The American Experience

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Andrew Carnegie – Famous Pittsburgher

(from PBS “The American Experience”)

One of the captains of industry of 19th century America, Andrew Carnegie helped build the formidable American steel industry, turning a poor young man into one of the richest entrepreneurs of his age. Later in his life, Carnegie sold his steel business and gave much of his fortune away to cultural, educational and scientific institutions for "the improvement of mankind."
Carnegie was born in Dunfermline, the medieval capital of Scotland, in 1835. The town was a center of the linen industry, and Andrew's father was a weaver, a profession the young Carnegie was expected to follow. But the industrial revolution that would later make Carnegie the richest man in the world, destroyed the weavers' craft. When the steam-powered looms came to Dunfermline in 1847 hundreds of hand loom weavers became expendable. Andrew's mother went to work to support the family, opening a small grocery shop and mending shoes.
An ambition for riches would mark Carnegie's path in life. However, a belief in political egalitarianism was another ambition he inherited from his family. Andrew's father, grandfather and uncle were all Scottish radicals who fought to do away with inherited privilege and to bring about the rights of common workers.
But Andrew's mother, fearing for the survival of her family, pushed the family to leave the poverty of Scotland for the possibilities in America. She borrowed 20 pounds she needed to pay the fare for the Atlantic passage and in 1848 the Carnegies joined two of Margaret's sisters in Pittsburgh, then a sooty city that was the iron-manufacturing center of the country.
William Carnegie secured work in a cotton factory and his son Andrew took work in the same building for $1.20 a week. Later, Carnegie worked as a messenger boy in the city's telegraph office. He memorized Pittsburgh's streets and important names and addresses.
Carnegie often was asked to deliver messages to the theater. He arranged to make these deliveries at night--and stayed on to watch plays by Shakespeare and other great playwrights. In what would be a life-long pursuit of knowledge, Carnegie also took advantage of a small library that a local benefactor made available to working boys.
One of the men Carnegie met at the telegraph office was Thomas A. Scott, a rising executive for the Pennsylvania Railroad. Scott was taken by the young worker and referred to him as "my boy Andy," hiring him as his private secretary and personal telegrapher at $35 a month.
"I couldn't imagine," Carnegie said many years later. "what I could ever do with so much money." Carnegie worked his way up the ladder in Pennsylvania Railroad and succeeded Scott as superintendent of the Pittsburgh Division. At the outbreak of the Civil War, Scott was hired to supervise military transportation for the North and Carnegie worked as his right hand man.
The Civil War fueled the iron industry, and by the time the war was over, Carnegie saw the potential in the field and resigned from Pennsylvania Railroad. He turned his attention to the Keystone Bridge Company, which worked to replace wooden bridges with stronger iron ones. In three years he had an annual income of $50,000.
However, Andrew expressed his uneasiness with the businessman's life. In a letter to himself at age 33, he wrote: "To continue much longer overwhelmed by business cares and with most of my thoughts wholly upon the way to make more money in the shortest time, must degrade me beyond hope of permanent recovery."
Carnegie would continue making unparalleled amounts of money for the next 30 years. Two years after he wrote that letter Carnegie would embrace a new steel refining process being used by Englishman Henry Bessemer to convert huge batches of iron into steel, which was much more flexible than brittle iron. Carnegie threw his own money into the process and even borrowed heavily to build a new steel plant near Pittsburgh. Carnegie was ruthless in keeping down costs and managed by the motto "watch costs and the profits take care of themselves."
Carnegie was unusual among the industrial captains of his day because he preached for the rights of laborers to unionize and to protect their jobs. But his actions did not always match his rhetoric. Carnegie's steel workers often worked long hours for low wages. In the Homestead Strike of 1892, Carnegie threw his support behind plant manager Henry Frick, who locked out workers threatening to strike and hired 300 Pinkerton private security guards to secure the factory for non-union workers. The Pinkertons were discovered approaching the plant on river barges, and a battle broke out. Seven workers and three Pinkertons were killed, and though the private guards were driven out, the state militia reestablished order at the plant and most workers lost their jobs. The episode would forever hurt Carnegie's reputation and haunt the man. He and Frick also became bitter, lifelong enemies afterward.
Still, Carnegie's steel juggernaut was unstoppable, and by 1900 Carnegie Steel produced more of the metal than all of Great Britain. That year financier J. P. Morgan mounted a major challenge to Carnegie's steel empire. A prolonged business war did not appeal to the 64-year old man eager to spend more time with his wife Louise and their daughter, Margaret.
Carnegie wrote the asking price for his steel business on a piece of paper and had one of his managers deliver the offer to Morgan. Morgan accepted without hesitation, buying the company for $480 million. "Congratulations, Mr. Carnegie," Morgan said to Carnegie when they finalized the deal. "you are now the richest man in the world."
Fond of saying that "the man who dies rich dies disgraced," Carnegie then turned his attention to giving away his fortune. He abhorred charity, and instead put his money to use helping others help themselves. That was the reason he spent much of his collected fortune on establishing over 2,500 public libraries; he built the buildings, but required the people to buy the books. By the time Carnegie's life was over, he gave away $350 million.
Carnegie was a vocal anti-imperialist and one of the first to call for a "league of nations," and he built a "a palace of peace" in The Hague that would later evolve into the World Court. His hopes for a civilized world of peace were destroyed, though, with the onset of World War I in 1914. Louise said that with these hostilities her husband's "heart was broken." Carnegie lived for another five years, but the last entry in his autobiography was the day World War I began.

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