In his first public appearance since leaving the White House, former Secretary of the Treasury Jack Lew visited Baruch College to speak about his career path and offer his thoughts about the national and global economy. The event was moderated by Timothy Henglein and Lisa Puran, two undergraduate students within the honors program at the Zicklin School of Business.
Lew, who is one of only four people in U.S. history to hold cabinet-level posts four times, served as the most senior economic official in the United States over the last four years. As Secretary of the Treasury, he played a critical role in policy making through one of the longest economic recoveries in U.S. history.
Despite having experienced a fair amount of frustration and stress on the job, Lew shared that the chance to make a difference is the main reason he found his job so exciting.
“You have an opportunity in public policy to work on issues that are bigger than anything you can do with your own life or in the life of the people that you see,” Lew said.
Lew has also held positions outside of the government, serving as the managing director and chief operating officer in two different Citigroup business units. Prior to that, he was the executive vice president of New York University. He served on the board of City Year New York as well as the Kaiser Family Foundation, the Center of Budget and Policy Priorities and the Hamilton Project at Brookings, among other organizations.
In his opening remarks, Lew commended Baruch College for its excellent business programs and its reputation as a school that has produced talented leaders from diverse backgrounds. Having grown up in New York as a child of immigrant parents, Lew touched upon issues related to immigration as well as the need for a wider inclusion of global economies.
“As someone who has spent a career helping to shape economic policy, I also know that immigration is one of the best ways to increase potential economic growth at a time when we look at constrained labor markets in the years ahead,” Lew said.
Lew added that the United States has been able to benefit from a fast-growing global economy both economically and in terms of security. He believes that some people today only see globalization as an opportunity for the affluent.
“We have to change the notion that, the growth comes, but only to those who own assets, those who are in large corporations [and] those who have a lot of wealth. And that if you are working for salary, the benefits of global growth and domestic growth that flows from international trade doesn’t get to working people,” Lew said.
He also highlighted several accomplishments of the previous administration, including promoting job initiatives and developing a more transparent financial system.
“By responding with urgently needed economic recovery measures and moving aggressively to shore up our financial system, we have proven yet again that sound public policy continues to make a difference,” Lew said.
Additionally, the United States has been more active in global economic affairs. With tensions rising in Iran, many did not believe that the U.S. government could successfully impose economic sanctions. Lew stressed the importance of creating peace under the nuclear deal and acting decisively.
“We proved that by sticking to your guns and being determined, putting the pressure in place, but also being willing to engage diplomatically we can get something very significant in terms of our national security done,” Lew said.
He added, “The key to future success is not separating countries in a way that will reduce overall global growth. The real solutions lie in innovation and a skilled workforce, which requires investments in education, research and infrastructure.”
Moving forward, Lew believes technology will continue to play a bigger role in the job market. He admits that it is crucial to teach people what the “economy of the future requires” so that they could learn the skills necessary to be sucessful in the workplace.
Having spent the last four years working on the Trans-Pacific Partnership, Lew was also asked about his thoughts on the current relationship between the United States and the Asia-Pacific region. He responded first by calling the withdrawal from the pact a “mistake,” arguing that the rules that were negotiated required high standard agreements that positioned the United States to “write the rules of the road for the next half century.”
Lew defined the relationship between China and the United States as “bilateral.” He emphasized the considerable amount of progress achieved in trying to push China toward policies that were more free-market oriented as well as the improvement in cooperation between the two nations in the Paris Agreement and the situation in North Korea. Lew also worked with governments in countries where the standards of oversight and regulation were not equal to that of the United States—“helping to put in place systems where banks could now know who they were doing business with.”
On the topic of the national deficit, Lew reiterated his view that Congress should remove the debt ceiling. He pointed out that the United States is just a few weeks away from hitting its limit once again, which will require the government to set a new borrowing cap.
“One of the things that created the United States as a superpower early in its existence was having an economy that was rooted in the full faith of credit,” Lew said.
Lew explained that debt should be evaluated as a percentage of GDP because the economy is growing every year. He adds that the trajectory of debt-to-GDP today, compared to the ratio during the financial crisis, has dropped from nearly 100 percent to the mid-70s. The answer, he suggests, must come from a “combination of things” that start with bigger investments in education and research.
Looking back on his last four years in office, Lew shared that he is “enormously proud to be in an economy that is doing well and that is on a financial footing that is much better than where it was.”