ANDREW CARNEGIE

Industrialist and Philanthropist

Andrew Carnegie was born in Dunfermline, Scotland on November 25, 1835 and came to Pittsburgh with his family in 1848. His father Will, a skilled weaver in Scotland before steam-powered looms made him unemployed, found work in a cotton mill and Andrew also found work there as a bobbin boy, earning $1.25 a week. He taught himself to read, and educated himself with borrowed books. Carnegie took his meager earnings over the next several years and invested in the stock of several young companies.

Carnegie distinguished himself in a series of small but increasingly important jobs. He became a messenger in a telegraph office in 1849, and soon a telegraph operator. In 1853, he became the telegrapher and personal assistant to Thomas Scott, the head of Pennsylvania Railroad's western division. In one of his best early investments, he invested $217.50 in the Woodruff Sleeping Car Co., which soon earned him $5,000 annually. In 1859, when Scott was promoted, Carnegie took over his job as Superintendent of the western division.

Carnegie formed the Freedom Iron Company in 1861, and when he retired from the railroad in 1865 he organized, along with a few others, the Keystone Bridge Company, with the idea of replacing wooden bridges with iron ones. In 1867, he organized the very succesful Keystone Telegraph Company.

Carnegie introduced the Bessemer steel making process to America. In 1875 he opened his largest steel plant, the Edgar Thompson Works, in Braddock, PA. It was named for the president of the Pennsylvania Railroad. A large, steady supply of coal and coke was needed as fuel to make this steel. Most of the coal and coke in the area, especially the rich "Connellsville Coke", was controlled by Henry Clay Frick. Carnegie bought a large share of Frick's company in 1881, giving Frick wealth but giving Carnegie control over Frick's company, though Carnegie tapped Frick to be one of his leading managers. In 1887 Carnegie used that investment to force Frick to settle a labor disagreement peacefully. Carnegie and Frick disagreed over how to handle labor problems, and these differences would show up in the famous Homestead Strike in 1892. This erupted when Carnegie was out of the country and Frick put the strike down with the use of violence, against Carnegie's usual pro-labor stance, though Carnegie would be blamed for it.

In 1886 his mother, Margaret died. They had been very close, and she had been opposed to him marrying. But the next year he finally married the woman he had been seeing for several years, Louise Whitfield.

Carnegie was a student of the manufacturing process, and believed that unit costs was extremely important. If the entire process, from natural resource to finished product, was traced, improvements could be made to raise the productivityand lower the cost. An example of the success of this would be the cost of steel rails, which in 1875 was $160 a ton but by 1898 it was down to $17 a ton.

In 1899, Carnegie joined several of his business interests by forming the Carnegie Steel Company in 1899, which was immediately a leader in the business. Continuing tensions between he and Frick caused Carnegie to ask Frick to resign from the board. After a bitter court battle, Frick accepted a great deal of money and left the company. In 1901, Carnegie sold out to a group organized by J. P. Morgan as the United States Steel Corp., which was based on Carnegie's holdings and was the largest corporation in the world at that time. The profits make Carnegie the richest man in the world.

Carnegie had decided that he should do things to help people and give much of his money away before he was 35 years of age. In fact, he felt degraded by the wealth he had amassed even at that time. He did a great deal of philanthropy during his working life. Notably, he gave money to towns to build free public libraries, as well as books for existing libraries. Over 2,500 libraries were built with his money. He did require that the town give money for books and annual upkeep. He also gave money for museums and concert halls (such as New York City's Carnegie Hall). He also started the Carnegie Institute of Technology in Pittsburgh (now Carnegie Mellon University)

After his retirement, he continued giving away his money. He established the Carnegie Institution to fund research in American colleges, the Carnegie Endowment for International Peace, and the Carnegie Corporation for scientific research. He donated money to build the Peace Palace in the Hague, Holland, and the Pan-American Building in Washington, D. C. He also gave money for the Carnegie Hero Fund, and much more. He believed that "He who dies rich dies disgraced." Although in 1998 American Heritage Magazine listed him as one of the Wealthiest Americans of all time, and he was still rich when he passed away in Massachusetts on August 11, 1919, Carnegie had given away over 90% of his fortune. His money still has an impact today, from proving DNA is the genetic material to supporting the Sesame Street television program.