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Connect, May 2012 - Ginger Lew - EY - United States

Connect, May 2012

Ginger Lew

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  Most recent position:
Senior Counselor to the National Economic Council and the SBA Administrator; former Co-chair of the White House Interagency Group on Innovation and Entrepreneurship (March 2009–October 2011)
  Last EY office:
Washington, D.C.
  Born in:
San Mateo, California
  Board/community involvement:
Appointed by Secretary of State Clinton to the Board of Governors of the East–West Center, a think tank for US–East Asia policies; serves on the Committee on Advanced Manufacturing for the National Academy of Sciences; co-founder of the Association of Asian-American Investment Managers; member, Board of Directors, The Meyer Foundation
  Career highlights:
Getting 21 nations to adopt policies to include more women in the workforce and promote women entrepreneurship and women leadership
  Most recent read:
Unbroken by Laura Hillenbrand

Ginger  Lew

My point of view

Transformative Change - The new growth dividend

For the past 30 years, alumna Ginger Lew has been committed to helping entrepreneurs and emerging businesses throughout the world — both as a private advisor and in her most recent role as Senior Counselor to the White House National Economic Council and the Small Business Administration Administrator. Now a private citizen again, Lew says that while she's optimistic about the future of entrepreneurship, some fundamental changes are needed.

After stepping down from my White House post last fall, my husband, Lennart, and I put 11,000 miles on our car, criss-crossing the US. During our trip, we made it a point to talk to the people we met — people from all walks of life and from all over the map. What struck us was the tremendous sense of hope and optimism the people of our country have: optimism that our nation is on the road to recovery and will be able to meet — and exceed — the challenges of the 21st century.

Having worked with businesses from around the world, I'm convinced that this kind of can-do spirit is unique to the US and gives us a strong competitive advantage, especially in fostering entrepreneurship. However, for us to truly promote business growth in our country, I believe a number of significant changes are required.

First, we must work to remove obstacles that impede business while providing the political and social framework, as well as the stability, that gives businesses the confidence to invest and grow. One thing that's impeding businesses is our outdated tax system. Our tax code is a patchwork of regulations that has ballooned from 400 pages in 1913 to over 71,000 pages today. We need to modernize and simplify our tax laws for individuals and businesses. For example, the current definition of "home business" was last updated in 1997 and requires a "dedicated home office space." That just doesn't fit in a world where people sit in their bedrooms or back porches designing computer apps.

From a business perspective, the United States is in a class by itself. We encourage risk-taking; we accept failure; and we celebrate success like no other country.

We've progressed from a world of manufacturing and inventory to one of services and intellectual capital and our tax code simply hasn't kept up. Rather than add yet another layer of new laws, I think we need to look at the entire regulatory regime.

Second, we need to find ways to accelerate the commercialization of federally funded research — whether it's conducted at our federal or university labs. The US spends more than US$148 billion each year on R&D. R&D contributes to our society as a whole. Bringing innovative technologies to the marketplace has kept our economy competitive and vibrant. Innovation drives change and it drives new opportunities.

While we can't predict which technologies or innovations are going to be game changers, we do know that when these bursts of innovation happen, there's very likely an entrepreneur who's responsible. We should support entrepreneurship because start-ups play a key role in job creation in the US — more than 40 million (net) new jobs were created by small businesses over the past 15 years. That's two out of every three jobs that were created by start-up companies. We need to support entrepreneurs by making it easier to access capital, reduce reporting requirements and find new markets.

Third, we need to find smart ways of reducing the federal deficit while investing in America's infrastructure, including education, technology and communication, and (as I can now attest with great authority) our nation's ailing highway system. I believe we can eliminate inefficient programs and reduce government spending. But I also believe we need to make strategic investments that will enable our country and its people to be competitive and more productive. Take education. Thirty percent of Americans don't graduate from high school. Yet as we move to a knowledge-based economy, companies are looking for people with higher skills. To my mind, there's a definite disconnect between the new jobs that the 21st century requires and what our education system provides. And despite how many people you see with their smartphones, the US actually lags behind in connectivity and broadband access. Globally, we're 18th in broadband internet subscriptions (Switzerland is #1) and 26th in broadband bandwidth (Hong Kong is #1). In a business environment that increasingly relies on digitization and e-commerce, the US needs to ensure that everyone has access.

Lest you think I'm being overly critical or negative — don't! Count me with the optimists; these are just some current business challenges as I see them. While on our cross-country trek, I also talked to a number of entrepreneurs. There's a real buzz and enthusiasm about new opportunities. Yes, raising capital remains a challenge, but even that's improving (thanks to some bipartisan efforts by Congress), and the commitment and energy is there. From a business perspective, the United States is in a class by itself. We encourage risk-taking; we accept failure; and we celebrate success like no other country. By addressing our business challenges head-on and finding ways to support our nation's entrepreneurs — whether through private or public means — I believe real growth lies ahead.

In the big city: Lew recently rang the closing bell at NASDAQ on behalf of the organization she founded, the Association of Asian-American Investment Managers.

More about Ginger Lew

After practicing law for 12 years, Ginger Lew joined Ernst & Young LLP in 1986 in Washington, D.C., as a member of the firm's former management consulting group. It was during her time at EY, while providing transaction services for a number of emerging businesses, that Lew "caught the entrepreneurial bug." As a result, in 1991 she joined a five-person start-up in the clean energy field as Vice President and General Counsel.

A short time later, she was recruited to join the Clinton Administration, where she served two positions (both requiring Senate confirmation). She first served as General Counsel for the Department of Commerce under Commerce Secretary Ron Brown. Then in 1996, Lew was asked to join the Small Business Administration as Chief Operating Officer. In 1998, Lew left the Clinton Administration to start a venture capital fund. It was also during this time that Lew began serving on the NASDAQ Listing and Hearing Review Council, a role she held for 10 years. During this time, she was also elected to the board of directors of a European venture capital fund, of which she later became Chairman.

After working with the Obama transition team advising on small business issues, Lew was asked in 2009 to join the White House as Senior Advisor to the National Economic Council and the SBA Administrator, a position she held until October 2011.

Today, Lew runs a small consulting firm, where she continues to advise a number of CEOs of young companies, particularly in the clean energy and technology fields. She and her husband have two adult children and three grandchildren. They enjoy hiking and bicycling and have participated in several seven-day biking excursions throughout the US.

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