Andrew Carnegie
“Andrew Carnegie was a critical agent in the triumph of industrial capitalism in the decades surrounding the turn of the twentieth century. “ (Nasaw, xii) At the same time, Carnegie, as once the French Enlightenment philosophers, and, after them, Alfred Nobel, believed that one could make this world better by promoting the dissemination of knowledge. Being an active American, he, unlike the French philosophers approached the matter practically — he had donated 95% of his earnings (the equivalent of the current 55 billion dollars) and wished he had time to donate everything.
Andrew Carnegie was born on November 25, 1835 in a small house in the Scottish village of Dunfermline . The house also served as a weaving workshop of his father, William Carnegie. Will belonged to the aristocracy of labor and was a true professional. He was a decent, sweet and sentimental man, despite the fact that came from radical families. Things were going well until the growing power of steam XIX century did not displace artisanal production. William Carnegie was unable to adapt to emerging conditions of the new industrial age, and by 1948 could hardly find a job. All the care of the family was taken over by Margaret Carnegie. Having borrowed the money for a trip, in May 17, 1848 the family joined the 188,233 Britons who emigrated to the United States. Carnegie settled in Slebtaune (PA) in a tiny house. And that was the city where 13-year-old Andrew Carnegie stepped on the ladder of success.
“Both William and Andrew found jobs at the Blackstock Cotton Mill, a cotton-weaving factory. Andrew’s first paying job earned him $1.20 a week.”(Rau, p.30) For this work he was paid 1 dollar 20 cents a week. Later on, a friend of the family offered the boy a job on the boiler. When the young Carnegie was working there, he had to spend long hours alone in a basement of the company, what was quite hard for him. However the business expanded and the factory owners needed an assistant, so Andrew turned into an office worker. His salary increased to 2 dollars a week. After working for 12 hours the Andrew was taking accounting lessons, given by an accountant in Pittsburg. In these sessions the young Carnegie discovered his aptitude for mathematics. Not long after Andrew got a job at the factory, he decided to switch the job, and started to work in the “O’Reilly Telegraph Company”. It was already the third place of work for three months in Slebtaune. His wages increased to 11 dollars 25 cents a month, and soon it was $13.50. Carnegie’s family quickly restored its financial position and was soon able to return the money, borrowed for the trip, and to buy a house.
A job of a messenger enabled Carnegie to know about everything and everyone in the business circles of the city. He taught himself telegraph and achieved perfection in this business - he could run faster than anyone on the key. By 1851, his salary rose to $ 25 a month.
The Crucial for Carnegie was meeting with Thomas Alexander Scott, who was a deputy manager of the western section of the “Pennsylvania” railway. At that point the road had only one track, and Scott realized that he needed his own telegraph. Carnegie was the best candidate for the post of the head of the telegraph. By that time Andrew had learned how to decrypt telegrams aurally, without using the system, invented by Samuel Morse. In 1853, the steel king took his job in the " Pennsylvania " and his salary has risen by 40 % to $ 35. This assignment allowed him to be at the epicenter of transportation in one of the fastest growing industrial areas of the United States.
Carnegie had many talents, not only in the professional field. He was brave and courageous in his actions, he knew how to win people’s attention, and he avoided intermediaries in everything. Scott appreciated his talents, and, in fact, it was he who introduced him to the world of big business people. At that point Andrew was known as “the Andy kid”, or “Mr. Andy Scott”. One day a remarkable event happened on " Pennsylvania " railroad, when that same kid helped to save the inflamed situation. The accident in the eastern sector has led to a halt trains on the line. Carnegie learned about it right away, as soon as arrived at work, but Mr. Scott could not be found. And that was the point, when Carnegie took a risk to rectify the situation by putting his future at stake. He began to knock orders on a telegraph key, with a TAS (Tomas Alexander Scott) signature. When Scott burst into the office, Andrew clearly laid out everything that had happened, and the measures he had taken. As Carnegie wrote later: " For a moment, Scott looked me straight in the face. I hardly dared to look up. " But he soon found out through third parties, that Scott showed off his protégé to friends.
It was probably the time when Thomas filled with great confidence to his " baby Andy", and therefore he offered Carnegie to do joint investments. The amount that was required for investing to “Adams Express Company “ stocks was $610. In 1856, it was a fortune, and of course, Andrew did not have the funds. Most likely Thomas had lent him the whole amount, although Carnegie claimed that it was this matter who helped him. Thanks to that investment, Carnegie learned how money could make money, and Andrew had evolved from employee in the capitalist.
In 1859, Scott became a vice-president of “Pennsylvania” railway. At a meeting with President Thomson, Thomas managed to convince him that Carnegie (who at the time just turned 24) was an excellent candidate for the post of the manager of the Western branch of Pennsylvania railway. So, by December 1, 1859 Andrew Carnegie was one of the key figures in the " Pennsylvania " with a salary of $1,500. However by the time Andrew was not so much worried about the size of his salary. In 1858, he made the investment in a very promising company, which produced sleepers — “Woodruff “. And that year had become very lucky for him. In 1863, his total income was 42,260 dollars. In the same year, his salary was $ 2,400. In 1865, Carnegie left the " Pennsylvania " being already an accomplished entrepreneur and investor. “By 1868, Pittsburgh was the major iron and steel producer in the nation. Pittsburgh produced about 45% of the nation’s total iron production. In 1867, Andrew Carnegie started his first iron works there.” (Scrabec, p.37)
Carnegie possessed “the sense of the critical moment for action” (Josephson, p.173). Shortly before the stock market crash in 1873, he sold all his shares and invested the money in steel production. “In 1875 Carnegie built the first large-scale steel plant in the United States. He named it Edgar Thomson Steel Works after the head of the Pennsylvania Railroad.” (Gillam, p. 44) Of course, Thomson was flattered, and Carnegie could not worry about the future orders. And, in order to save money and not to pay for the coke, so necessary in the steel industry, Carnegie bought a majority stake in the largest manufacturer. “The union of the Carnegie and Frick companies in 1883 had given an overwhelming impetus to the industrial machine which the men assembled in the form of a vertical combination”. (Josephson, p.264) The former owner — Henry Frick, became a manager. “The eventual success of the mill was a tribute to Carnegie’s tremendous drive and skill in cost cutting costs.” (Gillam, p.44)
As a result, the cost of production had decreased tenfold, and the Carnegie Steel Corporation, in which Carnegie ten years later - in 1899 brought together all its steel business, in terms of production went around the entire British steel industry.
In 1901, the 66-year-old Carnegie was going to retire. He began to transform his company into a joint stock corporation. At that time John Morgan was a banker, and perhaps the most important U.S. financial entrepreneur. He watched intently as Carnegie made his profit, and made plans about combining the steel industry in order to reduce costs, produce more, and increase wages to workers. To do this, he needed to buy the Carnegie’s company and several other smaller companies, to eliminate the competition and unnecessary costs. Therefore, on March 2, 1901 he conducted the negotiations, a deal that eventually led to the formation of United States Steel Corporation. The Carnegies’ share was $ 400,000,000, which was paid by to him in gold bullion.
“Carnegie was pleased with all the money he had made. He had earned it by hard work and smart choices. But he had so much money, that he wanted to give some away. It was his responsibility, to distribute wealth in community. ” (Rau, p.11) So, he bought a castle in Scotland and lived partly in it, partly in New York. He dedicated his life to serving the public interest, as well as to developing of education. He was an ardent supporter of the movement for spelling reform as a means of promoting the spread of the English language. “Specifically, Carnegie aimed at the most needy and “acceptable” making it charity”. (Skrabec, p.216)
Carnegie died on August 11, 1919 in Lennox, Massachusetts from bronchial pneumonia. “He was buried amid rolling hills, alongside the Hudson, in a graveyard filled with Americans in a landscape reminiscent of Scotland.” (Nasaw, p.799)
Bibliography
Carnegie, Andrew. Autobiography of Andrew Carnegie. N.p.: Tredition, 2012. Print.
Carnegie, Andrew. The Empire of Business. New York: Cosimo Classics, 2007. Print.
Carnegie, Andrew. Round the World. New York: Cosimo Classics, 2005. Print.
Carnegie, Andrew. Triumphant Democracy; Or, Fifty Years' March of the Republic,. New York: Cosimo Classics, 2005. Print.
Edge, Laura Bufano. Andrew Carnegie. Minneapolis: Twenty-First Century, 2004. Print.
Gillam, Scott. Andrew Carnegie: Industrial Giant and Philanthropist. N.p.: ABDO, 2009. Print.
Josephson, Matthew. The Robber Barons: The Great American Capitalists, 1861-1901. Vol. 47. N.p.: Transaction, 1962. Print. A Harvest Book.
Nasaw, David. Andrew Carnegie. London: Penguin, 2007. Print.
Rau, Dana Meachen. Andrew Carnegie: Captain of Industry. N.p.: Capstone, 2005. Print.
Skrabec, Quentin R. George Westinghouse: Gentle Genius. New York: Algora Pub., 2007. Print.
