An Interview with Paul Schervish
by Pamela Gerloff
1999 study by John J. Havens and Paul G. Schervish of the
Social Welfare Research Institute concluded that over the
next 55 years upwards of $41 trillion dollars will be transferred
from one generation to another—through inheritance,
philanthropy, and taxes. Recently, they wrote a report confirming
the validity of those estimates, despite the downturn in the
economy and equity markets. (Both studies may be downloaded
.) What does this mean for wealth holders,
for philanthropy, and for anyone living in the current era?
We talked to Professor Schervish about these questions and
some of his groundbreaking research on wealth holders.
You're a professor of sociology who studies wealthy
In 1984, a funder asked the following question:
become more financially secure, do they turn their attention
more to philanthropy?
Also embedded in it was the social
Do whole societies, as they become more financially
secure and affluent, become more engaged philanthropically?
I said, "We already know the major
answer to your questions: Sometimes it happens and sometimes
it doesn't. What we don't know is: When it happens,
what does that look like? And when it doesn't happen,
look like?"ť To find out, some
colleagues and I began interviewing wealth holders who were
diverse in source of wealth, locale, age, gender, and race.
What did you find?
Our first report produced themes of empowerment and beneficence.
Those have been major themes in all of our findings ever
since. Initially, we asked people detailed questions about
their philanthropy, but we discovered that the questions
we were asking weren't profound enough, so we shifted
our focus. Instead of asking only about financial security,
we asked about the meaning of money and probed people's
thinking and practice about the empowerment that comes with
increased financial capacity. For example, what did they
consider to be the secrets of their success and what did
that success allow them to do? We also asked about the meaning
they gave to their financial beneficence—the motivations
and events that added purpose, or that they experienced
as injurious in some way, or as meaningful. We asked a whole
range of questions, not just about their philanthropy, but
about the full range of their financial care, including
the amounts of money they give to their heirs and to their
And that led you to study wealth transfer?
Meeting True Needs
The various acts of care encompass both formal and
informal philanthropy, like providing funds for parents
who are in need; offering to buy clothes for your
grandchildren; providing health care insurance for
your workers, even though the market does not dictate
that you do that; providing high quality products
to your consumers, even though it is not a necessary
market obligation. All that is care.
These are ways in which people
are meeting the true needs of others, and not just
through what we typically call philanthropy. Philanthropy
is then only one potential choice for carrying out
financial capacity with virtue. People have an obligation
to make wise choices about care in their lives and
to make wise choices about their financial care—but
what those wise choices are is not for someone else
to say. They are certainly for others to ask about—to
invite a response, but not to dictate the response.
In working on this project, it occurred to me that almost
all of the major thinkers, from Adam Smith to Karl Marx to
Max Weber and Emile Durkheim, were all asking similar questions:
How is moral life initiated, maintained, and exercised
when there is a growth in political, economic, religious,
and cultural freedoms? What is the relationship between individual
choice and the common good? How is individual choice related
to personal happiness for oneself and others, and how do the
Those have become the key questions of
our research. Even though most people understand themselves
as being in the middle of the spectrum of the standard of
living, more and more have had their standard of living increase
so dramatically that the exercise of free choice is the most
dominant characteristic of modern American life. No longer
are there just a very few people who have a fuller range of
material choice. Although there is, in fact, persistent poverty
in the United States and globally, more and more people are
achieving a standard of living that allows for more choice.
You have written elsewhere that, "The leading cultural
and spiritual question of the current era is how to make
wise decisions in an age of affluence."ť Is that what
you're suggesting —that people in our society
now have so many choices that wisdom is needed in making
Aristotle understood that the goal of life is happiness
—you could also say love, unity with the divine presence,
or a whole range of things, but let's just say that
his term is one working definition of the goal of life.
Happiness is achieved if you can close the gap between where
you are and where you want to be; or, better said, if you
can close the gap between where you
and those with whom
you identify and care about
are and where you and they
would like to be.
We close this gap by wise choices,
and wise choices are the exercise of virtue. Without the
ability to choose, you have no potential virtue, because
virtue is making choices within a range of freedom. You
can close the gap by choice, but if your choice is arbitrary,
it will not necessarily produce happiness. However, if choices
are made with understanding, or the exercise of virtue,
then they are wise choices—and they are the choices
that will produce happiness.
So as people have more and more choice, if they want to
be happy then the need for wisdom is greater?
Yes. The modern affluent age is characterized increasingly
by choice. In order to produce happiness for oneself and
others we need those choices to be wise. In other words,
it's not just choice that counts; it's character.
So it is capacity (which comes from having the ability to
choose) plus character that leads to happiness. That is
what I call, for all of us, a gospel. It is the intersection
of our empowerments and our moral compasses—our capacity
for choice and our character. If you have capacity without
moral compass, you act arbitrarily. If you have moral compass
without capacity, you may simply be engaged in non-consequential
It sounds as if you're saying that in an affluent
society, there is an increased need to make wise decisions.
If that's so, does this imply that affluence will
push us into wisdom, individually and as a society—or,
at least, that it has that potential?
There is no automatic connection between affluence and wisdom.
At every point on the economic spectrum a different array
of issues comes to the fore. With affluence, a large part
of decision-making around survival and day-to-day living
is taken care of; the economic problem is solved. This adds
new temptations toward materialism and superficiality, but
it also offers opportunities to achieve what is deeper in
your life. If you can have what you want, you do not automatically
provide deeper answers to the question, What is it that
you want?—but you do have the question raised in your
life. You will not automatically choose a deeper quality
of life just because you have greater wealth and greater
choices, but the question itself and the potential to do
so are raised.
What does that mean for this time of unprecedented wealth
What is guaranteed is that the potential for wise choices
is there. The questions will arise in people's lives
either quietly or loudly, subtly or intrusively. This is
true not just for the super-wealthy but for all of us who
What factors enable wise choices to occur?
It is pretty simple: You are going to make wise financial
choices if you care. You might say that the school of wise
financial choices is care. Ultimately, what leads to wise
choices is love—the attention to others as ends in
themselves, as I am an end in myself, not a means to an
end. The way love is implemented and practiced is care,
which is attending to the true needs of others. So wise
choices come about through care.
And wisdom involves attending to the true needs of others?
It's related to it. The Sufis say good people attempt
to treat others the way they themselves would like to be
treated, generous people treat others better than they themselves
would like to be treated, but wise people treat others the
way they need to be treated. Wisdom is connected to answering
the difficult but right question:
What is the true need?
How does wisdom help you know the true need?
Wisdom is sensitized intelligence. It is what enables one
to learn about how to perceive, and attempt to meet, the
true need. That's why if the age of affluence is about
choice, we have to develop new experiences and practices
of wisdom. We need wise choices in a new era, especially
in this era when choices are not determined by the necessity
to say, "No, we can't afford it."ť In the
past, our limitations were also our freedom. When we didn't
have money for everything, we had to choose, and that helped
us decide what we valued. In an age of affluence we sometimes
regret that lost past, but it isn't a negative that
it's gone. It opens up a new opportunity to find a
positive rationale for wealth.
What might that be?
One rationale is meeting the true needs of others in the
realm of philanthropy—meeting true needs, not just
in accumulation through business, investments, or work.
Is philanthropy the only way to "meet true needs"ť
In the modern era, providing jobs is also a way of meeting
true needs. In this model of wisdom-as-meetingtrue- needs,
accumulation that leads to growth in the economy has a logic
of spirituality to it as much as philanthropic generosity
does. In this new model, we're identifying a broader,
deeper, and more profound wisdom.
Is there a right or wrong way to transfer wealth—for
example, when deciding whether and how much to leave to
charitable endeavors or to heirs or to taxes?
Morality in this model is not just an outcome, it's
a process of decision-making.
Would you say more?
The very process of figuring out what it is you are to be
doing with your talents and your financial capacity is itself
a spiritual activity. If I have $20 million, it doesn't
necessarily mean I should be giving more to charity. My
obligation may mean building a business and employing 50
people. Charitable giving is not the only avenue of financial
morality in this age of affluence. There is a whole range
of moral options, but they need to be discerned.
How does one discern?
You start by asking the questions
What do I want to do?
What inspires me?
You also ask
What meets the true
needs of others?
It may be caring for your little child
right now or your dying mother. The important thing is that
it is something you do yourself, in the realm of direct
care, rather than through some organization or government
or through other people's activities.
Why is that important?
Because only you can discern what you should do. It's
not about what you can put off on somebody else to carry
out. When you are directly involved, that enables you to
identify with the fate of others and to find happiness as
you contribute to the happiness of others. That's
why it's important to do something that you want to
So you are discerning three things:
a connection to your ultimate end, whatever you conceive
of that to be (e.g., happiness, service, union with God);
an affective part, which you find by asking
; and an intellectual component, which you discern
What needs to be done?
The final part is the execution of
it. How do you put it into practice? This involves discernment
too. In my view, it's figuring out what is to be done
by you that is the will of God. That is discerned by finding
where what you want to do and the needs of others intersect.
What if people don't relate to God? Is what you're
saying relevant to them?
Oh, yes. God is just one statement of a final end in life.
Aristotle says happiness. Aquinas says the unity of love
of God, love of neighbor, and love of self. Heidegger says
participation in Being. A Buddhist would say the entrance
into unity of all beings. Your ultimate end is the end that
isn't able to be described as a means to another end,
whatever that is for you.
What work should I do?
What do I
seem to be questions that more and more people
Much Will Heirs Receive?
most estates have more than one heir, the size of
inheritance will be relatively small per heir and
the effect will be diffused throughout the population.
"¦about half of the aggregate bequests to heirs
will be concentrated among heirs of the wealthiest
7% of estates with the remaining half disbursed among
heirs of the remaining 94% of estates. The average
total transfer to heirs from estates valued at $1
million or more will be approximately $1.9 million,
13 times larger than the average amount (approximately
$150,000) that will be shared among the heirs of estates
valued at less that $1 million. In each case, the
total bequest amount will be divided among the total
number of heirs of a given estate. As estates get
smaller, the proportion going to heirs approaches
100%, with little or nothing going to charity or taxes.
The larger the estate, the greater the proportion
bequeathed to heirs. Nonetheless, heirs of wealthy
estates will likely receive hundreds of thousands,
if not millions of dollars, while heirs of less affluent
estates will receive at most thousands of dollars,
while tens of millions of potential heirs will receive
little or nothing at all.
—From Executive Summary,
Why the $41 Trillion Wealth Transfer Estimate is Still Valid: A
Review of Challenges and Questions
Will Be the Baby Boomers' Share?
The 2003 wealth transfer report by John Havens and
Schervish responded to various challenges brought
against their earlier 1999 report. One charge was
The projected estimate is unrealistic
since the baby-boom generation, the largest generation
ever, will not inherit anything close to $41 trillion.
In the new report, Havens and Schervish
respond: "Many queries about the $41 trillion
wealth transfer estimate—often from boomers
themselves—wrongly assume two things about our
report. First, that the entire transfer of wealth
is going heirs; and second, that it is going only
to boomers. First, Ă˘â‚¬Ëśwealth transfer' is
not synonymous with Ă˘â‚¬Ëśinheritance.' original
report carefully points out that only $25 trillion
of $41 trillion transfer will pass from decedents'
estates to heirs. The remaining $17 trillion will
go to estate taxes, charitable bequests, and estate
settlement expenses. Second, equally important to
understand that while $25 trillion is going to heirs,
that figure is the amount of wealth that will be inherited
from 1998 through 2052 by all generations—and
not the boomers. Boomers may well inherit $7.2 trillion,
but majority of the inheritances will be transferred
to subsequent generations, including the children
and grandchildren of boomers. As the boomer generation
ages and dies during 55-year period, their role in
the wealth transfer process will far greater as benefactors
than as beneficiaries."ť
To read a summary of challenges
to the 1999 report and researchers' responses
in the second report, see
Executive Summary, Why the $41 Trillion Wealth Transfer Estimate
is Valid: A Review of Challenges and Questions
by John Havens and Paul G. Schervish (Social Welfare
Research Institute, Boston College, January 6, 2003)
Yes, because such choices are more available now. Having a
range of choice doesn't provide a certain answer to
the question, but when the quantity of one's needs have
been met, the next question is
What are the quality of
This is what Hegel called the cunning
of reason or what we might call the cunning of history. Certain
potentials are unfolding, but they don't automatically
lead to good. As our choices expand, the potential for both
good and evil grow. From the very same foundations can grow
control, manipulation, and heedlessness, or great care and
So the wealthy have greater potential to do both good and
evil with their money.
And when they do good, it is more freely chosen; therefore,
it is more heartily embraced.
Does the unprecedented wealth transfer imply that there
will be a "golden age of philanthropy,"ť as the
title of your first report suggests?
the Millennium: New Estimates of the Forthcoming Wealth
Transfer and the Prospects for a Golden Age of Philanthropy)
The wealth transfer projections indicate that the country's
foundation of affluence is growing. If people just do what
they are doing today, there will be a "golden age
of philanthropy,"ť because there will be more money
to be transferred. If the same percentages are given to
philanthropy as they are now, there will be many more dollars
given away. But what will make the age truly golden is that
we anticipate that people will become more charitably inclined
over the years to come. There is coming into play what we
call the new physics of philanthropy—a set of forces
that combine to foster philanthropic growth.
But the golden age of philanthropy
is perhaps more the potential of people to find satisfaction
and wise choices in directly attending to the needs of others—because
they have an income or financial resource stream that is
greater than their expense stream.
What does all of this mean for making wise decisions about
First of all, wealth transfer is about economic growth and
wealth and the capacity individuals have to allocate that
wealth, not just at their death but throughout their lives.
In fact, in our next model, we're going to talk about
wealth transfer to the three major choices—taxes,
family or heirs, and charity—as taking place not only
at the end of life but throughout life. Wealth transfer
is the transfer of wealth you make throughout your entire
life—for example, paying taxes, giving to charity,
and gifts to children.
Also, one of the interesting things
that is generally not understood in discussions about wealth
transfer is that when a substantial amount is transferred
to heirs, that doesn't necessarily mean it isn't
given to charity—as is testified to here and now by
so many who are associated with More Than Money. So an important
Are we developing the capacity to make
wise financial choices, and are we helping the next generation
to develop that capacity too?
The New Physics of Philanthropy: The Supply-Side Vectors of Charitable
Giving. Part 1: The Material Side of the Supply Side
by Paul G. Schervish and John J. Havens, The CASE International
Journal of Educational Advancement, Vol. 2, No. 2, November
2001, pp. 95-113.
The New Physics of Philanthropy: The Supply-Side Vectors of Charitable
Giving. Part 2: The Spiritual Side of the Supply Side
by Paul G. Schervish and John J. Havens, The CASE International
Journal of Educational Advancement, Vol. 2, No. 3, March
2002, pp. 221-241.
Major Donors, Major Motives: The People and Purposes Behind Major
,"ť by Paul G. Schervish, in New Directions
for Philanthropic Fundraising: Developing Major Gifts, edited
by Dwight F. Burlingame and James M. Hodge, Summer 1997,
pp. 85-112. The description of this report is available
Paul G. Schervish, Ph.D., is a professor of sociology
and director of the Social Welfare Research Institute at
Boston College (
and a national research fellow at The Center on Philanthropy
at Indiana University (
He was selected in 2000, 2001, and 2002 to
"Power and Influence Top 50."ť
Dr. Schervish serves regularly as a speaker and consultant
on how to surface and analyze the moral biographies of wealth
holders, on the motivations for charitable giving, and on
the spirituality of financial life.
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