Andrew Carnegie

Andrew Carnegie was born poor, a weaver’s son, but went on to become one of the wealthiest people in history. And then he gave most of his money away…

Video 1: Rags to Riches

Focus on Today. What is Homestead like today? The steel factory, once the biggest in the world, closed in the 1980s. In its place sits a shopping mall. The mall provides some jobs for local residents, but not many. And most of those jobs don’t pay much. Pittsburgh has earned praise for reinventing its economy in the post-industrial era. But many of the old mill towns have not benefited from the economic renaissance.

Last Smokestacks at the Homestead Works, c. 1995, by Charlee Brodsky

In the face of crumbling infrastructure and rampant unemployment, residents and community activists have come together to reinvent old mill towns like Homestead. Braddock, Pennsylvania—just up the river from Homestead—has become a national icon of a struggling community fighting for a better future. In 1892, the steelworkers of Homestead fought for a living wage and the right to have a say in the conditions of their labor. That struggle continues in Homestead, Braddock, and many old industrial towns throughout America.

Interact and Learn. Click on people in the image of the Homestead Strike below (drawn for SC101 by Scott Porcelli) to learn about their conflicting perspectives.

Global Connections. Homestead was a product of the Industrial Revolution, and so was Andrew Carnegie. A massive transformation in how people lived and worked, the Industrial Revolution swept across the world in the 18th and 19th centuries.

The Industrial Revolution as mapped in Philips’ New Historical Atlas for Students by Ramsay Muir, M.S., 1911

The Industrial Revolution began in Carnegie’s home country, the United Kingdom, and transformed his adopted land, the United States. Over time, nowhere in the world would be left untouched by the consequences of industrialization. Indian farmers sent cotton to the textile mills of England. Steel from Carnegie’s factories built railroads and ships that brought together an increasingly interconnected global economy. Who benefited from those connections? Industrialization was global but most of the profit was concentrated in Western Europe and the United States. Even within those countries, much of the money generated by industrialization ended up in the hands of elite industrialists like Andrew Carnegie. Industrialization widened the gap between the rich and the poor. The aristocracies of old gave way to new networks defined by money and power. Limited by race, class, and gender, those networks were closed to the majority of the world.

Experiment in social change. Look at your cell phone contacts, Facebook friends, and email lists, and consider the nature and extent of your own networks. How might you strengthen your relationships or bring new people into your network? First, think about someone you admire who is not in your immediate network (a potential mentor figure, perhaps, or an old teacher) and reach out to that person. See if you can share a conversation either in person or over the phone. You might explain that you want to know more about that person’s path to where they are today. Second, chose someone who is in your network but with whom you haven’t spoken for some time, and reach out to that person, letting them know how much they matter to you. Think about your history together, how you met, what you have in common, or what drew you apart. Third, consider if there is someone you might help by bringing into your network, maybe a younger student you could mentor or a neighbor who could use a friend. If you are a student, consider study abroad as a way to broaden your circle. Direct person-to-person connections are a powerful form of social change, but they also tend to be limited by the many distinctions (national, racial, religious, etc.) that divide this world. Approximately one billion people on this planet are desperately poor. Are you friends with any of them? If not, why not?

Reflect and Question. Here is an image of the Earth at night:

And here is a map of global Facebook networks:

What do these maps show? Why are some parts of the world better connected than others? (Be careful not to equate being on Facebook with being connected. China is largely dark in the above map, but only because the Chinese government has blocked access to Facebook while allowing access to other forms of social media that abide by government censorship. Does that mean that the Chinese are less connected?)

How can we build more inclusive networks? (Check out this article on “mesh networks” for some interesting ideas.)

What are the advantages and disadvantages of being “connected”? (Consider the fact that people spend money on devices that limit their access to the Internet.) Is a more connected world a better world?

To learn more about how Andrew Carnegie used his networks, watch Video 2: How to Spend Your Fortune…

Video 2: How To Spend Your Fortune

Focus on Today. The Gilded Age. That is what Mark Twain named the era he shared with Andrew Carnegie. Wealth abounded, but so did poverty. Inequality deepened as the United States industrialized. After the Second World War, that trend reversed. The gap between the rich and the poor began to shrink, in part as a result of government policies like the GI Bill and Medicare. But levels of inequality in the United States have skyrocketed once again:

And the gap between the rich and the poor is even more stark when viewed on a global scale:

World map showing countries by nominal GDP per capita in 2007

Inequality exists between countries and within countries. Where did all that inequality come from?

In 2014, Thomas Piketty, a French economist, published a best-selling book on the long-term evolution of inequality on a global scale. The Carnegie Mellon University CREATE Lab produced this map of the changes that Piketty explored:

Some countries have relatively little inequality. Denmark, Sweden, and Austria are among the most equal in terms of wealth. Other countries are dramatically unequal. Brazil, South Africa, and the United States all suffer from relatively steep divides between the rich and the poor. Why do some countries have so much more inequality than others? And why is the world itself so unequal?

Global Connections. Many of the world’s inequalities can be traced to the lopsided nature of the industrial revolution. As Andrew Carnegie’s life makes clear, the industrial revolution made fortunes, but those fortunes were not evenly shared. As the world industrialized and the process of production shifted toward large factories, workers began to organize unions to demand their share of the growing wealth.

Those unions crossed borders, but not as easily as companies or commodities. Karl Marx and Friedrich Engels famously proclaimed, “Workers of the World Unite!” But the labor movement faced a variety of divisions—racial, national, religious—that prevented a unified response to the inequalities that came with industrialization.

Experiment in social change. The $100 challenge. Andrew Carnegie responded to the inequalities of industrialization by giving away millions and millions of dollars. Chances are that you don’t have that kind of cash lying around. But if you worked with your friends and family, how much could you raise? Just as Carnegie worked his networks to amass the fortune he gave away, you can use your networks to create positive change in the world. Start by identifying a charity you believe in (there are several in the links page). Write a few sentences about why that charity matters to you, and share your thoughts with friends and family. Ask each friend or family member to give $5. Or consider using a website like kickstarter. See if you can raise at least $100. That much money can do more good than you might imagine.

Reflect and Question. The renowned social reformer, Jane Addams, saw a contradiction between charity and democracy. In her article, “The Subtle Problems of Charity,” Addams wrote: “The very need and existence of charity deny us the consolation and freedom which democracy will at last give.” Do you agree? In a democracy, should there be a need for charity?

What do you think about the “Giving Pledge“? A challenge started by Bill and Melinda Gates and Warren Buffet, the Giving Pledge is an effort to create more Andrew Carnegies in today’s world. To join the “Giving Pledge”, you must be a billionaire and be willing to give away at least half of your money. What is more shocking–that someone would give away half a billion dollars or that there are people who own a billion dollars in a world where millions of children don’t get enough to eat?

Explore this graphic of the richest Americans of the 20th century and consider what similarities link most of those at the top of economic pyramid. How many profited from a new technology? How many inherited part of their fortune? How many are white men?

Many of the most powerful industrialists gained money through monopolies, bribery, or other forms of illegal or unethical business. Can we reconcile the unsavory dimensions of Carnegie’s rise to power with the positive impact of the money he donated? Decide for yourself after watching Video 3: The Business of Life…

Video 3: The Business of Life

Focus on Today. Businesses exist to make money, but their impact goes well beyond profit. Sometimes that impact is negative. Think of the air pollution from Carnegie’s steel mills. But companies can also offer benefits to society—benefits that go beyond jobs, profits, and products. Some businesses build philanthropy into their model, like Tom’s Shoes, a company that donates a pair of shoes for every pair purchased.

Others try to serve poor customers with a product or service of high quality but low cost. The effectiveness of such “bottom of the pyramid” approaches to economic development remains hotly debated. Equally controversial is the role of microloans like those pioneered by the Grameen Bank in Bangladesh. At their best, such initiatives can create self-sustaining business models that can empower poor people to escape poverty. At their worst, microloans can come with high interest rates that drive the poor even deeper into debt.

Global Connections. While the industrial revolution helped create global inequalities, imperialism deepened those inequalities. Carnegie fought imperialism, but even his massive fortune was not enough to stop the spread of empire. By the First World War, most of Africa and Asia was under the control of Europe.

Why did Europeans colonize Latin America, Asia, and Africa rather than the other way around? The Europeans had guns, germs, and steel, but why?

Carnegie attacked imperialism because he believed it was harmful to all involved—even the imperialists themselves. He feared that empire would breed war. In August 1914, his fears came true. The First World War, caused in part by competition over empire, shattered Carnegie’s world. The great European empires turned on each other, and millions died from the trenches of France to the deserts of Arabia. As his own health deteriorated, Carnegie poured time and money into achieving a lasting peace. He believed that world peace was a realistic goal. Was he wrong?

Experiment in social change. Take a trip to a nearby cemetery. Bring a pen and piece of paper and find a quite spot. Think about your own funeral. What would you want your friends and family to say about you and your life? How can you live up to that vision of yourself? Choose something specific and try to implement it for one week. It’s harder than it sounds. Could you be kinder to strangers? Could you laugh more often? After the week is over, head back to the cemetery, and reflect on your success. Can you make the change last? Then ponder the fact that you have the opportunity to change, while so many people, many of them very young, have died needlessly in war. Could you help achieve the peace that Andrew Carnegie believed was possible? Consider joining an organization that attacks the roots of war, like seeds of peace, or chose a particular conflict that you care about and find out who is trying to bring peace. How can you help?

Reflect and Question. In 2006, Randy Pausch, a Computer Science Professor at Carnegie Mellon University, was diagnosed with Pancreatic Cancer. Before passing away, he gave his “Last Lecture,” a powerful challenge to pursue your childhood dreams that has become a popular youtube video and a New York Times Best Seller.

As you read or listen, think about your own childhood dreams: How have you lived them? How have they changed? What are your dreams now and how can you live up to them? Also think about what enables some people to pursue their dreams (think of Andrew Carnegie) while others are trapped in situations they can never escape, no matter how hard they try.

Keep Learning. To learn more about Andrew Carnegie, explore our suggestions for further reading or…

See how networks empowered Rosa Parks…Explore Gandhi’s rise to power…Compare Carnegie’s innovation with Einstein’s genius…Learn how Rachel Carson grappled with the legacy of industrialization…