The Redistribution of Wealth: Revisiting Andrew Carnegie's Essay on Wealth

"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."

Andrew Carnegie. Essay on Wealth, 1889

As Libertarian and ultra-conservative rancor vilify the so-called "socialist" acts of the Obama administration, it might behoove some to become familiar with one of the most wealthiest and active supporters of Capitalism. The fear spread by many on the right within some print and broadcast mediums have raised the alarm that Obama is tearing our country apart with such un-American notions as redistributing the wealth. Many are of the belief that such redistribution comes solely in the form of a person's wealth being taken and given to those less willing to work for it or earn it. That such a question or concern should even be asked will always be fraught with pro-capitalist hyperbole toward what Andrew Carnegie regarded as the "the sacredness of property". Though the wealth of individuals may be envied by many it is also something people think should be aspired to alone and not considered for dissemination to the general public. Not only is the innate inclination to preserve what is ours very strong but it is connected with an equally greater need to acquire more. It is this notion that I feel has been exploited by Corporate and individual greed and sermonized by the profits of industry on the right.

A synopsis of how this sacrosanct view of personal property developed begins with the breaking away of European social structures where people were either born to the manor or to a servile position that propped up the manor. This was known as the era of feudalism and existed for approximately 600-700 years (9th to 15th century) until the advent of mercantilism began to change this arrangement. Owning great wealth was no longer the sole domain of the royalty but had gained a foothold in a merchant class that had not been a part of the land-owning gentry in times past. Previous laborers who were tied to the land soon found sources of income in commodities and were able to build a capital base of their own that allowed them entry into a higher social and economic class. This upward mobility eventually pushed the envelope that lead to greater discoveries in the new world and a greater need for what would ultimately lead to a relatively prosperous middle class.

The dynamics of this transformation were slow but by the end of the 19th century the ability to acquire wealth was pretty much there for the individual if you pushed yourself physically and mentally and had just enough larceny in your veins to keep people from advancing beyond you. Rather than viewing such acts as wrong, some found that the act of pushing others out of what they had achieved was really just a part of the "natural" order of things. A scientific concept to justify this perception, "the survival of the fittest", coined by Herbert Spencer back in 1864, was used by the captains of industry as the 20th century approached.

Vast fortunes were achieved by 19th century robber barons like Carnegie, Rockefeller and J.P. Morgan whose acumen for attaining wealth often came through the exploitation of labor with cheap wages and long hours. It is this perception of wealth that was often attacked by people like Karl Marx and Eugene Debs. But it should be pointed out here that when I refer to fortunes I am not talking about what Carnegie called "moderate sums saved by many years of effort, the returns from which are required for the comfortable maintenance and education of families." To the steel magnate "this is not wealth but only competence, which it should be the aim of all to acquire."

What many wealthy people of today, with fortunes demonstrably less than what Andrew Carnegie had, appear to be enraged about is the notion that somehow their wealth should be used for more than serving their basic needs and the needs of their immediately family; that in fact it should "benefit the community" as well. Carnegie felt that hoarding vast fortunes by some was the "most injudicious" manner of utilizing one's wealth. It's not that Mr. Carnegie was born into great wealth and developed a benevolent concern for the poorer masses. No, the Kennedy model did not really exist during the 19th century. Carnegie was brought up in meager settings in his native Scotland. His vast wealth was acquired only after his family immigrated to America in 1848 (5). However, unlike many in his wealthy class, Carnegie learned that poverty had a debilitating affect on the individual and found that what he had gained through his ingenuity was not a mandate to justify guarding his own self-interest but seen as a gift by which he could enrich the lives of people less fortunate and gifted than he. His success was not seen as "only beneficial [for himself and his business] but essential for the future progress of the race."

To Carnegie, wealthy individuals, especially those whose success was achieved in business, were obligated to redistribute that wealth beyond what they needed to live comfortably. He was not promoting communism or socialism. In fact he expressly felt that the "socialist or anarchist who seeks to overturn present conditions is to be regarded as attacking the foundation upon which civilization itself rests". In his Essay, Carnegie referred to laws of accumulating wealth and the laws of competition as if they were akin to natural laws such as gravity. These views may have some merit under a more general law of self-interest that then spur personal efforts of man to formalize them through legislation; but the Spencerian notion of natural laws for accumulating wealth and competition would not hold up, I think, in a scientific court of inquiry.

But the point is was that one of the wealthiest Capitalist that ever lived was espousing a sentiment that many today feel is un-American instead of a virtue. As was pointed out earlier, Carnegie WAS NOT supporting a notion that ALL income earning people, especially the middle class, should be taxed unreasonably so everyone below their economic status could live comfortably without working for it. He WAS advocating that the wealthiest 1 or 2 percent of those in this nation should utilize their great fortunes to advance the lives of those who now find themselves without jobs, without the means for a higher education and without adequate health care coverage to sustain a productive life.

Carnegie would probably not only be astonished at the greed that led to the economic deprivations of many Americans today but would be outraged at the notion by those who advocate a return to those days that preceded such universal economic failure. He would be further offended by right-wing talking heads that admonish an administration that is trying to do what he pushed for over a century ago; using the great wealth of individuals as a "potent force" for elevating the weakest amongst us at the hour of their greatest need and beyond. For Carnegie, TRUE individualism would accomplish more than what socialism and communism promised. "Under [individualism's] 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 fellow citizens 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." - Source

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