The Gospel of Wealth

We’ve been watching the flow of huge amounts of money from donors to political campaigns or from advocates into petition campaigns or from advocates through the legislature to support issues lawmakers put on the ballot or write into the statute books.  On next Monday’s Campaign Watch discussion with Joe Mannies of the St. Louis Beacon (stlbeacon.,org) and Steve Kraske of the Kansas City Star (kcstar.com), we discuss unlimited campaign donations as part of our talk about the campaigns this year (there are other topics, too).  We’ll post that conversation on Missourinet.com Monday morning. 

Stay with us while we pivot.

The other night, the History Channel’s “Men Who Made America” series portrayed Andrew Carnegie.  The program totally distorted Carnegie’s role in building the great St. Louis Bridge that we know as the Eads Bridge–we’ll comment on that later, probably. In doing some searching through internet entries on Carnegie and Eads we came across a magazine article by Carnegie in the June, 1889 edition of North American Review called “The Gospel of Wealth.”  In it he said the very rich have a duty to use the money they have beyond the amount needed for a modest lifestyle  to serve the public good.  “The problem of our age is the proper administration of wealth, so that the ties of brotherhood may still bind together the rich and poor in harmonious relationship,” he started. He defended the right of millionaires to their milions but he also argued that the laborer also had a right to “his hundred dollars in the savings bank.”   It’s pretty clear from this year’s campaign that the “proper administration of wealth” has not been resolved in the last 123 years.

“Not evil, but good has come to the (human) race from the accumulation of wealth by those who have the ability and energy to produce it,” he wrote.  But he later asked, “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?”  He was writing of FORTUNES, not “moderate sums saved by many years of effort, the returns on 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.”

But the super-rich, the people with “surplus wealth” were his targets.  Carnegie argued they have three ways to dispose of their  surplus wealth: to leave it for the surviving family members, to bequeath it for public purposes, or to administer it during their lifetimes for the general public good.   He advocated the third choice. 

Note that none of his choices was “using vast sums of money to finance campaigns and petition drives.”   But in 1889, many of the super-rich didn’t mess around with the niceties of making campaign donations.  They just bought politicians outright.

Leaving the money to survivors, he argued, is an invitation to disaster because “it is no longer questionable that great sums bequeathed oftener work more for the injury than for the good of the recipients.” He had less resistance to the idea of  bequeathing fortunes to public uses after the death of the super rich person, “provided a man is content to wait until he is dead before it becomes of much good in the world.”  But he noted there were many instances in which the posthumous good hoped for is not achieved.  Carnegie was pretty harsh is noting, “No man is to be extolled for doing what he cannot help doing, or is he to be thanked by the community to which he only leaves wealth at death.  Men who leave vast sums in this way may fairly be thought men who would not have left it at all, had they been able to take it with them.”  He found “no grace in their gifts.”  Furthermore, he noted, such gifts sometimes become mired in costly court proceedings that wind up dissipating them to one degree or another.  Better, he argued, that the money be designated while the giver was still alive.

Carnegie had no problems with what some contemporary politicians disparage as the “death tax.”   Hanging on to fortunes until death, he argued, was selfish.  He advocated a graduated tax on estates.   He wrote, “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.”  

Carnegie felt that such a tax should “induce” the super-rich to properly administer their wealth during their lives in a way that is “most fruitful for the people.” 

In his article, Carnegie sees duties for the man of wealth.  He advocates “modest, unostentatious living, shunning display or extravagance,” providing “moderately for the legitimate wants of those dependent upon him.”  Any surplus funds should be administered in a matter “best calculated to produce the most beneficial results for the community–the man of wealth thus becoming the mere 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.” 

Under Carnegie’s observations, “The laws of accumulation will be left free; the laws of distribution free. Individualism will continue, but the millionaire will be but a trustee for the poor; entrusted for a season with a great part of the increased wealth of the community, but administering it for the community “far better than it could or would have done for itself.” 

Those who die with considerable available wealth that they could have administered while still alive “will pass away ‘unwept, unhonored, and unsung’…Of such as these the public verdict will then be: ‘The man who dies thus rich dies disgraced.'” 

Pretty clearly, Andrew Carnegie was a man of a different time.  If he tried to get his 1889 ideas through today’s political system, he’d likely be laughed out of many rooms.

We’re not comfortable with trying to guess what historical figures would say or do in today’s culture that is so much different from theirs.  That is not to say, though, that thoughts and lessons from the past should be dismissed in considering contemporary issues and actions.

Carnegie concluded his article in 1889 by arguing that adherence to the “true Gospel of Wealth” as he described it would someday “solve the problem of the Rich and the Poor, and to bring ‘Peace on Earth, among men of Good-Will.'” 

Andrew Carnegie left a net estate of $23,247,161 when he died thirty years after his “Gospel of Wealth” article.  The New York Times noted, however, “The huge fortune which he once possessed was reduced to these relatively small figures by the many public and private gifts Mr. Carnegie made during his life. The appraisal shows to what degree  Mr. Carnegie succeeded in carrying out his purpose to dispose of the great bulk of his fortune before his death.”  He had given away almost $350.7 million dollars (almost five-billion dollars in today’s money), about 94% of his wealth.  His numerous foundations, scholarships, and institutions continue to search for ways to “solve the problems of the Rich and the Poor, and to bring ‘Peace on Earth…”     

Andrew Carnegie is soooooooo nineteenth century.  But, you know, if you want to learn more about him and what he did with his money, and the benefits that continue to flow from his gifts, go to a local library that he might have created with his funds.  One thing about libraries that differs from amendments and statutes created by the twenty-first century super-rich is that libraries won’t be repealed.

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