Carnegie was born in Scotland, where his father was a loom weaver, a group that was being displaced by the growth of factories. The family emigrated to the United States in 1848, when Carnegie was 12 years old, and they were transported across the state of New York by horse drawn barges on the Erie Canal on the way to Pittsburgh. There Carnegie started out as a telegraph operator, working his way up the economic ladder in a classic rags to riches story. Working for Thomas Scott, owner of the Pennsylvania Railroad during the Civil War, Carnegie supervised the construction of the railroad bridges that transported soldiers and weapons for the Union Army. This employ led him to curiosity about the production of iron and steel, the latter of which would be the product that led him to become one of the wealthiest men in American history.
Using the newly developed Bessemer process in steel plants, which made steel more quickly and cheaply than could be done previously, Carnegie turned Pittsburgh into a city with an economy that centered on steel production. At the height of his economic power Carnegie had a virtual monopoly on steel in the United States, stomping out competitors by providing a cheaper product to customers across the nation. His method introduced a system that economists today call vertical integration, where he owned all aspects of the steel making process, including the mines, the ships and railroads that transported coal and other minerals, and the steel plants. Before he was displaced by oil magnate John D. Rockefeller, Carnegie was the richest man in the United States, but this wealth was not without some controversy.
One of the most famous strikes in labor history was the Homestead Strike of 1892, where skilled laborers tried to protect their rights against the growing threat of being displaced by automation. By this time Carnegie had Henry Frick running his operations, and Frick cracked down hard on the strikers, bringing in replacement workers and Pinkerton Agents to quell the violence there. Frick was a mean boss, and had other instances of what some regarded as cruel administration. There was a prominent foreman in Homestead who had put laborers there on an eight hour day, contending that less exhausted workers would be safer and produce better steel. When this man died in a factory accident, Frick promptly put the laborers back on a twelve hour day, at the same wages.
Carnegie had a social theory called the Gospel of Wealth. He contended that men competed in the economic world, and those who succeeded there obtained wealth that was a sign of God’s favor, in a process that resembled survival of the fittest in the process of evolution. He also felt that people did not know how to spend their money properly, so that the philanthropy of his later life gave them blessings, as in libraries and other cultural venues that they did not have the capacity to bestow upon themselves. Late in life, Carnegie lived in a castle that he bought in his homeland of Scotland, and members of the Parliament in London thought it rather curious that this wealthy new world capitalist heaped left-wing advice upon them in a strange manner. Whatever his political opinions, Carnegie was a man whose life had a tremendous effect on the economy of the United States, and the world.