Andrew Carnegie

Investing in education, science, pensions, civil heroism, music, and world peace

In 1900, Carnegie gave $2 million to start the Carnegie Institute of Technology (CIT) at Pittsburgh and the same amount in 1902 to create the Carnegie Institution at Washington, D.C., to encourage research and discovery. He later contributed more to these and other schools. CIT is now known as Carnegie Mellon University after it merged with the Mellon Institute of Industrial Research. Carnegie also served on the Boards of Cornell University and Stevens Institute of Technology.

In 1911, Carnegie became a sympathetic benefactor to George Ellery Hale, who was trying to build the 100-inch (2.5 m) Hooker Telescope at Mount Wilson in California, and donated an additional ten million dollars to the Carnegie Institution with the following suggestion to expedite the construction of the telescope: "I hope the work at Mount Wilson will be vigorously pushed, because I am so anxious to hear the expected results from it. I should like to be satisfied before I depart, that we are going to repay to the old land some part of the debt we owe them by revealing more clearly than ever to them the new heavens." The telescope saw first light on November 2, 1917, with Carnegie still alive.

In 1901, in Scotland, he gave $10 million to establish the Carnegie Trust for the Universities of Scotland. It was created by a deed that he signed on June 7, 1901, and it was incorporated by royal charter on August 21, 1902. The establishing gift of $10 million was then an unprecedented sum: at the time, total government assistance to all four Scottish universities was about £50,000 a year. The aim of the Trust was to improve and extend the opportunities for scientific research in the Scottish universities and to enable the deserving and qualified youth of Scotland to attend a university. He was subsequently elected Lord Rector of University of St. Andrews in December 1901, and formally installed as such in October 1902, serving until 1907. He also donated large sums of money to Dunfermline, the place of his birth. In addition to a library, Carnegie also bought the private estate which became Pittencrieff Park and opened it to all members of the public, establishing the Carnegie Dunfermline Trust to benefit the people of Dunfermline. A statue of Carnegie was later built between 1913 and 1914 in the park as a commemoration for his creation of the park.

Carnegie was a major patron of music. He was a founding financial backer of Jeannette Thurber's National Conservatory of Music of America in 1885. He built the music performing venue Carnegie Hall in New York City; it opened in 1891 and remained in his family until 1925. His interest in music led him to fund the construction of 7,000 pipe organs in churches and temples, with no apparent preference for any religious denomination or sect.

He gave a further $10 million in 1913 to endow the Carnegie United Kingdom Trust, a grant-making foundation. He transferred to the trust the charge of all his existing and future benefactions, other than university benefactions in the United Kingdom. He gave the trustees a wide discretion, and they inaugurated a policy of financing rural library schemes rather than erecting library buildings, and of assisting the musical education of the people rather than granting organs to churches.

In 1901, Carnegie also established large pension funds for his former employees at Homestead and, in 1905, for American college professors. The latter fund evolved into TIAA-CREF. One critical requirement was that church-related schools had to sever their religious connections to get his money.

Carnegie was a large benefactor of the Tuskegee Institute for Black American education under Booker T. Washington. He helped Washington create the National Negro Business League.

In 1904, he founded the Carnegie Hero Fund for the United States and Canada (a few years later also established in the United Kingdom, Switzerland, Norway, Sweden, France, Italy, the Netherlands, Belgium, Denmark, and Germany) for the recognition of deeds of heroism. Carnegie contributed $1.5 million in 1903 for the erection of the Peace Palace at The Hague; and he donated $150,000 for a Pan-American Palace in Washington as a home for the International Bureau of American Republics.

When it became obvious that Carnegie could not give away his entire fortune within his lifetime, he established the Carnegie Corporation of New York in 1911 "to promote the advancement and diffusion of knowledge and understanding" and continue his program of giving.

Carnegie was honored for his philanthropy and support of the arts by initiation as an honorary member of Phi Mu Alpha Sinfonia fraternity on October 14, 1917, at the New England Conservatory of Music in Boston, Massachusetts. The fraternity's mission reflects Carnegie's values by developing young men to share their talents to create harmony in the world.

On wealth

As early as 1868, at age 33, he drafted a memo to himself. He wrote: "... The amassing of wealth is one of the worse species of idolatry. No idol more debasing than the worship of money." In order to avoid degrading himself, he wrote in the same memo he would retire at age 35 to pursue the practice of philanthropic giving, for "... the man who dies thus rich dies disgraced." However, he did not begin his philanthropic work in earnest until 1881, at age 46, when he gifted a library to his hometown of Dunfermline, Scotland.

Carnegie wrote "The Gospel of Wealth", an article in which he stated his belief that the rich should use their wealth to help enrich society. In that article, Carnegie also expressed sympathy for the ideas of progressive taxation and an estate tax:

The growing disposition to tax more and more heavily large estates left at death is a cheering indication of the growth of a salutary change in public opinion. The State of Pennsylvania now takes—subject to some exceptions—one-tenth of the property left by its citizens. The budget presented in the British Parliament the other day proposes to increase the death duties; and, most significant of all, the new tax is to be a graduated one. Of all forms of taxation, this seems the wisest. Men who continue hoarding great sums all their lives, the proper use of which for public ends would work good to the community from which it chiefly came, should be made to feel that the community, in the form of the State, cannot thus be deprived of its proper share. By taxing estates heavily at death the State marks its condemnation of the selfish millionaire's unworthy life.

The following is taken from one of Carnegie's memos to himself:

Man does not live by bread alone. I have known millionaires starving for lack of the nutriment which alone can sustain all that is human in man, and I know workmen, and many so-called poor men, who revel in luxuries beyond the power of those millionaires to reach. It is the mind that makes the body rich. There is no class so pitiably wretched as that which possesses money and nothing else. Money can only be the useful drudge of things immeasurably higher than itself. Exalted beyond this, as it sometimes is, it remains Caliban still and still plays the beast. My aspirations take a higher flight. Mine be it to have contributed to the enlightenment and the joys of the mind, to the things of the spirit, to all that tends to bring into the lives of the toilers of Pittsburgh sweetness and light. I hold this the noblest possible use of wealth.

Religion and worldview

Carnegie and his family belonged to the Presbyterian Church in the United States of America, also known informally as the Northern Presbyterian Church. In his early life Carnegie was skeptical of Calvinism, and religion as a whole, but reconciled with it later in his life. In his autobiography, Carnegie describes his family as moderate Presbyterian believers, writing that "there was not one orthodox Presbyterian" in his family; various members of his family having somewhat distanced themselves from Calvinism, some of them leaning more towards Swedenborgianism. While a child, his family led vigorous theological and political disputes. His mother avoided the topic of religion. His father left the Presbyterian church after a sermon on infant damnation, while, according to Carnegie, still remaining very religious on his own.

Witnessing sectarianism and strife in 19th century Scotland regarding religion and philosophy, Carnegie kept his distance from organized religion and theism. Carnegie instead preferred to see things through naturalistic and scientific terms stating, "Not only had I got rid of the theology and the supernatural, but I had found the truth of evolution."

Later in life, Carnegie's firm opposition to religion softened. For many years he was a member of Madison Avenue Presbyterian Church, pastored from 1905 to 1926 by Social Gospel exponent Henry Sloane Coffin, while his wife and daughter belonged to the Brick Presbyterian Church. He also prepared (but did not deliver) an address in which he professed a belief in "an Infinite and Eternal Energy from which all things proceed". Records exist of a short period of correspondence around 1912–1913 between Carnegie and 'Abdu'l-Bahá, the eldest son of Bahá'u'lláh, founder of the Baháʼí Faith. In these letters, one of which was published in The New York Times in full text, Carnegie is extolled as a "lover of the world of humanity and one of the founders of Universal Peace".

Charitable institutions

On the subject of charity, Andrew Carnegie's actions diverged in the most significant and complex manner from Herbert Spencer's philosophies. In his 1854 essay "Manners and Fashion", Spencer referred to public education as "Old schemes". He went on to declare that public schools and colleges fill the heads of students with inept, useless knowledge and exclude useful knowledge. Spencer stated that he trusted no organization of any kind, "political, religious, literary, philanthropic", and believed that as they expanded in influence so too did their regulations expand. In addition, Spencer thought that as all institutions grow they become ever more corrupted by the influence of power and money. The institution eventually loses its "original spirit, and sinks into a lifeless mechanism". Spencer insisted that all forms of philanthropy that uplift the poor and downtrodden were reckless and incompetent. Spencer thought any attempt to prevent "the really salutary sufferings" of the less fortunate "bequeath to posterity a continually increasing curse". Carnegie, a self-proclaimed devotee of Spencer, testified to Congress on February 5, 1915: "My business is to do as much good in the world as I can; I have retired from all other business."

Charity to enable people to develop

Carnegie held that societal progress relied on individuals who maintained moral obligations to themselves and to society. Furthermore, he believed that charity supplied the means for those who wish to improve themselves to achieve their goals. Carnegie urged other wealthy people to contribute to society in the form of parks, works of art, libraries and other endeavors that improve the community and contribute to the "lasting good". Carnegie also held a strong opinion against inherited wealth. Carnegie believed that the sons of prosperous businesspersons were rarely as talented as their fathers. By leaving large sums of money to their children, wealthy business leaders were wasting resources that could be used to benefit society. Most notably, Carnegie believed that the future leaders of society would rise from the ranks of the poor. Carnegie strongly believed in this because he had risen from the bottom. He believed the poor possessed an advantage over the wealthy because they receive greater attention from their parents and are taught better work ethics.

1892: Homestead Strike

The Homestead Strike was a bloody labor confrontation lasting 143 days in 1892, one of the most serious in U.S. history. The conflict was centered on Carnegie Steel's main plant in Homestead, Pennsylvania, and grew out of a labor dispute between the Amalgamated Association of Iron and Steel Workers (AA) and the Carnegie Steel Company.

Carnegie left on a trip to Scotland before the unrest peaked. In doing so, Carnegie left mediation of the dispute in the hands of his associate and partner Henry Clay Frick. Frick was well known in industrial circles for maintaining staunch anti-union sentiment. With the collective bargaining agreement between the union and company expiring at the end of June, Frick and the leaders of the local AA union entered into negotiations in February. With the steel industry doing well and prices higher, the AA asked for a wage increase; the AA represented about 800 of the 3,800 workers at the plant. Frick immediately countered with an average 22% wage decrease that would affect nearly half the union's membership and remove a number of positions from the bargaining unit.

The union and company failed to come to an agreement, and management locked the union out. Workers considered the stoppage a "lockout" by management and not a "strike" by workers. As such, the workers would have been well within their rights to protest, and subsequent government action would have been a set of criminal procedures designed to crush what was seen as a pivotal demonstration of the growing labor rights movement, strongly opposed by management. Frick brought in thousands of strikebreakers to work the steel mills and Pinkerton agents to safeguard them.

On July 6, the arrival of a force of 300 Pinkerton agents from New York City and Chicago, Illinois, resulted in a fight in which 10 men—seven strikers and three Pinkertons—were killed and hundreds were injured. Pennsylvania Governor Robert Pattison ordered two brigades of the state militia to the strike site. Then allegedly in response to the fight between the striking workers and the Pinkertons, anarchist Alexander Berkman shot at Frick in an attempted assassination, wounding him. While not directly connected to the strike, Berkman was tied in for the assassination attempt. According to Berkman, "... with the elimination of Frick, responsibility for Homestead conditions would rest with Carnegie." Afterwards, the company successfully resumed operations with non-union immigrant employees in place of the Homestead plant workers, and Carnegie returned to the United States. However, Carnegie's reputation was permanently damaged by the Homestead events.

Theodore Roosevelt

According to David Nasaw, after 1898, when the United States entered a war with Spain, Carnegie increasingly devoted his energy to supporting pacifism. He strongly opposed the war and the subsequent imperialistic American takeover of the Philippines. When Theodore Roosevelt became president in 1901, Carnegie and Roosevelt were in frequent contact. They exchanged letters, communicated through mutual friends such as Secretary of State John Hay, and met in person. Carnegie hoped that Roosevelt would turn the Philippines free. He saluted Roosevelt for forcing Germany and Britain to arbitrate their conflict with Venezuela in 1903, and especially for becoming the mediator who negotiated an end to the war between Russia and Japan in 1907–1908.

Roosevelt relied on Carnegie for financing his expedition to Africa in 1909. In return he asked the ex-president to mediate the growing conflict between the cousins who ruled Britain and Germany. Roosevelt started to do so but the scheme collapsed when king Edward VII suddenly died. Nasaw argues that Roosevelt systematically deceived and manipulated Carnegie and held the elderly man in contempt. Nasaw quotes a private letter Roosevelt wrote to Whitelaw Reid in 1905: [I have] tried hard to like Carnegie, but it is pretty difficult. There is no type of man for whom I feel a more contemptuous abhorrence than for the one who makes a God of mere money-making and at the same time is always yelling out that kind of utterly stupid condemnation of war which in almost every case springs from a combination of defective physical courage, of unmanly shrinking from pain and effort, and of hopelessly twisted ideals. All the suffering from Spanish war comes far short of the suffering, preventable and non-preventable, among the operators of the Carnegie steel works, and among the small investors, during the time that Carnegie was making his fortune…. It is as noxious folly to denounce war per se as it is to denounce business per se. Unrighteous war is a hideous evil; but I am not at all sure that it is worse evil than business unrighteousness.