Janet Yellen on her legacy as the first woman to lead the Fed, Trump’s central bank clash, and Kevin Warsh’s tightrope

Her latest honor is as a 2026 inductee into the National Women’s Hall of Fame. Founded in 1969 in Seneca Falls, N.Y., the Hall of Fame each year inducts a class of women, about half contemporary (or living) and half historic.

To mark the milestone, Yellen spoke with Fortune about what this means to her and the most pressing political and economic questions of the day. “This one is very special to me,” Yellen said, comparing this award to all the honors she’s received in her life, “because the Women’s Hall of Fame is about the story of women in America and their struggle to achieve equality. And to me, it makes me part of that story.” Read the full conversation below:

How do you think about your own place in history?

I see myself as being situated in this having benefited from what generations before did and inspired me, and hoping that my story can inspire future generations. I had tremendous opportunities to work in an area where there have been relatively few women. I often attended meetings, both in academia and in international meetings, where I was the only woman at the table, and was able to nevertheless succeed.

When you look back at the entire scope of your career, which achievements are you proudest of?

I feel good about my ability to take my training in economics and my long-held view that the purpose of economics is to improve outcomes for people, especially people who are struggling to succeed. I’m grateful that I was entrusted with very important roles where I helped to make decisions, certainly with others that I think did advance American economic welfare, both at the Fed in trying to manage the worst financial crisis America has seen since the Great Depression, and to try to help people get back on their feet after all that they suffered.

How are you feeling about the Fed’s independence today and how worried are you in this moment?

We’ve seen the worst attacks on Fed independence in certainly in my lifetime. Presidents always care about what the Fed does, and typically prefer easier monetary policy than the Fed considers it appropriate to deliver. I’ve never seen a president who has pulled out all the stops in trying to put personnel at the Fed who will go along with his views on appropriate policy. Most recently, this means weaponizing the Department of Justice against the Fed chair. It’s meant attempting to remove a member of the Federal Reserve Board for very questionable cause.

The Federal Reserve’s job is price stability and full employment, and you have a president who has very explicitly stated the Fed’s job should be to hold down the interest costs of the debt. That’s the road in a banana republic to high or even hyperinflation. So yes, I’m very worried about Fed independence.

What’s it like for you to watch this all unfold?

I’m particularly concerned about his treatment of our allies and his approach to trade, and I think he’s destroying a set of global rules that have enabled us to have a peaceful and prosperous many decades since World War II ended, essentially breaking down a system that countries largely abided by, that have kept the world on a prosperous path. He’s really having devastating effects on how the global economy works. I’m seeing a president who is undermining one of our greatest assets, which is our research capabilities and our universities, who is really destroying much of the government, tearing down the civil service, which is a store of knowledge that has been an asset for the American people. There’s a lot to be concerned about.

What will the impact be for the next generation?

We’re looking at a world in which the economy is going to operate very differently. Some of the things that most economists believe have led to the greatest reductions in poverty and increases in economic welfare, we’re seeing the foundations of that kind of economy undermined. At the same time, we’re also seeing deregulation in the area I know best, which is the financial sector, I believe, has already gone too far and will ultimately lead to a future financial crisis, which undermines financial stability.

What do you make of Kevin Warsh as President Trump’s Fed chair pick?

I was president of the San Francisco Fed during the early days of the financial crisis, and then was vice chair of the Fed and overlapped with him in both roles. He’s a person who cares a lot about inflation. It’s really one of his strongest and most consistent themes. I do believe he values and understands the importance of the independence of the Fed. I think President Trump has put him in a very difficult situation. He will need to reassure his colleagues. He’s only one vote of 12 on the FOMC, and he will need to get his colleagues to go along with him in order to implement policies that he wants to put in place.

He said in his confirmation hearing he’s made no promises to the president about future policy, and that the president didn’t ask him to make any pledges. President Trump, on the other hand, said that he did. So I think this means that he’s starting off in a very difficult position. But he’s someone who knows both the strengths and weaknesses of the Fed and could be a good Fed chair.

If someone asked you if they should accept the chairmanship under these conditions, what would you tell them?

I would warn him. I would point to what’s happened to Chair Powell as an example of the difficulties you can face with President Trump if you defend the independence of the Fed and insist on making decisions that are fact- and analysis-based and are meant to promote the Fed’s Congressionally-given mandates. It is sobering for anyone stepping into one of these jobs to see that if the president doesn’t like what you’re doing and wants you to step down and replace you, that you could see charges brought against you for no good reason at all.

It’s difficult to walk into such a job. Hopefully he will do what he thinks is the right thing when he’s in that role.

Let’s talk about AI. You view getting Americans through the financial crisis as a major part of your legacy. How are you thinking about the impact of AI on the American workforce today and how concerned are you looking into the years ahead? What are the most important federal levers to pull?

Many people see that AI is a major technological shift and will have profound effects on our economy. But when it comes to whether they’re going to create jobs or destroy jobs—Who’s going to be affected? Where new jobs will come from?—nobody really knows. We are seeing in some narrow professional areas, like coding, sales, marketing, data analytics, that it is having an effect on hiring, and people who do jobs that really required significant skills are being replaced by AI. But it hasn’t diffused broadly through the economy.

There are both reasons to think that it will destroy jobs, as you’re seeing happening, say, for coders, but also to create jobs and to make people more productive in the jobs they have by being able to take over tasks like writing initial drafts of briefs or analyzing analyzing data.

I believe the Fed and fiscal policy, the government, have the ability to create enough demand in the economy so that jobs will appear. But if the jobs are all in healthcare and services, and they tend to be some of them lower-skilled jobs, and the jobs that disappearing are ones that are much higher-skilled, how that transition is going to take place—that may be very, very challenging.

We’ve had major technological change before, but usually the new technologies have reduced the demand for less skilled labor, and people have had to up their skills and move into more skilled jobs. But this is different, because it can affect skilled workers, white collar workers, directly. So there’s a lot of uncertainty.