily think about this amazing leader, you think about her as an economist as a very smart woman. But when I think about the environments that she's worked in, they're very similar to the auto industry. And certainly my experience in the auto industry. She's worked at the Fed, the Fed is not known for its fun, loving, innovative approach, it seems to be very, very conservative and traditional. And what I've gleaned from your book is that it decisions are made by a few people, it's not a place where you have open discussion and debate. And then she worked in the White House. And in your book, she describes the White House as, and I quote, "A sweaty locker room where key decision makers around the President were blunt, boisterous and ambitious men, some women sometimes felt overrun by them." There's the auto industry right there.

Jon: 06:18

You the industry better than I do, but I will say, you know, what I described the Fed, I describe it as a very inertial Institution and a very tradition bound institution, which has an effect in how they make decisions, they tend to move at a glacial pace, when the landscape is changing under their feet, it takes time for them to feel that change, and then to reach a consensus among themselves, and then to initiate changes in response to it. So there's very often a response time of several months, when the Fed is seeing something happening in the economy before it results in a response in their policies. It sounds like tradition, and inertia might be something that you would use to describe the auto industry to, in terms of male dominated Absolutely, pretty much everywhere Yellen has been, has been male dominated going all the way back to her teaching days as an assistant professor at Harvard in the 1970s, when there were very few women on faculty. And they found that Janet Yellen, you know, told me this found it was kind of difficult to find collaborators in that environment, he spent a lot of time trying to make herself comfortable, and boys clubs, as you say. And I think what what stood out to me and telling her story was that she always had a sense of purpose in the work that she did, that really mattered more to her than where she stood in the pecking order. Or really even thinking about glass ceilings, she just really wanted to get her economics right at every step of the game. And to use the economics in ways that were kind of worked for, for the greater good. She really went through her life with that sense of purpose. And, frankly, her marriage too was kind of driven by a sense of purpose. Yellen grew up in Brooklyn, in the 1950s. And at the dinner table, there were a lot of conversations about the Great Depression. Her father was a doctor, there were a lot of conversations about how unemployment affected the health and welfare of families and patients that he was treating her husband, George, another economist, was preoccupied from childhood about the problems of unemployment. And so both of them got into the field with a sense of purpose that they wanted to use their math skills and their analytical minds to do something for a greater social good. And they saw economics as a way to do that. Now, Yellen didn't always make the right calls. But the sense of purpose really drove her and that is really what helped her breaks glass ceilings, more than a desire to actually break glass ceilings.

Jan Griffiths: 09:12

You're right, she doesn't use that as like a badge of honor. She's not all about that. I broke a glass ceiling at Harvard and at the Fed and you know, in a White House, that's not who she is. And as I think back on my career, and we talk a lot about the glass ceiling, obviously, in the auto industry, but I never thought about it, Jon, I just wanted to do a good job. And I wanted to enjoy my work and I wanted a career. I never really thought about a glass ceiling. When you put that constraint in front of you. I think it makes it very hard to progress. Like you say she's very mission driven, right. It's all about I want to do the right thing. And I am no expert in the field of economics, not by a longshot. But I love the idea that she would debate with her husband and they brought humanity and human behavior into the mix. They understood economic models and what they were supposed to do and when they didn't behave the way they were supposed to. They wanted to understand that but they brought the human element in.

Jon: 10:13

Yeah. And Jan, you know, it's great that you mentioned that because, Yellen's husband, George Akerlof won a Nobel Prize, and the basis for that prize was a research paper he wrote in the 1960s, about the used car market, actually. And this gets exactly to your point about humanizing economics. So, Akerlof studied economics at MIT, the Massachusetts Institute of Technology, which was very math driven, he felt like there was kind of too much formality and math in the ideas that were being taught to him, and too much of an idea that markets behaved in this kind of predictable and mechanical way. And he said, no, there are humans in the bottom underneath these marketplaces. And they behave with feelings of greed, fear, suspicion, doubt. And so he looked at the used car market as his example. He said, alright, you know, and this was the 1960s, right before we had the systems in place now, but if you wanted to sell a used car in the 60s, you dropped it off at some dirty lot, or you sold it, you put an ad in the classified section. And the Insight he had was, well, if you're a seller of a used car in the 1960s, you know a lot more about what's going on under the hood, then the buyer, and the buyer is going to walk into any negotiation with you with some doubts about what you're selling him whether you're selling him a lemon. Akerlof paper was actually called the market for lemons. And so there was an information disconnect between what the buyer knew and what the seller knew, and information asymmetry, as he said, and there were also emotions, like suspicion and doubt, that made the market inefficient. And that was really the kind of calling card for his career. And very much Yellen is also who tried to kind of humanize economics and say, Well, wait a second, this isn't just a bunch of supply and demand curves. These are people underneath the statistics that we're trying to who's whose welfare we're trying to address.

Jan Griffiths: 12:17

Jon, you were gracious enough to take a look at the 21 traits of authentic leadership. And I asked you to pick out three that you thought, based on your research, your knowledge of Janet Yellen, three, what are the three that really stand out that you would consider the hallmark of her leadership and you chose purpose, gravitas and trust? So let's let's dive into those. Let's let's talk about purpose. I will tell you one of the things that struck me about the book is that she said that she believed in clearly articulating your goals and explaining yourself. And that is something that we need to do more of in the auto industry. So let's start there, Jon.

Jon: 13:02

Purpose we started talking about that. I mentioned she grew up in Brooklyn, her mother really pushed her to be a good student. It wasn't until she got to Yale as a PhD student in economics that she discovered her sense of purpose. And that was when she became close to her mentor James Tobin, another Nobel Prize winner, who really saw the purpose of economics as the kind of an avenue through which smart people could use analytical tools to improve the human condition. And that was the sense that he relate that Jim Tobin drilled into Janet Yellen, particularly as it related to unemployment, and the problems and damage that unemployment creates in families in the broader economy. And that's really, always what drove her in small ways. And in large ways, you know, the bigger backdrop, in her early years as a student and an academic, were these grand debates between Milton Friedman from the University of Chicago with his free market mindset, and the idea that the government should just get out of the way and stay out of the way. And then people like Tobin, at Yale, who was what you would call a Keynesian a person who believed that the government had a role to play in managing the business cycle and, you know, trying to improve the human condition. And Yellen came down on the side of Jim Tobin, her mentor with that sense of a purpose that she brought into her roles as a government official. Her job in her mind wasn't to get out of the way her job was in her mind when there was a crisis to attend to it. And I think she discovered over her years in Washington that it's a challenging role because the government can mess up too and we discovered that with this latest inflation outbreak, so I think she's learned that sense of purpose, but also a sense of purpose with some restraint, or awareness of the possibility of pushing too hard could sometimes cause unintended, unintended consequences.

Jan Griffiths: 15:18

And she's stayed so true to her mission, even though events that have happened over time, during her tenure in whatever position, she shows such resilience. And she's not swayed by political opinion and political favor, because the pressure has to be enormous. When you're working at the Fed or working in the White House. It's an area that I know nothing about. But I can't imagine that kind of pressure. But she is who she is. She's going a certain direction. She's open to others opinions, but she she's true to what she believes is right in her heart.

Jon: 15:55

You know, one of the things that I've said in talking about her work is that another lesson I take from her careers is what I call "lean in when it matters" so that's the Sheryl Sandberg phrase, lean in. But what I saw in Yellen was that because of this sense of purpose, she was a person who would pound the table, there's a chapter in the book called, these are fucking people, when she's talking to her own staff about the unemployment problem after the 2008 financial crisis, she will pound the table when she thinks it's important. But at the same time, she doesn't take herself so seriously that she's pounding the table all the time, or that she's pounding the seat at the table, just because she wants people to listen to her. She pounded the table when she feels like she's got something that other people need to hear.

Jan Griffiths: 16:44

You know, she believes in communicating that mission, that purpose. And there are several examples in the book where she talks about making sure that she has one on ones with people. She's opened for their their discussion and their debate. And there's one part in the book, I believe, she's trying to explain to Trump an example. And she uses the different color paint analogy. Tell us more about that.

Jon: 17:13

Yeah, that's, actually a great example. And it's a good example of the lessons that she's learned over time about, about leadership herself. So the Fed has out of necessity, become a more transparent organization over the last 30 years, and has become more focused on describing its goals. For instance, its 2% inflation goal. It's also a consensus driven organization, when there's a meeting with the Federal Open Market Committee 12 people vote. It's the job of the leader of the chair of the Fed, to get people to agree on a policy of what to do with interest rates. And her style as the chair was to spend a lot of time in preparation before these meetings, talking to every individual that was going to be voting and even others who weren't voting, hearing them out listening to their views and trying to bring people together in you know, to a common consensus. She used this, this analogy of paint and a really interesting one on one with Donald Trump, it was especially interesting because you know, Trump is what you might call a kind of singular authoritarian leader. He's the guy who thinks that, you know, he has to make all the calls. And Trump asked her well, so who do you think this is when she was up to be considered for another term? He ended up actually not not taking her. He said, Who do you think would be the best person for the job? And she didn't want to answer that. She thought she would be she instead, she said, Well, I'd like to talk about what I think it takes to be a good leader of the Fed. And she used this analogy of choosing a pink car. And she said, You know, so you've got all these people in a room there are 19 people who are the decision makers, 12 of them get to vote on a rotating basis. Some people are gonna walk into that room and want to paint it lime green, or chartreuse. And, you know, she might know in her mind that that's just like, not gonna fly to paint a room lime green. And what she came to see is there were times when she had to kind of just sit back and let the discussion play itself out. And let other people in the room kind of say, Yeah, you know what lime green isn't really where we want to go here. And let the kind of conversation come to her. When all along she would think that just like a nice Off White would be the right color. And the point here was that she believed in letting people air out their their views and their differences. And she believed that the worst ideas would kind of off the table through that discussion, and then they could really zero in on the important stuff and kind of where they could all reach agreement.

Jan Griffiths: 20:09

What I love about that is it tells me that she recognizes cognitive diversity. And there's an awful lot of discussion in the automotive industry. Today, we talk a lot about DEI, diversity, equity and inclusion. And that example, speaks volumes. It tells me that she gets it. And she's been leading that way for a long time. It's who she is,

Jon: 20:30

The Fed has had a lot of issues with diversity itself, not only when it comes to race or gender, but also diversity of views going into the financial crisis in 2008. The Fed was an institution that was dominated by PhD economists. And that tended to see the world through these models that they had built. And frankly, the models really weren't very well developed, and miss some major fault lines in the economy and the financial system going into 2008. So they have made an effort inside the institution to diversify notice, not only by by race and gender, but also just different worldviews. I mean, I think one of the big lessons to me from writing the book of the last 20 or 30 years is that you need to keep your mind open to what I would say are thoughtful skeptics, people who are coming at a debate or a discussion and saying, Well, wait a second, you know, a good example of this was before the financial crisis, there were some people, some economists, there was a guy named Raghuram Rajan at the University of Chicago who said, you know, the financial system might actually becoming more prone to failure, with all of these derivatives that are being used. And a lot of economists kind of dismissed his challenge of that conventional wisdom, it turned out to be right. And I think when you read this book, you'll see that over and over again, you know, there are some skeptics who are like broken clocks, and just keep saying the same thing over and over again. But there are others who just come at a conversation thoughtfully and say, Wait a second, what if your fundamental belief about say, trade, or financial stability, or inflation? What if your fundamental belief about this is wrong? What if we, like reconsider this fundamental belief? Where does this lead us? And I think that's one of the lessons of the journey that Yellen has taken is that you have to listen to these people, because sometimes they're onto something.

Jan Griffiths: 22:35

Let's talk about Gravitas. Now, you picked Gravitas, and I have taken liberties with the definition of the word, because my business is Gravitas Detroit, and I can do whatever I want. But Gravitas, Gravitas, to me is is the hallmark of authentic leadership. And it's more than the dictionary definition. It is that feeling when a leader walks into the room that has Gravitas, you feel it, you feel safe, you know that they've got your back, you know that they will challenge you, but that they've got you right and and that they know how to keep things calm in a time of crisis, and that there is a direction that they will get you and the team there, wherever that point needs to be. It's a sense it's a feeling and you know these people when they walk into the room. Now, I think often when people think of a leader with Gravitas you in the picture in your head. It's somebody that walks in with presents, they've probably got like a designer suit on quaffed perfectly quaffed hair when they walk in and they command the room, and that's okay, there are good leaders out there that have that kind of presence. But it's it's not a mold for everybody. They're all great leaders out there that don't fit that mold that couldn't care less about what they're wearing, what they're driving what their hair looks like. But boy, do they ever command of the detail and the facts and the figures. And are they true to their mission? And that's Janet Yellen. From what I can tell.

Jon: 24:14

I would take two core ingredients to the word Gravitas as I've seen them relate to her in my writing and reporting. The first ingredient. You touched on you said the command of the facts. And this gets back to a point I was making a moment ago about her upbringing and her mother, you know, so Janet Yellen had a very difficult mother. Her mother was a former school teacher who insisted that Yellen and her older brother John, not only do their homework every night, but if they'd be done correctly, so before it was ever even handed in, she checked it to make sure that they had all their answers right? They were not allowed to turn in homework with mistakes in it. Because as far as her mother was concerned, you know, like the whole point of doing the homework was to find the right answers, and you don't just race through it and turn it in, if you haven't done the work to find the right answers, and this made Yellen, a bit of a compulsive person, kind of especially early in life about getting her homework done, even today, as the Treasury Secretary, her staff, talking about a contrast with the former President Trump, her staff prepare two to 300 page briefing books for her. She brings them home on the weekend reads them from cover to cover, and comes back with follow up questions on Monday, she's very focused on making sure that she has done everything she can to understand an issue before decision time arrives or before debate time arrives. And a lot of people on both sides of debates with her have, have said that she was always the most prepared person in the room. Whenever she was in a debate, even when it was up against Alan Greenspan, the chair of the Fed in the 1990s. So that's one piece, get your homework done. That's one piece of Gravitas. The other thing which I've seen evolve in her actually over time. And in fact, you know, because I've been following her for a couple of decades, I've seen it grow. And that's a sense of comfort in her own skin. I think that relates to Gravitas. Because you know, I think people around a leader can detect if that leader feels comfortable with his or her place in an organization in a room, and is comfortable enough to accept challenges from other people to accept contradictory information to accept dissonance when it occurs, because that's inevitable. And also to accept that sometimes, so you're going to run to shit storms, and you've just got to kind of keep your head straight and get yourself through them. And what I've seen in Yellen, is that she's gotten more comfortable in her skin. Over the years, when you look at her time as the chair of the Council of Economic Advisers in the White House in the 90s. She was pretty uncomfortable during those years, in part because it was a boys club, in part because and this also relates to gravitas. She didn't like politics, she wanted to get her economics straight, but she just wasn't comfortable kind of fudging the truth to score political points. And it made her uncomfortable in her skin. I think today as Treasury Secretary, she kind of knows who she is. She knows what she's good at and what she's bad at. And she kind of tries to stay in her lane and not kind of overplay herself. And she's stayed out of a lot of the political spin game that you see happening in Washington, when I've been in to see her, you know, even in the worst of moments, you know, she's managed to kind of tell a joke and keep her head down and get back to work.

Jan Griffiths: 27:54

That is the definition of authentic leadership, when somebody truly is comfortable in their own skin. They're not afraid to show their vulnerability that they are indeed human. And one of the things that I picked up from the book is that she's also not afraid to hire really, really smart people. She's not intimidated by that at all. In fact, she welcomes it.

Jon: 28:16

When she became Fed chair. There was an economist out there, former chairman of the Central Bank of Israel, former MIT professor, a guy named Stanley Fischer, who had was the macro economic teacher of many of the great economists of the 20th century, because he taught the macro, the economics course at MIT that Ben Bernanke took, that so many other central bankers around the world took when Yellen became chair. And there was a time when people were saying that Stanley Fischer, because he held dual citizenship should be the chair of the Fed. When Yellen was nominated to be chair by Barack Obama, she said, I want Stanley Fischer to be the vice chair here. I want him we're going through a period of exceptional economic turmoil. And I want the best people next to me. And he was the Dean of Academic economics really, literally, Ben Bernanke, his mentor, and she brought him in, she convinced him to come in and work as the vice chair, which is also a bit of a credit to him, because he was used to being the number one guy, but he saw like her a duty to go and serve in a crisis. And so he did.

Jan Griffiths: 29:35

The other thing I really like, which again, is a clear hallmark of authentic leadership is her ability to recognize when she's made a mistake. And in the auto industry, we don't we're not trained that way. We don't like to play that game. We talk about failure. And this idea of oh yeah, we need to fail and try again when it comes to innovation but not really. You get to a Three quarters of bad results, and you're gone in the auto industry. We don't like to acknowledge our failures and talk about them right now, the more progressive leaders in the industry are encouraging more of that. But she's been doing that for a long time. She's not afraid to acknowledge when she makes a mistake, she very much wants to understand what happened and why. And what does she going to do differently next time, and even to the point that she live and make fun of her mistakes.

Jon: 30:28

I could give you a bunch of examples on that. But one of the most obvious ones is in 2022, after she had said that, she expected inflation to be transitory. And it turned out to be longer lasting than she and many others expected. She was asked on CNN, you know, you said this was going to be transitory what happened? And she said, I was wrong. And what was amazing about that in Washington, was that the fact that she said she was wrong, was seen as a news story in and of itself, because people don't admit to their mistakes in Washington. So there were all these headlines about how Janet Yellen admitted she was wrong. And to her, and we actually, you know, we asked her about this when she came to her office later, and we're like, why did you admit you are wrong? And she said, Because I was. So they didn't score political points in the 24 hour news cycle for acknowledging they made a mistake. But frankly, I think it probably enhanced her credibility, to acknowledge it. And this ability to acknowledge mistakes is it's actually one of the things that I saw grow in her as she became a leader. So another example was, shortly after she became Fed chair. The Fed has these meetings eight times a year, when she was chair after every other meeting, they would hold a press conference. And you know, the markets get very hang on every word that the Fed chair says in this press conference. And if you say something that kind of confuses people in markets or defy some expectation, you know, you could cause a crash or rally. And somebody asked her a question that kind of tried to corner her on when the Fed this is back in 2014. Likely, how long would it take before the Fed started raising interest rates. And she kind of suggested it was about six months. And she didn't mean to put a time stamp on it, it was in truth or was really dependent on a whole bunch of other variables. But she she suggested some that it was going to be within six months, and the markets tanked. And it was her first press conference. And it just so happened, she had come down with a really nasty bug while traveling to Australia, before this Fed meeting, and she had 103 Temperature three days before the meeting, and almost didn't make it so the whole like to her own first press conference, she almost didn't attend. And like the whole thing was a mess. And she kind of I was surprised, actually, she took it in stride. The day after the meeting, she started knocking on the doors of other fed governors in this big cavernous building. And, you know, there was one governor Jeremy Stein, who sometimes disagreed with her and challenged her and she said, I'm sorry, Jeremy, I really fucked that one up. And he was like, Oh, it's okay. And then when I asked about it later, she laughed about it. And that was actually the first time I saw her starting to kind of laugh at mistakes that people thought could be consequential. You know, she put her head down, she got back to work. And I think that like, for me, that was kind of a telltale moment, that showed that she was kind of becoming more comfortable in her skin, as she was able to acknowledge the mistakes she made.

Jan Griffiths: 33:55

She's not trying to fit a mold of leadership that somebody else has put out there. There is only there is the Janet Yellen, leadership model. She's not trying to be something she just is, who she is. And that leadership model that she practices is authentic leadership. And you talk about, you know, the pressure of that press conference, I cannot even imagine I mean, the economy can change course, if you say something stupid, right?

Jon: 34:24

And they would spend days before the press conference doing these like dress rehearsals where they would have fed staff, pretend to be different reporters, and then kind of fire at that at all kinds of different questions to make sure that she could handle you know, the kind of range of questions that might come at her. And even after all that practice, she kind of got cornered and made a bad answer, but you're right about the authenticity and that gets back to the politics and the Fed is kind of an academic and insulated institution. That tries to stay out of Washington politics and the political spin game, as the Treasury Secretary, she's expected she's in the middle of it. She's the top economic adviser to the President. And I think she's come to see that it's just not her thing. And she's trying to lead the Treasury and be a positive presence in the White House. by just doing the stuff that she's good at and letting you know, other people do the spin that she doesn't like and isn't effective at doing.

Jan Griffiths: 35:30

And not only do they jump on her every word and and tear apart everything she says. But they also watch what she wears.

Jon: 35:39

They used to make, they made fun of her actually, when she became chair of the Fed, because she showed up at Obama's nomination announcement wearing a dark suit with a gold chain. And then at her nomination confirmation hearing, she wore the exact same outfit she hadn't. She hadn't updated her wardrobe for a while. And there was kind of a silly debate in Washington about whether it was about Janet Yellen's wardrobe. And so she decided, yeah, you know what, maybe I should update my clothes. She she took a trip to Bloomingdale's in Chevy Chase. And then came by a store by a designer. She had heard of name Nina McLemore. And she said, Oh, I'm going to check out that stuff. And she went into nine as store, loved what she bought. And they had these kinds of power outfits for women with pop up colors that became yellow ones, signature outfit, these kind of distinguish, but kind of not too showy outfits that had style and power kind of written all over them.

Jan Griffiths: 36:47

And I love the fact that she embraced the gray really early on, because you know, that's kind of important to me.

Jon: 36:52

Yes. So there's a story behind that in the book too. So when she went gray early as had her mother, and in the 1980s, she would have been in her like mid 30s. She was thinking about coloring her hair because she was going great. Her son, Robbie was a little boy. And she told Robbie, you know, I think I'm going to color my hair. Robbie is in the middle of like all the family discussions and debates. And Robbie said, no, no, you know, he was a little boy said, no, no, no, Mommy, you can't do that. That wouldn't be you. If you change the color of your hair, that wouldn't be you. And she didn't want to upset her son. And she thought he had a point. So she just let it go gray. And that's become another one of her signature looks is her silver style. And, you know, she told me she's come to like it more and more over the years.

Jan Griffiths: 37:43

Yes, I know exactly how she feels. Let's talk about trust. You picked out trust as one of the elements the traits of authentic leadership that really stand out for Janet Yellen for you. Why, John?

Jon: 37:57

Well, it stands out for Yellen. But having written this book, it stands out in an even bigger and more important way. So the book that I've written I kind of use Yellen and her husband Akerlof to kind of retrace economic history over the last 50-60 years. And it led me to places that I wasn't really expecting to go. But I saw it unfold as their story unfolded. And that is the I'll say, I don't like using this word. But I will say the crisis of trust that the country faces that the United States faces today, we've had these big debates over the last, since the Great Depression, about the right interplay of government and markets. In managing our political and economic system. We have built an economy built a system built a nation around the idea of democratic market driven capitalism. And what we've seen in the last 20 years, oh, and by the way, you know, at the end of the 1990s, I think that the United States was very confident and its leaders were very confident that we had built a system that worked. Not only did it work, but that the rest of the world was going to follow us. Russia was going to follow our lead. And we encourage them to do that after the Berlin Wall fell, and China was going to follow our lead. And we encourage them to do that by bringing in them into the World Trade Organization. And what we've seen in the last 20 years is that the system that we've got this, this system of democratic market driven capitalism is not easy, and it's not inevitable. And we've seen China and Russia go in other directions. And we've seen in the United States two decades of, of challenges to our democratic system and to our market system. And as we've had these challenges, the American public has become The less trustful distrustful of the elites of the people who run the institutions that make our democracy and our capitalist system work. That's what was behind the rise of Donald Trump. That's what's behind the power of Bernie Sanders is people were very skeptical of the institutions that make this system work. What are the institutions? Well, it's the media, they distrust me. It's the government, they distrust the politicians. It's the banks that distrust the banks that were bailed out during the financial crisis of 2008, looking almost any corner of American life, and there's some element of skepticism about our elites. And the lesson that I took from writing this book, was that the most important thing I think, that we need to do as a country, and especially its leaders need to do boardroom leaders, executive leaders, bank leaders go on and on, is to rebuild trust with their constituents, because the systems that our electoral system, the democratic system, the market system, don't work unless you have institutions running them that the public trust. So that brings me back to Yellen. People asked me, What's her legacy? How will history judge her. And I think, you know, on the one hand, if you just kind of judge her based on the decisions that she's made, it's a mixed, it's a mixed record. To be honest, we're living through inflation and 2021 2022, that hurt a lot of households in the government threw a lot of money at the COVID crisis, that turned out to over stimulate and causes supply and demand imbalance that led to inflation, she was a part of that consensus that made that happen, you can't take that off of her record. She made some good decisions and good choices when she was running the Fed, as the vice chair in the chair. But really, I think the most important take that I get from this story is here's a person who's trying to do her job well, has good intentions, and is mindful of the need to rebuild trust in the institution, she runs right now the Treasury, and to convince the American people that that the people running the government are kind of honorable stewards of our democracy and our economy. And frankly, I think we need at all levels of leadership in every aspect of what we do, including right in my world, in journalism, we need people who think that way, and who are kind of focused on our constituencies, and that the most important currency that we've got with them, which is the trust they have in us, you know, she did an interview with 60 minutes recently, in which they unveiled the first dollar bills with her signature on them. And I found her response to that interview, it'd be really interesting when they asked her how she was feeling about having her name on $1 bill. And she said, $1 bill, to me, is this statement to the world of our value system. It's a statement to the rest of the world of the American value system. And therefore, it's important to me that we keep this currency stable, and strong. And I think it's that kind of mindset. What is your value system? What do you stand for? And how are you putting that to work on a daily basis? And are you putting it to work consistently? Those are the things that I think I've come to appreciate and respect really matter at this moment in American history.

Jan Griffiths: 43:45

Trust is so foundational to great leadership. And she she gets it and you see it coming through in so many different ways. First of all, with transparency, this need for transparency, for open discussion and debate, the way that she approaches not just her her job, but her life. There's a lot of integrity there. People trust her and this, I think a lot of that, too, goes back to what you said earlier about the preparation. And people trust that when she says something, it's true and correct. And she means it and believes in it. She's done the research.

Jon: 44:20

I don't want to over generalize when I say this, because I have to be mindful of the fact that our country is very, very divided right now. There is a red America and a blue America. And I talk about some of the roots of those divisions in the story, which is something that George Akerlof has written about, there is a large part of the population that doesn't trust Democrats. In the same way. There's a large part of the population that doesn't trust Republicans. And so I think we have to be mindful of the fact that, you know, just despite all these things that we're talking about in the praise that we're heaping on her, there aren't a lot of people out there who To see her as having been a part of the elites in the establishment that kind of navigated the ship during two decades of, of economic turbulence. And so part of creating trust isn't just securing it with the people admire you, but convincing the people who doubt you that there's more to you than some political label.

Jan Griffiths: 45:22

Absolutely. And Trustee, as as you know, in the auto industry, trust is a huge issue for us, because it starts with the product. Trust in the EV world is a big issue right now, people have range anxiety. So that's another aspect of trust. And then trust from a leadership perspective, where the leaders in the auto industry, trust their people to do what they're supposed to do. I mean, trust, it's everywhere. It's foundational, not maybe not not only to leadership, but in our lives. I think

Jon: 45:52

It's also and relates to the point I was trying to make about value systems, I think, you know, part of creating trust is conveying to others, that you have a value system that they respect, and appreciate and admire, and that you're living up to that value system on a daily basis, whether that be the value system of making quality cars, or whether it be a value system of telling truthful stories to your readers, you're not going to have trust, if people don't connect to the values that you convey, and are convinced that you're living up to what you say you're trying to create.

Jan Griffiths: 46:31

They have to connect with you as a human at a deep, deep level. And let's take a turn now and talk about the fun side of Janet Yellen. I was extremely fortunate. And I met Janet 2019. So let me paint the picture. I was the is Ms. Students supply management conference down in Houston. And I was the emcee for what they call the Exec. And so it's the senior level procurement leaders across multiple industries, not just auto in this session, and they have a private session with the two keynote speakers from the event and the two keynote speakers were Carly Fiorina and Janet Yellen, I had worked tirelessly to make sure that this exec end was going to go smooth, and that the audience would get everything they possibly could out of this experience. And I was ready to go. And I love, love, love music to raise the energy level anything I'm doing, whether it's my keynote, or I'm emceeing, whatever I bring music in because it just changes the energy level in the room. And then I'm thinking, Okay, I'm gonna have these keynote speakers come on to music, and I'm gonna have them just answer me for a minute, you know, run a minute, just, you know, few seconds just just to get some energy change the energy in the room. And then as I thought about it, I thought, Oh, my gonna get Janet Yellen. Because my perception was that she was conservative, you know, not this fun loving person. And that would be very difficult. So we start off with Cali theory and and I thought she'd be easy, right? Because, you know, she thought she'd be easy. Oh, boy, was I wrong? So Carly Fiorina would not answer me for one second, she was a cold fish.

Jon: 48:15

I want to quote you on that, Carly Fiorina would not answer for me that sounds like the title of a book.

Jan Griffiths: 48:18

I could talk about that for a long time, but I won't. So okay, let's push her to one site. So now, so it was kind of an awkward moment. So push it aside. So now I'm a little bit nervous, right? Because now I'm thinking, well, if I couldn't get her to dance for me, how what? How on earth? Am I gonna get Janet Yellen to dance for me? So the AV team is egging me on. Right. And they're going, Oh, go on, you could do it. I said, All right, because I love a challenge. So the so

Jon: 48:44

Part to dance with you on stage in front of all these other people.

Jan Griffiths: 48:49

I mean, I've only got like, a few minutes. So this wasn't planned or anything. She didn't know this was coming. So I pulled back the curtain and I talked, I just have a few minutes and I said, Okay, I Janet, nice to meet you. I said I'm Janet to because I'm actually Janet. Everybody calls me Jon so haha. And, and I said, I'd love to bring you on. Would you dance with me for just just a little bit just to you know, change the energy in the room? And she's like, Yeah, sure. I said, Oh, okay. And she says, What song did you pick from me? And I said, Well Born to be Wild. And she came on stage, Jon. Not only did she dance, but she leaps up in the air. And at this point, she's in her 70s (Yeah, yeah). And she lives up in the air. The crowd went wild because who on earth expected Janet Yellen, one of the most powerful women in the land. I think that's how I introduce her to come on stage and dance. But John the warmth that I felt from that woman and just that short interaction on the the fun, she loved it, and then she sat down, and she was in a panel discussion with Tim theory. He runs the isn manufacturing index, the old PMI. And her command and control of the data. And the detail was mind blowing. I mean, it was just amazing to see this woman come on stage and dance, and still have all command of the data. It was it was truly amazing. So that's my Janet Yellen, fun story.

Jon: 50:23

That's the second Janet Yellen dance story that I've heard. Unfortunately, I wish I had talked to you before I wrote the book, I would have gotten it in there. There was there was a story in the book about when she was the chair of the Council of Economic Advisers. She and the chair of the National Economic Council Gene Sperling would brief the White House staff whenever a major economic report came out. And these were the days when the unemployment, the economy was booming, late 1990s, unemployment keeps falling, inflation is stable. These were really strong days. And so one day, Jane Sperling says to her, instead of giving a report when they turned to us about the last jobs report, let's just get up and dance. You know, it's like, it's like, there's nothing left to say everything is so good right now, we should just dance. So she said, okay, and they got up and dance in the Roosevelt Room, I think it was in the White House. And people were shocked, as you were that Janet Yellen was up there throwing her hands in the air. I think what I've seen in her is that her whole family, her son is a PhD economist, her husband is a Nobel Prize winner. They are geeks of a very high order when they traveled when Robbie was little, they would travel with four suitcases, one for each one of them and one for the books that they were bringing with them. And they would sit and read on the beat, you know, on the beach in Hawaii, all morning before they decided to take a stroll. These are geeks of high water. But they're also aware of their geekiness and perfectly comfortable laughing at themselves. And I think again, as you know, as I said, she's become more comfortable in her skin as I've covered her. And you know, I've kind of seen that her kind of more likely to kind of laugh at herself. I went out to see them in the summer of 2021. I knew they vacationed in August, every year back home at their home in Berkeley. You know, so I said oh, by the way, I'm going to be out there, I'd love to stop by to see you. I was just trying to kind of guilt them into letting me see them. It just so happened. I was in to visit right around the time that the US pullout from Afghanistan was going terribly wrong. And there was a lot on Janet Yellen 's mind when I went to see them. And there was also concerns that there was going to be another debt ceiling crisis in Washington where the government stops paying its bills. So she was very concerned, she joked to me that for a very long day of work that she was afraid that she was going to become the first and only Treasury Secretary ever to default on the debt and die of a heart attack. And then after this long day at work, they said, Hey, let's go out and have some Chinese food. And we went out we had Chinese food, she ordered up a martini, and they told stories of when Janet and George first met and started dating. So from like this very high stakes life, and she was up again at you know, five o'clock in the morning and these back to back meetings. When the day was over, she could tell a joke, have a drink, unwind a little bit, and then just get back to work. And that's exactly what you did the next morning.

Jan Griffiths: 53:37

And I love Jon, the fact that in this book, you bring you bring out so much you bring out her personal life, you bring out her marriage, you bring out the economy, there's this history in it. There's so much in this book. I absolutely loved it. And I can't thank you enough for coming on the show and talking about this through the lens of the automotive industry for our audience. So Jon Hilsenrath, thank you so much for being on the show.

Jon: 54:07

Thanks for having me. I really appreciate what you say I tried to make this a book for anybody and not just a book for economics wanks. This is an important woman in American history. And it's also an important part of American economic history. I wanted to tell a story about people at work, and something that anyone could could could pull from and I appreciate you giving me a chance to talk about it. Thank you.

Jan Griffiths: 54:35

You certainly did.

Jan Griffiths: 54:42

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