The Kennedy Legacy

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How The $1 Billion Kennedy Family Fortune Defies Death And Taxes

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If America had an aristocracy, the most titled bloodline would certainly be the Kennedys. In the past half century, one Kennedy after another has occupied nearly every political position America has to offer, including the roles of congressman, senator, ambassador, mayor, SEC chairman, state representative, city councilman, and, of course, President.

The sustaining force behind the Kennedys reign is hardly a secret. Thanks to Joseph P. Kennedy, who made a fortune from insider trading only to later chair the SEC, the family is fabulously rich. But exactly how much is America’s first family worth? Forbespegs the extended family’s fortune at $1 billion.

Protected by a labyrinth of trusts, as well as tax strategies that would make Joseph P. Kennedy proud, the Kennedy fortune now spans approximately 30 family members, and includes the surnames Shriver, Lawford and the Smith. At nearly $175 million as of 2013, Caroline Kennedy is the richest descendant by far, but more modestly endowed relatives, such as Robert Shriver, who is running for Los Angeles County Supervisor, still possess assets in the tens of millions, according to public financial disclosures required of government officials.  

The bulk of the family’s wealth is held in dozens of trusts, which range in value from tens of thousands to as much as $25 million. Nearly all are managed by Joseph P. Kennedy Enterprises, a family office located in New York City with assets dating back to 1927, according to Christopher Kennedy, a member of the Kennedy family who sits on the office’s board.

Unlike the office’s heyday under JFK’s confidant Stephen Smith, when “there was actually stock picking going on inside the office walls,” the task of investing the family trusts today is handled by outside organizations, Kennedy said. While the family has a final say in where the assets are allocated, day-to-day oversight has been tasked to an advisory board of six experts, including Andy Golden, who manages Princeton University’s endowment.

Joseph P. Kennedy’s choice to place his fortune in trusts is possibly the single most critical reason why the family wealth is still around today. The most obvious benefit was to protect the fortune from the prying fingers of ne’er-do-well heirs, said Laurence Leamer, who wrote three Kennedy biographies. Trusts often prevent beneficiaries from tapping more than 10 percent of principal, said Rick Kruse, principal at Kruse and Crawford, which offers estate management advice.

The trusts also protect the family assets from another set of prying fingers: Uncle Sam’s. By holding assets in so called “dynasty trusts,” which are passed from heir to heir for decades, if not longer, the Kennedy family fortune is largely insulated from the estate tax, Kruse said. Handled correctly, a dynasty trust could potentially maintain an un-taxable fortune indefinitely. The oldest Kennedy trust on record dates back to 1936.

Like politics, tax savvy seems to run in the Kennedy family. The most recent example is the 1998 sale of the family’s most valuable asset: the iconic Merchandise Mart, a towering retail space on the Chicago River that was once thought to be the largest building in the world. Thanks to a carefully crafted deal with Vornado Realty VNO +0.13%, the Kennedy family deferred – or possibly avoided completely – capital gains tax on nearly half the value of the sale.

The Kennedys did this using an obscure investment tool called an “operating partnership unit.” Similar to equity, partnership units offered the Kennedys an ownership stake in Vornado Realty, generating a robust stream of dividends. Of the $303 million the family pocketed from the sale, $116 million came in the form of this investment instrument, according to SEC filings.

This alone isn’t a bad deal, being that the Kennedy’s have collected as much as $170 million in dividends since 1998, according to Forbes. The secret sauce, however, is that accepting partnership units in lieu of cash defers capital gains tax, as well as taxes on historical depreciation, for as long as the units are not cashed out, said Tony McEahern, head of wealth planning for Wells Fargo WFC -0.11 % Private Bank. In fact, if the partnership units were placed into trusts, capital gains taxes could potentially be deferred forever.

“This is definitely a tax-advantaged strategy,” said Rich Moore, managing director of equity research at RBC Capital Markets.

Christopher Kennedy declined to comment on how the sale’s proceeds were handled. However, public documents reveal that Caroline Kennedy, Robert Shriver, and Maria Shriver each collect income from assets dubbed Vornado Realty Trust and Vornado Realty Inc., which are valued at up to $7.5 million.

“We are a very public family with a very private investment philosophy,” Kennedy said.

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LIFE With JFK: Classic Portraits of a Political Superstar, 1947-1963

Not many public figures from the middle part of the 20th century are as closely identified with LIFE magazine as John Fitzgerald Kennedy. 
In fact, from his days as a decorated war hero in the late 1940s, through his years as a senator, into the White House and up until the very moment of his assassination, LIFE photographers spent an enormous amount of time (and film) on the ambitious Democrat from Massachusetts.

That he married a woman as magnetic and stylish as the former  Jacqueline Bouvier only further guaranteed that the two young cultural and political icons would never be absent from the weekly’s pages for long.

Here, LIFE.com features a series of photographs — many of which are classics, several of which never ran in LIFE — made during the decade and a half when John Kennedy was on his way to becoming, for a time, the most powerful person on earth.

(Source: TIME)

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May 29, 1964: Jackie Kennedy’s Return to Arlington

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By Nicolaus Mills, professor of American Studies at Sarah Lawrence College

Fifty years ago on May 29, 1964, Jackie Kennedy, accompanied by her two children, returned to Arlington National Cemetery. There she placed a sprig of lilies of the valley on President Kennedy’s grave.

The occasion was JFK’s 47th birthday, and Mrs. Kennedy’s homage seemed only natural. But today it is possible to see more than a tribute to her husband in Mrs. Kennedy’s actions. It is also possible to see her deciding the time had come for her and the nation to end their period of mourning.

The day, which was intensely covered by the media, began with Mrs. Kennedy attending mass at St. Matthew’s Roman Catholic Cathedral in Washington, where Bishop Phillip M. Hannan, who had eulogized the president following his assassination, gave the requiem sermon. Mrs. Kennedy, who had been so stoic at her husband’s burial six months earlier, wore no veil on this occasion and allowed herself to be seen crying openly.

A crowd of 1,000 people was waiting on the hillside across the Potomac when Mrs. Kennedy visited President Kennedy’s gravesite after the service, but it was as if Mrs. Kennedy looked on this spring day as one in which she was free to express her full range of feelings without worrying about being judged.

She knelt by the president’s grave, then watched as her son took the gold tie clasp in the form of his father’s World War II boat, PT-109, that he had on his coat, and placed it on the pine boughs covering the grave.

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By 4:30 p.m, Mrs. Kennedy was at the Hyannis Port, Massachusetts, home of her father-in-law, Joseph P. Kennedy, for an international telecast on President Kennedy’s life, but the most revealing indication of the specialness the day held for her came in the interview she did for the May 29 Life magazine.

On December 6 Mrs. Kennedy had been the subject of a Life cover story. In a widely remembered interview with journalist Theodore White, she had made a point of comparing the Kennedy administration to King Arthur’s legendary Camelot.  Referencing the popular Lerner and Loewe Broadway musical Camelot, she had told White that the specialness her husband and his administration had achieved was too unique to be duplicated.

“She came back to the idea that transfixed her,” White wrote. “Don’t let it be forgot, that was there was a spot, for one brief shining moment that was known as Camelot—and it will never be that way again,” White quoted Mrs. Kennedy as saying.

In her Life interviewof May 29, Mrs. Kennedy was still elegiac about her husband, but this time she was not preoccupied with the idea of the Kennedy administration as mythic. She spoke instead about preparing an exhibit of the president’s mementos that would tour the country and be used to raise funds for the Kennedy Library.

The point of the library, she stressed, was to let the president’s example be a guide to the future, not just evoke nostalgia for the past. The ’60s, Mrs. Kennedy was implicitly saying, needed a fresh start, and she was not going to stand in the way of that fresh start or turn herself into a professional widow.

Two months later, Mrs. Kennedy announced that she was giving up her home in Georgetown and moving to New York. The move freed her from the crowds that gathered daily in Georgetown to watch her comings and goings, but above all, the move let her start a new life on terms of her choosing.

In New York, Mrs. Kennedy became a leading figure in the city’s cultural life. The preservation of St. Bartholomew’s Church on Park Avenue and, most important, the preservation of Grand Central Station, which for a time during the ’70s lost its landmark designation, were among her triumphs.

“Jackie Onassis will save us,” the famed modern architect Philip Johnson commented when she took the lead in the fight to stop a proposed 59-story office tower from being erected over Grand Central Station. Johnson’s praise, made in 1975, captures how dramatically Mrs. Kennedy altered the public’s view of her and how easy it is to forget, living as we do in the age of Hillary Clinton and Michelle Obama, that, prior to the ’60s, presidential wives were seen but rarely heard, especially after their husbands left office. 

In deciding what to do after she moved away from Washington, Mrs. Kennedy had before her only the modern example of Eleanor Roosevelt, who, following her husband’s death, took an active role in the United Nations and continued writing her newspaper column. But Mrs. Roosevelt was in her sixties when her husband died after 12 years in office. In 1964 Jackie Kennedy was just 35, the widow of a first-term president, when she began setting historical precedents of her own.

(Source: thedailybeast.com)

Filed under Jackie Kennedy JFK Kennedy John F. Kennedy Jacqueline Kennedy

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Robert Kennedy’s granddaughter Michaela Kennedy Cuomo is continuing the family tradition of public service! She launched DISOBEY, a campaign to raise funds for school-building in indigenous Mexico. Join Michaela, her mom Kerry Kennedy, and celebs like Alec Baldwin, Alfre Woodard, Ed Begley, Jr, and Tim Daly by ordering your DISOBEY shirt here and share with friends: https://www.booster.com/RFK-mexico-schools

Robert Kennedy’s granddaughter Michaela Kennedy Cuomo is continuing the family tradition of public service! She launched DISOBEY, a campaign to raise funds for school-building in indigenous Mexico. Join Michaela, her mom Kerry Kennedy, and celebs like Alec Baldwin, Alfre Woodard, Ed Begley, Jr, and Tim Daly by ordering your DISOBEY shirt here and share with friends: https://www.booster.com/RFK-mexico-schools

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After 55 Years, U.S. Senator Ted Kennedy’s Diploma Given to Family at UVA Law Graduation

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More than half a century after U.S. Sen. Ted Kennedy graduated from the University of Virginia School of Law, his law diploma was posthumously delivered to his family on Sunday. The late senator’s grand-nephew, U.S. Rep. Joseph P. Kennedy III,  received the certificate while serving as the commencement speaker.

The path of the diploma began 55 years ago — when the future senator skipped his graduation ceremony in order to prepare to campaign for his brother, future President John F. Kennedy.  After that, the diploma was held by the UVA registrar and recently was sent to the University President’s Office to be returned to the family.

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When the UVA Law Student Bar Association invited Massachusetts Congressman Joe Kennedy, the grandson of Robert F. Kennedy (who graduated in 1951), to speak at commencement, an ideal opportunity to return the diploma arose.

(Source: law.virginia.edu)

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"Gracious and genuine": Memories of Jacqueline Kennedy Onassis

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"I was in my late teens when we first rode together in New Jersey. My horse had an unattactive habit of foaming at the mouth. Jackie was very well turned out in white britches. My horse laid his head in her lap and smeared her with green slime from hip to knee. She just smiled and turned her horse around, and my horse did it to her other leg. She never turned a hair. She was an incredibly gracious person."

~ Christine Todd Whitman, governor of New Jersey 

"She was one of the most informal people I’ve ever known. When she was married to Jack, we’d go sailing together. I’ll always remember her sitting there so peaceful, putting her bare feet in his lap. She was so genuine."

~ William Styron, author 

"The First Lady asked me how many people passed through the White House on tours. When I told her thousands did, she said they should sell something to the tourists and use the profits to help redecorate the White House. She decided to make a small book. It cost 42 cents and sold for a dollar. Over the years it has brought in $42 million."

~ Clark Clifford, JFK adviser 

"She was a tough editor. She was rigorous about correcting usage. typical sidenotes were, ‘Omit’ and ‘Do something!’ "

~ Jonathan Cott, author of four books edited by Jackie 

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"In 1974, when her maid Provi had the day off, Jackie would answer the phone in a fake Spanish accent. ‘Allo,’ she would say, hoping callers wouldn’t recognize her voice. She told me, ‘I have to do that to get rid of people.’ "

~ Barbara Gibson, formerly Rose Kennedy’s personal secretary 

"She always wore clothes in private before she wore them at public appearances. The week before she went to Dallas, she wore the pink suit with the pillbox hat to our play group. She was very excited about the trip, very happy to be going." 

~ Meredith Dale, whose daughter Rosalind played with John Jr. in the early ’60s 

"There was a bridal dinner the nigh I before Caroline’s wedding, when John gave a touching toast about how close they were. He said, ‘All our lives "there’s just been the three of us.’ Instead of losing his sister, he had become very close to Ed Schlossberg. He ended saying that the three of them now welcome a fourth. Later, I told Jackie how I would want that kind of closeness for my sons. She looked me right in the eye and said, ‘It’s the best thing I’ve ever done.’ "

~  Doris Kearns Goodwin, biographer 

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Jackie Kennedy was the most successful of the Kennedys in managing her own legacy – until now

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By Kevin Cullen

It is fairly safe to assume that if Jacqueline Kennedy had even a hint that her correspondence with an Irish priest would become public, not to mention sold off at auction, she would have been horrified.

But she probably wouldn’t have been surprised.

As part of a family that has tried, mostly in vain, to control the unrelenting glare of public scrutiny, Jackie Kennedy had been the most successful in managing her own legacy. At least until now.

Publicity has always been both a blessing and a curse for the Kennedys. The family, especially old Joe Kennedy, used carefully managed publicity to build a fortune and a political dynasty. But the Faustian part of that deal is how the family’s most intimate moments have often played out in public, almost as a voyeuristic form of entertainment for some.

Every towering achievement, from Jack Kennedy’s election as the first Catholic president in 1960 to young Joe Kennedy’s recent election to Congress, has been matched if not surpassed by a slew of tragedies that seem disproportionate to the family’s size.

Real people, not caricatures
Given that Kennedy-watching, like the royals beat, is a cottage industry, it is easy to forget that there are real people, not caricatures, behind all the photographs and books.

Last year, in the midst of the commemorations of the 50th anniversary of Jack Kennedy’s assassination, I had dinner with young Joe Kennedy, the newly minted congressman. He had been after me to talk about an issue dear to him, the disenfranchisement of Haitian migrant workers who cut sugar cane in the Dominican Republic.

Joe spent his years in the Peace Corps, founded by his great-uncle JFK, in the Dominican Republic and was worried about a recent ruling by the Dominican supreme court that could leave many Haitian migrant workers stateless. He talks about helping migrant workers in the Dominican Republic with the same passion that his grandfather Bobby talked about helping Caesar Chavez’s migrant workers in California.

As we talked about a subject with which most Americans couldn’t be bothered, I noticed that the TV on the wall over Joe’s shoulder was showing the open car as it made its way down Dealey Plaza in Dallas on the afternoon of November 22nd, 1963. When I told Joe what was on the TV behind him, he didn’t turn around. He had been animated while talking about helping migrant workers but now he was suddenly subdued.

“I’ve tried not to watch any of it,” he said, looking down, fumbling with his silverware.

For Joe Kennedy, for his whole extended family, this was not some media event, not some opportunity for every Joe Soap in the world to recall where they were when JFK was shot. For young Joe Kennedy it was another reminder that he never got to know his father’s uncle who became president. It was another reminder that he never got to sit on the lap of his grandfather who wanted to be president. It was, for young Joe Kennedy, not a national moment of reflection and commemoration, but a sombre, personal reminder that he was part of a family that has been given much but also has had so much taken away.

Young Joe Kennedy articulated the blessing and the curse.

“The outpouring has been moving,” he said of so much attention to the anniversary of his great-uncle’s murder. “What he embodied and represented, in challenging us to be a better country, for us to be better citizens, to be better people, is still important. That challenge still resonates. If you are willing to answer that call, you can serve in the military, in the Peace Corps, whatever form.

“But, you know, he was a father, a husband, an uncle, a son. And our family still misses him.”

Jackie missed him, too, for the rest of her days. And she was determined to limit the intrusion, which would explain why she maintained such a long, intimate correspondence with Fr Joseph Leonard.

Outlier
Jackie was an outlier, always was. She was always her own person in a family where conformity is prized. Jackie’s independent, curious spirit emerges in these letters and, as with her friendship with Cardinal Richard Cushing, her choice of Fr Leonard as a confidant shows her preference for priests who were more warm than pious.

These letters going on the auction block, after emerging in the pages of The Irish Times, the Boston Globe and then everywhere else, shows just how difficult it is for someone as wildly famous and purposely mysterious as Jackie Kennedy to manage a legacy, especially from the grave. At the end of the day the most private of first ladies comes out looking better, I think, but she would not have wanted it to happen this way.

(Source: irishtimes.com)

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