A brief summary of Andrew Carnegie’s historic essay, The Gospel of Wealth: The Problem of the Administration of Wealth.
In 1889, steel mogul Andrew Carnegie published a short essay entitled Wealth, in which he discusses how the wealthy should use their personal fortunes. This essay was republished in the UK under the title The Gospel of Wealth. Carnegie went on to write a series of additional essays, which were collected and published in book form in 1900. Subtitled as The Problem of the Administration of Wealth, his original essay forms the first part of the twelve-chapter book.
The Problem of the Administration of Wealth begins with an analysis of the economic state of the world. Advances in industry had raised the standard of living for the poorest people to a level unknown to kings of earlier ages. But these advances brought another change: a heretofore unseen level of disparity between the rich and the poor.
Carnegie then offers a muddled defense of Capitalism before appealing to pragmatism: Capitalism is the order of the day and one must accept it.
This brings him to his main point: since Capitalism results in a few people amassing huge personal fortunes, what is the proper moral use for those fortunes? It being humanly impossible to spend that much money on oneself, Carnegie identifies three possible courses of action:
- Leave the fortune to heirs
- Bequeath the fortune to charity
- Give the fortune to charity during one’s lifetime
The first he finds untenable because a man’s heirs are rarely able to put it to good use. Spoiled heirs squander and lose the money; it benefits no one.
Bequeathing one’s fortune to charity is little better than leaving it to one’s heirs, because there is no way to ensure the money is well spent. A charitable institution is not likely to be a better steward of money than an heir. Nor does bequeathing a fortune to charity deserve any respect, because a man who waits until his death to give to charity is a man who presumably would rather have taken it all with him.
The only proper use of a personal fortune, says Carnegie, is to use it for the public good during one’s lifetime. That is the only way to ensure that it is used properly, not wasted. A philanthropist should not spend the money in ways that encourage dependence and actually work to harm the recipients of charity, but rather use it only to fund enterprises that are genuinely helpful to the public.
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The first thing I wanted to know after reading your post was “what were Andrew Carnegie’s religious views?” One Google search attributed this quote to him:
“I don’t believe in God. My god is patriotism. Teach a man to be a good citizen and you have solved the problem of life.”
In another place I found a theology prof’s book review of an Andrew Carnegie biography, which said:
“One of the findings that particularly interested me was Carnegie’s religious views. Raised in a family that had little use for their native Church of Scotland, Carnegie attended a Swedenborgian enclave for a while as a teenager. But until he makes the acquaintance of Hebert Spencer, he wrestles to find a philosophy that articulates his own very secular beliefs. Spencer, the apostle of “Positivism,” gives Carnegie the social evolutionary hope in progress that allows him to justify his own personal success and to view the world through rose-colored glasses. When the Great War is unleashed in 1914, Carnegie’s faith is crushed, he lapses into an emotional breakdown and essentially stops communicating with the world until his death in 1919.”
I just wanted to know what was and was not motivating the man.
This was very helpful towards what i was looking for; however, I would like to know is how he defends the great wealth accumulated by the industrialists?
Carnegie’s defense of capitalism is in an essay entitled The Advantages of Poverty. I wrote a brief review of it: http://www.luforum.com/strangerthansf/nonfiction/carnegie-gospelofwealth03.html
i need to know 4 questions..
1. does carnegie believe that all inequalities of income should be abolished, and why?
2. how does carnegie hope to prevent communism and unrest among the lower class?
3.why would a rich man like carnegie support the estate tax?
4. how should a rich man spend his money?
Thanks for stopping by, Morgan. I can’t claim to speak for Andrew Carnegie, but I did read his essays, so I’ll try to respond.
1. Carnegie did not believe income inequality should be abolished. He firmly believed in capitalism and the rights of a man to make his own fortune.
2. I believe Carnegie advocated a policy of treating workers well and enlisting them as partners in making the business succeed. He devoted an article (An Employer’s View of the Labor Question, which I’ve written a review of) to this question. He suggests that labor disputes should be solved through negotiation rather than strikes.
3. I don’t know if Carnegie supported an estate tax, but it would fit nicely into his worldview. He took a dim view of anyone who didn’t spend his excess wealth in philanthropic pursuits. He particularly thought it was bad to leave money to one’s children, which would encourage them to be lazy.
4. Part two of the Gospel of Wealth explains what a man should spend his money on. I wrote a review. The short version: a man should spend his money on universities, libraries, hospitals, parks, performance halls, public swimming pools, and churches.