Distinguished Guest Speaker Offers Insights to AP Economics Students
Earlier this year, students in our AP Economics classes were offered an exciting opportunity to connect with Mr. Peter Georgescu, the founding CEO of ground-breaking integrated communications firm Young & Rubicam. Since Mr. Georgescu’s transition to emeritus status in 2000, he has continued to serve on the boards of multiple publicly held companies, focusing on his belief in the power of education and, most recently, on the issue of inequality in America. In this work, Peter serves as a director of JUST Capital, an organization that seeks to “equip the market with the data, tools, and insights to deliver on the promise of stakeholder capitalism and an economy that works for all Americans.”
In his recent writings, Mr. Georgescu has commented on the necessity of a living wage as a part of the American economy’s enduring promise of personal transformation. His perspective on the attainability of the American dream remains rooted in his own experience, having immigrated to the US in 1954 at the age of 15 from Romania, where had been held in hard labor as a political hostage. In a recent piece for Forbes magazine, Mr. Georgescu lifts up the case of Boeing’s challenges with their 737 aircraft as a cautionary tale related to his theories about corporate motivation and accountability: “I believe the facts surrounding the Boeing 737 ban point to a toxic corporate culture shaped by shareholder primacy and short-term profits — a culture where employee complaints were increasingly silenced, and individual’s resistance was blatantly ignored.”
Rutgers Prep students asked to share their reflections on their conversation with Mr. Georgescu were struck by both his wide-ranging experience and his passion for moving towards an economic environment in which corporations see themselves as being accountable to a wider group of stakeholders than simply shareholders. In response to Mr. Georgescu’s presentation, Griffin Hooper ’21 wrote, “With minimum wages having workers fall below the poverty line, there is an obvious problem with how businesses interact with their valued employees. Mr. Georgescu believes that a corporation’s purpose is to value the customer and invest in the employees. Previously, the idea of shareholder capitalism ruled the world. Economics have asserted that a company’s goal is to serve their individual shareholders by any means necessary. Mr. Georgescu believes that it is time to change that way of thinking. Ultimately, Mr. Georgescu believes that businesses must value the customer, invest in their employees, and support their communities because without stakeholders in a business, the business would not be able to function.” Another AP Economics student, Ben Cucculo ’21, shared, “I thought that Mr. Georgescu brought an interesting and new perspective on capitalism. Despite his devotion to the capitalistic system, he is not afraid to critique its flaws and show us ways to go about improving the system. His ability to tie his discussion into current events was also quite admirable as he was able to give us real world examples of why the system is flawed and how his ideas to fix it would benefit everyone equally. The only lingering question that I find myself asking is if the ideas Mr. Georgescu presented are realistic in the sense that big business CEOs would actually consider putting more money into their workers and employees or if it is something that we can only hope for. Without support from all big businesses it is hard to see the situation that the middle class finds themselves in changing anytime soon.”
Mr. Loose, the teacher responsible for establishing the connection with Mr. Georgescu, said, “Mr. Georgescu stands out among his peers who are trying to figure out how to shrink income inequality in our country, as he was able to persuasively show how capitalism can actually be the cure for this problem. If more stakeholders are considered when CEOs and corporate boards make their strategic decisions, then businesses can be more successful while also helping more people in the economy share from their own success.” Mr. Loose is pleased to have provided his students with an opportunity to grapple with a real-world challenge within the larger universe of economics. We hope that all of our students are developing a foundational habit of thinking about their learning as applied learning, and we look forward to having our Rutgers Prep graduates return with stories of the ways in which these well-planted seeds have sprouted.