Andrew Carnegie was born on November 25, 1834, in Dunfermline, Scotland. Carnegie lived in a small weaver’s cottage where there was one main room which served as the living room, dining room and bedroom. Carnegie got his early education at the Free School in Dunfermline.
At the age of 13, Carnegie’s father fell on some very tough times so his mother jumped into help make ends meet. Selling potted meats in her store and helping out a local cobbler, she became the primary breadwinner of the family in the 1840s. After a few years of struggling to make ends meet, the family decided to move to the United States and settled in Allegheny, Pennsylvania.
Carnegie took his first job in America as a bobbin boy. He would change the spools of thread in a cotton mill twelve hours a day, for six days a week. His starting pay for this job was $1.20 ($26.26 in 2017) per week. In 1850, Carnegie became a telegraph messenger boy for the Pittsburgh Office of the Ohio Telegraph Company. This job came with a significant pay raise to $2.50 (76.00 in 2017) per week. After working there for some time, he started to memorize all the locations of Pittsburgh’s businesses and the faces of important men.
In 1853, Thomas Scott of the Pennsylvania Railroad employed Carnegie as a secretary and telegraph operator for $4.00 ($125.00 in 2017) per week. Carnegie rapidly shot up through the company, and by the age of 18, he became superintendent of the Pittsburgh division. During his time with the railroad, Carnegie learned a lot about management and cost control from Thomas Scott. Scott was also very instrumental in Carnegie’s first investments.
In 1861, Carnegie was appointed by Thomas Scott (who was now Assistant Secretary of War in charge of military transportation) as superintendent of the military railways and the Union government’s telegraph lines in the east. Carnegie helped open rail lines into Washington D.C. that rebels had cut. Carnegie rode the locomotive pulling the first brigade of Union troops to reach Washington D.C. Following the defeat of Union forces at Bull Run, he personally supervised the transportation of the defeated forces.
Under his supervision, the telegraph services systematically assisted in a Union Victory. Carnegie joked that “he was the first casualty of the war” when he gained a scar on his cheek from freeing a trapped telegraph wire.
In 1864, Carnegie invested $40,000 in Story Farm on Oil Creek in Venango County, Pennsylvania. In one year, the farm yielded over 1,000,000 dollars in cash and dividends and petrol from oil wells on the property. Demand for iron products, such as armor for gunboats, cannons and shells and several other products, made Pittsburgh the center of wartime production.
After the war, Carnegie left the railroad business to devote his time and business to the ironworks trade. Carnegie formed two businesses, the Keystone Bridge Works and the Union Ironworks in Pittsburgh, Pennsylvania. Carnegie made his fortune in the steel industry by controlling the most extensive integrated iron and steel operations ever owned by an industrialist in the United States.
Carnegie discovered a cheap and efficient method to mass produce steel. First, he adapted the Bessemer Process of Steel making. Secondly, he vertically integrated all of his supplies and raw material. By the late 1880s, Carnegie Steel was the largest manufacturer of pig iron, steel rails and coke in the world. In 1883, Carnegie bought rival Homestead Steel Works. this purchase included tributary coal and iron fields, a 425-mile long railway and a line of lake steamships.
In 1879, Carnegie and a few of his partners opened up the South Fork Fishing and Hunting Club, located just north of Johnstown, Pennsylvania. The Club was built near the South Fork Dam which was originally built to be part of a canal system that had been intended to cross the state to provide a means of transportation between Philadelphia and Pittsburgh. However, due to the growth of the railroad, the canal system was scrapped and the dam was sold by the state to private entities. It was sold and purchased several times and during this time period, less than ideal repairs were made to the dam. Most repairs were made using mud and straw. One of the previous owners went as far as to sell the discharge pipes that were intended to allow for a controllable release of water out of the dam. By the time the South Fork Dam was purchased by the South Fork Fishing and Hunting Club, there was not much stability left in the dam.
On May 31, 1889, the first of two incidents that marred Carnegie’s life occurred. A combination of faulty repair work on the dam, a reduction in the height of the dam, high snow melt and heavy spring rains combined to cause the dam to break. Johnstown, Pennsylvania sat 20 miles downstream of the dam. When the dam broke, the water flooded Johnstown and a number of other small communities located in the same valley, killing 2,209 people. Once news of the dam’s break was telegraphed to Pittsburgh, Henry Frick and other members of the South Fork Fishing and Hunting Club formed the Pittsburgh Relief Committee for assistance to the flood victims. All the club members also agreed to never speak publicly of the incident ever again.
The second major incident that occurred under Carnegie’s watch was the Homestead Strike, which was one of the bloodiest in American history. The labor confrontation lasted for 143 days in 1892, and was centered at Carnegie’s steel main plant in Homestead, Pennsylvania. The confrontation started from a dispute between the National Amalgamated Association of Iron and Steel Workers of the United States and Carnegie Steel Company. To avoid being a part of this, Carnegie left for Scotland and let Henry Frick handle the dispute. Frick brought in thousands of strikebreakers to work the steel mills as well as Pinkerton agents to safe guard them. On July 6, 300 Pinkerton agents arrived which resulted in a fight, killing ten men. Seven of the ten were strikers and three were Pinkerton agents.
In 1901, at the age of 66, Carnegie was considering retirement, so he restructured his enterprises into joint stock corporations. Once he did this, John Pierpont Morgan who had witnessed how efficiently Carnegie made a profit, decided to buy out Carnegie. On March 2, 1901, Carnegie’s steel enterprises were purchased by JP Morgan for 480 million dollars (13.8 billion in 2017). Carnegie’s share of this was 225,639,000 dollars (6.5 billion in 2017) paid to Carnegie in the form of 5 percent, 50-year gold bonds. It was said that “Carnegie never wanted to see or touch these bonds that represented the fruition of his business career. It was as if he feared that if he looked upon them they might vanish like the gossamer gold of the leprechaun. Let them lie safe from New York tax assessors until he was ready to dispose of them.”
Carnegie was always very busy as a scholar and activist. He befriended several famous poets such as Mathew Arnold and humorist, Mark Twain. He also had correspondence with several U.S. Presidents. Carnegie was also never selfish with his money. He built swimming baths in Dunfermline, Scotland. He also donated to the Dunfermline Carnegie Library in Scotland. In the United States he gave to Bellevue Hospital Medical College, which is now part of the New York University Medical Center, to fund a historical laboratory now called the Carnegie Laboratory. At one point, Carnegie even offered the Philippians 20 million dollars so they could buy their independence from the United States.
Carnegie helped open over three thousand libraries and gave two million dollars to start Carnegie Institute of Technology, which is now known as Carnegie Mellon University. He also funded the construction of seven thousand church organs, and he built and owned Carnegie Hall in New York City. Carnegie was also a large benefactor of the Tuskegee Institute for African American Education which was established by Booker T. Washington. He also worked with Washington to establish the National Negro Business League to help promote the interests of African-American businesses. In 1904, he founded the Carnegie Hero Fund to recognize ordinary people who performed extraordinary acts of heroism in the United States and Canada.
By the time Carnegie had passed away on August 11, 1919, he had given away over 350 million dollars (approx 76.9 billion in 2017) of his wealth. After his death, his remaining 30 million dollars was given to foundations, charities and pensioners.