Michael French mulls over the life of an entrepreneur-turned-philanthropist
When I once began a talk by acknowledging financial support from the Carnegie Trust for the Universities of Scotland, my audience murmured disapproval. Certainly Andrew Carnegie's spectacular business career left a legacy of achievements and failings that ensure a diverse, often-vocal range of supportive admirers and resolute adversaries.
Carnegie's extensive writings and charitable donations provide interpretations of, and justifications for, his industrial career as well as propounding his political and social philosophies. Above all, his correspondence offers insights into his family and business lives as well as his diverse range of social contacts in the US and Europe. As a result, there have been several biographies and other studies of aspects of his career.
Peter Krass offers an orthodox biography that analyses Carnegie's activities and motivations. Carnegie was born in Dunfermline, Scotland, in 1835 into a family of weavers who emigrated to the US in 1848. Through the patronage of Thomas A. Scott, general superintendent of the Pennsylvania Railroad, Carnegie ascended rapidly from telegraph operator to railroad executive. From this position he acquired the corporate stocks that generated his increasing personal wealth and influence from the 1860s onwards. He operated businesses that sold supplies and services to the railroads, often as exercises in insider trading, and acquired stakes in bridge building, railroad construction and then iron and steel-manufacturing.
Carnegie's driven and irascible personality contributed to the expansion and technological advancement of steel-making in the US and to the industry's recurring bouts of intense price competition. He gained notoriety as a ruthless financial manipulator and, following the violence at the Homestead works in 1892, as a repressive employer.
Eventually, J. P. Morgan paid Carnegie $480 million for his steel businesses as part of the process of creating US Steel in 1901. Thereafter, Carnegie devoted his resources to philanthropy and a multitude of political and social campaigns. Domestically, Carnegie displayed considerable loyalty to his immediate family, above all to his mother.
Krass provides a detailed, thorough and thoughtful appraisal of a major figure, which integrates contributions from the various specialist studies of aspects of Carnegie's life. Indeed, the book's primary value lies in assembling and assessing the different facets of Carnegie's personality and career rather than offering a distinctive interpretation.
The analysis is careful to delineate earlier biographers' perspectives and to highlight the elements of selectivity and revisionism to be found in Carnegie's own accounts. Krass acknowledges Carnegie's contribution to the emergence of large-scale enterprise in late 19th-century America, but balances this with a critical appraisal of the associated business practices. The analysis provides a useful case study, especially of how a leading entrepreneur exerted control through financial power, incessant promotion of his interests and a sometimes-counterproductive mixture of threats and exhortations.
Krass periodically contrasts the world of labour with Carnegie's lifestyle.
Indeed, he was motivated to write the book, in part, because his great-grandfather was employed in Carnegie's mills. This perspective works well in the discussion of the events leading to the violence at Homestead, but thereafter the natural momentum of a biography keeps the focus more on Carnegie and his fellow corporate philanthropists.
The final section of the book is interesting for its portrayal of the transatlantic world of social elites through which Carnegie passed as he alternated between New York and long summer trips to estates in Scotland.
More attention might have been paid to other transatlantic relationships, including immigration, and to the culture and living standards of steel workers up to 1920. Such a perspective, implicit at times or apparent in Carnegie's correspondence and contacts, might have given more sense of the context within which he propounded his views after 1901, given the vibrancy of debates about reform in the Progressive era. The book does explore the development of Carnegie's social and political views, which combined a strong republicanism with an autocratic approach to management.
Perhaps the most interesting theme is the intellectual transition from a family heritage of Scottish radicalism to an advocacy of unregulated capitalism and then to the merits of philanthropy. The latter, Krass argues, reflected Carnegie's deeply held belief in the importance of deploying wealth to promote causes that offered opportunities for self-improvement. Undoubtedly, the charitable activities and endowments satisfied Carnegie's desire for public recognition. Yet, although this ideology clearly served to justify the acquisition of wealth, it was deeply ingrained in Carnegie's thinking, being apparent in his correspondence well before he acquired colossal wealth. Carnegie made over substantial endowments, leaving their allocation to trustees who occasionally used them in ways that he disliked.
Krass draws comparisons with other major donors, including Rockefeller, but might have considered later examples such as the Ford Foundation. This would have illuminated the networks and strategies that contributed to the professionalisation of philanthropy, especially in relation to education and social-welfare provision. Certainly these themes resonate with contemporary debates about wealth accumulation and philanthropy.
Michael French is professor of economic and social history, University of Glasgow.
Author - Peter Krass
Publisher - Wiley
Pages - 612
Price - £25.95 and £13.50
ISBN - 0 471 38630 8 and 46883 5