Andrew Carnegie (1835-1919):
"It's a God's mercy I was born a Scotchman, for I do not see how I could ever have been contented to be anything else."
~ Andrew Carnegie [Our Coaching Trip, 1882]
Andrew Carnegie was born in the attic of a small, one-story house on the corner of Moodie St. and Priory Lane in Dunfermline, Fife. Andrew's father, William Carnegie, a damask weaver, named his son in honour of his own father, a man "well known throughout the district for his wit and humour, his genial nature and irrepressible spirits." 1 Carnegie's maternal grandfather, Thomas Morrison, was even more respected and distinguished as an orator and politician (he was head of the district radical party), and spouted his opinion to his grandson. Andrew was also very devoted to his mother, Margaret Morrison, and calls her his heroine on the dedication page of his Gospel of Wealth.
In his autobiography, Carnegie reminisces with fondness his childhood in Dunfermline, recalling especially the wondrous, mystical air of its Abbey, founded by Michael Canmore and Queen Margaret in the eleventh century. Although his life in Scotland was relatively short and lived in relative poverty, it had a profound impact on his development:
"The child privileged to develop amid such surroundings absorbs poetry and romance with the air he breathes, assimilates history and tradition as he gazes around. These become to him his real world in childhood - the ideal is the ever-present real. . . . No bright child of Dunfermline can escape the influence of the Abbey, Palace, and Glen. These touch him and set fire to the latent spark within, making him something different and beyond what, less happily born, he would have become."
~ Andrew Carnegie [Autobiography of Andrew Carnegie] 2
Of equally profound influence on the young Carnegie was the class system into which he was born. He was disdainful from the start of pedigree unaccompanied by merit or distinguished accomplishments, and formed many of his opinions from listening to his grandfather's speeches. His uncle Bailie, who succeeded Thomas Morrison as head of the active district radical party, admired the republican government and monarchical denunciation of America. Thus the young Carnegie grew up amidst heated political debate, idealizing a society in which "every citizen's privilege was every man's right". "It is not to be wondered," he surmises in reflection, "at that, nursed amid such surroundings, I developed into a violent young Republican whose motto was, 'death to privilege.' At that time I did not know what privilege meant, but my father did." 3
His uncle, George Lauder, introduced him and his younger brother Todd to Scotland's history: he told his nephews about the heroes Robert the Bruce and William Wallace, recounted Blind Harry's history, and recited the works of the poet Robert Burns, who Carnegie came to regard as the greatest preacher of liberty and democracy the world had ever known. So dear to the boy's heart were these figures that he found it difficult to leave them behind when the family immigrated to America in 1848; for a long while his heart remained, by his own acknowledgement, in Dunfermline.
The introduction of steam machinery to the weaving trade crippled hand-weavers like Carnegie's father. The family auctioned off its looms and furniture (disappointingly, the sales had amounted to twenty pounds less than they required for ship fare) with hopes of joining two of Margaret's sisters and other extended family in Pittsburgh. The family of four - William, Margaret, Andrew, and his five-year-old brother Tom - left Dunfermline in May 1848. They departed Scotland from Glasgow on a seven-week voyage aboard the SV Wiscasset. After arriving in New York, it took the family another three weeks of travel by canal boat to reach their final destination, Allegheny City.
In their new home, William resumed weaving, and Margaret bound shoes in addition to her household work. Andrew's school days were over - at thirteen, he obtained his first job at the same cotton factory his father now worked. He was employed as a bobbin boy, working twelve hours a day, seven days a week, for a meager $1.20 weekly wage. But he was proud to be contributing to his family. Although they struggled, Margaret continued to tell her sons that they "could be useful men, honored and respected," if they "always did what was right... A keen sense of honor, independence, self-respect pervaded the household. Walter Scott said of Burns that he had the most extraordinary eye he ever saw in a human being. I can say as much," mused Carnegie, "for my mother." 4
Carnegie's salary increased to two dollars a week when he transferred from the cotton factory to a bobbin factory, where he spent the next year running the steam engine and firing the boiler. His supervisor there was impressed with his penmanship and offered him the chance to come out of the factory cellar and work in the office as a clerk. A few months later, in 1850, his first big break came along by chance; his uncle referred him to Mr. David Brooks, a personal friend at the telegraph office who was looking for a messenger boy. Eager to do a favor for a fellow Scotchman, Mr. Brooks employed Carnegie for two-fifty a week. This happy work as messenger boy, which Carnegie recounted as his "first real start in life," acquainted him with some of the leading men of the city.
One such man, Colonel James Anderson, had an immense four-hundred volume personal library that he opened to "working boys" every Saturday afternoon. There was perhaps no greater influence on Carnegie than the generosity and public-mindedness of Col. Anderson, who opened up the doors of self-improvement to those who otherwise would never have such opportunities for reading and learning. The Colonel's makeshift "free library" rooted in young Carnegie the philanthropic hopes that would later come to characterize his legacy.
Carnegie's dedication, intelligence, and reliability as a messenger boy did not go unnoticed by his superiors. At the end of each month, the boys would line up to collect their eleven and a quarter dollar wage by the manager, Colonel John Glass. It so happened one month, after Carnegie had been employed for about a year, that Col. Glass skipped over him when distributing wages. Fearing the worst, his heart immediately sank, pangs of disgrace filling his chest as the other boys left. The Colonel then pulled him behind the counter and announced quietly that he was worth more than the other boys; and resolved to pay him thirteen and a half dollars a month. The extra two and a quarter dollars he brought home in his pocket that day "were worth more to me," he quipped, "then than all the millions I have made since". 5 His head spinning with his new-found wealth, he dreamed that night of buying a carriage, to him the pinnacle symbol of wealth, for his mother and father.
It wasn't too long after that that good money started coming in. He was soon filling in when the telegraph operator was absent, and learned how to read the incoming messages by ear. In 1852, at the age of seventeen, he was promoted to full telegraph operator and was earning the seemingly enormous sum of twenty-five dollars a month. His prominence as an operator grew when he mastered the rare feat of transmitting a message without first copying it onto paper, reliant entirely upon the sound of the telegraph code. Through this capacity he made the acquaintance of Thomas A. Scott, superintendent of the Pittsburgh division of the Pennsylvania Railroad Company, who requested in 1853 that young Carnegie come to work for him as his personal clerk.
This position earned Carnegie thirty-five dollars a month. He learned the ins and outs of the railroad industry while making innovations such as keeping the telegraph office open around the clock, and burning railroad cars following accidents to clear the tracks. For two years he steadily advanced through the company, and managed to contribute enough money to his family that they were able to purchase the lot on which they lived in 1855.
His father, however, was not as successful. After being laid off from the cotton factory, he tried to produce his own cloth, traveling as far as Cincinnati to (rather unsuccessfully) peddle it. He was only fifty-one when he passed away in October 1855, leaving twenty-year-old Andrew as the family's breadwinner.
Yet fortune was not far behind the sorrow. A few months later, Mr. Scott asked Carnegie if he had five hundred dollars to invest with him to buy ten shares in Adams Express, a freight and cargo transport company. Although Carnegie did not have the capital, his mother secured a loan with help from her brother, a justice of the peace in Pittsburgh suburb of East Liverpool. It was his first investment, and it yielded a ten-dollar dividend the first month. When he saw his cheque, he cried out, "Eureka! Here's the goose that lays the golden eggs!" 6
Opportunity kept on presenting itself. The next year, he and Mr. Scott (who had been promoted to Railroad superintendent,) smartly invested in the Woodruff Sleeping Car Company, which was receiving a five-thousand dollar annual return within two years. Carnegie reinvested his dividends in railroad-related industries, such as iron, steel, and bridges, thus gradually accumulating more capital and wealth. In 1859, Carnegie was promoted to superintendent of the Pittsburgh Division, where he was put in charge of his own department, earning a fifteen-hundred dollar annual salary. He and his mother moved to the upscale suburb of Homewood, where he elevated her station and eased her labours - albeit in the face of some resistance - by hiring a servant for the home.
When the Civil War broke out not long after, the Pennsylvania Railroad proved critical to Union success. Mr. Scott served as Assistant Secretary of War in charge of military transportation, and he appointed Carnegie Superintendent of the Military Railways and Union Government's eastern telegraph lines. Carnegie helped to reopen cut rail lines to Washington, organized the transportation of Union brigades to the capital, and supervised the evacuation of defeated and wounded soldiers. In order to defeat the Confederacy, the Union required a vast amount of munitions, and railroad lines to deliver them. Carnegie saw the huge, not yet fully developed potential of American industry; in 1861, he invested eleven thousand dollars in an oil company in Titusville, Pennsylvania. In one year the farm yielded nearly eighteen thousand dollars in cash dividends. After the war, Carnegie retired from his position with the railroad to focus all his energy on the iron industry, which would become the source of his future fortune.
Carnegie's business ventures flourished through the latter part of the 1860s and 1870s. In 1865, he, along with several associates, organized the Keystone Bridge Company, envisioning bridges built of steel, rather than wood, to increase their durability. His old friend, Mr. Scott, loaned him half of the eighty-thousand dollar start-up cost. Two years later, after Carnegie founded the Keystone Telegraph Company, he again used his connections with Mr. Scott to secure a deal with the Pennsylvania Railroad. This allowed his telegraph company to string its wires across the railroad's poles the whole length of the state, a venture so successful that Keystone was almost immediately able to merge with the Pacific and Atlantic Telegraph Companies.
Carnegie had been vested in Pittsburgh's emerging steel industry since 1861, but it was his 1872 visit to Henry Bessemer's steel plants in the UK that opened his eyes to the commercial potential of steel. His first steel plant, the J. Edgar Thompson Works (named for the president of the Pennsylvania Railroad president) opened in 1875 in Braddock, Pennsylvania, thus setting Pittsburgh on its course toward becoming the steel production capital of the world. Carnegie employed a method of cheap and efficient mass-production of steel rails for use in the railroad lines; he also developed a vertical integration style of management, bringing together the companies that supplied his raw materials for steel production. In the 1880s, he merged with Henry Frick, his chief coke supplier, and bought out the rival Homestead Works, while continuing to make unparalleled sums of money. And in 1892, he consolidated several smaller steel plants into one huge, unstoppable juggernaut, Carnegie Steel, which by the end of the decade was bringing him forty million dollars a year. As the world ventured into the twentieth century, Carnegie Steel was producing more steel than all the plants in Great Britain combined, and its owner controlled the most extensive integrated iron and steel operation in the United States.
At this time, however, financier J. P. Morgan mounted a challenge to Carnegie's steel empire. Although Carnegie believed he could beat this emerging competitor in the long term, he was by this time sixty-four years old, longing to retire and spend a quiet life with his wife and young daughter. 7 So in 1901, Carnegie sold Morgan his company for a sum of $480 million dollars ($300 billion dollars by today's standards), marking the largest single business transaction in history: "Congratulations, Mr. Carnegie," Morgan said when the deal was finalized. "You are now the richest man in the world." 8
Carnegie's legacy, however, lies not in his accumulation of wealth, but in the philanthropic efforts to which he distributed his money. Never forgetting the profound impact Colonel James Anderson's free library had had on him as a young man, Carnegie began building his philanthropic legacy on the belief that, if given equal opportunity for self-improvement through learning, there was no limit to what any person might accomplish. Eight years after donating a public bath to his native Dunfermline in 1873, Carnegie returned once again to his hometown with his mother, at last having her arrive in the glorious coach he had fantasized about as a boy. She personally laid the foundation stone for the world's first Carnegie Library, carrying on a family tradition begun decades ago by her late husband. William Carnegie, Andrew learned later, had been one of the founders of the town's first circulating library, with a collection composed of the few books the five founders had personally owned. "I followed my father in library-founding unknowingly," he wrote of his lineage. "I am tempted to say almost providentially - and it has been a source of intense satisfaction to me." 9
The architect for the Dunfermline library had wanted to carve Carnegie's coat of arms over the front entrance. Carnegie informed the man that he had no arms, so suggested to the architect instead that a rising sun shedding its rays with the motto: "Let there be light," be carved.
By the end of his life, Carnegie had dedicated over fifty-six million dollars to the funding of over twenty-five hundred libraries across the English-speaking world. 10
His major philanthropic efforts, however, did not begin until he retired in 1901, after selling Carnegie Steel to J. P. Morgan. For the next twenty years, he dedicated himself to giving his fortune away to causes nearest to his heart: libraries, education, and world peace. In 1889, he had outlined his beliefs on wealth and responsibility in a tract called Gospel of Wealth. A rich man, he insisted, had a moral obligation to donate his wealth toward the public good, saving none for himself beyond what the family required to live on: "No man," he famously proclaimed, "can become rich without himself enriching others." He was not a proponent of almsgiving, but instead supported the creation and maintenance of institutions that would provide ways for hard-working, dedicated people to improve themselves.
Carnegie's first donation to academia came in 1899, when he gave fifty thousand pounds to found the University of Birmingham in the United Kingdom. The next year, his vision to open a vocational training school for the sons and daughters of working-class Pittsburghers came to fruition with the establishment of Carnegie Technical Schools. Founded with the motto "My heart is in the work," Carnegie Technical Schools have since evolved into Carnegie Mellon University, one America's most elite academic institutions. And although the school is most noted for its contributions to the fields of science and technology, Carnegie Mellon is also one of the few schools in the United States at which a student can major in bag-piping.
Carnegie's philanthropic vision for providing the more disadvantaged with solid education was not limited to Pittsburgh. In 1901 he provided a ten million dollar endowment for the establishment of the Carnegie Trust for the Universities of Scotland ( www.carnegie-trust.org) - a sum several times larger than what the governmental provided to fund Scotland's four universities. He did the same thing for the United States with the Carnegie Institution of Washington, providing over twenty-two million dollars to create a research institution that would serve as a resource for all universities. Carnegie didn't stop at funding just the institutions, though. In 1905, he set up the Carnegie Foundation for the Advancement of Teaching to provide pensions for teachers. The Foundation established the first widespread educational standards for US's colleges and universities.
Carnegie was also a champion of world peace, stating, "I am more drawn to this cause than to any". In fact, after the United States purchased the Philippines for twenty million dollars from Spain following its defeat in Spanish-American War of 1898, Carnegie offered to buy the Philippines from the United States government for the same sum, hoping to secure its independence! A decade later, in 1910, he supplied ten million dollars to establish the Carnegie Endowment for International Peace (www.carnegieendowment.org) to "hasten the abolition of international war, the foulest blot upon our civilization". The Endowment, which works closely with the US State Department, has funded conferences and publications on major world policy issues, including economics, politics, and technology, and the relations businesses, governments, international organizations have in such issues.
With his remaining $125 million, he established the Carnegie Corporation of New York (www.carnegie.org) in 1911. His last philanthropic trust was endowed "to promote the advancement and diffusion of knowledge and understanding," by aiding technical schools, universities, colleges, and scientific research The Corporation's motto remains the same today as it was a century ago: "Only in popular education can man erect the structure of an enduring civilization."
Other notable contributions include the building of Carnegie Hall in 1891 at 881 Seventh Avenue in midtown Manhattan; the creation of the National Negro Business League, with which he assisted Booker T. Washington; and the Carnegie Heroes Funds, international organizations that have awarded over twenty million dollars to people who have been injured "in an attempt to preserve and rescue their fellows."
Believing that "the man who dies rich dies disgraced," Carnegie gave away more than $350 million, or ninety percent of his fortune, during his lifetime. He died in his Lenox, Massachusetts estate, Shadowbrook, in 1919, and his gravestone was made from a block taken from Skibo Castle, his Scotland home.Visit the museum website of Carnegie's birthplace, the home on Moodie St. in Dunfermline
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