Roger Ferguson, the chief executive of TIAA and a possible Treasury secretary in a Biden administration, said the U.S economy could be six percent bigger than it is today if policy makers narrowed the country’s wealth gap.
The racial and economic divide “makes our economy smaller,” he said Wednesday during a web event hosted by Youth INC, a non-profit based in New York. “Racism isn’t an African-American problem, it’s not a Black problem -- it’s everyone’s problem.”
Ferguson, who was vice chairman of the Federal Reserve’s Board of Governors from 1999 to 2006, is among several candidates that Joe Biden’s transition team is considering for Treasury secretary. Biden wants to make a historic choice for a job that has always been held by a White man.
Ferguson’s comments make him a strong candidate to advise Biden, who is putting racial disparities high on the agenda as he assembles his administration. The former vice president has promised that his cabinet will be diverse, and included several experts on the racial wealth gap on his teams reviewing federal agencies as part of the transition.
Biden is not expected to announce cabinet choices until next week or early December.
(Many media outlets called the presidential election for Biden, who would take office Jan. 20. Trump is challenging the election results, alleging widespread fraud, and has not conceded.)
The son of a public school teacher, Ferguson was the first Black person to become a Federal Reserve vice chairman. Earlier this week, he announced that he would retire in March from TIAA, which is known for offering retirement products to teachers.
During the web event, Ferguson, 69, said that access to capital is one key roadblock for minority entrepreneurs because they can’t build trust with lenders, who rely largely on credit history and employment history.
“We need to help individuals who don’t have access or the ability to show good credit how they might do that,” he said, citing examples of banks looking to a track record of good rent and car payments as a way to build trust.
Youth INC on Wednesday presented Ferguson with an award for his philanthropic work.
© Copyright 2023 Bloomberg News. All rights reserved.