“The objective is to normalize the discussion so it’s not otherworldly”
May 21, 2017 7:08 AM   Subscribe

How the Wealthy Talk to Their Children About Money. In which the New York Times inadvertently makes a case for the estate tax.
posted by indubitable (80 comments total) 32 users marked this as a favorite
 
I feel so sorry for these poor rich people who stand to inherit so much money. Maybe some of us could volunteer to take some of that burden off by offering to take a few millions off the hands of the poor trust fund elite.

Or, like you said, the estate tax.
posted by orangutan at 7:14 AM on May 21 [31 favorites]


"inadvertently"?
posted by at by at 7:14 AM on May 21 [3 favorites]


I think once the kids get through all the extended end-of-life care and the fact that everything costs so much more, it will be a smaller amount than they think if not completely swallowed up.
posted by amanda at 7:17 AM on May 21 [4 favorites]


If you juxtapose this with this post about homeless children and the children of opioid addicts, you get an excellent argument for burning it all down.
posted by schadenfrau at 7:18 AM on May 21 [44 favorites]


I don't have kids (yet), but I imagine that the opposite talk, where you explain to your adult or nearly-adult children that you have fuck-all saved for their college fund, and effectively no retirement savings, that they're pretty much on their own, and it would be nice if they could help you a little bit in the coming years, is even tougher.
posted by LiteOpera at 7:20 AM on May 21 [96 favorites]


Meanwhile, the rest of us just leave a note with our PayPal password and which mattress to look under for that $100 I put away for the funeral.
posted by Miss Cellania at 7:20 AM on May 21 [29 favorites]


To expand on LiteOpera's comment, I made sure to explain to my kids before they got to high school that their college expenses would be their own, and any grades they made from now on would affect their ability to pay for one. So far, that's worked out well.
posted by Miss Cellania at 7:23 AM on May 21 [13 favorites]


Can they pay off my student loans? That won't be a difficult talk to have. I'll say thank you and be sincerely grateful.
posted by sio42 at 7:24 AM on May 21 [3 favorites]


I remember my parents giving me a version of that talk, LiteOpera.

Talk about growing up suddenly.
posted by rokusan at 7:28 AM on May 21 [1 favorite]


In which the New York Times inadvertently makes a case for the estate tax.

inadvertently? -- at by

For the Times? Yes.
posted by rokusan at 7:29 AM on May 21 [6 favorites]


I wonder some enterprising financial advisor doesn't hire themself out to give wealth management lessons to young heirs-to-be.
posted by The Underpants Monster at 7:52 AM on May 21


I remember the first time we almost didn't make the mortgage payment. I was about 8. That was a LESSON.
posted by zerolives at 8:10 AM on May 21 [10 favorites]


If you juxtapose this with this post about homeless children and the children of opioid addicts, you get an excellent argument for burning it all down.

don't burn, expropriate
posted by indubitable at 8:12 AM on May 21 [14 favorites]


I don't have kids (yet), but I imagine that the opposite talk, where you explain to your adult or nearly-adult children that you have fuck-all saved for their college fund, and effectively no retirement savings, that they're pretty much on their own, and it would be nice if they could help you a little bit in the coming years, is even tougher.
posted by LiteOpera at 7:20 AM on May 21 [5 favorites −] Favorite added! [!]


This is why I hate the New York Times. We subscribed in a panic after the election, but now that I read it more regularly I realize they are obsessed with the interests of the ruling white elite, and middle class and poor people, along with people of color and for that matter women are relegated to a few weird stories about sports, crime, extreme poverty, or fashion. The situation described in this comment is much more common than the rich person in the article, but which story gets told in the Times?

Try scrolling through the NY Times and counting the photos of white men. Today is better than most days: it's only about half white men, a pretty weird ratio when you consider the demographics of the world. News happens to everyone.
posted by latkes at 8:17 AM on May 21 [72 favorites]


A friend of mine is an estate lawyer and he told me that for all but the very rich, there's very little inheritance these days because the cost of end-of-life care invariably eats everything. Not really news to my family but shocking how universal it is.
posted by octothorpe at 8:18 AM on May 21 [20 favorites]


A friend of mine is an estate lawyer and he told me that for all but the very rich, there's very little inheritance these days because the cost of end-of-life care invariably eats everything. Not really news to my family but shocking how universal it is

Which is why we e had long talks between my mother and brother about when to euthanize, sometimes with specific dollar amounts. .

Great country this.
posted by The Whelk at 8:25 AM on May 21 [38 favorites]


It's always interesting to me to try to figure out who they think the audience for stories like this is. Is it people who actually face this dilemma, which must be a pretty small percentage of their readership? Is it people who don't but hope that someday they will? Is it people who don't but like to fantasize about what it would be like to have to contend with this problem? Is it clickbait for people who enjoy feeling outrage? It's a conundrum. But they sure do publish a lot of service journalism for the .01%, which suggests that someone is reading this stuff. And of course, we all read it, so that's a data point on the question of audience.
posted by ArbitraryAndCapricious at 8:27 AM on May 21 [23 favorites]


Arbitrary and Capricious -- there are more rich people than you think, the print edition of the New York Times is one of the very few media that significant numbers of them consume, and hence advertisers will pay a TON to be in the print edition of the Times next to articles that target them. When it can do double duty as both service journalism for the rich and forward/tweet/blog snark for the lefties and hipsters, even better.
posted by MattD at 8:55 AM on May 21 [22 favorites]


how many people sent this article to their parents as a goof with a note "whenever you're ready to talk, i'm here"
posted by (Arsenio) Hall and (Warren) Oates at 9:09 AM on May 21 [23 favorites]


My parents are gone (with nothing left momentarily at the end) so I'm the parent now. Our 401k/403b accounts are doing well be if there's anything left at the end it's going to film preservation efforts or something similar.
posted by octothorpe at 9:21 AM on May 21


I grew up in a family with money (for the country where we lived), and my parents sat down and told us about the importance of not relying on this and learning to be independent. There will be no trust fund and may be no inheritance. Don't rely on it. Don't count on it.

And almost like it was prescient, my grandfather passed away, and my aunts, uncles, and cousins squandered everything that was passed down. We watched millions evaporate in the space of 20 years. I also suspect, given the decades left of life in my parents and future inflation, that they'll likely burn through what's left themselves, and it will fall to us children to help them in the end.

The most important way to talk to your kids about money is to always reinforce that they will have to earn it themselves. Wealth can disappear. Nations can collapse. Economies can fall apart. Nothing is guaranteed.
posted by bl1nk at 9:21 AM on May 21 [20 favorites]


As long as rich white guys were on the program, they could and should have given space to people like Buffett and Gates, who have announced that they will be giving almost all of it away in their lifetimes.
posted by homerica at 9:23 AM on May 21 [2 favorites]


Weird. Who would have thought a column called "wealth matters" would be about the wealthy.
posted by JPD at 9:39 AM on May 21 [7 favorites]


This article was interesting to me because over the course of my daughter's childhood we went from upper middle class to somewhat wealthy, in a small, rural blue-collar town. We're not obnoxious about it (no gold-plated vinyl siding on the house, etc), but it's a small town and everyone knows everyone's business. At one point some of my daughter's classmates asked her point blank whether she was rich. At which point, she asked us, her parents, about it.

So, in fact, at a relatively early age, we had that talk with our kid about our wealth, and what it meant, and what it meant for her (and also, what it didn't mean, as in, for example, it didn't mean she could spend her entire life just fucking off). It's also a topic we check in on with her on a semi-regular basis, because it does affect her life on a continuing basis.

One of the things I'm very pleased about is that even at a relatively early age, our kid had a pretty good grip on how little money compensates for other things relating to being a person, and that you still have to do the work of being a good and decent human being. I also think living where we do has also been useful to her, in the sense that she gets a daily understanding of what life is like for people who don't have all the financial advantages we do; she also gets a daily understanding that the value of people is not confined to their financial worth (and perhaps more to the point for her, to the financial worth of one's family). It helps in both cases that we've always been open with her about our money, and what it means, and what we think about it.

This NYT article kind of goes about addressing this issue in a vaguely obnoxious way, and there's a reasonable question as to why this topic needed to be addressed in an article at all. But it's not wrong; there's use in making sure, if one has money, that one's children understand what it is and what it means, and what it means for them. Just as one would (or should) with any family issue. It's a (literally) high-class problem to have, but it's still a problem and should be addressed.
posted by jscalzi at 9:40 AM on May 21 [50 favorites]


Re: college, I recommend not the program my parents used, which was:

"How do you expect us to pay for your college if you don't get good grades" K - 11.5

"We never said we were paying for college, good luck kid" 11.5+
posted by maxwelton at 9:41 AM on May 21 [20 favorites]


I weep for the Weiners and the hardships they are enduring :(
posted by Foci for Analysis at 9:51 AM on May 21 [1 favorite]


I wonder some enterprising financial advisor doesn't hire themself out to give wealth management lessons to young heirs-to-be.

Every major financial services firm has a program like this to keep the money at the firm after the generational transfer.
posted by leotrotsky at 10:00 AM on May 21 [6 favorites]


A friend of mine is an estate lawyer and he told me that for all but the very rich, there's very little inheritance these days because the cost of end-of-life care invariably eats everything.

I'm an estate attorney and your buddy is almost committing malpractice if he isn't doing Medicaid/ LTC planning for his clients who can't self-insure. In my state, if you know the rules, for the first spouse who needs nursing care, you can protect 100% of the estate, regardless of size, and have Medicaid pay for their care in perpetuity. If the second spouse needs care, you can still save 50-100% depending upon the asset mix.
posted by leotrotsky at 10:10 AM on May 21 [36 favorites]


they're pretty much on their own, and it would be nice if they could help you a little bit in the coming years...

"just so you know, curiousJr, my retirement plan is your couch." true story.
posted by j_curiouser at 10:13 AM on May 21 [3 favorites]


...for all but the very rich, there's very little inheritance these days because the cost of end-of-life care invariably eats everything.

I've been privy to discussions like this, and it has been pointed out that the estate should expect the end-of-life costs for the guy who actually earned the money is about $10M. That means never moving to a nursing home or hospice, all care is delivered at home, with multiple round-the-clock nurses, and if needed, round-the-clock doctors. Every medical procedure will be done by the world's best. And there will be secondary specialists flown in so stand by. If there is a 4% chance of the heart procedure causing a blood-clot related stroke, then the world's best stroke specialist will be sitting there twirling his fingers.

This guy had the same heart operation my mother did. She lost the ability to speak due to the consequent stroke. She could hardly walk. The operation bought her six years. He was playing tennis two weeks later.
posted by StickyCarpet at 10:33 AM on May 21 [10 favorites]


It's oddly reassuring to read others' parents' financial fails. In the spirit of sharing, mine did the following (protip: don't follow in their footsteps, it took me nearly a decade to get a solid sense of the value of things).

"No, we can't afford to get you new jeans." At Costco, eh.
"We REALLY NEEDED this new BMW, it's much safer than the [five-year-old] Volvo we had."
"Yeah, no, we can't afford school sports for you this year."
"Well the new Toyota 4x4 is of course necessary given how old the [three-year-old] Chevy pickup was getting."
"You need to drive more carefully, we've had to pay for your tires once already in two years, omigod."
"We figured we'd get a second BMW just in case the first one has problems."
"No, we can't afford to help you with university, good grief do you have any idea how greedy you sound? You know full well we had to renovate the kitchen and build a new room!" This was on their three-bedroom, three-bathroom house with an existing office, living room, huge entry, and massive kitchen. The new room? Was for a jacuzzi. I had to pay for university with loans and side jobs. While my parents claimed me as a dependent.
posted by fraula at 10:35 AM on May 21 [26 favorites]


fraula no offense, but those aren't financial fails; your parents just sound like assholes.
posted by leotrotsky at 10:42 AM on May 21 [63 favorites]


The documentary " Born Rich" is about the children of the -up against the wall when the revolution comes class 1%.
posted by Pirate-Bartender-Zombie-Monkey at 10:43 AM on May 21 [5 favorites]


My parents gave me no clue that there was no "college savings account" until after I'd been accepted to a tiny liberal arts college that I loved, which I'd chosen from among the many many beautiful mailings I received after taking, and doing well on, the PSAT and SAT.

I'd assumed that there was some kind of savings account for college, such as I'd seen mentioned on TV many times. Many of the brochures I'd received said that no student would be refused an education for lack of means. I assumed it would work out somehow.

My parents explained bitterly that middle-class people like us could only really afford a school like that if they owned their own business and so could hide assets from the IRS and financial aid people. I'm still not sure whether they were correct.

It was really traumatic, and the fear of doing that to another child is a major reason I don't have children now.

At some point, my father called the college to confirm this understanding of reality. He offered me the phone, but I was too upset to deal with it. The only way I'd endured life up until that point was with the belief that someday I was going to be with people I could connect with, who would care about the same things I did, and with whom I could talk about things that mattered.

My mother told me "We're not mortgaging the house for you." I just kind of gave up at that point. If I'd been a little more worldly, maybe I could have found a way, or maybe not, but I didn't even know that I could try.

I ended up putting myself through a state school that I didn't care anything about (my parents did pay for most of the first year, plus a small scholarship), and my grades, and my facial expression in my graduation photos, reflect that. That course of study would have been wonderful for someone else, but it was, in a way, wasted on me. I feel very guilty now for not appreciating how much some of my friends must have wanted what I had.
posted by amtho at 10:46 AM on May 21 [17 favorites]


Since so many people seem to base their thinking about the estate tax on the fictional trope of a distant, unheard-of relative who somehow has no one else to leave their fortune to, I say: 100% estate tax, but for each night spent sundown to sunup in a haunted house they can convert say a hundred thousand dollars to regular income.
posted by ckape at 10:51 AM on May 21 [12 favorites]


Also, one other thing I remember learning from my folks (and is a common proverb in Asia) "wealth doesn't survive 3 generations". The first generation starts without wealth and accumulates their fortune. Second generation remembers what that experience is like and has some responsibility but has also acquired decadence. The third generation has only known decadence and just blows it all. There's also the challenge with how every generation adds more hands to split that fortune so everything can just be frittered away by division.

This also to say that all of these families can try but most of them will fail because we're all selfish and short sighted and prone to bad decisions.
posted by bl1nk at 11:26 AM on May 21 [3 favorites]


fraula - I went from a set of parents like yours ("we can't enroll you in sports or activities because we went to the south of France and Fiji" etc) to one who lived in actual borderline poverty. I still have no sense of what's up or down. Sam Irby's piece is really the only thing about money that I've seen that actually speaks to my experiences.

A friend of mine worked for a nonprofit that helped young people who were set to inherit vast sums digest the meaning of their wealth, their responsibilities (legacy) and how to best use their money to make the world a better place reflecting their values. Surprisingly taxing emotional labor involved as well as helping ppl process guilt and burden about being secured by wealth probably earned on the backs of others' suffering - how to best redistribute it out to the world fairly was a big burden for these people, some pretty young.

Once the resentment burned off I realized this was actually needed as financial advisors are like wizards that help dragons hoard their coins. Sadly enough the org I believe is shuttered now or in the sunset process as its initial operating funds were one large gift which eventually ran out, and the late Obama/early Trump era is not kind to people who want to convince the oligarchy to deconstruct itself.
posted by SassHat at 11:28 AM on May 21 [14 favorites]


Also, one other thing I remember learning from my folks (and is a common proverb in Asia) "wealth doesn't survive 3 generations".

Cornelius Vanderbilt died in 1877 worth ~215 billion in today's dollars.

The Vanderbilt family reunion in 1973 didn't have a single millionaire.
posted by leotrotsky at 11:30 AM on May 21 [11 favorites]


Cornelius Vanderbilt died in 1877 worth ~215 billion in today's dollars. The Vanderbilt family reunion in 1973 didn't have a single millionaire.

Gloria must have had something better to do that weekend.
posted by Etrigan at 11:33 AM on May 21 [28 favorites]


There's also the challenge with how every generation adds more hands to split that fortune so everything can just be frittered away by division.

That's why concerns about Dynasty Trusts are probably a bit overrated. That said, as folks have fewer kids this might be changing.

I'm on mobile, but someone with Excel could do the math: what's the generational birth rate (# of kids per say 25 years) required to grow principal with historical rates of inflation and market returns, assuming you're drawing down, say 100-200k for income?
posted by leotrotsky at 11:37 AM on May 21


Gloria must have had something better to do that weekend.

Maybe, but 120 folks did show up.

Vanderbilt Family Reunion
posted by leotrotsky at 11:45 AM on May 21


My father passed away recently, and I'm just starting down the path of figuring out what my co-executor sister and I need to do to split things properly. There isn't a whole lot in the way of cash so it's mostly divvying items and figuring out what to do with the house and sending death certificates to 4.2918E+12 groups.

As for college, my mother was all for my exploring the deep end of the pool. Apply to Carnegie Mellon, she said! (I did, and got accepted.) Apply to Duke! Apply to -- hey, Mom, are you going to be helping to pay for any of these? No? Then STFU. And the far cheaper safety school I ended up at was only affordable by my father scraping and straining, which was one of many reasons I made sure he got care and attention to the end.
posted by delfin at 11:53 AM on May 21 [5 favorites]


So here's the thing. There are some rich families that stay generationally rich, but my sense is that they do it by imposing an ethic of relentless competition on their kids. The point of making money is not to make money: it's that there are winners and losers in life, and you will disgrace the family and lose your parents' love if you don't show yourself to be a winner by making lots of money. This is how you get, for instance, George W. Bush and Mitt Romney. It's how you get Donald Trump, his children, and Jared Kushner. But it would be better for our society, and probably emotionally healthier for the kids, if they just squandered it all on hookers and blow.

Another strategy is the noblesse oblige thing, where you tell your kids that because they don't have to earn a living, they have an obligation to do something useful with their lives. It's easy to object to that mindset, and I kind of do, but it's probably preferable to any of the alternatives.
posted by ArbitraryAndCapricious at 12:13 PM on May 21 [11 favorites]


If money is such a problem, well... they've got problems... I think we could rob solve them
posted by Nanukthedog at 1:27 PM on May 21 [2 favorites]


my sense is that they do it by imposing an ethic of relentless competition on their kids. The point of making money is not to make money: it's that there are winners and losers in life, and you will disgrace the family and lose your parents' love if you don't show yourself to be a winner by making lots of money.

You mention some famous examples, but there are a lot of rich people who aren't obnoxious enough to be in the news. I wouldn't judge all successful rich families by the examples of a few infamous ones.
posted by amtho at 1:36 PM on May 21 [2 favorites]


I teach kids from wealthy families, and it's interesting to hear young children talk about money. Just last week one of my kids told the class that his whole family works at McDonalds, which is true in a sense, in that they own a bunch of them and travel around managing them. I talked to him a bit about it, and he doesn't see a distinction at all between owning them and working there... yet. (He's 7.)
posted by Huck500 at 1:47 PM on May 21 [4 favorites]


Q: So, who does rule America?

A: The owners and managers of large income-producing properties; i.e., the owners of corporations, banks, other financial institutions, and agri-businesses. But they have plenty of help from the managers and experts they hire. You can read the essential details of the argument on this site, or read the new seventh edition of Who Rules America?.
posted by Pirate-Bartender-Zombie-Monkey at 2:03 PM on May 21 [8 favorites]


If money is such a problem, well... they've got problems... I think we could rob solve them

I hear jscalzi's loaded. You lure him into the alley and hold him down while I take his wallet.
posted by briank at 2:17 PM on May 21 [1 favorite]


My grandparents founded a business that's done quite well, although not "everybody in the family can quit their jobs" well. It started to take off when as their kids started to have kids, and at that point my grandparents started to think seriously about how to keep the business and the associated wealth in the family while avoiding a lot of the pitfalls people have mentioned already in this thread. I'm very grateful that my grandparents had those hard talks with their kids (and by all reports, there were some ugly moments during those discussions), because I think it made it easier for my parents and my uncles and aunts to talk to our generation about money from an earlier age, and to make some of the points to us that jscalzi talked about making to his kid - nothing was promised in terms of employment or support, the money could easily dry up, and the expectation was that we would be actively contributing to future generations of the family, not just drawing down on the money that already existed.

Partially as a result, everybody who's out of college in gen 3 has a job outside of the family business, and we've got really strong rules about what people actually get from the business (not much) and what it takes to get into the business (multiple years of employment outside of the company, and then, if a job is open, being head-and-shoulders above other applicants, and then, if we get a job, being head-and-shoulders above other employees). It's kind of this:

Another strategy is the noblesse oblige thing, where you tell your kids that because they don't have to earn a living, they have an obligation to do something useful with their lives.

I guess...I hope we've figured out a relatively healthy way to do it? As a family, we donate a bunch of money and time to social causes and left-of-center politicians (although we're nowhere near the Adelson/Koch/Murdoch buy-yourself-a-political-party bracket). The business we run pays living wages everywhere we work, and we try to limit the chances for nepotism and make it nearly impossible to use the company as a piggy bank. I don't know if it's possible to be both ethical and successful capitalists, but we're trying.
posted by protocoach at 2:24 PM on May 21 [11 favorites]


I wonder some enterprising financial advisor doesn't hire themself out to give wealth management lessons to young heirs-to-be.

That's a pretty common service provided by wealth management firms.
posted by jpe at 2:45 PM on May 21 [1 favorite]


A few random comments from a print subscriber who cancelled recently*:

1) NYT print subscription is pricey. If you think of it as primarily as a national news source, you may be surprised by the amount that is driven by lifestyle signifiers.
2) NYT editors are in general at the top of a very competitive profession. Many will sympathize with the problems of the rich. The era of blue collar reporters is well behind us; NYT types are media professionals now.
3) Articles like this, that appeal to the wealthy, are also a very favorable setting for selling advertise space to luxury brands. I'm not sure how much this has changed in the internet era but people selling ads used to love it when the writers were willing to provide a bunch of stories like this in one section.
4) "I was totally unprepared to be an inheritor" is an instant classic, in the vein of Romney's complaint that he had to sell stock to make ends meet when he was in college**. The hardship of getting 10 million dollars for doing nothing, but suspecting you were not correctly positioned to exploit every possible tax loophole that was built in by your breed's lobbyists, is a great burden on these types. Because that is literally the only problem they have with the inheritance.

In the interest of full disclosure I'm doing OK after a few decades of work in silicon valley--not $10 million OK or anything, but still OK--so I also understand that talking about money to family can be awkward and you probably do get a lot of people who are middle to upper middle class feeling this is sort of relevant to them. Especially if they aspire to be there.

*Cancellation was post-election, in disgust. I'd decided to cancel before the outcome. There is much better reporting out there; even the good reporting is often purely because of its reputation, as people with juicy stories decide to leak to the Times instead of people doing better work.

**Articles like this often remind me of a Father Brown story where the gimmick was that a thief, by subtle body language changes, was blending with either the rich people or the service staff at an exclusive club as appropriate to get away with his crime (pocketing silverware or something.) The English elite, when they found out what had happened, were impressed with how capable he must have been to pass as the richest of the rich. Father Brown's wry response was that if you thought it was tough to be a rich person you should try being a poor one.

Chesterton is a problematic writer to say the least but he could throw in a nice observation or two.

posted by mark k at 2:56 PM on May 21 [8 favorites]


"I hear jscalzi's loaded. You lure him into the alley and hold him down while I take his wallet."

Won't work. My manservant handles all my petty cash.
posted by jscalzi at 3:30 PM on May 21 [31 favorites]


So ransom it is!
posted by mr. digits at 3:37 PM on May 21 [3 favorites]


There's been a lot of talk here about wealth not surviving generations, but on the other hand:
The Wealthy in Florence Today Are the Same Families as 600 Years Ago
Researchers compared data on Florentine taxpayers in 1427 against tax data in 2011 and found about 900 surnames still present in Florence
If you are only kinda-sorta wealthy, that can go in a hurry, but if you are super-wealthy and invested wisely, your family can still be wealthy centuries later. In America, as the classes get further and further apart and the middle class disappears, I suspect this is only getting truer. Rich people have many ways of making sure their kids are set for life.
posted by Pater Aletheias at 3:38 PM on May 21 [31 favorites]


I've read numerous reports of Ms jscalzi having immense strength. I'd rather just roll Eric Trump in said alley. There'd be more satisfaction in that.
.
posted by Ber at 3:46 PM on May 21 [6 favorites]


Next: How the Wealthy Talk to Their Children about Pitchfork Mobs and Guillotines.
posted by GenjiandProust at 4:40 PM on May 21 [19 favorites]


The documentary Born Rich recounts a number of instances of The Talk. Ivanka Trump comes off as one of the sanest of the bunch.
posted by clawsoon at 6:08 PM on May 21 [1 favorite]


If you are only kinda-sorta wealthy, that can go in a hurry, but if you are super-wealthy and invested wisely, your family can still be wealthy centuries later.

As Chris Rock said, Shaq is rich. The white guy who signs his checks is wealthy.
posted by Etrigan at 6:18 PM on May 21 [11 favorites]


Next: the exploited classes can talk back to the wealthy through the medium of pitchfork mobs & guillotines.
posted by Pirate-Bartender-Zombie-Monkey at 6:18 PM on May 21 [1 favorite]


The Wealthy in Florence Today Are the Same Families as 600 Years Ago
Researchers compared data on Florentine taxpayers in 1427 against tax data in 2011 and found about 900 surnames still present in Florence


A study of rare British surnames also showed that rich families tend to stay that way for generations. All that stuff about poverty to poverty in 3 generations sounds great in theory, but I think it's actually pretty anomalous and more like wishful thinking..
posted by peacheater at 6:32 PM on May 21 [8 favorites]


If you know and trust your children the way to do it is to distribute your wealth early.
posted by notreally at 6:34 PM on May 21 [1 favorite]


Pirate-Bartender-Zombie-Monkey: Next: the exploited classes can talk back to the wealthy through the medium of pitchfork mobs & guillotines.

The truly wealthy are usually far enough away that they don't have to worry about the pitchforks. It's the kulaks and petty landlords who usually bear the brunt of popular violence.
posted by clawsoon at 6:40 PM on May 21 [4 favorites]


Gotta start somewhere.
posted by Pirate-Bartender-Zombie-Monkey at 6:43 PM on May 21 [4 favorites]


I was surprised to find so many wealthy landowners when Mom and I worked on our our family tree. We asked Grandma about it; she said her grandfather drank away the family fortune and property, and then died of stomach cancer from eating nothing but saccharine pickles for years.
posted by The Underpants Monster at 6:43 PM on May 21 [1 favorite]


If you know and trust your children the way to do it is to distribute your wealth early.

Known in the trade as the King Lear Plan.
posted by The Underpants Monster at 6:45 PM on May 21 [5 favorites]


The truly wealthy are usually far enough away that they don't have to worry about the pitchforks. It's the kulaks and petty landlords who usually bear the brunt of popular violence.

The capitalists have their useful idiots, too.
posted by mark k at 9:00 PM on May 21 [1 favorite]


your family can still be wealthy centuries later

It's relatively easy to make 6% on conservative investments in the long run, and if your family members each have 2 kids every 30 years, then your family growth rate is 2.3%. That gives you 3.7% growth that you can either spend, or reinvest, and be able to grow your family's wealth forever.

Interestingly if members of your family have more kids or have them younger, the numbers rapidly stop working -- if your family members each have 4 kids every 20 years, then your family is growing at more than 7%, and your family wealth can't realistically keep up even if you don't spend any of the money.

I do wonder if old, wealthy families have secret pacts to not have too many kids and not have them too early.
posted by miyabo at 9:17 PM on May 21 [1 favorite]


A study of rare British surnames also showed that rich families tend to stay that way for generations. All that stuff about poverty to poverty in 3 generations sounds great in theory, but I think it's actually pretty anomalous and more like wishful thinking..

My guess is that the old British families didn't go from poverty to wealth in one generation. It's quite possible that sudden wealth does tend disappear in 3 generations while gradually built up wealth sticks around longer.
posted by the agents of KAOS at 11:01 PM on May 21 [2 favorites]


Is this satire?
posted by zardoz at 11:05 PM on May 21 [1 favorite]


British generational wealth has generally endured up to.the modern era through primogeniture. Sure you'd set up your second sons with a commission in the Army or Navy, your third goes into the Church and the rest can be East Indian Company clerks. The important thing is that all the assets are held together through the generations by one guy who knows it from the start. Then just pray he isn't a waster.

There was a great article on here a while ago about how modern divorce laws and guilt from the sole heir has been breaking up some of the great estates.
posted by DoveBrown at 12:12 AM on May 22 [2 favorites]


It's relatively easy to make 6% on conservative investments in the long run, and if your family members each have 2 kids every 30 years, then your family growth rate is 2.3%. That gives you 3.7% growth that you can either spend, or reinvest, and be able to grow your family's wealth forever.

In a world completely without inflation, sure.
posted by praemunire at 12:41 AM on May 22 [1 favorite]


I spent some time at a private liberal arts college in my early adulthood. Students were from a mix of economic classes, but weighted toward the upper middle class (professionals and petit bourgeoisie) with an over-representation from the upper class as well. It was unpleasant yet fascinating to see some of my fellow students building or solidifying worldviews that included negative stereotypes about poor (or even middle class) people and various religious to secularized versions of the gospel of wealth as emotional protection against having to come to terms with inequality and how unfair our economic system was in their favor.
posted by eviemath at 6:51 AM on May 22 [3 favorites]


I don't know much about wealth, but I know this:
In Florence, many of the wealthiest taxpaying families in 1421 are still the wealthiest families today. The very top earner in 2011 is descended from a guild member who was in the 97th percentile in 1421. In between came Medici rule, Napoleon, the Hapsburg Empire, the resorgimento, industrialization, democracy, socialism, fascism, and two world wars. Still, the names honored on the endowed chapels of the early renaissance are the names of the families who pay the most income tax in Florence today.

In England between 1170 and 2011, relative social status has been more consistently inherited than height has been. The same surnames that are listed as major landowners in the 1086 Domesday Book are still upper-class today. This despite the impact of the English Civil War, the Industrial Revolution, Labour governments, emigration, immigration, and the EU.

In Sweden, they stopped creating nobles in the 17th century. Then came the industrial revolution, emigration, democracy, and socialism, yet families whose names indicate noble heritage are still richer than other Swedes.

In France, the aristocrats of the Roman era were pagan, Latin-speaking owners of villas and slaves. By the early medieval era, the country’s leaders were Christian bishops who saw themselves as Franks. Yet the Frankish bishops were the lineal descendants of the Romano-Gallic villa owners. The Fall of the Roman Empire, barbarian invasions, and Christianity did little to shake their relative advantage.

In China, 13 surnames are over-represented among the highest scorers on the Confucian state exams in 221 BCE. The same surnames predominate among “the high officials in the Nationalist government from 1912 to the triumph of the communists in 1949; professors at the ten most prestigious universities in the country in 2012; chairs of the boards of companies listed in 2006 as having assets of $1.5 million and above; and members of the (still communist) central government administration in 2010.” Between 1912 and today, Mao is thought to have executed 800,000 landlords; and at least 10 million Chinese were killed or driven into exile on the grounds of being bourgeois. Yet now descendants of the old Chinese bourgeoisie sit on the boards of multi-billion-dollar Chinese companies.
That last one... whooboy. The rich stay rich EVEN AFTER MAO is pretty sobering stuff.
posted by anotherpanacea at 7:08 AM on May 22 [27 favorites]


Yet now descendants of the old Chinese bourgeoisie sit on the boards of multi-billion-dollar Chinese companies.
That last one... whooboy. The rich stay rich EVEN AFTER MAO is pretty sobering stuff.


Power marries money. Money marries power.
posted by leotrotsky at 7:35 AM on May 22 [4 favorites]


I hear jscalzi's loaded. You lure him into the alley and hold him down while I take his wallet.

Oh come on. It's my understanding heneeds to use his vast wealth to pay Tor to publish him, subvert the Hugos and corrupt the science fiction field. He barely has enough left over to pay to have his manservant properly flogged.
posted by happyroach at 8:22 AM on May 22 [6 favorites]


The rich stay rich EVEN AFTER MAO is pretty sobering stuff.

The truly wealthy have never been the victims of any revolution or coup or purge or whatever. Maybe a few of their particularly useless or unlucky offspring suffer, but the truly wealthy are either managing those political movements from behind the scenes or have enough money in enough different pots that they can simply walk away, then return when cracks appear in the new system and the money starts leaking through it.
posted by Etrigan at 8:55 AM on May 22 [2 favorites]


"In the interest of full disclosure I'm doing OK after a few decades of work in silicon valley--not $10 million OK or anything, but still OK--so I also understand that talking about money to family can be awkward and you probably do get a lot of people who are middle to upper middle class feeling this is sort of relevant to them. Especially if they aspire to be there."

Fun fact: The "objective" journalism model as conceived by Ochs was to give members of the rising professional classes the vocabulary they needed to consort with their upper-class bosses.
posted by klangklangston at 11:48 AM on May 22 [1 favorite]


So this is an embarrassingly close to home article.

I ended up going to a shitty state school in a large part because my dad never got around to filling out my FAFSA. I waited and waited, and finally applied to the nearby university that had open admissions. I figured it was cheap enough I could figure something out, even if I couldn't apply for financial aid.

I thought eventually we'd discuss money. But schools let you add a lot to your tuition. Books, board, food plan. So I had this bill, and I asked my dad what I should do. And he wanted to look it over first. And it just... resolved itself.

I would try to bring it up. But it was always that they were able to take care of it, but maybe they wouldn't next time, but we shouldn't really talk about other options unless we really need to. When I would discuss getting a job, even part time, or even related to my studies, they would become really disappointed that I wasn't taking my education seriously.

After college, I was flailing about. Not surprising, since I was actively discouraged to learn how to Adult. And my grandmother casually mentions there's still money sitting in my education trust fund, perhaps for Law School.

I've since learned that we are a family of trust funds. My dad's blue collar jobs have been solely to provide health insurance. Our financial struggles were issues around cash flow management, not genuine poverty. As far as I know, my dad's generation is the last of guaranteed income. But it's also possible I just haven't triggered whatever life event.

Even with the best of intentions, it's hard to avoid an unhealthy level of control in your relationship. Add sexism, and it's ripe for abuse. My grandfather, the one with all the strings and power, never complains about his wealth. But his victims are regularly dismissed, because it doesn't count if someone compensates you for your abuse. It's a profoundly fucked up world to live in and why I have always supported a strong estate tax.

tiny pony request: I am very aware of how much privilege I have that this is my story to share. But it is also a story about how I was raised to accept abusive behavior, so I'd really appreciate not directing any of the "I'd put up with [x] to have access to wealth" jokes my way.
posted by politikitty at 1:26 PM on May 22 [12 favorites]


God. When will it end? I mean the ceilingless wealth & greed, the class/caste of precarity (which wealthy people are still subject to, even in a mostly psychological way, since they are paranoid it might not be enough, which in a way is plain true cuz it *could* all go to shit, but in a way many also can't, or won't, define the What that "enough" is for... so those who can take time to actually scrounge up a definition can proceed to the choice between Greed Preservation and Less Evil Sharing/Spreading, but what will they pick...). This system, these systems, and not far down the line physical lives are actually on the line.

Sorry I'm sucked up in the money+family+capital emotion tornado.

Small thing about Chinese surnames 'over-representation' top schools, business, etc.: do consider that there are relatively few surnames shared by many people (Chinese surname wiki):
Although there are thousands of Chinese family names, the 100 most common, which together make up less than 5% of those in existence, are shared by 85% of the population. The three most common surnames in Mainland China are Li, Wang and Zhang, which make up 7.9%, 7.4% and 7.1% respectively. Together they number close to 300 million and are easily the most common surnames in the world.
...
In a 1990 study, the top 200 family names accounted for over 96% of a random sample of 174,900 persons, with over 500 other names accounting for the remaining 4%. In a different study (1987), which combined data from Taiwan and China (sample size of 570,000 persons), the top 19 names covered 55.6%, and the top 100 names covered 87% of the sample. Other data suggest that the top 50 names comprise 70% of the population.
Of course I agree that power wants to stay powerful, not disputing that. But I'm not sure from the links how much is considered "over-representation" of names in an exam roster, and by what criteria? Maybe I missed it. Just a small note hoping that the authors of these surname-capital-marker studies took into consideration the longview of each nation or culture's history of names, not just run the current name numbers. The simplification/bureaucratizing of surnames in China started long ago and still continued after Mao (like via simplification of characters); plus, depending on what spellings/transcriptions were used for such studies, there could be more overlap represented, etc. Ok, onomastics nerd out.
posted by cluebucket at 1:19 PM on May 30 [3 favorites]


since they are paranoid it might not be enough, which in a way is plain true cuz it *could* all go to shit, but in a way many also can't, or won't, define the What that "enough" is for...

Generational wealth totally exacerbates this. How am I supposed to plan for my retirement when I don't know the full extent of my resources? I still have two generations ahead of me still alive and they are 1) not great with money 2) not particularly healthy and will need extensive end of life care, and 3) not particularly happy with my liberal leanings.

So even though I love the idea of spending down your wealth during your lifetime, that's something only septegenerian politikitty can really do. And I know that sounds like I'm trying to make it someone else's problem. But it's something I've genuinely wanted to do since my childhood, when my mom mentioned "these elephant tusks will one day belong to you", because what child wants elephant tusks.

So that bothers me. Because I've met old people. I've studied old people as a political demographic. They are resistant to progressive change as a whole. So am I really going to be willing to fund critical issues that I 'don't get', or donate to issues that were relevant and under-served when I was a teenager?
posted by politikitty at 6:20 PM on May 30


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