Autobiography of Andrew Carnegie Part 22

It involved increased labor and a few more clerks, but that was a small matter. The remark about high prices charged set me to thinking why the men could not open a cooperative store. This was also arranged--the firm agreeing to pay the rent of the building, but insisting that the men themselves take the stock and manage it. Out of that came the Braddock's Cooperative Society, a valuable inst.i.tution for many reasons, not the least of them that it taught the men that business had its difficulties.

The coal trouble was cured effectively by our agreeing that the company sell all its men coal at the net cost price to us (about half of what had been charged by coal dealers, so I was told) and arranging to deliver it at the men's houses--the buyer paying only actual cost of cartage.

There was another matter. We found that the men's savings caused them anxiety, for little faith have the prudent, saving men in banks and, unfortunately, our Government at that time did not follow the British in having post-office deposit banks. We offered to take the actual savings of each workman, up to two thousand dollars, and pay six per cent interest upon them, to encourage thrift. Their money was kept separate from the business, in a trust fund, and lent to such as wished to build homes for themselves. I consider this one of the best things that can be done for the saving workman.

It was such concessions as these that proved the most profitable investments ever made by the company, even from an economical standpoint. It pays to go beyond the letter of the bond with your men.

Two of my partners, as Mr. Phipps has put it, "knew my extreme disposition to always grant the demands of labor, however unreasonable," but looking back upon my failing in this respect, I wish it had been greater--much greater. No expenditure returned such dividends as the friendship of our workmen.

We soon had a body of workmen, I truly believe, wholly unequaled--the best workmen and the best men ever drawn together. Quarrels and strikes became things of the past. Had the Homestead men been our own old men, instead of men we had to pick up, it is scarcely possible that the trouble there in 1892 could have arisen. The scale at the steel-rail mills, introduced in 1889, has been running up to the present time (1914), and I think there never has been a labor grievance at the works since. The men, as I have already stated, dissolved their old union because there was no use paying dues to a union when the men themselves had a three years' contract. Although their labor union is dissolved another and a better one has taken its place--a cordial union between the employers and their men, the best union of all for both parties.

It is for the interest of the employer that his men shall make good earnings and have steady work. The sliding scale enables the company to meet the market; and sometimes to take orders and keep the works running, which is the main thing for the working-men. High wages are well enough, but they are not to be compared with steady employment.

The Edgar Thomson Mills are, in my opinion, the ideal works in respect to the relations of capital and labor. I am told the men in our day, and even to this day (1914) prefer two to three turns, but three turns are sure to come. Labor's hours are to be shortened as we progress.

Eight hours will be the rule--eight for work, eight for sleep, and eight for rest and recreation.

There have been many incidents in my business life proving that labor troubles are not solely founded upon wages. I believe the best preventive of quarrels to be recognition of, and sincere interest in, the men, satisfying them that you really care for them and that you rejoice in their success. This I can sincerely say--that I always enjoyed my conferences with our workmen, which were not always in regard to wages, and that the better I knew the men the more I liked them. They have usually two virtues to the employer's one, and they are certainly more generous to each other.

Labor is usually helpless against capital. The employer, perhaps, decides to shut up the shops; he ceases to make profits for a short time. There is no change in his habits, food, clothing, pleasures--no agonizing fear of want. Contrast this with his workman whose lessening means of subsistence torment him. He has few comforts, scarcely the necessities for his wife and children in health, and for the sick little ones no proper treatment. It is not capital we need to guard, but helpless labor. If I returned to business to-morrow, fear of labor troubles would not enter my mind, but tenderness for poor and sometimes misguided though well-meaning laborers would fill my heart and soften it; and thereby soften theirs.

Upon my return to Pittsburgh in 1892, after the Homestead trouble, I went to the works and met many of the old men who had not been concerned in the riot. They expressed the opinion that if I had been at home the strike would never have happened. I told them that the company had offered generous terms and beyond its offer I should not have gone; that before their cable reached me in Scotland, the Governor of the State had appeared on the scene with troops and wished the law vindicated; that the question had then pa.s.sed out of my partners' hands. I added:

"You were badly advised. My partners' offer should have been accepted.

It was very generous. I don't know that I would have offered so much."

To this one of the rollers said to me:

"Oh, Mr. Carnegie, it wasn't a question of dollars. The boys would have let you kick 'em, but they wouldn't let that other man stroke their hair."

So much does sentiment count for in the practical affairs of life, even with the laboring cla.s.ses. This is not generally believed by those who do not know them, but I am certain that disputes about wages do not account for one half the disagreements between capital and labor. There is lack of due appreciation and of kind treatment of employees upon the part of the employers.

Suits had been entered against many of the strikers, but upon my return these were promptly dismissed. All the old men who remained, and had not been guilty of violence, were taken back. I had cabled from Scotland urging that Mr. Schwab be sent back to Homestead. He had been only recently promoted to the Edgar Thomson Works. He went back, and "Charlie," as he was affectionately called, soon restored order, peace, and harmony. Had he remained at the Homestead Works, in all probability no serious trouble would have arisen. "Charlie" liked his workmen and they liked him; but there still remained at Homestead an unsatisfactory element in the men who had previously been discarded from our various works for good reasons and had found employment at the new works before we purchased them.

CHAPTER XIX

THE "GOSPEL OF WEALTH"

After my book, "The Gospel of Wealth,"[44] was published, it was inevitable that I should live up to its teachings by ceasing to struggle for more wealth. I resolved to stop acc.u.mulating and begin the infinitely more serious and difficult task of wise distribution.

Our profits had reached forty millions of dollars per year and the prospect of increased earnings before us was amazing. Our successors, the United States Steel Corporation, soon after the purchase, netted sixty millions in one year. Had our company continued in business and adhered to our plans of extension, we figured that seventy millions in that year might have been earned.

[Footnote 44: _The Gospel of Wealth_ (Century Company, New York, 1900) contains various magazine articles written between 1886 and 1899 and published in the _Youth's Companion_, the _Century Magazine_, the _North American Review_, the _Forum_, the _Contemporary Review_, the _Fortnightly Review_, the _Nineteenth Century_, and the _Scottish Leader_. Gladstone asked that the article in the _North American Review_ be printed in England. It was published in the _Pall Mall Budget_ and christened the "Gospel of Wealth." Gladstone, Cardinal Manning, Rev. Hugh Price, and Rev. Dr. Hermann Adler answered it, and Mr. Carnegie replied to them.]

Steel had ascended the throne and was driving away all inferior material. It was clearly seen that there was a great future ahead; but so far as I was concerned I knew the task of distribution before me would tax me in my old age to the utmost. As usual, Shakespeare had placed his talismanic touch upon the thought and framed the sentence--

"So distribution should undo excess, And each man have enough."

At this juncture--that is March, 1901--Mr. Schwab told me Mr. Morgan had said to him he should really like to know if I wished to retire from business; if so he thought he could arrange it. He also said he had consulted our partners and that they were disposed to sell, being attracted by the terms Mr. Morgan had offered. I told Mr. Schwab that if my partners were desirous to sell I would concur, and we finally sold.

[Ill.u.s.tration: CHARLES M. SCHWAB]

There had been so much deception by speculators buying old iron and steel mills and foisting them upon innocent purchasers at inflated values--hundred-dollar shares in some cases selling for a trifle--that I declined to take anything for the common stock. Had I done so, it would have given me just about one hundred millions more of five per cent bonds, which Mr. Morgan said afterwards I could have obtained.

Such was the prosperity and such the money value of our steel business. Events proved I should have been quite justified in asking the additional sum named, for the common stock has paid five per cent continuously since.[45] But I had enough, as has been proved, to keep me busier than ever before, trying to distribute it.

[Footnote 45: The Carnegie Steel Company was bought by Mr. Morgan at Mr. Carnegie's own price. There was some talk at the time of his holding out for a higher price than he received, but testifying before a committee of the House of Representatives in January, 1912, Mr.

Carnegie said: "I considered what was fair: and that is the option Morgan got. Schwab went down and arranged it. I never saw Morgan on the subject or any man connected with him. Never a word pa.s.sed between him and me. I gave my memorandum and Morgan saw it was eminently fair.

I have been told many times since by insiders that I should have asked $100,000,000 more and could have got it easily. Once for all, I want to put a stop to all this talk about Mr. Carnegie 'forcing high prices for anything.'"]

My first distribution was to the men in the mills. The following letters and papers will explain the gift:

_New York, N.Y., March 12, 1901_

I make this first use of surplus wealth, four millions of first mortgage 5% Bonds, upon retiring from business, as an acknowledgment of the deep debt which I owe to the workmen who have contributed so greatly to my success. It is designed to relieve those who may suffer from accidents, and provide small pensions for those needing help in old age.

In addition I give one million dollars of such bonds, the proceeds thereof to be used to maintain the libraries and halls I have built for our workmen.

In return, the Homestead workmen presented the following address:

_Munhall, Pa., Feb'y 23, 1903_

MR. ANDREW CARNEGIE New York, N.Y.

DEAR SIR:

We, the employees of the Homestead Steel Works, desire by this means to express to you through our Committee our great appreciation of your benevolence in establishing the "Andrew Carnegie Relief Fund," the first annual report of its operation having been placed before us during the past month.

The interest which you have always shown in your workmen has won for you an appreciation which cannot be expressed by mere words. Of the many channels through which you have sought to do good, we believe that the "Andrew Carnegie Relief Fund" stands first. We have personal knowledge of cares lightened and of hope and strength renewed in homes where human prospects seemed dark and discouraging.

Respectfully yours

{ HARRY F. ROSE, _Roller_ { JOHN BELL, JR., _Blacksmith_ Committee { J.A. HORTON, _Timekeeper_ { WALTER A. GREIG, _Electric Foreman_ { HARRY CUSACK, _Yardmaster_

The Lucy Furnace men presented me with a beautiful silver plate and inscribed upon it the following address:

ANDREW CARNEGIE RELIEF FUND

LUCY FURNACES

_Whereas_, Mr. Andrew Carnegie, in his munificent philanthropy, has endowed the "Andrew Carnegie Relief Fund"

for the benefit of employees of the Carnegie Company, Therefore be it

_Resolved_, that the employees of the Lucy Furnaces, in special meeting a.s.sembled, do convey to Mr. Andrew Carnegie their sincere thanks for and appreciation of his unexcelled and bounteous endowment, and furthermore be it

_Resolved_, that it is their earnest wish and prayer that his life may be long spared to enjoy the fruits of his works.

{ JAMES SCOTT, _Chairman_ { LOUIS A. HUTCHISON, _Secretary_ { JAMES DALY Committee { R.C. TAYLOR { JOHN V. WARD { FREDERICK VOELKER { JOHN M. VEIGH

I sailed soon for Europe, and as usual some of my partners did not fail to accompany me to the steamer and bade me good-bye. But, oh! the difference to me! Say what we would, do what we would, the solemn change had come. This I could not fail to realize. The wrench was indeed severe and there was pain in the good-bye which was also a farewell.