The library was in effect sold to Carnegie for £10,000, with the Acton family retaining possession for the lifetime of Lord Acton. After Acton’s death in 1902 Carnegie passed the library to his friend John Morley as a gift to dispose of as he wished. In turn Morley gave the library to the University of Cambridge.
To further his aim of promoting medical research Carnegie was prompted to make a specific donation by his doctor, Frederick Dennis, who had set up a laboratory for the study of the causes and cure of diseases at Belleview Hospital, New York. Dr Dennis was particularly interested in the study of cholera; at that time the highly infectious disease was rampant in various European ports, and Dennis was anxious to make sure that America was safe from the deadly infections. This was exactly the type of charitable outlet that stirred Carnegie at the time and started him off on a new range of philanthropy.
Another important promotion of books occurred with the opening of the Carnegie Free Library in Allegheny City. Based on a donation of $250,000, the library was nine years in gestation, eventually housing some 75,000 books and a music hall with a $10,000 pipe organ. To Carnegie’s delight the formal opening was attended by President Benjamin Harrison, and the library was dedicated on 20 February 1890. As usual Carnegie gave a speech which would become a template for addresses wherever he opened a library in particular:
The poorest citizen, the poorest man, the poorest woman that toils from morn till night for a livelihood (as, thank heaven, I had to do in my early days), as he walks this hall, as he reads the books from these alcoves, he listens to the organ and admires the works of art in this gallery equally with the millionaires and the foremost citizen; I want him to exclaim in his own heart: ‘Behold all this is mine.’26
The build-up to the opening ceremony was marred by the last illness and death in January 1890 of Carnegie’s mother-in-law Mrs John Whitfield. Louise had cared for her for months and was deeply distressed at the death. Her deep mourning caused her to be absent from the library opening.
Years before, Carnegie had offered Pittsburgh a library, but the city fathers had rejected his generosity because they believed they had not sufficient civil funds to maintain it. Now, spurred on by the Allegheny City project, they asked Carnegie if his proffered $250,000 was still on the table. The negative reply caused dismay. Then in his idiosyncratic way Carnegie offered them $1 million instead. With its additional art gallery, meeting rooms, music facility and branch libraries, the Pittsburgh library was Carnegie’s latest public benefaction to date. As he did in business, Carnegie involved himself in every aspect of the project, from choosing paint to the style of the bookshelves.
These two library projects stirred up Carnegie’s detractors again, and not just those in the Democratic party. Carnegie’s steelworkers were particularly bitter; they had had their wages cut, and here was Carnegie lashing out thousands to fund a project that few of them wanted to use. Why could they not have fair wages to be able to buy things they wanted?
Carnegie was impervious to such carping. With President Harrison as his friend and colleague he was jubilant. He took Harrison on a visit to his steelworks before the president left Allegheny City and introduced him to his team of managers, including Charles Schwab, the young supervisor of the Homestead Mills, and Harrison saw something of Carnegie’s employment philosophy at work:
‘How is this, Mr Carnegie? You present only boys to me,’ remarked the President.
‘Yes, Mr President, but do you notice what kind of boys they are?’
‘Yes, hustlers [i.e. go-getters]. Every one of them.’27
Carnegie had made Schwab a chief engineer and manager by the time he was 20; now aged 28 he had a partnership in the business and would soon be a millionaire. Harrison observed one of Carnegie’s employment secrets: INTELLIGENCE + ENERGY + FORESIGHT + ENTHUSIASM = REWARD. And Carnegie was aiming at political rewards for himself. Harrison was somewhat embarrassed to receive from him a keg of whisky to introduce him to Scottish spirits, and his aides were concerned that he would be seen as too close to rapacious capitalists. Yet Harrison enjoyed himself at the sumptuous dinner Carnegie threw for him at the Arlington Hotel, Washington DC, following the library opening. Carnegie had long wished to be a prominent player on the Washington stage. His friendship with Harrison and Secretary of State James Blaine strengthened that; and when Blaine died in 1893, another Carnegie player – his lawyer and fishing companion George Shiras Jr – was appointed to the Supreme Court to help promote business and Carnegie. Before Blaine died, though, Carnegie was to receive his one and only political appointment.28
James Blaine was an internationalist with a particular interest in South America. He organised the first Pan-American Conference, gathering together delegates from North, South and Central America to debate commercial issues. Carnegie was one of America’s ten delegates, enjoying the role of envoys’ host at Pittsburgh when the party set out on a six-week tour of America’s manufacturing, commercial and agricultural locations.
Carnegie began to study South American history and politics. Under Spanish rule from the sixteenth century until 1810, when the first autonomous government was established, with full independence following in 1818, Chile suffered further revolution when rebels overthrew the government in 1891. Leading members of the deposed government were granted asylum in America and Carnegie boned up on Chilean current affairs. Diplomatically America became more involved when several naval men were murdered and others attacked after shore leave was granted to the men of the USS Baltimore stationed in Chilean waters.
Public indignation was high in America with calls for immediate gunboat retribution. Carnegie the neo-pacifist counselled President Harrison to tread softly, and careful diplomacy calmed the situation. From this time on, whenever America was involved in tension abroad, Carnegie’s personal intervention tactic cranked into action with the sending of memos, letters and telegrams and face-to-face confrontations with all concerned. Carnegie was happy; he felt that the government and president he had helped to buy were on his side, and just as he had exacted profit from his business activities he wished to do the same in politics. Nevertheless there were time bombs lurking in his immediate future which would indelibly harm his reputation.
FIFTEEN
THE HOMESTEAD AFFAIR
Andrew Carnegie sweated the last dollar out of his workers and gave them little in return; his gifts to libraries and other institutions were stolen from the pockets of his labourers and he got all the credit.
Comment by one of Carnegie’s workers reminiscing about
the Homestead Troubles of 1892
There were certain contracts over the years that Carnegie did not bid for, notably in the field of armaments for the US Navy. Carnegie’s interest in the US Navy dated from the days of the Civil War, and the exploits of Captain David Glasgow Farragut (1801–70), a Southerner who fought for the North in the Federal Navy, and took part in the siege and capture of Vicksburgh (1863) and the destruction of Confederate vessels in Mobile Bay. Carnegie had a picture of Farragut in his Civil War portfolio and he was developing in his mind a plan to reward such heroes – a plan which would eventually evolve into his Hero Fund Trust in 1908. Nevertheless at this point his pacifism deterred him from dealing in the machines of war; that being said, he also realised that there was little money to be made from naval armaments.
However, in December 1889 the construction of the battleship Maine and the cruiser New York was delayed by difficulties in the supply of steel from Carnegie’s rival Joseph Wharton’s Bethlehem Steel Co. President Harrison’s Naval Secretary Benjamin Tracy contacted Carnegie to seek his help. Carnegie was tempted; an order for 6,000 tons of steel was big and lucrative. But what of his pacifism? Whether he realised it or not Tracy had managed to reach Carnegie’s weak spot: his vanity. His acceptance of the contract would please his Washington friends and advance his status. Thus Carnegie’s conceit mollified his principles, the contract was accepted and the management of the manufacture was gi
ven to Henry Clay Frick.
From wherever he was Carnegie monitored the contract’s progress, and even when he was at Cluny Castle the US Naval attaché W.H. Emery, based at the US embassy in London, kept him supplied with memos from James Blaine to help him keep within the US government’s guidelines for the contract. Thus Carnegie was able to telegraph instructions and advice to Frick. He even bought land in Pittsburgh on which to construct a mill for the contract production. The land purchase promoted its own difficulties but when taken to law Carnegie, Phipps & Co. won. After all, Carnegie was a skilled manipulator. And this was just the beginning. Carnegie was to win more orders for steel for armaments, with stockholder Cousin Dod acting as adviser. Carnegie’s detractors past and present cite these arms deals as fine examples of the ‘pacifist’ Carnegie’s ‘hypocrisy’. More charges of dissembling would pile up.
From the late 1870s many of America’s railroad and coal industries had been sorely troubled by labour difficulties, often in the form of serious riots. Carnegie’s Pittsburgh works had been largely trouble-free by comparison, and paths had been smoothed by his cooperation with unions. For instance, from the opening of his rail mill in 1875 he had dealt with worker representative groups like the ‘Sons of Vulcan’, which merged with the Amalgamated Association of Iron and Steel Workers in 1876.1 Carnegie’s diplomatic relationship with the unions helped him to acquire the trouble-hit mills of Homestead (acquired 1883) and Duquesne (annexed 1890) from their owners who lacked his man-management skills.
By the late 1880s American workers were beginning to flex their muscles more and the smaller unions linked up with larger groups like the American Federation of Labor.2 Workers became more militant, as the great railroad strike of 1886, which paralysed Chicago, was to show. Extremists even resorted to bomb-throwing and radicalism became the vogue on public platforms and in the press. Capital and labour united was fast becoming capital versus labour, and vice versa. As the employer of 15,000 men, Carnegie offered his opinions on the ‘labour question’ and ‘labour struggles’ in such reviews as Forum.3 He agreed in principle that workers should get a better return from profits, and wrapped his sentiments in his usual wordy altruism. However, he much preferred face-to-face bargaining with his workforce than talks with representatives of a nationwide union not known to him, and believed that ‘a friendly, even a familiar, relationship was the best protection against the worst evils inherent in a large rolling mill’.4 He felt that when his workers could refer to him as ‘the little boss’, or even ‘Andy’, he could negotiate with them better. Further, while being sympathetic to workers wishing to better themselves, he was against violent revolution: ‘Rioters assembling in numbers and marching to pillage will be remorselessly shot down,’ was his opinion for the future.5
Nevertheless, Carnegie believed, employers should not knowingly provoke violence, as had been seen when ‘imported labourers’ (i.e. ‘scabs’ to the striking workers) had been brought in to the work areas to replace the strikers. ‘Thou shalt not take thy neighbour’s job’ became one of Carnegie’s mantras. The right to strike peaceably was one thing, noted Carnegie, but rioting violently was another – as were employers who repaid agitation with severity. Even so, another Carnegie mantra developed: ‘Union leaders who impeded progress had to be stopped.’ Always he sought to increase efficiency in his workforce. Both sides in industry, he believed, should act within the law.6
This was his attitude when dealing with the strike at his Edgar Thomson Braddock mill during 1887–8. Because of difficult trading conditions wages had been reduced; the men refused to accept this and the mill was closed on 17 December 1887. When conditions improved in February 1888 Carnegie refused to reopen the mill until a new wages structure was agreed for the future. What he wanted was to tie wages to the price of steel rails in the market place, and he also wanted 12-hour shifts to suit the non-stop operation of the blast furnaces. The men refused these proposals, and Carnegie kept the works closed, honouring his principle not to use ‘imported labour’. The works only reopened when the men voted to return on Carnegie’s terms. Thus his tactics were to meet frontal attack with blockade. His published views on this subject reached a wide audience, but dismayed many of America’s industrial leaders.
Carnegie wanted to introduce the same conditions at his Homestead mill as he had at the Braddock. At Homestead, however, the Amalgamated Association had a stronger influence and opposition was more vigorous; a strike issued when news of the implementation circulated on 1 July 1889. Carnegie was in Europe and the deadlock was in the hands of William L. Abbott, chairman of Carnegie, Phipps & Co. Abbott decided to use ‘imported (non-union) labourers’. Violence erupted as the men attempted to descend from the trains bringing them to the works. The Sheriff of Allegheny and 120 deputies headed off the strikers and peace was restored. Abbott negotiated with the men, who were prepared to accept Carnegie’s sliding-scale wage structure but not any changes to the existing shift patterns. This agreement would last until 1892. The Amalgamated Association saw it as a capitulation on the part of management and thus a triumph for trade unionism at Homestead. Carnegie, although pleased with the outcome, was not impressed that Abbott had tried to use ‘imported labourers’ instead of following his tactics at Braddock.
During January 1889 Henry Clay Frick became chairman of Carnegie, Bros & Co., Carnegie believing that the promotion would enhance the company. Frick was to prove a strong character in dealing with strikers in the coke fields in February 1890. Since 1882–3 Carnegie had been a substantial investor in the H.C. Frick Coke Co. and Frick had acquired an interest in Carnegie Bros & Co. in 1887. But there was more to his appointment than that; from at least 1883 Carnegie had been contemplating retirement and he believed that Frick was the man to take over his mantle. Yet there was a serious flaw in the arrangement because Frick did not believe in the sentiments Carnegie had expressed in his 1886 Forum articles. Fundamentally he believed that a company could employ who it chose, pay what it chose, and sack who it chose. Frick was no friend of the trade unions.
On 1 July 1892 Carnegie Bros & Co. was federalised and the Carnegie Steel Co. Ltd came into being with Frick as chairman. At this point the capital of Carnegie Bros had risen to $25 million, with a profit of around $4.5 million per year; the new company was formed to embrace this larger business. It was the largest steel company in the world. There were twenty-three major stockholders in the new corporation: Carnegie held $13.8 million; Henry Phipps Jr and Henry Clay Frick had $2.75 million each and George Lauder – Cousin Dod – $1 million.7 Dod was one of the seven company chairmen. In modern values, by way of example, Dod’s shares were worth around $4.33 million.
The emergence of the new company coincided with the expiry date of the wage agreement with the Homestead workers. Overall Carnegie wanted to reduce tonnage wage payments to reflect the increased productivity won by the new machinery he had installed; again he wanted a reduction in the minimum wage to reflect the depressed steel market. Although the path to achieving the new agreements would not be smooth, Carnegie believed that the policy he had enacted in 1889 would win the day and Frick was not unduly worried either. Only 325 of the 3,800 employees at Homestead would be directly affected by the new wage structures anyway.8
Most of the men affected were highly skilled and of British or German origin, and most were members of the Amalgamated Association. The bulk of the unskilled workforce included Hungarians, Slavs, Poles, Italians and others, many of whom could not speak English. Among them the Hungarians were considered the wildest, and the most prone to violence and disaffection. Their work was brutal and hazardous, dealing with molten metal in a work environment where health and safety came low on the list of priorities. The unskilled were paid in the range of $12.50 per week compared with the $40 of the skilled. Nevertheless Carnegie was in no doubt that Frick would successfully negotiate new rates with the men involved and in the spring of 1892 he set sail for Europe with Louise.
Eight weeks after Carnegie lef
t, Frick met with the leaders of the representative Amalgamated Association union. Their demands were clear: a renewal of the existing Homestead wage agreement to last until 1895. Frick refused. Proposals were exchanged, with the men agreeing to a one dollar a week reduction in the standard wage; Frick required two dollars. There seemed to be room for manoeuvre. As Carnegie’s biographer Burton J. Hendrick points out: ‘To the unprejudiced observer it would look as though the disputing parties were approaching an agreement.’9 Yet the main problem was Frick himself. Instead of following Carnegie’s lead and meeting the union leaders face-to-face to talk, Frick conducted negotiations through third parties like Homestead superintendent John A. Potter. In fact Frick’s last word was an ultimatum. Later a report would note: ‘Frick . . . seemed to have been too stern, brusque and somewhat autocratic. . . .’10
Frick knew there would be trouble, and gave orders for the Homestead property to be ‘secured’. This meant building a ‘high board fence’ around the mill’s perimeter with a barbed wire topping, searchlights and strategic portholes. The workers saw this as a provocative ‘offensive and defensive’ measure. Frick also hired operatives of the Pinkerton National Detective Agency. Glasgow-born Allan Pinkerton, had emigrated to America in 1842 and became a detective and deputy-sheriff at Chicago in 1850; in 1852 he formed his own detective agency (the first in the USA) which solved a series of train robberies. In 1861 he guarded Abraham Lincoln and was the head of the US Secret Service during the Civil War. By the 1890s Pinkerton’s agents were notorious for their brutality, having helped break or control some seventy strikes. It must be said, though, that in employing these agents Frick was not doing anything unusual, as such a move was common practice among industrialists and railroad companies who felt threatened by crime, riots or labour troubles.
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