Great article that shows a little math on why a trust fund designed to benefit all future heirs doesn't really work, math-wise. Within a number of generations the family tree is so large that the share of assets is diluted down to practically nothing. It discussed a neat alternative idea though.
http://actionecon.com/building-generational-wealth/
I'm not sure I followed the math here. He assumes two children per couple, and a generation time of 25 years (which corresponds to an annual growth rate of 2.8%).* If we assume 5% real growth for a portfolio the doubling time for the trust would be about 14 years, so it seems like it, given enough money, it should be possible to set up a trust that would continue to provide about the same inflation adjusted benefit descendants for many generations.
Now the author also makes the (very valid) point that after a dozen or so generations the current generation will share only a small fraction of your DNA. Whether this influences your decision making will vary from person to person. People are obviously able to put a lot of emotional investment into others who share no direct genetic relationship with them (for example adopted children). OTOH, people who share no genetic relationship with you, have no memories of you, and who you'll never have the chance to interact with...
The final point that tax laws may change in the future in ways that are unfavorable to dynasty trusts is also well taken and something folks will need to be aware of.
*In America, excluding first generation immigrants, our fertility rate is now down to 1.79 children per woman and continuing to decline. Average age of the mother at first birth is up to 26.3 years, while average age of the mother at second birth is up above 28, and both numbers are continuing to increase. So two children per couple with an average generation time of 25 years is actually more pessimistic than the statistics would indicate. 27 years and 1.8 kids drops the annual growth rate of descendants from 2.8%/year to 2.2%/year, so a significant decrease even if current trends stopped tomorrow.