Worst CEO in the World: GenY

Worst CEO in the World: GenY: "Gen Y’s A SocioPsychological Perspective William Czander, Ph.D. (Please do not cite or quote) The Baby Boomers grew up with TV whi..."

The Negative Influence of Positive Thinking-

The Negative Influence of Positive Thinking- Enter the Gurus and Coaches

The groundswell of a of all groundswells the hokum of positivism that promises wealth, success and happiness is officially embedded in American culture and is rapidly being carried throughout the world by gurus, new age and alternative therapists and fast talkers who claim the title of motivational speakers. Positive thinking may have had its beginnings in America but that is all. We find ample evidence of positive thinking embedded in cultures all over the world even in Tehran. According to Fassihi (2009) Alireza Azmandian is Iran’s most famous motivational speaker and positive thinking guru who attracts tens of thousands each week to his lectures. Happiness books and dozens of magazines can be found at every newsstand and the “Happiness” magazine is the most popular magazine. Every day, dozens of self-help seminars take place, some underground at people's homes and others in public venues, all around the sprawling capital and in some of Iran's bigger cities. One of the most popular books being hawked by positive thinkers is "The Secret." This book written by Australian author Rhonda Byrne was featured on Oprah Winfrey and tops the best-seller lists in Australia. The Farsi translation is in its 10th printing. State-owned television Channel Four has broadcast the book's companion video, shot in documentary style and distributed world-wide on DVD, four times in the past six months.

Another Australian David Schirmer one of the so-called experts in the DVD maintains that anyone can have happiness, health and wealth and that the secret of success is positive thinking. He maintains that one can transform their lives through their thoughts and that positive thoughts work like magnets, attracting wealth, health and happiness. This is the law of attraction. This is also espoused by Bob Protor who maintains he has discovered and is willing to teach the “science of getting rich.” As expected the only one getting rich here is Bob. In Australia positive thinking is taught at many universities and psychiatrists have adopted it and teach it to teachers under the assumption it will improve everything from depression, body image, mental health and grades.

In England teachers are taught to use positive thinking to get 7,000 high school students out of the depths of depression. They received millions of government pounds to support the training program. This approach is so widely accepted that a positive thinking guru was brought in to motivate the British rugby team as it was taking on its rival Australia in preparation for the Rugby World Cup, they lost. Maybe the Australian positive thinking gurur was better.

January 31, 2010

Essay

Governments around the world are spending billions on so-called positive thinking programs for school children, the military and government employees. Positive thinking entered corporate America in the early 1990’s and is now a staple, permeating executive constellations and in most corporations all levels of management. It can be said that in the modern corporation one cannot gain entry into the executive constellation unless one can demonstrate that they are proponents of positive thinking.

What is it?

Positive thinking has been around for some time gaining wide popularity during the Great Depression and popularized by a Protestant preacher Norman Vincent Peale in his 1952 book “The Power of Positive Thinking.” He preached that one is thinking positively when one has a mental attitude that expects good and favorable results. These were the steps he laid out in his book and sermons for developing personal strength and if followed would lead to a successful, healthy, and happy life. He claims to give:

• Confidence-building words to live by

• Ways to overcome self-doubt

• Strategies for achieving good health

• A program to release the vast energies within you

• Accepting ourselves and our individual needs

• Embracing the spiritual forces that surround you

Today positive thinking is a dangerous mixture of ideological “right wing” conservatism, evangelical passion, Ayan Rand’s philosophy, and those who give it legitimization the happiness psychologists and professors.

Legitimizing Positive Thinking

In many American universities there are “positive thinkers” who like to call themselves “happiness coaches.” Coaches, motivational gurus along with executives and bankers subscribe to “positive thinking” ideology and they point to the happiness research that has been pouring out of these universities. Conceptually and perhaps in other ways connected to “positive thinking” ideology is the happiness researcher, a former American Psychological Association President and University of Pennsylvania scholar Martin Seligman who has also been connected to the CIA and Bush’s torture programs. Early on in his career he was a proponent of aversion therapy who actually believed he could cure homosexuality. He chairs the university’s master program in Applied Positive psychology. Seligman is also the author of “Authentic Happiness: Using the New Positive Psychology to Realize Your Potential for Lasting Fulfillment.” Positive thinkers led by Seligman claim they have “scientifically” discovered what truly makes people happy and they now offer programs where they claim they can teach people to overcome negative emotions (anger, fear, pessimism, and sadness) and replace them with positive thoughts and feelings. They claim they can help individuals identify and cultivate their character strengths and use them everyday to achieve happiness in their work.

To further their claims of legitimacy, the happiness researchers and consultants have created the Journal of Happiness Studies and a World Data-base of Happiness. Others who lend credibility to this movement are Tal D. Ben Shahar, who teaches a course on Positive Psychology and Psychology of Leadership and Shawn Achor who teaches Positive Psychology and the Science of Happiness, they claim these are the most popular courses at Harvard. Ben Shahar gives advice, self-help tips, and writes books on how to be happy and of course he gives inspirational talks and is called “Dr. Prozac” by his students. Antidotal data suggest that many universities in America are either offering or planning to offer a “Happiness” course in 2010

The side effects of positive thinking

Of course included in this potpourri of magic is a motivation to change corporate American by putting a smile on every employees face and develop and strengthen employee’s positive emotions so that they can work harder and longer hours like noncomplaining robots..

Smile or you are fired: Why executives love positive thinking?

In corporate America it is almost impossible for a manager to avoid those who sell the virtues of a positive mental attitude. The attitude and how to get it is contained in a barrage of books, business magazines, corporate literature, and newspapers, and forms the basic message at corporate “pep rallies,” which range from large scale cavernous meetings of several thousand employees to intimate pseudo group therapy meetings and inspirational retreats. Managers returning from these events eschewed all forms of negativism even to the point of isolating employees accused of spreading “negative energy” or “negative vibes” and in some cases terminating them. What is a negative employee? Typically they are those who cause trouble, give their manager a “headache,” they may seek to mobilize employees against management or some change initiative, but in most cases they are employees who point out flaws, suggest alternatives, and question assumptions. They enjoy critical thinking and they love to diagnose and solve problems. One could say they embrace what the positive/happiness people dread, the diagnostic medical model. As a matter of fact the positive/happiness people don’t refer to it as the medical model of diagnosis they call it the disease model and maintain that it promotes victimization, pathology, and of course, negativity. As a consultant stated in an address to several hundred managers, “We have to stop focusing on problems or what’s wrong, we need to change our attitude and the attitudes of our employees and develop their strengths. Negativity and pessimism spreads like a cancer and the only way to combat it is to get on with what’s good, what works, that’s our strength.” While condemning the medical model he conveniently uses it. Positive consultants aggressively report that negativity is a disease and must be defeated and only a positive attitude defeats this disease. This is indeed simplistic or magical thinking, but it has a powerful voice in universities and among an ever growing field of organizational consultants, coaches, gurus, speakers, and writers.

Ayan Rand and the positive thinkers

What does this all mean for corporate employees? This is nothing more than a brainwashing movement supported and funded by corporate titans and bankers to keep employees happily working at the “grindstone” while filling the coffers of the elite. Consider this, we find the thinking of Ayan Rand intertwined with positive thinkers and happiness gurus. Followers of the late Ayan Rand are found in large numbers among bankers and corporate executives and this fits neatly into the positive thinkers and happiness ideology. These Randians or objectivtists, as they liked to be called, believe that any encroachment by government into the free market system is a recipe for disaster, except when they screw up then its OK to get a bailout. It’s a perfect world. Their rationalizations boggle the mind. While accepting the federal bailout they go so far as to conclude that the 2008 financial crisis is the direct result of government interference and regulation. They also believe:

· Altruism is destructive

· Redistribution of wealth is bad

· Self-interest/selfishness is good

This philosophy (if one could call it that) is not only preached throughout the corporate world it formed the basis for how the Federal Reserve and the American government operated for many years. This was recently borne out when Alan Greenspan, the Federal Reserve Chairman from 1987 to 2006 and a long time disciple of Rand, told members of the House Oversight and Government Reform Committee that past decisions and the lack of government regulations helped pave the way for the current financial crisis. He angered Randians when he acknowledged that his libertarian (he did not use the term Randian) view of markets and the financial world had not worked out so well. "You know," he told the legislators, "that's precisely the reason I was shocked, because I have been going for 40 years or more with very considerable evidence that it was working exceptionally well." While Greenspan did defend his various decisions, he admitted that his faith in the ability of free and loosely-regulated markets to produce the best outcomes had been shaken: "I made a mistake in presuming that the self-interests of organizations, specifically banks and others, were such as that they were best capable of protecting their own shareholders and their equity in the firms." After more than 40 years an admission by one Randian that her philosophy not only does not work but was responsible for the financial crisis and the loss of millions of jobs. In spite of this, corporate titans still pitch the Randian belief system to their employees because it will enhance their wealth. There is no better example of this than John Allison the CEO of BB&T, America’s 11^th largest bank, who gives all his new executives a copy of Rand’s “Atlas Shrugged” and new employees receive a 30 page pamphlet based on the company’s Randian philosophy and values (Martin, 2009). In 2009 he resigned his CEO position, (he remained as chairman) to travel the country condemning government interference and he took a position at Wake Forest University’s business school. By the way in 2008, his bank, BB&T, received a $3.1 bailout from the government (TARP). In addition BB&T spends $5 million to finance teaching positions and research on Rand. And of course they collectively deny any responsibility for the financial crisis. We now see colleges and universities fighting for the opportunity to teach their undergraduates the wonders of an almost perfect immorality.

We not only see an underlying connection between the Randians, positivists thinkers and happiness gurus spreading their ideas in corporations, banks and government but we also see a bizarre unholy alliance between the Christian Free Enterprise evangelists and the Randian atheists. While the Christian Free Enterprisers would most likely not accept Rand’s position that Jesus devoted his life in an erroneous attempt to help a bunch of losers, they would suggest something akin to that positive thinker Ronald Reagan who’s “trickle down” theory that maintains one should be free to accumulate as much wealth as one wants and those so-called losers will somehow benefit. We see the religious roots in positive thinking beginning with its founder the Reverend Norman V. Peale and this is carried forth in the studies by Robert Emmons the Editor in Chief of the Journal of Positive Psychology. Emmons includes religion in his happiness studies. He says that religious people are grateful and gratitude is found in religion and religious people see God as the ultimate benefactor. This is spelled out in the title of a chapter in his latest book “Thanks be to God: Gratitude and the Human Spirit” (Emmons, 2007).

It comes as no surprise that the “right-wing” ideologist’s have embraced positive thinking and have used it to lambaste the “Left” by accusing them of being negative. The late William Safire writing for VP Spiro Agnew called Vietnam protesters “nattering nabobs of negativism.” President Obama was condemned by the “Right” as being negative when he pointed out the policy mistakes America has made in the past.. When Obama says; “For every day we wait or point fingers or drag our feet, more Americans will lose their jobs,” Mr. Obama warned. “More families will lose their savings. More dreams will be deferred and denied. And our nation will sink deeper into a crisis that, at some point, we may not be able to reverse.” He is called Mr. Negativity and even the Wall Street Journal rarely misses an opportunity to condemn him as too negative. To be critical, to suggest something is wrong and needs correction, to worry outloud is the new bad. College and university professors who see criticism are an intellectual endeavor are thoroughly condemned. As one senior professor commented “I found myself apologizing in class the other day for being too negative. Given this current climate of political correctness coupled with blatant positivism I actually felt I was going overboard and that I was going to be dismissed as a negative person.”

Believe it or not, there is another group, an offshoot of these positive/happiness/evangelical/Right-wing/Randians. This is a growing group of so-called organizational development consultants who preach a model of consulting based on positive thinking. They call it “appreciative inquiry” or “AI”. Following the positive thinkers their approach focuses on what works, rather than trying to fix what doesn't work. It is the opposite of problem solving or critical thinking and rejects diagnosis. Narcissistic CEO’s and bankers love “AI” because it never considers inadequacies, blame, or the need for remediate skills or practice. They preach a “you can do it if you just believe you can” attitude that claims if one builds on successes, strengths, and focuses on how to create more exceptional performance than one need not understand what is “broken” or dysfunctional..

These “AI” consultants, “positive thinking” preachers, and “happiness” coaches entered the financial corporations in the early 1990’s and told managers and executives just what they wanted to hear. They were told to be positive, dismiss trouble and critical analysis. They were selling blind optimism and bankers were buying. Gurus and motivational speakers told executives, managers and bankers to be successful “go for it”, “you deserve success”, “negativity is for losers” and have a “yes attitude”. This type of thinking feeds into the development and maintenance of narcissistic cultures and what Ehrenreich and others maintain led to the financial crisis of 2008. They claim that financial executives, influenced by these gurus and coaches, took extraordinary risks and avoided caution, and engaged in behaviors that went beyond the boundaries of good business practice. These “success gurus” sold a delusion that success comes when one wills it. The “go for it” mentality is the equivalent of saying its OK to be greedy, you deserve it. Narcissistic corporate cultures brought in these gurus, consultants, and motivational speakers for two reasons. First, they needed to justify their behavior of greed, selfishness, and the fact the millions were loosing their jobs as executives got rich. Just as the compensation consultants obtained fat fees for suggesting outrageous compensation for CEO’s, these consultants and coaches told executives they deserved to be rich and were handsomely paid for their advice. Secondly, consultants, motivational speakers and coaches were used to pump up employees. Based on the flimsy notion put forth by Tal D. Ben Shalar, the Harvard happiness professor, who maintains that if a traumatic experience could create a post-traumatic stress disorder (PTSD) than an exceedingly positive, euphoric event could create a happy joyful employee. As a result we witnessed the meteoric growth of corporate “pep rallies,” or what some called “brainwashing events.”

Pumping up Employees- “Smile or your fired”

What do Wall Street bankers and retail giants like Wal Mart and Home Depot have in common? They both embrace this mixture of Randian, positive thinking, happiness ideology as well as free enterprise fundamentalist philosophy that seeks to maintain traditional male and female sex roles where men are the conquerors and heroic hunters (in this case wealth accumulation). Executives stage major corporate events that become celebrations of Christian manliness by emphasizing power, correctness, and dominance over all things, especially women. The pep rally in and of itself is a masculine activity. Like a football pep rally, the warriors are celebrated as they go off to battle and women are turned into submissive cheerleaders in skimpy outfits. At these corporate rallies they hear inspirational speeches from military heroes, celebrity professors, gurus, positive consultants and retired billionaires. They use an array of techniques to foster a collective or mass psychology by putting employees through a variety of exercises or activities where they visualize themselves as successful, instill a passion to be successful, and tell them if they “will it,” they will be wealthy. They complete happiness questionnaires and are told to memorize and follow certain steps that will make them happy. They sing, clap, cheer, laugh, yell and cry. They are told that being a happy and eager follower is “servant leadership” and a good Christian value. They rally around corporate slogans “You can do it” “We can do it”, “You can have it your way”, “It’s up to you”, “Just do it”, “It’s up to you”, etc. Psychologically they merge their self system with the corporation and its leadership. They become children of the corporation and if the event is successful they become children of a cult. Employees identify with their corporate executives and in the process want their leaders to have wealth and privilege. Under these conditions leaders can do no wrong. If the company falters it is not the system or leaders who are responsible, it is the employees. They are the problem because they are not working harder.

There is another side to this. There are those employees who attend these events and go through these brainwashing programs and maintain an intact self system by using the defense of cynicism. They go through the motions, play the game and hold on to their job. Just as the elf in McDonalds looks the customer in the eyes and says “have a nice day” if they are good actors the customer believes it is genuine and not part of the requirements of the role. However, if the customer realizes that if the elf fails to express the correct mood and may be fired then the customer is drawn into the conflict between employee and management.

This brings us to the real function of these positive, Randian, fundamentalist, happiness programs. Their aim is to eliminate employer-employee conflict and create an unquestioning workforce that will idealize its leadership by cherishing their power and wealth while never realizing they are being exploited and oppressed. Also, we can see why these corporations are so vehemently antiunion. Unions are a threat to the executive’s power, masculinity, and all the accoutrements that go with it; wealth, private jets, limousines, etc. Unions form a collectivity that is capable of defeating the elitist executives and stockholders. However over the years the unions have been reduced to a quarrelsome sort, making concession after concession to the new power elite and there threats. Meanwhile a workforce faced with the anxiety of being terminated and loosing everything, defends against the dread by conforming to the bosses who say “smile.” Those who fail to “smile” or fail to exhibit positive attitudes, no matter what the external reality is are considered maladjusted. They are either fired or sent to “positive adjustment” events or rallies where they are pumped up with positive emotions in a climate that resembles a religious revival. They are convinced that they must adopt an upbeat vision of reality. This belief creates a state of mind where one must deny reality when reality does not elicit positive feelings.

These specialists in "happiness" argue that we are capable of attracting those things in life (Law of Attraction), whether it is money, relationships or employment, both good and bad if we focus on them. What does this mean? It means those who are abused and battered wives or children, the unemployed, the depressed and mentally ill, the illiterate, the lonely, those crushed by poverty, the terminal illness, those fighting with addictions, those suffering from trauma, those trapped in menial and poorly paid jobs, those who are terminated, those whose homes are in foreclosure or who are filing for bankruptcy because they cannot pay their medical bills, are to blame for their negativity. It’s their fault because they are focusing too much on negativity. Hummm I wonder what they would say about the writer of this book. The positive, happiness, right-wing, evangelical ideology justifies the cruelty of Rands unfettered capitalism and absolves CEO’s and bankers of guilt by shifting the blame to those they oppress- “If you are in a sorry state it’s your fault, not mine”.

Psychotherapists and psychoanalysts get to work with these employees after the power elite and their positive happiness gurus, coaches and consultants have done their damage. When the employee is burned out, rejected, failed, or accused of being responsible for all the failure in their lives, they then seek genuine help, if they can afford it. But beware, the happiness people are entering the field of psychotherapy with promises of how positive psychology or PP interventions can be used to alleviate depression, anxiety, ADHA, and relationship problems.

Richard Fuld and Lehman

Gorilla Fuld and Lehman Brothers (Excerpts from Czander’s book)

Wall Street has always been know for its excesses and for promoting the mentality that relies exclusively on the profit motive and rewards. This way of thinking once the domain of Wall Street is now pervasive in corporate America. Wall Street executives became celebrities as their wealth and power was flaunted. However, their celebrity status quickly moved to greedy villains as they became the gang that significantly contributed to the financial meltdown in 2008.

Richard Fuld the CEO of the defunct Lehman Brothers is a prime example of CEO excess. In 2006 Fuld received a 17 percent salary raise to bring his yearly total to $40.5 million. This income included $6.3 million cash bonus, $10.9 million of restricted stock, $10 million in options, $750,000 in salary, and $12.5 million from a vested portion of a long-term incentive plan. Lehman Brothers gave out bonuses of $5.7 billion in 2007, with Fuld receiving $35 million. Fuld’s five-year compensation total, excluding this latest bonus, is nearly $312 million. In addition, starting in 2007, Lehman pledged to pay Fuld $180 million in stock over the next 10 years provided he stays with the firm (Onaran,2007). After telling investors Lehman had survived the housing credit crisis, the bank reported losses of $2.8 billion in the first quarter of 2008, Fuld gave what many consider to be a feeble response, and he demoted two top executives. In September, 2008, Lehman filed for bankruptcy, and Barclays bank purchased its core assets for $2 billion. In 2008-09 Barclays terminated 4,600 jobs and Fuld was out.

Fuld was not the highest paid Wall Street CEO in the high flying days of 2006 he had three ahead of him. Lloyd Blankfein of Goldman Sacks made $58 million, followed by Stanley O’Neal of Merrill Lynch at $48 million, and John Mack of Morgan Stanley at $42.2 million. In 2007, Blankfein made over $53 million, and Mack made over $41 million. The CEO who took over for the ousted O’Neal, John Thain made over $83 million. Peter Kraus joined Merrill Lynch just before it collapsed and was bought by Bank of America, after 3 months on the job he got an exit package of $25 million. He then was given $52 million to take a job at Alliance Bernstein. He gets rich going and coming.

The Wall Street Bonus

The famous Christmas bonuses are also painful to observe from an average worker’s perspective. In 2007, the four largest investment firms, Goldman Sachs, Morgan Stanley, Lehman Brothers and Bear Stearns, gave out year end bonuses of nearly $30 billion.

Investment bank Goldman Sachs bonuses increased 22 percent in 2007 as they awarded $12.1 billion in bonuses. Its CEO Lloyd Blankfein received $68 million, $14 million more than 2006. Goldman co-presidents Gary Cohn and Jon Winkelried were each given bonuses worth $40.5 million, up from $26 million apiece in 2006.

Much of Goldman Sachs record profits in 2007 came from its successful financial manipulations in the subprime mortgage market. It essentially bet against its major Wall Street rivals, who plunged heavily into the business of repackaging home mortgages, into ever-more-complex financial securities whose value is now problematic, even unknowable. As a reward, in 2008 Sachs Co-Presidents each earned $67.5 million with Blankfein earning about $100 million. In 2008 Goldman’s stock declined more than 60% and had to obtain a $10 billion government bailout and Blankfein’s compensation dropped to $42.9 million.

In 2009 after two profitable quarters Goldman Sachs repaid the government its bailout money and set aside $11.36 billion for compensation and benefits in the just first six months of the year, a 33% increase from last year. JPMorgan Chase also paid back taxpayer money and set aside $14.5 billion for bonuses in the first half of 2009, up 22% from 2008.Morgan Stanley has also repaid the government and the bank recorded its third-consecutive loss in the second quarter of 2009. Despite that, the bank has set aside $6 billion so far this year for bonuses and $3.87 billion just in the second quarter, which represents 72% of its revenue. Main Street is once again outraged.

The record for exit packages would have been Richard Fuld if his company had not gone bankrupt he was scheduled to receive $299 million when he exited

Examining Fuld

Richard Fuld, the celebrity CEO of bankrupted Lehman Brothers, appeared in magazines and newspapers on a regular basis, and was called “Gorilla” Fuld. Over a period of 12 years he converted Lehman into a financial high roller that earned more than $15 billion in profits from 2003 through 2007. His investment bank had been hailed as one of Wall Street's best-managed firms as recently as a year ago (Associated Press, 2008 b). In 2006, Institutional Investor magazine named Fuld, America’s top chief executive. The “gorilla” nickname was given because of his aggressiveness, which brought his company considerable success. However, success, and accolades may have had two problematic consequences. It may have encouraged Mr. Fuld to take more and bigger risks, in particular, aggressively piling into high-risk mortgages, and it caused him to find it difficult to acknowledge that his company, was in difficulty – despite frequent warnings from leading analysts. For example, even as Lehman’s stock dropped from $85 to $22 Fuld was persuading investors that the bank remained on solid ground. After, thirty years with the company, he came to believe he was invincible and rejected reports that the bank was in serious trouble. Consequently, his failure to admit failure and sell at prices he rejected as too low, led Lehman to the brink.

In September, 2008 Lehman filed for bankruptcy. Lehman, “… did this to themselves with their own greed," according to A. M. Sabino, a St. John's University business professor who specializes in bankruptcy. "People just got crazy and in their endless obsession to squeeze every penny of profit, they forgot about the perils of taking on too much risk." 28,600 employees are expected to lose their jobs and savings. Between 1993 and 2007, Fuld received about $466 million in compensation, according to executive pay research firm Equilar (Associated Press, 2008b).

A good example of an executive constellation that engaged in high risk and denied realities associated with potential failure is the defunct Lehman Brothers.

The largest bankruptcy in American history, Lehman Brothers filed for bankruptcy in the fall, 2008. The story of this failure centers on Richard Fuld, Lehman’s CEO. Fuld joined Lehman as a college intern in 1969. He was appointed CEO in 1993 and became the longest serving CEO on Wall Street. In his 16 years he was considered one of the industry's most skilled chief executives, boosting the firm's profit from $113 million in 1994 to $4.2 billion in 2007, and multiplying its share price 20 times. According to Onaran and Helyar (2008), “Fuld lived for and identified with his firm. It was his oxygen …. He had spent his entire career there, so his saga is also a story of Wall Street over the past four decades.” Over the past eight years his compensation totaled about $300 million.

According to Onaran and Helyar (2008), “Fuld's failure to save Lehman … is a story about how the most indomitable man on Wall Street became addicted to leverage and intoxicated with the power it brought. …Isolated, surrounded by acolytes and unaware of the rivalries tearing his firm apart, Fuld was too prideful to accept the fast-eroding value of the empire he had built, too slow to cut a deal. “ Fuld rejected offers to save the firm, Warren Buffett’s offer was considered too low and banks from Japan, China and Dubai were also rejected. If he had accepted offers, Lehman might have survived, but Fuld refused. Why? Some suggest he was too proud and accused Fuld of hubris. Shefrin (2002) maintains that CEO’s suffer from the “Lake Wobegon Syndrome” where all the children are above average. Wiestein, (1980) suggests that excessive optimism is most apparent when CEO’s believe they can exert control and have a high level of commitment. Fuld’s commitment and control was legendary on Wall Street.

Fuld has been widely criticized as the major reason for Lehman’s demised and he has been ridiculed as an example of the high risk Wall Street practices that sent the American economy into turmoil in the fall of 2008. According to New York State Comptroller Thomas DiNapoli, “Mr. Fuld’s decisions drove the company toward ruin ….” (Tong, 2008). What was the motivation for these decisions?

Fuld was always a risk taker. He began his work at Lehman on the commercial-paper desk, and was considered a formidable fixed-income trader. According to Onaran and Helyar (2008), ``Fuld took a franchise he'd built from almost nothing, brick by brick, and then trashed it in less than two years,'' said Sean Egan, president and founder of Egan-Jones Ratings Co. in Haverford, Pennsylvania. ``His biggest mistake was in not understanding the risks that had evolved since he was last active in debt markets. And he relied on the support of others whose interests were aligned with him.'' Who were the others? It did not matter, what mattered was that he surrounded himself with the infamous “yes men”. One can easily come to the conclusion that any CEO who has the need to be surrounded by “yes men” is on the road to self destruction, because these subordinates are filled with conscious and unconscious hostility that evolves out of the function of serving their master. They function as intimidated, obliging and thoughtless underlings, who may occupy prestigious positions but do so because they always say “yes”. The hostility evolves from their feelings of being a fraud and their contempt towards their boss. Consequently, they withheld important information from Fuld and worst they lied to him. Have “yes men” been known to lie to their bosses, of course.

Fuld had created the illusion that Lehman was a close knit family. It may have been a family, but it more closely resembled a dysfunctional family. Let’s look at some characteristics of dysfunctional families and how the executive constellation at Lehman resembled them.

· In dysfunctional families speech is stifled and there is emotional intolerance to the expression of feelings or opinions. Lehman was a culture of fear and intimidation where “bad news” was not allowed. Fulds interactions were brief to the point of bluntness. Monosyllables and at times grunting was an often used mode of communication. When Fuld was angry he would give his underling his intimidating stare. This meant one had better depart.

· Dysfunctional families have addiction problems. Alcohol and drugs are most prevalent. At Lehman the addiction was money. Fuld hired what he considered the “best brains” on Wall Street, often at the highest salaries, with the highest bonuses.

· In dysfunctional families there may exist a perfectionist attitude where there is a fixation on prestige, power, and putting up a “good front” to impress others. According to Fuld he never let managers who disagreed square off directly. The most dissension he will tolerate is an agreement to disagree. Fuld stated; "What I need is peace in the family." (Wharton, 2007).

· In dysfunctional families, isolation is often an issue. According to Onaran and Helyar (2008), Fuld became increasing isolated, turning more of the operations over to his officers, however, the authoritarian climate he created cut him off from dissenting opinion.

· In dysfunctional families the lack of impulse control is often a problem. Fuld was feared because of his temper and outbursts.

· In dysfunctional families there is little show of feelings and denial of an inner life. “In public at least, Fuld has never seemed to react with emotion to anything. When times were bad, he just said they would get better. When times were good, he said the same,” (Onaran and Helyar, 2008).

· In dysfunctional families conflict is apparent. Lehman had a reputation for turf wars, personality clashes, and power grabs.

· Dysfunctional families avoid change and “doing things differently. In a discussion about leadership at the Wharton school in 2004, giving leadership advice Fuld said, pick a strategy and stick with it, "unless of course, you're wrong."

· Dysfunctional families have a aura of self righteousness about them. Fuld recalled that in 1998 the financial press was filled with false rumors about the firm. Fuld's policy had always been to ignore the press and let false rumors die. He stuck with that strategy as the stock fell from $85 a share to $22. Finally, he was forced to go out on the road and talk to analysts. Fuld also pre-released earnings to help explain away the rumors (Wharton 2004). This strategy failed in 2008.

What Lehman had was a toxic mixture of resistance to and a fear of change, associated with ever increasing risk. This was most apparent when Fuld spoke at the Wharton school of business in 2004. “Fuld was asked how Lehman will be able to compete against much larger investment firms and international banks such as Citigroup. He responded that the size of a firm is not as important as its understanding of risk tolerance. While Lehman could support six or seven major deals a year, it will instead focus on three or four that can most benefit from Lehman's expertise”, said Fuld, who cautioned that “the global financial system remains awash in liquidity that could dry up suddenly. If that were to happen, Fuld does not want Lehman to be overextended” (Wharton, 2008). The real tragedy was he allowed or perhaps encouraged Lehman to do the opposite. He avoided change and embraced risk and overextended his company..

Lehman was Fulds creation, and it became an important part of, not only his professional career, but his life. For Lehman to decline meant he was in decline. At the age of 62 he could not accept the move towards decline, and death. Fuld became a “Tragic Man”..

The Delusional CEO

Fuld creates an intimidating environment and so demoralizes his staff that they come to believe that the CEO is not the problem, but is in fact quite superior, and that they, the employees are incompetents. When these employees are in management positions they struggle with the experience of being devalued and unappreciated and they see kudos and resources going to others less skillful or successful, but supportive of the fantasy of perfection. On the other hand, a gulf can develop between employees that see reality correctly and observe the CEO as being “out of touch” with reality. Typically, the CEO will fight back and accuse these employees as being troublemakers or cynics. They are often correct employees do become cynical when the executive and his constellation used distortions to protect their delusions.

As time goes on the CEO becomes increasingly insulated, (Fuld was called the “invisible CEO”) withdrawing from reality and engaging in behaviors that appear to outsiders, as bazaar and contradictory. Bonding within the executive constellation evolves almost exclusively from scapegoating activities where non-believers are attacked and labeled. The system becomes exceedingly conservative, politically correct, and judgmental. Their primary activity is to support the illusion of perfection. The CEO reaches downward selecting more and more managers and potential managers who support his delusion or pretend to do so. As these individuals are selectively promoted the CEO becomes increasingly inadequate and the organization deteriorates farther. As statistics or “the metrics” suggest the organization is failing the CEO will rely more and more on testimonials and antidotal data to maintain the fantasy that things are very well.

Another way the CEO maintains delusions is by increasing ceremonies where they congratulate each other, and share stories about their perfections among themselves and anyone who will listen. Often the recipients of these testimonials are low-level employees or interns. The others, those who are scapegoated and labeled, are left out of these functions because often they are the one who are criticized either formally of informally. The CEO carefully controls the “list” of who is invited. The “we-they” climate created by the CEO is supported by events to overtly display the minority status of the “they”.

GenY

Gen Y’s

A SocioPsychological Perspective

William Czander, Ph.D.

(Please do not cite or quote)

The Baby Boomers grew up with TV which promotes homogeneity, the Gen Y’s grew up with the internet which drives diversity.

As a psychologist and psychoanalyst I have some difficulty developing a picture of any generation, including the Gen Y’s, as a modal personality. For example, how can we establish that there is a set of characteristics that are unique to such a large social grouping? To isolate characteristics raises the potential of stereotyping, a phenomena that has plagued social groupings for generations. For example, to refer to this generation under study, Gen Y, alludes to a succession from Gen X, a term that was originally coined as a pejorative label. On the other hand, attempting to understand a particular social group; in this case an age group can help us understand our reactions and prejudices associated with this group. If I approach a study of this group as I would a corporation, organization, family or a person it may increase our capacity to be more tolerant, and sensitive to their choices, decisions, conflicts, etc. Mind you, I do not wish to judge, but understand and hopefully in doing so I will be more compassionate and reflective of my interactions. We also need to know that much of what writers think they know about Gen Y’s students comes from anecdotes. According to Hoover (2007), the only longitudinal study of Gen Y’s was completed by the Cooperative Research Institute at UCLA. They took issue with the findings of Strauss and Howe, authors of Millennials Rising (Vintage Books, 2000). For example they found today’s students are spending more time studying than their predecessors and that students were becoming more preoccupied with finding lucrative careers--not less so.

Finally, it is also important to understand that throughout history young generations have been condemned by the older generation suggesting a powerful bias. Consider some of the comments made by some or our greatest philosophers: “I have no hope in the future of our country if today’s youth are going to be tomorrow’s leaders. They are unbearable, foolish, and even frightening.” The author of this sentence is Hesiod, a Greek philosopher, in 740 BC. A Babylonian tablet from 3,000 BC reads: “Today’s youth are deeply corrupt, evil, mean and unreliable. They will never be like the youth in the past, and will be unable to preserve our culture.” In 400 BC Socrates said: “Our youth love luxury, they are rude, despise authority, have no respect for the elderly, have become tyrants, talk back to their parents, they are impossible to deal with.” Finally, Aristotle says: “Youth have many desires, are volatile, readily lose interest. Youth desire with great enthusiasm but quickly get tired.” As we move into the 21st century we may take the wisdom of these philosophers with a grain a salt and maintain that the one thing we can be certain of about our younger generation is that when they grow old they will observe the younger generation with the same disdain. With this in mind I will explore this young generation with caution, kindness and understanding.

Gen Y’s and Other Generations

These generations are not defined by any formal process, but rather by demographers, the media, popular culture writers, market researchers, and by members of the generation themselves. Also, the birthdates applied to these generations vary greatly, especially the Gen Y’s and the Gen Jones. As a matter of fact, many writers completely leave out Gen Jones. Gen Jones is left out because most writers and demographers claim the Boomer population was born between 1943 and 1964, this would include the Gen Jones as part of the Boomer population. For our purpose we will establish the Baby Boomers born between 1943 and 1964, and the Gen X’s born between 1965 and 1979. In addition, we will expand the Gen Y’s to a period from 1980 to 1994. This gives us the best idea of how one generation impacts another. For example, putting together a book of readings called the Feminist Papers; Alice Rossi discovered that the feminist’s movement actually skipped a generation. One generation would accept the feminist banner and push for equality, while the generation that followed would be dormant. The next generation would embrace the feminist movement, and so on. We see this now with the Gen Y women and to some degree the Gen X’s who are benefiting from the gains of the feminist Baby Boomers. We certainly see the effects one generation has on another when we examine the impact the Baby Boomer parents have on their children, the Gen Y’s.

Who are Gen Y’s?

The term Generation Y first appeared in an August 1993 magazine Advertising Age editorial to describe those children born between 1980–1995 (Melbourne, 1999). The U.S. Department of Commerce places Gen Y from 1980 to 1989. For our purpose we will use the demographics most demographers and writers on the subject agree. By maintaining that Gen Y’s are 13 to 27 year olds allows us to put the Gen Y population at approximately 75 million which approximates the number of Baby Boomers.

Based on Year 2007 % of total population Actual Numbers (millions)

Gen Z 1995-? 20% 60

Gen Y 1980-94 25 % 75

Gen X 1965-79 8% 26

Baby Boomers 1943-64 27% 80

Matures before-1943 20% 60

A notable demographic shift should begin to occur in 2008 when the oldest Baby Boomers hit the U.S. legal retirement age of 65. As Boomers retire, more members of Generation X will be expected to take roles in middle and upper management and the large membership of Generation Y will take up positions in the lower half of the workforce. This process has begun and a spurred on a multimillion dollar consulting business where hoards of so-called experts are claiming that management must understand these young men and women or suffer problematic consequences. This volatile shift, the constant flow of numbers exiting and entering the workplace, will occur well into 2030, and experts believe it will have a profound, if not revolutionary, impact on the workplace. The biggest impact brought about by the Gen Y’s will be the blurring of the traditional boundaries between work, home and play as well as the boundaries between; family, friends and workplace colleagues.

Let’s look at some of the characteristics of the Gen Y’s, which may explain why management and others in positions of authority are expecting significant conflicts and change.

The internet generation

Consider these facts about GenY’s from a survey of 7,705 U.S. college students by Junco and Mastrodicasa (2007):

• 97% own a computer
• 94% own a cell phone
• 76% use Instant Messaging (IM).
• 15% of IM users are logged on 24 hours a day/7 days a week
• 34% use websites as their primary source of news
• 28% own a blog and 44% read blogs
• 49% download music using peer-to-peer file sharing
• 75% of college students have a Facebook or Myspace account
• 60% own some type of portable music and/or video device such as an ipod

While we consider some Baby Boomers and definitely Gen X’s a generation of multi-taskers, the Gen Y’s are a generation of “Continuous Partial Attention.” According to Stone (2006), who coined the phrase, there is a given need to stay on top of all the real and potential information and data that passes by. In this mindset the Gen Y continuously scans for opportunities. It explains the apparent lack of attention Boomers experience when interacting with Gen Y’s, Boomers complain “they are in another world”. This is not true- according to Stone (2006) - they have a method of cognitive functioning shaped by electronic communication. Consequently, they have developed their own unique style or method of communicating. I recently observed three Gen Y’s eating dinner together in a restaurant, all were are on their cell phones, talking to the people on their phones as well as to each other. This would drive some Boomers “nuts.”

From a psychological perspective the Gen Y’s are motivated to be “part of…”, or perhaps motivated by the fear of not being “part of…..” For Gen Y’s not to be “part of…” is experienced as catastrophic. Therefore, continuously filtering information and data is a search for a “feel good” piece of data; data that will make them feel alive, important, loved, and above all successful.

This post multi-tasker or “always on” generation can study for exams with all of their electronic devices operating simultaneously: the TV, computer for IM'ing, their cell close by and an ipod in an ear. At work they can juggle e-mail on their Blackberries while talking on cell phones and working on a project. It does not matter where or when, they can wire-up. As a consequence, they prefer not to have an office or set hours. They are just as comfortable working on a park bench, coffee shop, the office or home. Mark Liston (2007) author of Valpaks’ blog entry (see great blog entry ) he gives an example of how a Gen Y sales rep would handle his work differently than his Gen X and Baby Boomer counterparts:

It is 10 a.m. in an office with three sales people - a boomer, a Gen X'er and a Gen Y. The Sales Manager tells each of them that they need to get new sales and the sales manager wants them to go out prospecting and come back with four appointments. The following occurs:

• The Gen Y is back by noon announcing they have their four appointments, a lunch appointment with a friend and will be back in the office right after lunch.
• The Gen X'er starts to argue with the sales manager and asks why they must go out of the office to prospect. Why they can't just use the phone to set the appointments and save some gas? They then ask why new sales are so important and get into a philosophical debate on growing new customers versus having to get new customers. At the end of the argument everyone is frustrated.
• The Boomer grabs a cup of coffee and tells the rest of the people in the office how they used to be able to get 10 appointments a day. They go on ad nauseam about how they knocked on doors, got around the gatekeeper, made huge sales to the president of the company, etc. By lunch time they are still in the office pontificating.

A CEO (Baby Boomer), trying to motivate a Gen Y’er said “You come in late and go home early; do you know how many hours I put in each week?” The Gen Y’er said “No” The CEO said “60 hours.” The Gen Y responded, “Why does it take you so long?”

Observe the TV show on 60 minutes devoted to Gen Y’s.

http://www.cbsnews.com/stories/2007/11/08/60minutes/main3475200_page2.shtml

In a survey of business owners in Australia, Martin and Tulgan (2007), found Gen Y’s to be "demanding, impatient and bad at communicating." The survey found that almost 70% of those surveyed found their Generation Y workers to be problematic; with poor spelling and grammar and no understanding of appropriate corporate behaviors. However, the survey also suggested most employers praised the energy and charisma of their Generation Y workers.

According to Martin and Tulgan (2007) nearly half (49 %) of employers surveyed said the biggest gap in communication styles between Generation Y workers (employees 29 years old or younger) and older workers older, are Gen Y’s capacity to communicate more through technology rather than in person. Older workers prefer face-to-face communication, while Gen Y’s prefer on-line. According to MBA Alliance (2006) two thirds of all MBA’s are now earned on-line. It is suggested that two thirds of all graduate degrees (masters and doctorates) within the next 10 years will be earned on-line. Presently, colleges are scrambling to get in the business.

Martin and Tulgan (2007) surveyed job expectations, and found that 87 % of all hiring managers and HR professionals say some or most Gen Y workers feel more entitled in terms of compensation, benefits and career advancement than older generations.

The Society for HR Managers (2007) claimed the following:

• 74 percent of employers say Gen Y workers expect to be paid more
• 61 percent say Gen Y workers expect to have flexible work schedules
• 56 percent say Gen Y workers expect to be promoted within a year
• 50 percent say Gen Y workers expect to have more vacation or personal time
• 37 percent say Gen Y workers expect to have access to state-of-the-art technology

Over half (55 percent) of employers maintain Gen Y workers have a more difficult time taking direction or responding to authority than other generations of workers.

Fifteen percent of employers said they changed or implemented new policies or programs to accommodate Gen Y workers, Haefner (2007). Examples include:

• More flexible work schedules (57 percent);
• More recognition programs (33 percent);
• More access to state-of-the-art technology (26 percent);
• Increased salaries and bonuses (26 percent);
• More ongoing education programs (24 percent);
• Paying for cell phones, blackberries, etc. (20 percent);
• More telecommuting options (18 percent);
• More vacation time (11 percent).

More than 60% of employers say they are experiencing tension between employees from different generations, according to a survey by Lee Hecht Harrison (2007). Conflicts will typically arise over intergenerational expectations. Gen Y entitlement and their wish to be treated fairly and equitably will clearly go against the grain of the traditional corporation that values obedience and hierarchical respect. If you couple the attitudes of the Gen Y’s with their appearance: (tattoos, body piercing, casual dress, in some cases torn jeans and flip-flops) then tensions will be most apparent. Corporations are already beginning to gear up and adapt to the Gen Y’s and they are well aware that if they are unable to recruit and attract Gen Y’s they will face significant problems.

At Abbott Laboratories in Chicago, recruiters are offering benefits such as flexible work schedules, telecommuting, full tuition reimbursement and an online mentoring tool.

Aflac, an insurer based in Columbus, Ga., is highlighting such perks as time off given as awards, flexible work schedules and recognition.

Sun Microsystems telecommuting program, for example, has kicked into high gear in response to Generation Y's demands. Today more than half of Sun's employees work remotely.

Xerox is using the slogan "Express Yourself", a phrase popular in the 1970’s, as a way to describe its culture to recruits. The hope is that the slogan will appeal to Gen Y's desire to be themselves, and develop solutions and work toward change. Recruiters also point out the importance of diversity at the company; Gen Y is one of the most diverse demographic groups — one out of three is a minority. In this sense it appears that Xerox may be responding to what would have happened if the Hippy-Baby Boomers had not rejected the corporate world but instead decided to enter at the same age as the Gen Y’s. Xerox may be aware that generation Y’s are primarily children of the Baby Boomers. Xerox may be aware of the Gen Y’s tendency to share social views and culture with their Boomer parents and the Gen X’ers, their 'older cousins' or even older siblings.

In an interesting way Maccoby (2002) describes a shift in what he calls “Organizational Social Character.” He summarizes changes in socio-economic base, the social character, and the ideals, ideology, or social self rooted in the bureaucratic and interactive social characters. In the Gen Y we see the full evolution of the interactive character. We also see the intergenerational shift described by Maccoby (2002), a shift brought about by Boomer parenting.
Maccoby (2002) explains the relationship between the Baby Boomers and their children, but more importantly the reasonthe Boomers maintain such a high degree of involvement in their children’s life. The Boomers do not want their Gen Y children to become the bureaucratic characters that they have become and the children do not want this either.

The Parents

To fully understand the Gen Y’s we must understand the relationships they have with their Boomer parents. They have been called “helicopter parents”. They hover above their children watching, coaching, mentoring, giving advice, demanding, threatening, and making certain they are achieving. These parents have the technological capacity to keep track of their children 24/7. Reports, assignments, tests and school progress are posted daily on the school web site beginning in Middle School. Any aberrations are quickly confronted with a teacher-parent-guidance conference. No more end of the semester report cards.

When the Boomer generation went off to college they spoke very little to their parents. Typically, the only mode of communication was a letter or the pay phone on the wall in the hall. Today’s Gen Y’s have cell phones (74% own a cell phone) and computers (94% own a computer).The Gen Y’s are in constant contact with Mom and Dad via electronic devices. A colleague reports that his son had started college about 300 miles from their home. Both parents speak to their son every day, and the communication continues through email. They know how well he sleeps, what he eats, when tests are given, etc. They know his dates, his friends, and his study partners. And, he loves the connection. In the 60 Minutes vignette of Gen Y’s, a description is given of a student complaining to his professor about a low grade and then hands him his cell phone to talk to his mother. This is an accurate portrayal of this new form of parenting; some psychologists call it pathological involvement. Just as his mother would go to his grade school to argue in favor of her son and try to convince his teachers that he was much better then the given grades, the process continues through high school, the university and even the Gen Y’s workplace.

Merrill Lynch holds “parents’ day” for interns' families to tour the trading floor. KMPG invites parents to the Gen Y’s first day of work. This is a rapidly growing phenomenon. The Collegiate Employee Research Institute (CERI) at Michigan State University claims that 23% of corporations in the U.S report interacting with parents of Gen Y’s. It seems the larger the company the greater the numbers of interactions with parents. In corporations with over 3,799 employees, the numbers reporting interaction with parents increases to 32%. In addition, this number increases when the Gen Y’s are recruited internationally. HR managers are well aware of these dependency relationships and are eager to sell their company to the Gen Y parents. If the parents are impressed, it will improve recruitment and retention.

Where does this dependency begin? It is easy to understand the necessary dependency in the early ages (4 to 7 years) as children leave the nest for school, but now we see it continuing through high school, college and at work. In addition, we do not see the necessary autonomous development as the child gets older. Consider what a Baby Boomer parent recalled when contrasting his experience as a child with those of his children. He said, “We went to the park or vacant lot and we played by ourselves, no adults. If it was baseball we choose sides and played a game. We argued and we settled the conflicts.” He went on to say, “I never see kids playing without adult supervision, the pickup game is dead, everything is organized and structured by parents, and if the parents are not around, then its some hired professional.” The Gen Y’s have considerable difficulty functioning autonomously, and the reason why is simple, they were never given the chance to succeed or fail on their own.

Years ago I was in a pediatrician office. Two mothers were watching their children on the floor building towers out of block. When one child placed the blocks in a precarious position the mother quickly leaped to rescue and adjusted the tower to keep it from falling. The other mother, witnessing the precarious tower, let it fall, and said “try again.” The child began to build the tower again. The child whose tower was rescued lost interest and went on to play something else. Which child has the better chance of functioning autonomously in the adult world?

Many psychologists, counselors, and advisors worry that this over indulgence and ubiquitous safety net has stifled normal social development and the necessary steps required to move successfully into the adult world. These parents have promoted dependency, and they maintain it is necessary.

The parents appear to be a race, and their children are in it. The finish line is success and happiness, and it also includes keeping up with the “Jones’s” and perhaps beating them. They wish to proudly display achievements that become fused with parental/child achievements, this is evidenced when they place their “my child is on the honor roll at …school” bumper sticker on their car. The competition begins in K-1, goes through college acceptance day and later onto their child’s career. The young man, who handed his cell phone to his professor so his mother could fight for him, was most likely the same student whose mother arrived at his middle school 30 minutes after he received a grade of “C”.

These parents are not only excessively involved in their children’s grades, choice of teacher, selection into honors classes, but also their social life, and athletic activities. It would be hard to find a coach who has not been accosted by an irate parent over their child’s treatment; lack of playing time, poor use of their child, general coaching competence, etc.

Of particular notice, is the degree to which these parents plan and prepare their children to be successful, whether its sports, education, playing an instrument, writing, acting, horse riding, language, etc. GenY’s are prepared to excel, they are prepared by tutors, coaches, summer camps, after school programs and other experts. Given the financial investment it is understandable when we witness outraged parents reacting when their investment fails to produce the expected results.

The Gen Y’s are insulated from anything resembling failure. If they do fail, it is not their fault, it’s the fault of the tutor, coach, camp, teacher, etc. and especially those who offered the assessment. In many cases parents offer warnings to teachers that they have made a significant investment in preparing their child for success and they will not tolerate failure.

We now see the function of over scheduling and controlling the Gen Y’s life. It’s to avoid the possibility of failure. Gen Y’s never use the term failure. If a Gen Y is fired from a job they are told by their fellow Gen Y’s and parents, “It’s not for you.” The word failure is omitted from the Gen Y’s vocabulary. One middle school counselor reported a parent pleading for a higher grade, that they should understand, math is not their child’s “thing.”

The Gen Y’s parents are the equivalent of the so called “stage mom” who coach and manage their child’s career and road to success. Every parent wants to feel a sense of pride in their children, however, for these parents, pride and success becomes an obsession. These parents, according to Rosenfeld and Wise (2000), are “in constant fear that their children will under perform in any area -- academic, social or athletic".

At school and work Gen Y’s present an array of issues to those who occupy traditionally superior or authority positions. The first difficulty is the Gen Y’s wish to be treated as an equal. In their child-centered family they were not only treated as equals, they were often catered to, their indiscretions over looked and punishment avoided under the assumption in would be psychologically damaging, or worse, it would precipitate rageful outbursts and parental abuse. The Gen Y’s have an attitude of entitlement. In grade school they were told they were entitled to their opinions and their opinions were valued. Teachers and parents believe that if they fail to value opinions it would hurt their self esteem. I remember discussing autos with a daughter when she was 10 years old, and she commented that she liked Toyota’s best, they were a good American Company. Seeking to correct her I told her Toyota was a Japanese company. She said I was wrong. When I insisted that I was correct. She responded, “I’m entitled to my opinion.” I responded “But… But… But… it’s a fact.” End of discussion. With her arms crossed, she looked straight ahead. She went on to graduate from the Gallatin School at NYU, a school made for Gen Y’s. Students refer to their teachers by first name, they study what they want, and every student’s opinion is considered.

Consider the display of trophies being awarded to the young children in the 60 Minutes tape. Gen Y’s grew up expecting a trophy for every sport they played. Not for winning but for merely showing up or showing spirit, team work and an array of categories. In the workplace they expect the same. Praise and rewards for showing up. Gen Y’s grew up in a world where praise and positive reinforcement were constant. Any form of criticism was met with anger, not only from the child, but from the parents. Children were told they were special, not just by Mr. Rogers, but by their parents, teachers, coaches, relatives and mass media.

A critical question is the motivation among Baby Boomers to produce this type of generation. The answer can be found by assessing the Baby Boomers development. First, they were part of the first “child centered “culture. An explosion of births after WW 2, followed by the so-called “white flight” to the suburbs where children and later adolescents bonded together and collectively rejected parental values, authority, segregation, war, corporate and conventional life style. The Hippie generation accepted diversity, open sex, communalism, drugs, and music and went “back to the earth.” Most Baby Boomers enjoyed their freedom in the late 60’s through the 70’s and then discovered an important fact of life, the need for a career and money. In their attempts to prolong adolescence they failed to plan for work, a career, children and middle age. Many then took jobs and quickly discovered they were not happy. A colleague along with his hippie wife was in their thirties when they had their first child. Discovering he needed a career, he decided to go to graduate school and study literature. They soon had another baby. He dropped out of graduate school and took a job in a bank. The Baby Boomer, ex-hippy was now taking the 7:45 AM train into the city five days a week. He had become Whyte’s “Organizational Man”, “the man in the grey flannel suit” a corporate automaton he had maintained he would never become. To buy a home his wife took a job, they hired a nanny and saved money. They both worked long hard hours, and returned home every night exhausted. They fed their children, ate, drank and went to sleep… and did the same thing the next day. The ex-hippy said “We are going to make certain that our kids do not ‘piss away’ their childhood, teenage, and young adult years like we did. We want them to have a plan, to be happy. I’ll be dammed if I let my kinds to turn out like us.”

As mentioned above, the GenY’s worry more about money than any previous generation. But as adults/parents, the Baby Boomers join their Gen Y’s in money worries. During their life time they have seen the price of family homes grow from a median price of $45,000 to $250,000 -$500,000, depending upon geographical location. They see college tuition increase every year with the competition for scholarships intensifying. In the U.S. 43% of families spend more than they earn, the average households carry $8,000 in credit card debt, and 2004 the average family debt of Baby Boomers was close to $80,000. In England the number declaring themselves insolvent has risen 95% in a decade, and the average personal debt is 30,000 Pounds. In Canada its $70,000.

Another reason for money worries is that before they enter the workplace, the Gen Y’s are overwhelmingly in debt. They face higher costs for higher education than any previous generation. Whereas I, a Baby Boomer paid $27 per semester at CCNY, I just finished paying $120,000 for my daughters NYU degree.

The average student loan debt varies from $22,000 to $29,000. Three out of four Gen Y’s obtained their own credit cards while in college, often pushed by overzealous loan companies. As a consequence, Gen Y’s leave college with between $3,000 and $4,500 in credit card debt. It is not surprising that thirty cents of every dollar earned will go to service their debt. In addition, one in nine high school students have credit cards co-signed by a parent.

Being in such debt at an early age contributes to considerable financial knowledge. They work hard to get out of debt and worry about their credit scores. This may explain why so many; 50 to 60% move home after graduation from college, why they cram into urban apartments, and why they depend upon parents for financial help. This also may explain why CEO’s and managers maintain that all the Gen Y’s care about is money. They are not unlike the general population with their concern for money, the 2007 job satisfaction results of the Society for Human Resource Management states that compensation/pay is the number one factor in selecting a job, following are benefits, job security, flexibility to balance work/life, and the ability to communicate effectively with management. It may be that the Gen Y’s are more vociferous in their desire for more pay. They are so electronically connected that it's not unusual for them to know the salary and perks that companies in a given field are offering. According to Ketter (2006), eighty-one percent of 18- to 25-year-olds surveyed, by the Pew Research Center for People and the Press, said getting rich is their generation’s most important or second-most-important life goal. 51% said the same about being famous. They also plan for their retirement and believe retirement is an important factor in their choice of employer.

When it comes to money the Gen Y’s are a pragmatic group. They have learned from their Boomer parents that wasting time and not planning can lead to financial failure. They are told, “If you fail to plan you will never get that home, or that second vacation home, or the boat, etc.” They must be pragmatic, they know the stark realities of owning a home, car, taking vacations, obtaining degrees, being unemployed and living on their own, and raising a family.

Despite their considerable financial knowledge and efforts to survive financially, after Gen X’s, they have the second highest bankruptcy rate of any generation. It is expected that the bankruptcy rate will dramatically increase as the Gen Y population ages.

The Gen Y’s know about their parent’s financial situations. They see the debt and the psychological issues it brings and they bond with them about money anxieties.

Are their anxieties real? Because 43% of U.S. households spend more that they earn, in 2001 more than 1 million homeowners have three or more mortgages on their property; over 1.8 million owners have outstanding loans that equal 100% or more the value of their homes, and with the recent housing market crash these numbers will increase significantly. The housing debt is outstanding.

American Housing Survey 2001

National Northeast Midwest South West Median years left on mortgage 29 29 28 29 29 Median outstanding principal $69,227 $70,516 $58,966 $59,848 $102,264 Median total loan as % of value 56.40% 50.30% 55.60% 59.80% 57.40% Median cash received in primary mortgage refinance $24,513 $27,839 $19,362 $21,219 $28,431 Number of homeowners with 3+ mortgages 1,008,000 220,000 265,000 301,000 222,000

Source: American Housing Survey (2001)

The average U.S. household with a mortgage, two college graduates who borrowed money for school and more than one credit card, owes about $150,000, and that figure is only expected to rise.

In the U.S., it is predicted that 97% of all Baby Boomers cannot afford to retire at 65.

Does this financial picture precipitate stress? For the Baby Boomer, stress and anxiety takes the form of dread. This fear of losing a foothold and loosing everything is displaced onto their children who are pressured into a structured plan by their parents to make them successful. If their Gen Y offspring are accomplished and competent; have a plan for career success, and are well coached, they can grow up avoiding the situation in which the Baby Boomers now find themselves.

However, these fears, while real in many cases, function as a defense against the anxiety of moving into the adult world; a world painted by their parents as dangerous, because it contains failure. Again, the concept of autonomy is relevant to our understanding of the relationship between Gen Y and their parents. If the Baby Boomer parents withdraw closeness of supervision and the visibility of their authority it would allow for autonomous functioning. However, from a developmental perspective, one can only function autonomously if one has been able to separate and function without the need for attachment. For the Gen Y, attachment is necessary because if he/she separates or differentiates, the anxiety and fear will be overwhelming. It is as if the Gen Y is taught to say to themselves, “If I do this on my own I will be in danger. If I fail I will be blamed. If I stay attached and avoid separation, then I can be protected: I will be safe in the holding arms of mother.” They are safe from uncertainties, the risks of unhappiness, misery and failure, all for which they unfortunately have not been prepared.

The Gen Y denies the reality of his/her separateness and the responsibility of fashioning their life. Consequently, they rely on a wide variety of regressive and neurotic psychic structures that provide illusions and fantasies that enable them to avoid the actuality that he/she is separate, and support the pretense that he/she resides in the earliest state of blissful security. This illusion is a type of rapproachmont. They feel the freedom to experiment, try new things-thus to take risks. Many of them have the financial security and oftentimes a blessing to go off on their own and “figure it out.” They develop this illusion of being on their own. Also, because their parents can keep tabs on them they feel much more comfortable letting them go. So the Gen Y’s go backpacking overseas, take a semester off in Spain in the 10^th grade, teach in Africa, sail the Atlantic, engage in research in Japan or drive across the U.S. alone, as one of my Gen Y’s children will do. Like the 3 year old who runs away and then turns to see if mom is chasing, the Gen Y is never fully detached.

References:

American Housing Survey (2001) United States Census Bureau. Retrieved from: http://www.census.gov/hhes/www/housing/ahs/ahs01/ahs01.html

Collegiate Employee Research Institute CERI (2007)

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