US Senate News:
Source: United States Senator for Massachusetts – Elizabeth Warren
February 23, 2021
Senator Warren Urges Treasury to Commit to Using the Financial Stability Oversight Council to address financial risks to low-income and underserved communities
Washington, DC – In a Senate Finance Committee hearing today, United States Senator Elizabeth Warren (D-Mass.) introduced Mr. Wally Adeyemo, the nominee for Deputy Secretary of the Treasury, who served as the Consumer Financial Protection Bureau’s (CFPB) first chief of staff.
During today’s Finance Committee hearing, Senator Warren questioned Mr. Adeyemo’s commitment to issuing new Special Drawing Rights to provide low income countries with the resources they need to fight the pandemic and help support a global economic recovery. Senator Warren urged Mr. Adeyemo to commit to using the Financial Stability Oversight Council (FSOC) as a tool to address risks that financial activities impose on low-income and underserved communities.
Transcript: Finance Committee Hearing to Consider Nomination of Wally Adeyemo
U.S. Senate Committee on Finance
Tuesday, February 23, 2021
Senator Warren: Thank you, Mr. Chairman Wyden, and thank you, Ranking Member Crapo. I appreciate your warm welcome. I am happy to be joining a committee that has such principled leadership, so thank you very much.
I have the privilege of introducing Wally Adeyemo, who has been nominated to be our next Deputy Secretary of the Treasury.
I have known Wally for more than a decade. We worked closely together when we were standing up the Consumer Financial Protection Bureau, and I have trusted his counsel ever since.
Wally understands the American Dream up close and personal. He and his family immigrated to the U.S. from Nigeria, laying down roots in California’s Inland Empire. He grew up in a working-class neighborhood where he learned about hard work and righteous values from his mother, who is a nurse, and his father, who is an elementary school principal.
Now, perhaps, one of the most important things to know about Wally is that he was named “Most Likely to Succeed” by his classmates at Eisenhower High School in Rialto, California. This was a very perceptive group of high school kids. He then headed off to UC Berkeley and then to Yale Law School. He was working at the Treasury Department when President Obama asked me to set up the newly-passed Consumer Financial Protection Bureau. Wally became the CFPB’s first chief of staff, where he worked miracle after miracle. During his years in the Obama administration, he lent his talents to just about every critical economic policymaking position. He has a wealth of experience for this job.
Wally’s smarts, his talent for making things happen, and his skill as a natural diplomat prepare him well for this role. He has a firm command of the array of domestic and international policies under the Treasury’s purview. And I believe that he can be trusted to effectively advance our economic and national security interests abroad.
But the thing about Wally – what makes him so remarkable – is that he knows deep in his bones that America’s interests lie in our shared prosperity. If confirmed, he will fight to ensure that every family has a fair shot at getting ahead and that every kid has access to the opportunities that he enjoyed. Wally always remembers where he came from. And for that reason, I know he’ll always stand up for hard-working people who are trying to build a future.
Wally cares deeply about our country. He truly believes in the good that America can do around the world. And he will fight day and night to ensure that this is a better country for America’s workers and families.
So, welcome, Wally. Congratulations on your nomination. And we look forward to today’s discussion.
[Senator Warren returns to the hearing to question Mr. Adeyemo.]
Senator Warren: So, the Trump administration didn’t even pretend to have a strategy for containing the coronavirus and rebuilding our economy. It’s why we’ve surpassed half a million deaths and unemployment is actually around 10 percent.
I’m glad to see decisive action from President Biden on both fronts. He is demonstrating the leadership we’ve been waiting for. And Treasury has an important role to play here, including when engaging with our allies.
The International Monetary Fund issues Special Drawing Rights – a kind of currency that members like the U.S. can use to provide resources to countries that need help.
Now, it’s no surprise that Trump officials blocked efforts to issue new SDRs, withholding a critical tool that would help support a global pandemic response.
Mr. Adeyemo, can you help explain this: why providing low-income countries with the resources they need to fight the pandemic and its economic fallout is so important to our own safety and economic recovery?
Mr. Wally Adeyemo: Senator, thank you for the question. My view is that, and the view that is shared by I know, members of this committee, is that in order to address this pandemic and contain the pandemic we need to contain it globally. Fundamentally the pandemic doesn’t respect borders. It doesn’t respect counties or cities or states, it is global in nature, and we need to ensure that countries around the world are put in a position to deal with a pandemic and its results. Part of this is going to require money, as we’ve discovered in our own country, and providing financial resources to some of the poorest countries in the world is going to be critical to our national security if we seek to make sure that COVID-19 isn’t something that continues to affect us.
Senator Warren: Yeah, good. Thank you, I appreciate that answer and I hope Treasury will commit to delivering this crucial support. This pandemic will not be over for us until it’s over for everyone, and our economy won’t fully recover until other countries are back on their feet as well.
Right now the pandemic and economic recovery need to be your top priorities, I understand that. But I also want to ask about how to ensure the financial system serves the needs of families going forward.
Our financial system is rigged for a long time to help the wealthy and well-connected. Private equity firms get rich off of stripping assets from companies, loading them up with a bunch of debt, and then leaving workers, consumers, and whole communities in the dust. This business model is based on creating even more massive inequality in our economy.
Treasury has tools to address this head on, including through the Financial Stability Oversight Council.
So, Mr. Adeyemo, one of FSOC’s responsibilities is addressing the risks financial activities impose on low-income and underserved communities. Will you commit to using FSOC authorities to address economic inequality – including by recommending more regulatory scrutiny of private equity funds?
Mr. Adeyemo: Senator, I’m committed to working with Secretary Yellen to address issues that face minority communities, minorities in this country, using all the tools of the Treasury Department. Some of these are regulatory but I think we have a number of other tools that we can use also to address these challenges. They are issues that I care about personally and I look forward to working with the Secretary on those issues, and also working with you to address them going forward.
Senator Warren: Well, and I appreciate that but I really do want to bear down on this one. You have an FSOC tool here that’s powerfully important. All it takes us the courage to step up and use that tool. So, I appreciate that there are other tools as well and I want to see you use them all. But will you commit to using this tool?
Mr. Adeyemo: I’m committed, Senator, to talking to Secretary Yellen about this tool and making sure that on top of our agenda is thinking about how the financial system can best serve all Americans including marginalized communities. In terms of how the FSOC does that I’m looking forward to talking to her about that and making sure that we come back to you.
Senator Warren: Now, Mr. Adeyemo, I just want to say on this one I don’t think you should waver about this. If you and the administration are committed to taking a whole of government approach to advancing economic and racial equality, then Treasury can’t be a bystander in this. The Treasury has a lot of tools, especially FSOC. And I urge you to use them.
Mr. Adeyemo: Thank you Senator and I look forward to using all of our tools to address this very important issue.
Senator Warren: I like hearing you say you’ll use all your tools. Thank you. Thank you, Mr. Chairman.