Modern History Sourcebook:
The Gospel of Wealth, 1889
Andrew Carnegie (18351919) was a massively successful
business man - his wealth was based on the provision of iron and
steel to the railways, but also a man who recalled his radical
roots in Scotland before his immigration to the United States.
To resolve what might seem to be contradictions between the creation
of wealth, which he saw as proceeding from immutable social laws,
and social provision he came up with the notion of the "gospel
of wealth". He lived up to his word, and gave away his fortune
to socially beneficial projects, most famously by funding libraries.
His approval of death taxes might surprise modern billionaires!
The problem of our age is the administration of wealth, so that
the ties of brotherhood may still bind together the rich and poor
in harmonious relationship. The conditions of human life have
not only been changed, but revolutionized, within the past few
hundred years. In former days there was little difference between
the dwelling, dress, food, and environment of the chief and those
of his retainers. . . . The contrast between the palace of the
millionaire and the cottage of the laborer with us today
measures the change which has come with civilization.
This change, however, is not to be deplored, but welcomed as highly
beneficial. It is well, nay, essential for the progress of the
race, that the houses of some should be homes for all that is
highest and best in literature and the arts, and for all the refinements
of civilization, rather than that none should be so. Much better
this great irregularity than universal squalor. Without wealth
there can be no Maecenas [Note: a rich Roman patron of the
arts]. The "good old times" were not good old times
. Neither master nor servant was as well situated then as to day.
A relapse to old conditions would be disastrous to both-not the
least so to him who serves-and would sweep away civilization with
. . .
We start, then, with a condition of affairs under which the best
interests of the race are promoted, but which inevitably gives
wealth to the few. Thus far, accepting conditions as they exist,
the situation can be surveyed and pronounced good. The question
then arises-and, if the foregoing be correct, it is the only question
with which we have to deal-What is the proper mode of administering
wealth after the laws upon which civilization is founded have
thrown it into the hands of the few? And it is of this great question
that I believe I offer the true solution. It will be understood
that fortunes are here spoken of, not moderate sums saved by many
years of effort, the returns from which are required for the comfortable
maintenance and education of families. This is not wealth, but
only competence, which it should be the aim of all to acquire.
There are but three modes in which surplus wealth can be disposed
of. It can be left to the families of the decedents; or it can
be bequeathed for public purposes; or, finally, it can be administered
during their lives by its possessors. Under the first and second
modes most of the wealth of the world that has reached the few
has hitherto been applied. Let us in turn consider each of these
modes. The first is the most injudicious. In monarchial countries,
the estates and the greatest portion of the wealth are left to
the first son, that the vanity of the parent may be gratified
by the thought that his name and title are to descend to succeeding
generations unimpaired. The condition of this class in Europe
today teaches the futility of such hopes or ambitions. The
successors have become impoverished through their follies or from
the fall in the value of land.... Why should men leave great fortunes
to their children? If this is done from affection, is it not misguided
affection? Observation teaches that, generally speaking, it is
not well for the children that they should be so burdened. Neither
is it well for the state. Beyond providing for the wife and daughters
moderate sources of income, and very moderate allowances indeed,
if any, for the sons, men may well hesitate, for it is no longer
questionable that great sums bequeathed oftener work more for
the injury than for the good of the recipients. Wise men will
soon conclude that, for the best interests of the members of their
families and of the state, such bequests are an improper use of
. . .
As to the second mode, that of leaving wealth at death for public
uses, it may be said that this is only a means for the disposal
of wealth, provided a man is content to wait until he is dead
before it becomes of much good in the world.... The cases are
not few in which the real object sought by the testator is not
attained, nor are they few in which his real wishes are thwarted....
The growing disposition to tax more and more heavily large estates
left at death is a cheering indication of the growth of a salutary
change in public opinion.... Of all forms of taxation, this seems
the wisest. Men who continue hoarding great sums all their lives,
the proper use of which for public ends would work good to the
community, should be made to feel that the community, in the form
of the state, cannot thus be deprived of its proper share. By
taxing estates heavily at death, the state marks its condemnation
of the selfish millionaire's unworthy life.
. . . This policy would work powerfully to induce the rich man
to attend to the administration of wealth during his life, which
is the end that society should always have in view, as being that
by far most fruitful for the people....
There remains, then, only one mode of using great fortunes: but
in this way we have the true antidote for the temporary unequal
distribution of wealth, the reconciliation of the rich and the
poor-a reign of harmony-another ideal, differing, indeed from
that of the Communist in requiring only the further evolution
of existing conditions, not the total overthrow of our civilization.
It is founded upon the present most intense individualism, and
the race is prepared to put it in practice by degrees whenever
it pleases. Under its sway we shall have an ideal state, in which
the surplus wealth of the few will become, in the best sense,
the property of the many, because administered for the common
good, and this wealth, passing through the hands of the few, can
be made a much more potent force for the elevation of our race
than if it had been distributed in small sums to the people themselves.
Even the poorest can be made to see this, and to agree that great
sums gathered by some of their fellowcitizens and spent
for public purposes, from which the masses reap the principal
benefit, are more valuable to them than if scattered among them
through the course of many years in trifling amounts.
. . .
This, then, is held to be the duty of the man of Wealth: First,
to set an example of modest, unostentatious living, shunning display
or extravagance; to provide moderately for the legitimate wants
of those dependent upon him; and after doing so to consider all
surplus revenues which come to him simply as trust funds, which
he is called upon to administer, and strictly bound as a matter
of duty to administer in the manner which, in his judgment, is
best calculated to produce the most beneficial result for the
community-the man of wealth thus becoming the sole agent and trustee
for his poorer brethren, bringing to their service his superior
wisdom, experience, and ability to administer-doing for them better
than they would or could do for themselves.
Andrew Camegie, "Wealth," North American Review, 148, no. 391 (June 1889): 653, 65762.
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(c)Paul Halsall Aug 1997