The Voice of the Rising Generation

Family Wealth and Wisdom

James E. Hughes, Susan E. Massenzio, Keith Whitaker

• Editore: Wiley
• Anno: 2014
• ISBN:
  9781118936528
• Edizione: 1
• Argomento: Negocios y empresa
• Categoria: Gestión del patrimonio

Avoid "Shirtsleeves to Shirtsleeves" by Finding Your Voice

Growing up in a family with significant wealth or a family business can often feel like an exercise in silence. What should you ask? Whom should you ask? When? Is it ever right to talk about such things?

The Voice of the Rising Generation speaks directly to those who find themselves living in that silence, the so-called "next generation." Great wealth or a family business can act like a "black hole, " sapping the dreams and aspirations of future generations who feel that they can never measure up to the fortune's founder. This book, written by a psychologist, an educator, and a wise counselor who single-handedly changed the landscape of family wealth, diagnoses with economy and precision the cause of entitlement and dependency. It is not too much money or too few chores. It is the failure of rising generations to individuate, that is, to pursue their dreams, develop their resilience, and find their voice.

Many books are addressed to parents and grandparents who worry about the effects of wealth on their descendants. Almost alone in the field, this book speaks directly to 20-, 30- and 40-somethings, encouraging them—literally, giving them courage—to meet the challenge of integrating wealth's power into their lives, rather than disappearing into the black hole. Readers will:

• Come to understand the true causes of entitlement and dependency
• Identify the psychological characteristics of the rising generation and the challenges proper to its development
• Clarify their own dreams, work, and vocation
• Navigate personal relationships and communication within the context of wealth
• Recognize the special challenges faced when rising is delayed until mid-life.

If you are a young person who is starting your life's journey and wondering about the effects of parental gifts, trusts, or a family business, this book will offer you questions, reflections, and lessons-learned to help you find your own way. If you are a parent, grandparent, elder, or mentor, The Voice of the Rising Generation can serve the young people in your life as a gift more precious than gold.

Chapter 1
Setting Sail

To Members of the Rising Generation

This chapter—indeed, this book as a whole—is meant for you.

There are many books, and some good ones, written for your parents and grandparents. (Indeed, our previous book, The Cycle of the Gift, is meant primarily for them.) These books may speak about the next generation, but usually as an object of your parents' or grandparents' care and concern, not as a subject in your own right. You may benefit from such books, but they are not truly meant for you.

In this chapter, we will encourage your reflection on the challenges that family wealth poses to you—challenges often unrecognized but almost always felt. In the next chapter, we will ask you to step back and observe the characteristics and the challenges common to rising generations in general, with or without wealth. Then, in Chapters 3 through 5, we will engage you in considering strategies for dealing with these challenges and fostering your own flourishing.

Who do we mean by you? We mean especially members of the so-called “second generation” in enterprising families. You have grown up in the presence—perhaps the shadow—of successful parents, some who may seem larger than life. You, too, may have labored at their side but most likely under their direction. You know that they can be a tough act to follow.

By you we also intend to include members of generations beyond the second. In such cases, the founder of your family's fortune may be an old man or woman or even a picture on the wall. The stories of the founder's rise may seem like ancient history—and yet those tales and their financial consequences probably still hold a powerful place in your thoughts and actions.

Whatever your exact relationship to the founders, you, our readers, are rising within a world that those founders helped create. They likely control or have established the mechanisms for control of your family's financial capital. But you hold the future, and that is the greatest repository of human capital possible. Your task, then, is twofold: to recognize the reality of the world in which you are rising but also to rise, responsibly and happily, in a life that you create.

The Black Hole

We have referred several times to the challenges that wealth poses to the rising generation. You may wonder, “What are these supposed challenges?” After all, financial wealth is usually considered a good thing. It enables us to buy homes, pay for educations, take vacations, and help others. Most people worry about having too little, not too much.

Some of your parents, teachers, or other authorities may have summed up the problem with family wealth in one foreboding word: entitlement. Another common label for the problem is dependency. In some circles, you may even hear young members of families with wealth described as trust babies. These are not terms applied to wealth creators. They are usually reserved for members of the rising generation whose rising has, in the view of their parents, gone awry.

We do not deny that such words as entitlement or dependency can sometimes be useful. (Trust baby is an insult, meant to be destructive.) But these words do not, in our view, adequately describe the problem.

At the risk of oversimplifying a complicated matter, we believe that the source of the problems that family wealth poses to rising generations lies in the source of family wealth itself: the founder or, more precisely, the founding dream. It is the power of the founding dream that, in our view, often ends up silencing the dreams of rising generations. This silence, in turn, is the reason that the proverb of “shirtsleeves to shirtsleeves in three generations” so often comes true. It is the true cause of entitlement and dependency.

Why do we identify the source of the problem with the founder or the founding dream? Think for a moment about the founder or founders of your family's fortune. Most likely, the founder had big plans and a large sense of his¹ own ability to put those ideas to work. We call this sense of one's own ability self-efficacy. The founder's dream takes material shape in an idea, then a business, and then in the family's financial wealth. It projects itself into business relationships, personal relationships, and legal structures. Ultimately, the dream may inform what work family members do, whom they marry, how they raise their children, and how they spend “their” money. It likely will define the family's impact on the community—whether through business or philanthropy or both. It will give the family its name, in the sense of its public reputation.

We have seen the founding dream take shape in all these ways and more. Such a dream is almost like a sun (see Figure 1.1). It opens the eyes of colleagues, coworkers, and family members to new possibilities. It brightens a path for their efforts. It illuminates the founder and his or her family and shows them to the rest of the world. A founder's dream is an extraordinary and impressive expression of human capital.

Figure 1.1 Founder's Dream as Sun

Such a dream is a smaller version of the great dreams of political founders or refounders, such as George Washington, Abraham Lincoln, Winston Churchill, Mahatma Gandhi, Martin Luther King, Jr., and Nelson Mandela. These founders' dreams have lit up our countries and our world. The dreams of family founders do the same on a smaller stage but with even more concentrated power.

The challenges created by such dreams are also similar in the political and the domestic realms. Thomas Jefferson thought that the “tree of liberty” must be refreshed (with the blood of patriots and tyrants) every 20 years at least—that is, by every rising generation.² As a young politician, Abraham Lincoln feared that the passing of the Founding Fathers would lead to political chaos, since future leaders could not imagine surpassing the deeds of Washington or Jefferson, and as a result might not even try, leaving the country rudderless.³ Twenty-five years later, in his most famous speech, Lincoln recast the bloody Civil War as ushering in a “new birth of freedom,” not just for the United States but possibly for the world.⁴

Both Jefferson and Lincoln saw the challenge posed by a great dream: precisely because of its power, the founding dream may silence the dreams of rising generations. This is the paradox of dreams. Dreams are a fundamental example of human capital. But by their power they may prevent future dreams from being born. In such cases, human capital destroys itself. The founder's sun becomes a black hole (see Figure 1.2).

Figure 1.2 Founder's Dream as Black Hole

In the case of families, the greater the founder's dream, the more powerful the effects of the black hole may be. Ask yourself: In what ways, in what areas of my life, do I feel the gravitational pull of the founder's dream? Do I see it at work in my parents or siblings? Do I see it at work in our choices, in our relationships, and in our plans? How do I see myself in comparison to the great man (or woman, or couple)? Have I begun to think of myself as merely “next”? Am I living in the black hole?

Talking about Silence

If some of these questions strike home, then you know the power of the founder's dream on rising generations. The fear of failing to measure up, or to strike out on your own, may outweigh the hope of future possibilities. When fear outweighs hope, the practical effect is that family members fall silent. You may come to believe that nothing you can think or say or do matters, compared to the greatness of the founders. You may believe everything is already done or decided. If so, your voice and dreams vanish into the black hole.

There are many ways that this silence can express itself. It can even be quite eloquent. Following are some examples of the forms this silence can take, examples taken from our experience but abstracted in various ways to make a point. The names are invented; the caricatures are composites. We follow each example with some questions to ask yourself.

The Very Good Steward

Hudson grew up knowing his family was wealthy. He knew about the business, the factories, the trusts, and so forth. Even in grammar school, he took pride in telling his classmates about how the stock market worked. (Most of them thought he was a bit of a show-off.) When he graduated from college, he moved into the role of serving as trustee, joining his family business's board, and generally keeping track of the family finances. His parents were delighted with his responsible behavior. As his life went on, however, Hudson's pride in himself turned into a deep sense of being burdened. He felt as though he never gave himself the chance to live his own life.

Have you ever been told, “What I really want is for you to become a good steward of our family's wealth”? There is nothing wrong with being a steward. A good steward takes care of someone else's property while that person is away. Stewardship has a distinguished history in the context of charity, in which believers are encouraged to see themselves as...