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NORTH AMERICAN REVIEW.
No. CCCXCI.

JUNE, 1889.

WEALTH.
BY ANDREW CARNEGIE.

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. 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
thje dwelling, dress, food, and environment of the chief and those
of his retainers. The Indians are to-day where civilized man then
was. When visiting the Sioux, I was led to the wigwam of the
chief. It was just like the others in external appearance, and
even within the difference was trifling between it and those of
the poorest of his braves. The contrast between the palace of the
millionaire and the cottage of the laborer with us to-day meas
ures 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 refine
ments of civilization, rather than that none should be so. Much
better this great irregularity than universal squalor. Without
" "
wealth there can be no Maecenas. The good old times were
not good old times. Neither master nor servant was as well situ
ated then as to-day. A relapse to old conditions would be disas
trous to both?not the least so to him who serves?and would
sweep away civilization with it. But whether the change be for
vol. cxLviii.?no. 391. 42
654 THE NORTH AMERICAN REVIEW.

good or ill, it is upon us, beyond our power to alter, and there
fore to be accepted and made the best of. It is a waste of time
to criticise the inevitable.
It is easy to see how the change has come. One illustration
will serve for almost every phase of the cause. In the manu
facture of products we have the whole story. It applies to all
combinations of human industry, as stimulated and enlarged by
the inventions of this scientific age. Formerly articles were
manufactured at the domestic hearth or in small shops which
formed part of the household. The master and his apprentices
worked side by side, the latter living with the master, and there
fore subject to the same conditions. When these apprentices rose
to be masters, there was little or no change in their mode of life,
and in turn, educated in the same routine appren
they, succeeding
tices. There was, substantially, social equality, and even political
equality, for those engaged in industrial pursuits had then little
or no political voice in the State.
But the inevitable result of such a mode of manufacture was
crude articles at high prices. To-day the world obtains com
modities of excellent quality at prices which even the generation
preceding this would have deemed incredible. In the commer
cial world similar causes have produced similar results, and th,e
race is benefited thereby. The poor enjoy what the rich could
not before afford. What were the luxuries have become the neces
saries of life. The laborer has now more comforts than the farmer
had a few generations ago. The farmer has more luxuries than
the landlord had, and is more richly clad and better housed. The
landlord has books and pictures rarer, and appointments more
artistic, than the King could then obtain.
The price we pay for this salutary change is, no doubt, great.
We assemble thousands of operatives in the factory, in the mine,
and in the counting-house, of whom the employer can know
little or nothing, and to whom the employer is little better than
a myth. All intercourse between them is at an end. Rigid Castes
are formed, and, as usual, mutual breeds mutual dis
ignorance
trust. Each Caste is without sympathy for the other, and ready
to credit anything disparaging in regard to it. Under the law
of competition, the employer of thousands is forced into the
strictest economies, among which the rates paid to labor figure
prominently, and often there is friction between the employer
 WEALTH 655
and the employed, between capital and labor, between rich and
poor. Human society loses homogeneity.
The
, price which society pays for the law of competition, like
the price it pays for cheap comforts and luxuries, is also great ;
but the advantages of this law are also greater still, for it is to
this law that we owe our wonderful material development, which
brings improved conditions in its train. But, whether the law
be benign or not, we must say of it, as we say of the change in
the conditions of men to which we have referred : It is here ; we
cannot evade it ; no substitutes for it have been found ; and
while the law may be sometimes hard for the individual, it is
best for the race, because it insures the survival of the fittest in
every department. We accept and welcome, therefore, as condi
tions to which we must accommodate ourselves, great inequality
of environment, the concentration of business, industrial and
commercial, in the hands of a few, and the law of competition
between these, as being not only beneficial, but essential for the
future progress of the race. Having accepted these, it follows
that there must be great scope for the exercise of special ability
in the merchant and in the manufacturer who has to conduct
affairs upon a great scale. That this talent for organization and
management is rare among men is proved by the fact that it
secures for its possessor enormous rewards, no matter
invariably
where or under what laws or conditions. The experienced in
affairs rate the man whose services can be obtained as a
always
partner as not only the first consideration, but such as
to render the question of his capital scarcely worth con
sidering, for such men soon create capital ; while, without
the special talent required, capital soon takes wings. Such men
become interested in firms or corporations using millions ; and
estimating only simple interest to be made upon the capital in
vested, it is inevitable that their income must exceed their ex
penditures, and that they must accumulate wealth. Nor is there
any middle ground which such men can occupy, because the
great manufacturing or commercial concern which does not earn
at least interest upon its capital soon becomes bankrupt. It must
either go forward or fall behind : to stand still is impossible. It
is a condition essential for its successful operation that it should
be thus far profitable, and even that, in addition to interest on
capital, it should make profit. It is a law, as certain as any of
656 THE NORTH AMERICAN REVIEW.

the others named, that men possessed of this peculiar talent for
affairs, under the free play of economic forces, must, of necessity,
soon be in receipt of more revenue than can be judiciously ex
pended upon themselves ; and this law is as beneficial for the race
as the others.

Objections to the foundations upon which society is based are

not in order, because the condition of the race is better with these
than it has been with any others which have been tried. Of the
effect of any new substitutes proposed we cannot be sure. The So
cialist or Anarchist who seeks to overturn present conditions is to
be regarded as attacking the foundation upon which civilization
itself rests, for civilization took its start from the day that the
capable, industrious workman said to his incompetent and lazy fel
" dost not thou shalt not reap," and thus ended
low, If thou sow,
primitive Communism by separating the drones from the bees*
One who studies this subject will soon be brought face to face
with the conclusion that upon the sacredness of property civiliza
tion itself depends?the right of the laborer to his hundred dol
lars in the savings bank, and equally the legal right of the million
aire to his millions. To those who propose to substitute Commu
nism for this intense Individualism the answer, therefore, is: The
race has tried that. All progress from that barbarous day to the
present time has resulted from its displacement. Not evil, but good,
has come to the race from the accumulation of wealth by those
who have the ability and energy that produce it. But even if we
admit for a moment that it might be better for the race to discard
its present foundation, Individualism,?that it is a nobler ideal
that man should labor, not for himself alone, but in and for a
brotherhood of his fellows, and share with them all in common,
realizing Swedenborg's idea of Heaven, where, as he says, the
angels derive their happiness, not from laboring for self, but for
each other,?even admit all this, and a sufficient answer is, This
is not evolution, but revolution. It necessitates the changing of
human nature itself?a work of aeons, even if it were good to change
it, which we cannot know. It is not practicable in our day or in
our age. Even if desirable theoretically, it belongs to another and
long-succeeding sociological stratum. Our duty is with what is
practicable now ; with the next step possible in our day and gene
ration. It is criminal to waste our energies in endeavoring to up
root, when all we can profitably or possibly accomplish is to
 WEALTH. 657
bend the universal tree of humanity a little in the direction most
favorable to the production of good fruit under existing circum
stances. We might as well urge the destruction of the highest
existing type of man because he failed to reach our ideal as to
favor the destruction of Individualism Private Property, the Law
of Accumulation of Wealth, and th< ijaw of Competition ; for
these are the highest results of human experience, the soil in
which society so far has produced the best fruit. Unequally or
unjustly, perhaps, as these laws sometimes operate, and imper
fect as they appear to the Idealist, they are, nevertheless, like the
highest type of man, the best and most valuable of all that hu
manity has yet accomplished.
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 main
tenance 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 con
sider each of these modes. The first is the most injudicious. In
monarchical 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 to-day 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. Even in Great Britain the
658 THE NORTH AMERICAN REVIEW.

strict law of entail has been found inadequate to maintain the

status of an hereditary class. Its soil is rapidly passing into the
hands of the stranger. Under republican institutions the divi
sion of property among the children is much fairer, but the ques
tion which forces itself upon thoughtful men in all lands is :
Why should men leave great fortunes to their children ? If
this is done from affection, is it not misguided affection ? Ob
servation 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 mod
erate sources of income, and very moderate allowances indeed, if

any, for the sons, men may well hesitate, for it is no longer ques
tionable 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
their means.
It is not suggested that men who have failed to educate their
sons to earn a livelihood shall cast them adrift in poverty. If
any man has seen fit to rear his sons with a view to their living
idle lives, or, what is highly commendable, has instilled in them
the sentiment that they are in a position to labor for public ends
without reference to pecuniary considerations, then, of course,
the duty of the parent is to see that such are provided for in
moderation. There are instances of millionaires' sons unspoiled
by wealth, who, being rich, still perform great services in the com
Such are the very salt of the earth, as valuable as, un
munity.
fortunately, they are rare; still it is not the exception, but the rule,
that men must regard, and, looking at the usual result of enor
mous sums conferred upon legatees, the thoughtful man must
" as soon son a curse as the al
shortly say, I would leave to my
mighty dollar," and admit to himself that it is not the welfare of
the children, but family pride, which inspires these enormous
legacies.
to the second mode, that of leaving wealth
As at death for
public uses, it may be said that this is only a means for the dis
posal of wealth, provided a man is content to wait until he is
dead before it becomes of much good in the world. Knowledge
of the results of legacies bequeathed is not calculated to inspire
the brightest hopes of much posthumous good being accom
 WEALTH. 6?0
pushed. 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. In many cases the bequests are so used as to
become only monuments of his folly. It is well to remember that
it requires the exercise of not less ability than that which acquired
the wealth to use it so as to be really beneficial to the commu
nity. Besides this, it may fairly be said that no man is to be
extolled for doing what he cannot help doing, nor 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. The memories of such cannot be held in
grateful remembrance, for there is no grace in their gifts. It is
not to be wondered at that such bequests seem so generally to
lack the blessing.
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. The State of Pennsylvania
now takes?subject to some exceptions?one-tenth of the prop
erty left by its citizens. The budget presented in the British Par
liament the other day proposes to increase the death-duties ; and,
most significant of all, the new tax is to be a graduated one. 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.
It is desirable that nations should go much further in this
direction. Indeed, it is difficult to set bounds to the share of a
rich man's estate which should go at his death to the public
through the agency of the state, and by all means such taxes
should be graduated, beginning at nothing upon moderate sums
to dependents, and increasing rapidly as the amounts swell, until
of the millionaire's hoard, as of Shylock's, at least
"-The other half
Comes to the privy coffer of the state,"

This policy would work to induce the rich man to

powerfully
attend to the administration of wealth during his life, which is
 660 THE NORTH AMERICAN REVIEW.

the end that society should always have in view, as being that
by far most fruitful for the people. Nor need it be feared that
this policy would sap the root of enterprise and render men less
anxious to accumulate, for to the class whose ambition it is to
leave great fortunes and be talked about after their death, it will at
tract even more attention, and, indeed, be a somewhat nobler am
bition to have enormous sums paid over to the state from their
fortunes.
There remains, then, only one mode of using great fortunes ;
but in this 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 exist
ing 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 and this
good, 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 dis
tributed in small sums to the people themselves. Even the poor
est can be made to see this, and to agree that great sums gathered
by some of their fellow-citizens and spent for public purposes,
from which the masses reap the principal benefit, are more valu
able to them than if scattered among them through the course of
many years in trifling amounts.
If we consider what results flow from the Cooper Institute,
for instance, to the best portion of the race in New York not
possessed of means, and compare these with those which would
have arisen for the good of the masses from an equal sum dis
tributed by Mr. Cooper in his lifetime in the form of wages,
which is the highest form of distribution, being for work done
and not for charity, we can form some estimate of the possibili
ties for the improvement of the race which lie embedded in the
present law of the accumulation of wealth. Much of this sum,
if distributed in small quantities among the people, would have
been wasted in the indulgence of appetite, some of it in excess,
and itmay be doubted whether even the part put to the best use,
that of adding to the comforts of the home, would have yielded
 WEALTH. 661
results for the race, as a race, at all comparable to those which are
flowing and are to flow from the Cooper Institute from generation
to generation. Let the advocate of violent or radical change pon
der well this thought.
We might even go so far as to take another instance, that of
Mr. Tilden's bequest of five millions of dollars for a free library in
the city of New York, but in referring to this one cannot help say
ing involuntarily, How much better if Mr. Tilden had devoted the
last years of his own life to the proper administration of this
immense sum ; in which case neither legal contest nor any other
cause of delay could have interfered with his aims. But let us
assume that Mr. Tilden's millions finally become the means of
giving to this city a noble public library, where the treasures of
the world contained in books will be open to all forever, without
money and without price. Considering the good of that part of
the race which congregates in and around Manhattan Island, would
its permanent benefit have been better promoted had these millions
been allowed to circulate in small sums through th? hands of the
masses ? Even the most strenuous advocate of Communism must
entertain a doubt upon this subject. Most of those who think
will probably entertain no doubt whatever.
Poor and restricted are our opportunities in this life; narrow
our horizon; our best work most imperfect; but rich men should
be thankful for one inestimable boon. They have it in their
power during their lives to busy themselves in organizing benefac
tions from which the masses of their fellows will derive lasting
advantage, and thus dignify their own lives. The highest life is
probably to be reached, not by such imitation of the life of Christ
as Count Tolsto? gives us, but, while animated by Christ's spirit,
by recognizing the changed conditions of this age, and adopting
modes of expressing this spirit suitable to the changed conditions
under which we live ; still laboring for the good of our fellows,
which was the essence of his life and teaching, but laboring in a
different manner.
This, then, is held to be the duty of the man of Wealth:
First, to set an example of modest, unostentatious living, shun
ning display or extravagance; to provide moderately for the legiti
mate wants of those dependent upon him; and after doing so to
consider all surplus revenues which come to him simply as trust
fundan which he is called upon to administer, and strictly bound
662 THE NORTH AMERICAN REVIEW.

as a matter of duty to administer in the manner which, in his

judgment, is 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.
We are met here with the difficulty of determining what are
moderate sums to leave to members of the family ; what is mod
est, unostentatious living ; what is the test of extravagance.
There must be different standards for different conditions. The
answer is that it is as impossible to name exact amounts or actions
as it is to define good manners, good taste, or the rules of pro
priety ; but, nevertheless, these are verities, well known although
undefinable. Public sentiment is quick to know and to feel what
offends these. So in the case of wealth. The rule in regard to
good taste in the dress of men or women applies here. Whatever
makes one conspicuous offends the canon. If any family be
chiefly known for display, for extravagance in home, table,
for enormous sums in any form
equipage, ostentatiously spent
upon itself,?if these be its chief distinctions, we have no diffi
culty in estimating its nature or culture. So likewise in regard to
the use or abuse of its wealth, or to generous, free
surplus
handed cooperation in good public uses, or to unabated efforts
to accumulate and hoard to the last, whether they administer or
bequeath. The verdict rests with the best and most enlightened
public sentiment. The community will surely judge, and its
judgments will not often be wrong.
The best uses to which surplus wealth can be put have already
been indicated. Those who would administer wisely must, indeed,
be wise, for one of the serious obstacles to the improvement of
our race is indiscriminate charity. It were better for mankind
that the millions of tho rich were thrown into the sea than so
spent as to encourage the slothful, the drunken, the unworthy.
Of every thousand dollars spent in so called charity to-day, it is
probable that $950 is unwisely spent ; so spent, indeed, as to pro
duce the very evils which it proposes to mitigate or cure. A well
known writer of philosophic books admitted the other day that
he had given a quarter of a dollar to a man who approached him
as he was coming to visit the house of his friend. He knew
nothing of the habits of this beggar ; knew not the use that
 WEALTH. 663
would be made of this money, although he had every reason to
suspect that it would be spent improperly. This man professed
to be a disciple of Herbert Spencer ; yet the quarter-dollar given
that night will probably work more injury than all the money
which its thoughtless donor will ever be able to give in true char
ity will do good. He only gratified his own feelings, saved him
self from annoyance,?and this was probably one of the most
selfish and very worst actions of his life, for in all respects he is
most worthy.
In bestowing charity, the main consideration should be to
help those who will help themselves; to provide part of the
means by which those who desire to improve may do so ;
to give those who desire to rise the aids by which they may
rise ; to assist, but rarely or never to do all. Neither the indi
vidual nor the race is improved by alms-giving. Those worthy
of assistance, except in rare cases, seldom require assistance. The

really valuable men of the race never do, except in cases of acci
dent or sudden one has, of course, cases of
change. Every
individuals brought own knowledge where temporary as
to his
sistance can do genuine good, and these he will not overlook.
But the amount which can be wisely given by the individual
for individuals is necessarily limited by his lack of knowledge
of the circumstances connected with each. He is the only
true reformer who is as careful and as anxious not to aid the un

worthy is to aid the worthy, and, perhaps, even more so,

as he
for in alms-giving more injury is probably done by rewarding vice
than by relieving virtue.
The rich man is thus almost restricted to following the exam
ples of Peter Cooper, Enoch Pratt of Baltimore, Mr. Pratt of
Brooklyn, Senator Stanford, and others, who know that the best
means of benefiting the community is to place within its reach
the ladders upon which the aspiring can rise?parks, and means
of recreation, by which men are helped in body and mind ;works
of art, certain to give pleasure and improve the public taste, and
public institutions of various kinds, which will improve the
general condition of the people ;?in this manner returning their
surplus wealth to the mass of their fellows in the forms best cal
culated to do them lasting good.
Thus is the problem of Rich and Poor to be solved. The laws
of Accumulation will be left free ; the laws of distribution free.
664 THE NORTH AMERICAN REVIEW.

Individualism will continue, but the millionaire will be but a

trustee for the poor ; intrusted 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. The best minds will thus have reached a stage in the
development of the race in which it is clearly seen that there is
no mode of disposing of surplus wealth creditable to thoughtful
and earnest men into whose hands it flows save by using it year
by year for the general good. This day already dawns. But a
little while, and although, without incurring the pity of their
fellows, men may die sharers in great business enterprises from
which their capital cannot be or has not been withdrawn, and
is left chiefly at death for public uses, yet the man who
dies leaving behind him millions of available wealth, which
was his to administer will "
during life, pass away unwept,
unhonored, and no matter to what uses he leaves the
unsung,"
dross which he cannot take with him. Of such as these the
: " man
public verdict will then be The who dies thus rich dies
disgraced."
Such, in my opinion, is the true Gospel concerning Wealth,
obedience to which is destined some day to solve the problem of
"
the Rich and the Poor, and to bring Peace on earth, among
men Good-Will."
Andrew Carnegie.