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The Gospel of Wealth Summary provides key takeaways, review, quotes and author biography of Andrew Carnegie’s book regarding wealth. Andrew Carnegie could be long gone. But, his views about wealth still hold.
Andrew Carnegie was one of the wealthiest men in the USA. Hence, his open support for the capitalist model is simple to understand. Carnegie was a Scottish immigrant to America. He collected colossal fortune especially in the steel sector in the late 1800s. Carnegie Steel Co. was more than $400mn in today’s dollar when it sold. He devoted his remaining life to noble causes. The North American Review published his essay in 1889. Though short, this essay is full of Carnegie’s wisdom and vision.
Carnegie felt that law of competition is a capitalist society’s base. Hence, he said, just some rivals can – and must – control wealth. This isn’t a politically correct idea in today’s world. But, Carnegie encouraged the wealthy to accept their duty toward society. He practiced what he talked. In his lifetime, he gave over $350mn to many causes. This included setting up many libraries and Carnegie Mellon University. His ideas of charity and capitalism are rooted in using the dollar for a good purpose. Therefore, we recommend this book The Gospel of Wealth to all of you.
“THE PROBLEM OF OUR AGE IS THE PROPER ADMINISTRATION OF WEALTH.”
This Summary Will Help You Learn
- Why Carnegie thought that wealth distribution is the base of capitalism,
- How the competition law impacts a capitalist society, and
- Why and how the rich must leave a lasting legacy.
Take-Aways
- The real value of money relies on its proper distribution.
- Law of competition forms the base of capitalism.
- Despite its faults, capitalism forms favorable economic situations for society.
- Capitalism forms a difference between the rich and the middle class.
- It’s certain that most wealth falls with the few.
- The rich must follow a humble lifestyle and have a positive social image.
- Wealthy people must help their fellow beings.
- Proper oversight is needed; else recipients will mishandle charity.
- Random acts of donation are often ineffective. They don’t benefit the full society.
- Donors should play an active part in the proper use of their resources.
The Gospel of Wealth Summary
Capitalism as a Vehicle for Growth
Economic development and growth are necessary for a capitalist society. An ideal system forms a line between the rich and poor. Industry leaders do their duties by creating business opportunities. These produce profit and offer employment for ordinary people. Financial success allows leaders in other areas to enjoy luxuries. These luxuries are beyond the access of the working class. But, this isn’t a negative situation. Instead, such difference shows economic growth. In a capitalist system, the quality of goods/services is better. Plus, the prices are lower, and hence things are affordable for everyone. Some people may go back to the days of more equality among people. But, going back to those days will only be damaging.
Today’s working class can access necessities. These things were luxuries for even the prosperous 100 years ago. Sadly, economic growth comes at a considerable price. This is especially true in interpersonal relations. The growing gap between employee-employer becomes a ground for mistrust. An executive can’t have excellent relationships with all his workers especially when it’s a massive operation with thousands of people. Hence, workers become just names and faces. And so, both sides are unable to understand the problem of the other. Thus, the ultimate result is damaging to interpersonal relations.
The Law of Competition
The competition law forces employers to be careful about the expenses. Hence, salaries become a primary source of conflict between employee-employer. The law of competition has these flaws. But, rejecting its highly positive sides will be short-sighted. For future growth, competition is key. No other system can promote the growth of business this much. An individual may suffer in the process. But, society as a whole reaps the benefits. The ones who accept it will bloom. And, the ones who don’t accept this will fail.
The competition law builds an environment which develops leaders who have great skills. They know that profitability is the right measure of growth, especially in a free market economy. Capitalism allows great people to attain excellent results. This is the opposite of a communist society where individual growth isn’t encouraged. Capitalism, supported by competition, is better than communism.
This system enables all people to find their economic status. It appreciates the spur of individualism in every person. Also, it doesn’t support artificial limits which can stop growth. The system may not be perfect. But, it rewards people who are capable and motivated.
Distribution of Wealth
Capitalism offers excellent chances to nearly all members of society. But, only a few are lucky to have the means to collect wealth. Such people have just three practical options for distributing their extra wealth. These are:
- Leave a legacy for their family members on their death.
- Fund organizations and projects to benefit society.
- Distribute resources all through their lives.
History is proof that heirs mishandle legacies. European royal families gave their estates to the eldest male child. Even if his lavish ways of living ensured the destruction of the money, this behavior raises the question if parents must give their wealth to children. Of course, a parent won’t make his child live in poverty. Because ensuring a decent life for a child is a parental duty. Still, there’s a chance that parents do a disservice by giving millions to their kids. This’s especially true for children who can’t fend for themselves. Or those who don’t have any charitable goals. Hence, parents should teach their kids a sense of responsibility. And, also by giving them proper education.
There’s the second scenario as well. That is people, leaving their wealth for public consumption. Here, they give up the chance to do charity while being alive. Sadly, those left in charge don’t use the wealth for society’s best interests.
The rich have the power to sponsor things from which society can benefit.
Higher Taxes May Help
Higher taxes are a suitable means of discouraging the rich from hoarding money. They’ll also encourage wealthy people to allocate their resources while they’re alive. And, not waiting for others to do so once they die. People who collect money but don’t use for society aren’t worthy of admiration. The community won’t appreciate this. It’ll feel that they left their money because they can’t take it to their grave.
For Society’s Benefit
The best way of allocating surplus is ensuring that it benefits maximum people. The primary goal is to create a system which invests wealth in noble causes. This is more desirable than the less effective traditional approach. In the old method, donors allocate small sums to society over many years. In the absence of clear direction and control, money may not be appropriately used. People may end up spending it on unnecessary things.
Samuel J. Tilden was former governor of New York. He gave $5mn to build a free library in NYC. This’s a great example of how to spend one’s fortune for society’s benefit. A library opens the world’s treasure contained in books for all. But, Tilden would’ve been more praised, if he did this when he was alive. This way there wouldn’t have been the legal controversy and delay.
Wealthy people should identify and be thankful for their gift. They have the chance to help their fellow beings. The power to make other people’s lives better is a rare gift. And no one should waste this.
The mandate for the Wealthy
The mandate for the rich is apparent. Live a humble life without any fanfare. Provide sensibly for your family. And see all extra money as a way of helping society. The rich are just acting as a “trustee and agent” for their poor fellow beings. Wealthy people should find the best way to use their assets for society’s benefits.
Of course, there’s no universal definition of indulgence. Hence, one can’t identify whether a rich person is leading a life of luxury. One can’t even tell the level to which a person works within his sensibility. But, public sentiment is a mediator of good taste. It could be in matters of lifestyle, dressing or behavior. A person showing his money prefers appearance over substance. Also, he doesn’t see charity seriously. In this sense, the public’s judgment is often right.
Sensible Charity
The random distribution of donation is a big hurdle in society’s growth. There’s a dire need for wise advice and administration. Otherwise, donors waste millions on the unworthy and drunken. Randomly donated money increases the problems it should be removing. The money you give drunkards will not bring any change to their lives. Instead, they’re likely to misspend it. Giving charity may make people feel good about themselves. It may also stop beggars from being a nuisance for some-time. But, the same amount invested in a worthy cause will have a more significant impact.
The primary goal of the charity is benefitting people who want to improve their life. But, they don’t have the means to do so. In a few cases, otherwise, hard-working people are struck with bad luck. Hence, they want temporary financial help. In most cases, though, donors must donate to those whose intentions are genuine. And not to those who are just seeking a handout. So, if you wish to give, find where your money is going.
Follow people who build infrastructure which helps societal growth. For example, books, libraries, etc. help people to grow their mental and physical skills. Museums please the senses and elevate the society by large.
“NOT EVIL, BUT GOOD HAS COME… FROM THE ACCUMULATION OF WEALTH BY THOSE WHO HAVE HAD THE ABILITY AND ENERGY TO PRODUCE IT.”
Solving the Problem
The proper allocation of money has many benefits. It leaves the wealthy free to continue collecting wealth. Plus, it assures the rich that they won’t have to compromise their individuality. Instead, society trusts them to act on behalf of the deprived. Hence, the rich will use their powers to manage the society’s wealth for the larger good.
Millionaires should realize that there’s no pride in dying rich. The wealthy who don’t donate when they’re alive will die unsung. Applying this “gospel of wealth” will help the humankind. It will also mend the gap between the poor and the rich.
The Gospel of Wealth Quotes
“The problem of our age is the proper administration of wealth.”
“Not evil, but good has come… from the accumulation of wealth by those who have had the ability and energy to produce it.”
“Individualism, Private Property, the Law of Accumulation of Wealth and the Law of Competition… are the highest result of human experience.”
“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 than its cost.”
“It is to this law that we owe our wonderful material development.”
“Upon the sacredness of property civilization itself depends – the right of the laborer to his hundred dollars in the savings bank, and equally the legal right of the millionaire to his millions.”
“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?”
“By taxing estates heavily at death the State marks its condemnation of the selfish millionaire’s unworthy life.”
The rich “have it in their power during their lives to busy themselves in organizing benefactions from which the masses of their fellows will derive lasting advantage.”
“There is no mode of disposing of surplus wealth creditable to thoughtful and earnest men… save by using it year by year for the general good.”
“Of every thousand dollars spent in so-called charity today, it is probable that nine hundred and fifty dollars is unwisely spent.”
“In bestowing charity, the main consideration should be to help those who will help themselves.”
“No man is… to be thanked by the community to which he only leaves wealth at death. Men who leave vast sums in this way… would not have left it at all had they been able to take it with them.”
