Dynasty Trusts Guard Personal Autonomy in Hierarchic Society
A dynasty trust enables a degree of personal autonomy that is otherwise hard to achieve in a global economy characterized by punitive tax rates, job concentration in hierarchic corporations and public-sector agencies, and increasingly precarious property and privacy rights. A well-designed dynasty trust provides to generations of beneficiaries at least the minimum material support necessary for physical survival. A dynasty trust can also preserve family values and serve as perpetual source of funds for new business investments and philanthropic projects.
The term personal autonomy used here generally means the capacity to select choices and make decisions based on one’s own values and preferences, rather than on material exigencies dictated by society, government or employers. Personal autonomy implies the ability to internalize values and beliefs, observe and analyze situations, discern one’s desires and preferences, set goals, and to identify a corresponding course of action. Personal autonomy is strongly correlated with human dignity and self-respect.
Very few members of our society actually control the means of their physical livelihood. Most of us work for wages or salaries as employees in private enterprises or government agencies. As a result, our workplaces and livelihoods are subject to the decisions of managers over whom we have no substantive control. Some people are business owners and have no formal boss, but are nevertheless subject to directions from clients, customers, government regulators, tax collectors, campaign contributors or prevailing public opinion.
In any case, we all pay various combinations of rent, mortgage, medical and dental bills, auto payments, sales tax, business tax, income tax and real estate tax, which are always increasing and which are mercilessly collected. With few exceptions, people are locked into an economic system that affords little flexibility in a relentless struggle to pay their monthly bills. Economic efficiency demands routine compliance with workplace procedures and acquiescence to management decisions. While such conformity makes economic sense, it is somewhat inconsistent with notions of personal autonomy.
Thus, despite living in a society that formally affords liberal political and personal freedoms, as a practical matter, most of us have little opportunity to practice personal autonomy in the workplace, much less exercise freedom of choice there. Legally we have the right to quit a job when we disagree. Practically, we have to think about the serious existential consequences of quitting. In other words, the economic reality of our society breeds obedience and compliance. Consciously or unconsciously, every person who must earn a living knows that conformity puts food on the table, and that nonconformity gets him fired.
This is not to say that personal autonomy cannot exist and be exercised in our economy. But even under the best circumstances, conflicts typically arise between an individual’s values and the goals and preferences of his “boss”. If and when the individual surrenders to the organization, which he is likely to do if his physical livelihood depends on it, personal autonomy loses.
The loss of personal autonomy in today’s society is a loss of personal dignity for an individual. Just as important for society as a whole, however, is the resulting moral vacuum in the workplace. An individual accustomed only to performing an economic function in a hierarchical organization and focused on satisfying a supervisor and achieving profit-oriented goals is not psychologically capable of making moral decisions or resisting immoral ones. This phenomenon might help to explain the lack of moral fortitude and the rampant corruption among politicians, government agencies, journalists, Wall Street bankers and media platforms.
A dynasty trust creates at least some amount of financial independence, insulating a beneficiary from the economic pressures described above. A dynasty trust helps to preserve the kind of personal autonomy that is necessary for an individual’s self-respect and for honest, moral decision-making in society.
Critics of dynasty trusts suggest that a dynasty trust encourages irresponsible and nonproductive behavior in beneficiaries because their economic survival is somewhat guaranteed no matter what they do. Although there is some logic to such a view, reality does not conclusively support it. The history of the United States contains innumerable examples of inheritors of family wealth who made significant contributions to society, even though they could easily have squandered their whole lives doing nothing. Further, there is historical support for the idea that inherited wealth facilitated and enabled good work by individuals that they would otherwise not have done.
Also, arguably irresponsible or corrupt conduct of individuals is already protected now by the sovereign immunity afforded government officials, and by the limited liability of corporations, LLCs and worker compensation laws. Asset protection of a dynasty trust do not really alter the legal landscape there. Finally, at an extremely basic level, a hypothetical financially independent individual who makes absolutely no overtly positive contribution to society might be better for humanity than a mid-level executive who makes no decisions on his own but who earns a decent living working for an organization (e.g., the CIA and FBI) that does harm in the world.
A dynasty trust does not guarantee personal happiness or moral conduct in society. A dynasty trust, however, might provide the financial independence and security that enable the development and exercise of personal autonomy. Personal autonomy is a necessary component of human dignity and moral decision-making.