Thomas M. Carnegie
Encyclopedia
Thomas Morrison Carnegie (October 2, 1843 – October 19, 1886) was a Scottish
-born American
industrialist
. He was the brother of steel
magnate Andrew Carnegie
, and co-founder of the Edgar Thomson Steel Works
(a steel manufacturing company).
He was born in Dunfermline
, Fife
, Scotland
, on October 2, 1843. His parents were Will and Margaret Carnegie, and he had a brother, Andrew, who was eight years older. A sister, Ann, had been born in 1840 but died in infancy. His father was a master weaver
, and his mother sold food in the home and sewed soles on leather boots to help provide income. Left destitute by automation (which threw his father, a hand weaver, out of work), the family emigrated to the United States
in 1848 and settled in "Slabtown"—an immigrant neighborhood in Allegheny City
, at the time a distinct and fast-growing city on the north side of the Allegheny
and Ohio River
s across from Pittsburgh, Pennsylvania
. The family rented rooms from a relative who owned a house at 336 Rebecca Street. (The street is gone, replaced by Three Rivers Stadium
football
stadium.) Allegheny City was an unpleasant place to live. It had no municipal water system until 1848, no natural gas
lines until 1853, and no sewer system, and wild hogs roamed the streets attacking children. There, Thomas attended local public school.
As a boy, Thomas Carnegie was "the beautiful white-haired child with lustrous black eyes, who everywhere attracted attention". He was generally considered well-mannered but reserved, and often went into a quiet room during social gatherings. He was also noted for his quick and wry sense of humor. But while Andrew Carnegie found a father-figure (in Tom Scott, a family friend) after the death of Will Carnegie in 1855, Thomas did not and spent most of his life emulating his brother. And while some, such as Andrew Carnegie biographer Joseph Frazier Wall
have concluded that Margaret Carnegie secretly favored Thomas, others such as Richard S. Tedlow
disagree and conclude that Thomas was largely isolated and lonely within the extended Carnegie family and their large coterie of friends. It is well documented that Andrew and Thomas did not have the same group of friends, and that Thomas' group was smaller. In time, Thomas Carnegie became a lifelong heavy drinker.
. Andrew was appointed superintendent of the western division of the Pennsylvania Railroad
in 1859, and he made Thomas (who had quit school) his assistant. (This was not the end of Thomas' schooling. As an adult, he would later take classes at Duff College
.)
The family moved back to Pittsburgh in 1859, residing at 10 Hancock Street (later renamed Eighth Street, and now part of the Downtown Pittsburgh central business district). But the pollution from nearby factories and iron forges proved too much, and after only a few short months on Hancock Street Andrew purchased a Victorian
home for Thomas and their mother in Homewood
, then a middle-class village on the edge of Pittsburgh. Andrew and Thomas rode the train to and from work together, and attended the theater frequently.
In 1861, Andrew persuaded Thomas to invest in the Columbia Oil Company, and it paid off handsomely. That Andrew Carnegie should ask an 18-year-old boy to be a stock investor was not unusual. When Andrew traveled to Scotland with his mother and a friend in 1862, he left Thomas in charge of his numerous business affairs (assets by that time nearing $47,860 or $8.5 million in 2009 inflation-adjusted dollars).
. Miller subsequently bought out Anton Kloman's share. Phipps and Miller later learned that Andrew Kloman had sold a one-ninth share in the business to a local man who subsequently died during the war, and Miller bought his share (raising his ownership in the business to four-ninths). Kloman, Miller, and Phipps were soon at odds over these transactions and one another's refusal to sell out to the others, and they sought Andrew Carnegie's assistance in resolving the dispute. On September 1, 1863, Carnegie drew up new incorporation papers which made Miller a "special partner" in the firm and which also made Thomas Carnegie a partner in the business. The money for Thomas' investment came from Andrew. A clause in the contract permitted Kloman and Phipps to oust Miller and make him a silent partner, which they quickly did. The same clause, however, gave Thomas Carnegie the right to purchase the extra one-ninth share Miller had obtained, and Andrew Carnegie immediately financed this purchase. When Miller, one of Andrew's closest friends, protested, Andrew induced Thomas to plead with him to acquiesce lest Andrew's reputation as a fair dealer suffer. Miller did so.
Meanwhile, Miller established a rival firm, the Cyclops Iron Company, with Andrew Carnegie as an investor. The Cyclops firm opened in October 1864. Thomas Carnegie, however, was deeply concerned that the Cyclops company would harm his own interests in Iron City Forge, and successfully prevailed on Andrew to merge the two firms. (It may also be true that Andrew Carnegie always intended to merge the two firms in order to gain control of both, and used Thomas for this purpose.) Kloman and Phipps at first refused, but Thomas made an offer of all the shares in Cyclops plus an additional payment of $50,000 (a very large sum at the time). On May 1, 1865, the new Union Iron Mills Company was formed. Thomas Carnegie was to "help out" as needed, and appointed vice president of the firm.
While Andrew Carnegie and Thomas N. Miller spent the better part of the next year touring Europe, Thomas Carnegie flourished at the Union Iron Mills. The company struggled financially as the end of the Civil War led to sharp drops in the need for iron products, but Thomas proved to be a warm and friendly executive where his brother was cold and austere. Thomas' ability to make friends allowed the firm to receive numerous contracts and even infusions of capital when needed, and it is unlikely the company would have survived without him. Andrew wrote to Thomas extensively from Europe, constantly criticizing his business decisions, providing him with micromanaging
instructions, and generally demeaning him. From Europe, Andrew also badgered Thomas to make improvements to their home in America, and decided to call the rapidly expanding mansion "Fairfield." But Thomas' judgment could prove wiser than Andrew's. In July 1865, Andrew Carnegie became fascinated with the "Dodd process," a new English method of welding steel facing to iron railroad rails, and despite Tom's misgivings he purchased the American patent for the process. But the process proved unworkable, and despite additional investments and retooling of the mill additional rails proved just as brittle and breakable as the first. Thomas advised him to conserve his money, but Andrew purchased yet another steel welding patent to try to fix the process. That, too, failed and soon Carnegie's steel-welding business was bankrupt. Thomas correctly foresaw that Andrew too easily believed his judgment was infallible, and soon a coal mining process Andrew had purchased also led to significant financial losses.
Meanwhile, Thomas began courting Lucy Coleman, daughter of Pittsburgh iron manufacturing magnate William Coleman. Coleman provided Thomas with critical advice on how to improve the Union Iron Mills, and inside information on the coming railroad building boom. Another critical business relationship was with Piper & Shiffler (later known as the Keystone Bridge Company
), an iron bridge building firm invested in by Andrew Carnegie in 1862. Andrew diverted much of Piper & Shiffler's contracts to the Union Iron Mills, further bolstering the company's profits. Tom often tried to rein in some of his brother's excesses, but to no avail. For example, in 1866 Andrew proposed purchasing a pipe works adjacent to the old Cyclops iron works. Thomas opposed the purchase, arguing that the time for expansion was not ripe and that the pipe works used a kind of iron with the Union Iron Mills did not produce. The pipe works turned out to be a white elephant
, but they burned down shortly thereafter (saving the firm from further losses).
Thomas Carnegie married Lucy Ackerman Coleman in June 1866, and honeymooned in Europe. They had been courting since 1864. By 1881, the couple had nine children. The children were tutored at home, although they also attended a private school for a portion of the day. In 1867, Andrew moved to New York City, giving "Fairfield" to Thomas, Lucy, and his mother Margaret. Margaret moved to New York City to live with her older son in 1870.
In 1880, with seven children at Fairfield and the city of Pittsburgh becoming increasingly hazardous to health due to its burgeoning industry, Thomas and Lucy began seeking a summer home along the southern East Coast
for their family. The previous year, the Carnegies had met reporter Frederick Ober while on vacation in Fernandina Beach, Florida
. Ober told them about an island plantation
he was writing an article about. In 1880, Lippincott's Monthly Magazine
published an article by Ober about Dungeness
, a plantation on the barrier island
of Cumberland Island
on the southern Atlantic
coast of the state of Georgia
. Although it had suffered an extensive fire in 1866 and was uninhabitable, the mansion had a storied past. The article drew the attention of Lucy Carnegie (who had attended boarding school as a girl in nearby Fernandina), and the Carnegies decided the place would be an ideal summer home. The mansion's owner was ex-Confederate
General William George MacKay Davis, a first cousin of Confederate President
Jefferson Davis
who bought the plantation from its creditors in 1879. Carnegie offered to buy Dungeness on August 25, 1880, for $25,000 but his offer was rejected. But after the death of Gen. Davis' son and grandson at the property, Davis desired to leave the place which had brought him such grief and Carnegie offered and Davis accepted a price of $35,000. The sale for the 4000 acres (1,618.7 ha) property (which included orange and olive groves, gardens, several cottages, and outbuildings) was final on November 17, 1881. Over the next four months, the burned-out mansion was demolished and noted Pittsburgh architect Andrew Peebles designed a massive Queen Anne Style
mansion with wraparound verandas, high ceilings, several porches, many turret
s, and a 100 feet (30.5 m) high tower. In April 1882, Carnegie and his cousin, Leander Morris, jointly purchased an adjoining 8240 acres (3,334.6 ha) property. The cornerstone for the new Dungeness was laid on February 26, 1884, and the $285,000, 6720 square feet (624.3 m²) mansion (fully furnished) completed on January 1, 1885. There was even a landing for Thomas Carnegie's steam-powered yacht, the Missoe. The Carnegies visited Dungeness irregularly over the next year, traveling to Georgia in a private railroad car.
. Iron ore was usually smelted into pig iron first, a brittle but refined product (often cast in ingot
s) which was usually sold to other companies and turned into wrought iron
or steel. Several investors in the Union Iron Mills wished to invest in companies producing pig iron, but William Coleman advised against it and advocated building a wholly owned modern furnace under the company's control. A division of the Union Iron Mills (named the Isabella Furnace Company) was organized on December 1, 1870, and the company's first blast furnace
(named the "Lucy furnace" after Thomas' wife) was constructed on 51st Street in Pittsburgh. Most of the investors who joined the Isabella Furnace Company were Thomas' friends, not Andrew's. Thomas Carnegie supervised the operation of the Lucy furnace, and he was almost alone in contributing to its business success. The Lucy furnace was enormous—75 feet (22.9 m) high with a 20 feet (6.1 m) bosh (the widest part of the furnace and the hottest due to its proximity to the hearth)—and was producing a record-shattering 300 short tons (272.2 t) a day by 1872. A second Lucy furnace was built in 1877. In 1881, a two-thirds share in the company was sold to Wilson, Walker & Co. and James R. Wilson relieved Thomas Carnegie and John Phipps of their duties overseeing the operation of the furnaces.
Thomas Carnegie's experience in running the Lucy furnaces led him to co-found the Edgar Thomson Steel Works. In early 1871, William Coleman became interested in the new Bessemer process
steel-making furnaces, and he traveled throughout Ohio, New York, and Pennsylvania to view these new works. Coleman invited Thomas Carnegie to join him in building the new steel works, and together they purchased 107 acres (43.3 ha) of land about 10 miles (16.1 km) north of Pittsburgh known as Braddock's Field
(a historic battlefield where French and Indian forces from Fort Duquesne
defeated British General Edward Braddock
on July 5, 1755, in the Battle of the Monongahela
). (Thomas borrowed the money for his investment from his brother.) Coleman and Carnegie lived near one another in Homewood and went to work together on the streetcar, and it was during these daily commutes that the men worked on their plans for the new steel works. Although Thomas asked Andrew to invest in the new mill, Andrew refused (considering it too risky a venture). Thomas then prevailed upon David McCandless, a wealthy Pittsburgh merchant and vice president of the Exchange National Bank. McCandless agreed, and brought in William P. Shinn (a Norman Medal
-winning engineer) as treasurer. In the spring of 1872, Andrew Carnegie (while on a bond
-selling trip) made a survey of Bessemer steel works in Europe and returned to the U.S. highly enthusiastic about the new project. Andrew subsequently invested $250,000 in the works. Meanwhile, Coleman, McCandless, Scott, and Thomas Carnegie had purchased a newly plat
ted tract in Pittsburgh, subdivided
it, and sold the lots at a significant profit. The partners then invested $50,000 each in the steel mill. A new company, Carnegie, McCandless & Co., was formed on January 13, 1873, to build the works.
Thomas was on vacation with Andrew and their mother at the upscale resort town of Cresson Springs
in September 1873 when they learned of the failure of the investment bank of Jay Cooke & Company
, which precipitated the Panic of 1873
. The Panic created financial difficulties for the company, and it floated bonds to stay alive. J. Edgar Thomson
, president of the Pennsylvania Railroad and a mentor and close friend to many of the partners, bought many of these bonds late 1873, helping keep the firm afloat. The partners dissolved Carnegie, McCandless & Co. to take advantage of a new Pennsylvania law permitting the formation of limited liability companies
, and the Edgar Thomson Steel Company Ltd. was created on October 12, 1874. The company took its name from J. Edgar Thomson, who although not a large investor in the works had a superb reputation as an honest and trustworthy person (an important asset in risky financial times).
Over the next several years, Thomas Carnegie generally oversaw the Edgar Thomson Steel Company. His success in this endeavor was summed up by a corporate historian this way:
Other historical assessments conclude Thomas had a solid grasp of the steel business and was a respected manager, even if Andrew considered him overly cautious. William Abbott, chairman of Carnegie, Phipps, & Co., considered Thomas the better businessman than Andrew, "solid, shrewd, farseeing, absolutely honest and dependable." Thomas lacked Andrew's ambition, but "was content with a good, prosperous, safe business and cared nothing for expansion. He disapproved of Andrew's skyrocketing tendencies, regarded him as a plunger and a dangerous leader. Tom wanted earnings in the shape of dividends, whereas Andrew insisted on using them for expansion." Although he shied away from publicity, he was a hard worker and well liked by both management and workers. His one flaw was his drinking: He often left work at noon and drank heavily for the rest of the day.
Crony capitalism
was an important part of American industrialism during this period. Thomas Carnegie, however, was not very adept at it. There is conflicting evidence as to whether he mixed widely in Pittsburgh society, with at least one scholar claiming he did and another that he did not. He was reserved at social gatherings, using his attendance at parties to pick up business gossip and industry buzz. He played cards on a weekly basis with Henry Clay Frick
, Philander Knox, Andrew and Richard Mellon
, and George Westinghouse
. His closest friend was David A. Stewart, a co-partner in the Thomson works, and Stewart readily defended Thomas against the criticisms and jibes of others (particularly Andrew Carnegie).
Thomas sold half his interest in Edgar Thomson Steel to his older brother in 1876 after disagreement broke out over whether to build another "Lucy furnace." Thomas Carnegie, however, held no position on the Thomson board of directors, a situation Andrew Carnegie wanted rectified the moment a position on the board became available. This occurred in the summer of 1876, but William P. Shinn (the second-largest stockholder in the company) complained bitterly to Andrew (traveling in Europe) that the seat should have gone to him. Nonetheless, Thomas was not only added to the board but made chairman upon Andrew Carnegie's return to the U.S. a few months later. Shinn eventually had enough, and resigned as manager of the Thomson steel works in September 1879. Thomas replaced Shinn as manager.
Andrew Carnegie decided to stop relying solely on his company's own furnaces for coke, and began seeking to buy the fuel on the open market. Thomas and Henry Phipps had alerted Andrew to the need for a greater and steadier supply for coke for the growing steel works. In 1881, Andrew sent Thomas to meet with Henry Clay Frick
, owner of H.C. Frick & Co.—the largest coke producing company in the U.S. Thomas' goal was to induce Frick to buy the Carnegie coke ovens. In November 1881, Thomas proposed selling the Monastery Coke Works near Latrobe, Pennsylvania
, to Frick, or at least have Frick take over the marketing and selling of the coke produced there. Thomas' offer came as Frick was planning his wedding, and it fell to Andrew to meet with Frick and his new bride as they honeymooned in New York City. By this time, Thomas had negotiated most of an agreement with Frick, as well as planned the meeting with Andrew. Carnegie took a 10 percent interest in H.C. Frick & Co., Frick took a 50 percent interest in the Monastery coke works, and H.C. Frick & Co. would become the exclusive supplier of coke to Carnegie Bros. & Co. and the Edgar Thomson Steel Works. Thomas was assigned to negotiate the price of coke on an annual basis with Frick, and over the next two years H.C. Frick & Co. made a 23 percent profit on the coke sold. By 1885, Andrew Carnegie had purchased enough stock in H.C. Frick & Co. to own 50 percent of the company. Frick now attempted to buy into the Carnegie steel companies by selling 12 of the remaining 16 percent of the H.C. Frick which he still owned, but Thomas warned him not to try and to instead seek a position as a manager within the company.
Thomas also played a key role in the consolidation of Andrew's businesses. Thomas had become more involved with the management of Edgar Thomson Steel and less with the Isabella Furnace and Union Iron companies. It was Thomas who suggested to Andrew that the companies be consolidated into a single firm, and that Thomas' stake in the new firm be raised commensurate with his managerial role. His older brother agreed. On April 1, 1888, Andrew Carnegie reorganized his iron and steel businesses into one company, Carnegie Bros. & Co., with Thomas holding 17 percent of the stock. Included in the reorganization were the Lucy and Isabella furnaces, Union Iron Mills, and Homestead works.
In late September 1886, Thomas Carnegie fell ill with what he believed to be a cold. He was sick off and on for the next several weeks. On October 16, he left work thinking he was suffering from yet another cold, but died of pneumonia
just three days later. His wife and all of his children except Margaret (who was attending a boarding school
in New York
) were at his bedside when he died. For most of his life, Thomas had been a member of the Swedenborgian Church
. His funeral, however, was conducted by an Episcopalian, and Carnegie was buried on October 21, 1886, in Allegheny Cemetery
in Pittsburgh. His mother, also quite ill for some time, died on November 10 (never learning of her younger son's death).
Thomas' death was a serious blow to Andrew Carnegie's financial interests. Thomas had run most of Andrew's enterprises, and to fill his role Andrew Carnegie turned to Henry Clay Frick as his replacement. Frick later played a critical role in the Homestead Strike
and in brokering the deal between Carnegie and J. P. Morgan
that created U.S. Steel
.
Thomas' will named Lucy his sole executrix
and legatee
. The will asked (but did not require) her to seek the advice of her brother-in-law Andrew Carnegie and her father (deceased in 1878) in disposing of Thomas' business interests. Although Andrew Carnegie advised her to sell out to him, she refused and retained ownership in businesses which led to rapid rises in her personal wealth over the next several decades.
Both Andrew and Thomas Carnegie had been members of the South Fork Fishing and Hunting Club
, a highly exclusive wealthy businessman's club which operated a mountaintop retreat overlooking Lake Conemaugh, one of the largest man-made lakes of the day. Lake Conemaugh was formed by the construction of the South Fork Dam
in 1853, but had been drained and abandoned prior to its purchase by the South Fork organization. The club, which formed in 1879, maintained the South Fork Dam and refilled the reservoir. Andrew and Thomas built a cottage near the clubhouse, and often stayed there. The South Fork Dam failed on May 31, 1889, resulting in the disastrous Johnstown Flood
.
Scotland
Scotland is a country that is part of the United Kingdom. Occupying the northern third of the island of Great Britain, it shares a border with England to the south and is bounded by the North Sea to the east, the Atlantic Ocean to the north and west, and the North Channel and Irish Sea to the...
-born American
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
industrialist
Business magnate
A business magnate, sometimes referred to as a capitalist, czar, mogul, tycoon, baron, oligarch, or industrialist, is an informal term used to refer to an entrepreneur who has reached prominence and derived a notable amount of wealth from a particular industry .-Etymology:The word magnate itself...
. He was the brother of steel
Steel
Steel is an alloy that consists mostly of iron and has a carbon content between 0.2% and 2.1% by weight, depending on the grade. Carbon is the most common alloying material for iron, but various other alloying elements are used, such as manganese, chromium, vanadium, and tungsten...
magnate Andrew Carnegie
Andrew Carnegie
Andrew Carnegie was a Scottish-American industrialist, businessman, and entrepreneur who led the enormous expansion of the American steel industry in the late 19th century...
, and co-founder of the Edgar Thomson Steel Works
Edgar Thomson Steel Works
The Edgar Thomson Steel Works is a steel mill in North Braddock, Pennsylvania. It is active since 1872.-History :The mill occupies the historic site of Braddock's Field, on the banks of the Monongahela River east of Pittsburgh, Pennsylvania...
(a steel manufacturing company).
Early life
Dunfermline
Dunfermline is a town and former Royal Burgh in Fife, Scotland, on high ground from the northern shore of the Firth of Forth. According to a 2008 estimate, Dunfermline has a population of 46,430, making it the second-biggest settlement in Fife. Part of the town's name comes from the Gaelic word...
, Fife
Fife
Fife is a council area and former county of Scotland. It is situated between the Firth of Tay and the Firth of Forth, with inland boundaries to Perth and Kinross and Clackmannanshire...
, Scotland
Scotland
Scotland is a country that is part of the United Kingdom. Occupying the northern third of the island of Great Britain, it shares a border with England to the south and is bounded by the North Sea to the east, the Atlantic Ocean to the north and west, and the North Channel and Irish Sea to the...
, on October 2, 1843. His parents were Will and Margaret Carnegie, and he had a brother, Andrew, who was eight years older. A sister, Ann, had been born in 1840 but died in infancy. His father was a master weaver
Weaving
Weaving is a method of fabric production in which two distinct sets of yarns or threads are interlaced at right angles to form a fabric or cloth. The other methods are knitting, lace making and felting. The longitudinal threads are called the warp and the lateral threads are the weft or filling...
, and his mother sold food in the home and sewed soles on leather boots to help provide income. Left destitute by automation (which threw his father, a hand weaver, out of work), the family emigrated to the United States
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
in 1848 and settled in "Slabtown"—an immigrant neighborhood in Allegheny City
Allegheny, Pennsylvania
Allegheny City was a Pennsylvania municipality located on the north side of the junction of the Allegheny and Ohio rivers, across from downtown Pittsburgh. It was annexed by Pittsburgh in 1907...
, at the time a distinct and fast-growing city on the north side of the Allegheny
Allegheny River
The Allegheny River is a principal tributary of the Ohio River; it is located in the Eastern United States. The Allegheny River joins with the Monongahela River to form the Ohio River at the "Point" of Point State Park in Downtown Pittsburgh, Pennsylvania...
and Ohio River
Ohio River
The Ohio River is the largest tributary, by volume, of the Mississippi River. At the confluence, the Ohio is even bigger than the Mississippi and, thus, is hydrologically the main stream of the whole river system, including the Allegheny River further upstream...
s across from Pittsburgh, Pennsylvania
Pittsburgh, Pennsylvania
Pittsburgh is the second-largest city in the US Commonwealth of Pennsylvania and the county seat of Allegheny County. Regionally, it anchors the largest urban area of Appalachia and the Ohio River Valley, and nationally, it is the 22nd-largest urban area in the United States...
. The family rented rooms from a relative who owned a house at 336 Rebecca Street. (The street is gone, replaced by Three Rivers Stadium
Three Rivers Stadium
Three Rivers Stadium was a multi-purpose stadium located in Pittsburgh, Pennsylvania from 1970 to 2000. It was home to the Pittsburgh Pirates and the Pittsburgh Steelers, the city's Major League Baseball franchise and National Football League franchise respectively.Built as a replacement to...
football
American football
American football is a sport played between two teams of eleven with the objective of scoring points by advancing the ball into the opposing team's end zone. Known in the United States simply as football, it may also be referred to informally as gridiron football. The ball can be advanced by...
stadium.) Allegheny City was an unpleasant place to live. It had no municipal water system until 1848, no natural gas
Natural gas
Natural gas is a naturally occurring gas mixture consisting primarily of methane, typically with 0–20% higher hydrocarbons . It is found associated with other hydrocarbon fuel, in coal beds, as methane clathrates, and is an important fuel source and a major feedstock for fertilizers.Most natural...
lines until 1853, and no sewer system, and wild hogs roamed the streets attacking children. There, Thomas attended local public school.
As a boy, Thomas Carnegie was "the beautiful white-haired child with lustrous black eyes, who everywhere attracted attention". He was generally considered well-mannered but reserved, and often went into a quiet room during social gatherings. He was also noted for his quick and wry sense of humor. But while Andrew Carnegie found a father-figure (in Tom Scott, a family friend) after the death of Will Carnegie in 1855, Thomas did not and spent most of his life emulating his brother. And while some, such as Andrew Carnegie biographer Joseph Frazier Wall
Joseph Frazier Wall
Joseph Frazier Wall was an American historian and professor of history at Grinnell College. His biography of Andrew Carnegie won the Bancroft Prize in 1971, and he was later nominated for the Pulitzer Prize for his biography on the Du Pont family.-External links:*...
have concluded that Margaret Carnegie secretly favored Thomas, others such as Richard S. Tedlow
Richard S. Tedlow
Richard S. Tedlow is the MBA Class of 1949 Professor of Business Administration at Harvard Business School, where he is a specialist in the history of business. He is the author of "Andy Grove: The life and times of an American," one of the top ten business books in 2006.-References:...
disagree and conclude that Thomas was largely isolated and lonely within the extended Carnegie family and their large coterie of friends. It is well documented that Andrew and Thomas did not have the same group of friends, and that Thomas' group was smaller. In time, Thomas Carnegie became a lifelong heavy drinker.
Career
Andrew Carnegie made a good deal of money from stock investing, and in 1853 purchased their rented home on Rebecca Street. In 1858, after Andrew had been appointed Thomas Scott's assistant, the Carnegie family sold their Rebecca Street home and bought a large home in AltoonaAltoona, Pennsylvania
-History:A major railroad town, Altoona was founded by the Pennsylvania Railroad in 1849 as the site for a shop complex. Altoona was incorporated as a borough on February 6, 1854, and as a city under legislation approved on April 3, 1867, and February 8, 1868...
. Andrew was appointed superintendent of the western division of the Pennsylvania Railroad
Pennsylvania Railroad
The Pennsylvania Railroad was an American Class I railroad, founded in 1846. Commonly referred to as the "Pennsy", the PRR was headquartered in Philadelphia, Pennsylvania....
in 1859, and he made Thomas (who had quit school) his assistant. (This was not the end of Thomas' schooling. As an adult, he would later take classes at Duff College
Duff's Business Institute
Duff's Business Institute is the former name of Everest Institute's Pittsburgh campus. It offers career college programs in a variety of areas. The College was founded in 1851 as Duff's Mercantile College and has also been known as The Pioneer Business College in America, Iron City Commercial...
.)
The family moved back to Pittsburgh in 1859, residing at 10 Hancock Street (later renamed Eighth Street, and now part of the Downtown Pittsburgh central business district). But the pollution from nearby factories and iron forges proved too much, and after only a few short months on Hancock Street Andrew purchased a Victorian
Victorian architecture
The term Victorian architecture refers collectively to several architectural styles employed predominantly during the middle and late 19th century. The period that it indicates may slightly overlap the actual reign, 20 June 1837 – 22 January 1901, of Queen Victoria. This represents the British and...
home for Thomas and their mother in Homewood
Homewood (Pittsburgh)
Homewood is a predominantly African American neighborhood of Pittsburgh, Pennsylvania, United States, officially divided into three neighborhoods: Homewood North, Homewood South and Homewood West....
, then a middle-class village on the edge of Pittsburgh. Andrew and Thomas rode the train to and from work together, and attended the theater frequently.
In 1861, Andrew persuaded Thomas to invest in the Columbia Oil Company, and it paid off handsomely. That Andrew Carnegie should ask an 18-year-old boy to be a stock investor was not unusual. When Andrew traveled to Scotland with his mother and a friend in 1862, he left Thomas in charge of his numerous business affairs (assets by that time nearing $47,860 or $8.5 million in 2009 inflation-adjusted dollars).
Union Iron Mills
Thomas' business ventures were often pulled along in the wake of his older brother's interests, and he made his fortune in iron and steel because of Andrew. In 1861, Thomas N. Miller, John Phipps (the son of the shoemaker Margaret Carnegie did home work for), Anthony Kloman, and Andrew Kloman organized the Iron City Forge in Pittsburgh to take advantage of the booming need for iron products during the American Civil WarAmerican Civil War
The American Civil War was a civil war fought in the United States of America. In response to the election of Abraham Lincoln as President of the United States, 11 southern slave states declared their secession from the United States and formed the Confederate States of America ; the other 25...
. Miller subsequently bought out Anton Kloman's share. Phipps and Miller later learned that Andrew Kloman had sold a one-ninth share in the business to a local man who subsequently died during the war, and Miller bought his share (raising his ownership in the business to four-ninths). Kloman, Miller, and Phipps were soon at odds over these transactions and one another's refusal to sell out to the others, and they sought Andrew Carnegie's assistance in resolving the dispute. On September 1, 1863, Carnegie drew up new incorporation papers which made Miller a "special partner" in the firm and which also made Thomas Carnegie a partner in the business. The money for Thomas' investment came from Andrew. A clause in the contract permitted Kloman and Phipps to oust Miller and make him a silent partner, which they quickly did. The same clause, however, gave Thomas Carnegie the right to purchase the extra one-ninth share Miller had obtained, and Andrew Carnegie immediately financed this purchase. When Miller, one of Andrew's closest friends, protested, Andrew induced Thomas to plead with him to acquiesce lest Andrew's reputation as a fair dealer suffer. Miller did so.
Meanwhile, Miller established a rival firm, the Cyclops Iron Company, with Andrew Carnegie as an investor. The Cyclops firm opened in October 1864. Thomas Carnegie, however, was deeply concerned that the Cyclops company would harm his own interests in Iron City Forge, and successfully prevailed on Andrew to merge the two firms. (It may also be true that Andrew Carnegie always intended to merge the two firms in order to gain control of both, and used Thomas for this purpose.) Kloman and Phipps at first refused, but Thomas made an offer of all the shares in Cyclops plus an additional payment of $50,000 (a very large sum at the time). On May 1, 1865, the new Union Iron Mills Company was formed. Thomas Carnegie was to "help out" as needed, and appointed vice president of the firm.
While Andrew Carnegie and Thomas N. Miller spent the better part of the next year touring Europe, Thomas Carnegie flourished at the Union Iron Mills. The company struggled financially as the end of the Civil War led to sharp drops in the need for iron products, but Thomas proved to be a warm and friendly executive where his brother was cold and austere. Thomas' ability to make friends allowed the firm to receive numerous contracts and even infusions of capital when needed, and it is unlikely the company would have survived without him. Andrew wrote to Thomas extensively from Europe, constantly criticizing his business decisions, providing him with micromanaging
Micromanagement
In business management, micromanagement is a management style where a manager closely observes or controls the work of her or his subordinates or employees...
instructions, and generally demeaning him. From Europe, Andrew also badgered Thomas to make improvements to their home in America, and decided to call the rapidly expanding mansion "Fairfield." But Thomas' judgment could prove wiser than Andrew's. In July 1865, Andrew Carnegie became fascinated with the "Dodd process," a new English method of welding steel facing to iron railroad rails, and despite Tom's misgivings he purchased the American patent for the process. But the process proved unworkable, and despite additional investments and retooling of the mill additional rails proved just as brittle and breakable as the first. Thomas advised him to conserve his money, but Andrew purchased yet another steel welding patent to try to fix the process. That, too, failed and soon Carnegie's steel-welding business was bankrupt. Thomas correctly foresaw that Andrew too easily believed his judgment was infallible, and soon a coal mining process Andrew had purchased also led to significant financial losses.
Meanwhile, Thomas began courting Lucy Coleman, daughter of Pittsburgh iron manufacturing magnate William Coleman. Coleman provided Thomas with critical advice on how to improve the Union Iron Mills, and inside information on the coming railroad building boom. Another critical business relationship was with Piper & Shiffler (later known as the Keystone Bridge Company
Keystone Bridge Company
The Keystone Bridge Company, founded in 1865 by Andrew Carnegie, was an important American bridge building company. It was one of the 28 companies absorbed into the American Bridge Company in 1900. The company advertised its services for building steel, iron,wooden railway and road bridges. It held...
), an iron bridge building firm invested in by Andrew Carnegie in 1862. Andrew diverted much of Piper & Shiffler's contracts to the Union Iron Mills, further bolstering the company's profits. Tom often tried to rein in some of his brother's excesses, but to no avail. For example, in 1866 Andrew proposed purchasing a pipe works adjacent to the old Cyclops iron works. Thomas opposed the purchase, arguing that the time for expansion was not ripe and that the pipe works used a kind of iron with the Union Iron Mills did not produce. The pipe works turned out to be a white elephant
White elephant
A white elephant is an idiom for a valuable but burdensome possession of which its owner cannot dispose and whose cost is out of proportion to its usefulness or worth...
, but they burned down shortly thereafter (saving the firm from further losses).
Thomas Carnegie married Lucy Ackerman Coleman in June 1866, and honeymooned in Europe. They had been courting since 1864. By 1881, the couple had nine children. The children were tutored at home, although they also attended a private school for a portion of the day. In 1867, Andrew moved to New York City, giving "Fairfield" to Thomas, Lucy, and his mother Margaret. Margaret moved to New York City to live with her older son in 1870.
East Coast of the United States
The East Coast of the United States, also known as the Eastern Seaboard, refers to the easternmost coastal states in the United States, which touch the Atlantic Ocean and stretch up to Canada. The term includes the U.S...
for their family. The previous year, the Carnegies had met reporter Frederick Ober while on vacation in Fernandina Beach, Florida
Fernandina Beach, Florida
Fernandina Beach is a city in Nassau County in the state of Florida in the United States of America and on Amelia Island. It is a part of Greater Jacksonville and is among Florida's northernmost cities. The area was first inhabited by the Timucuan Indian tribe...
. Ober told them about an island plantation
Plantation
A plantation is a long artificially established forest, farm or estate, where crops are grown for sale, often in distant markets rather than for local on-site consumption...
he was writing an article about. In 1880, Lippincott's Monthly Magazine
Lippincott's Monthly Magazine
Lippincott's Monthly Magazine was a 19th century literary magazine published in Philadelphia from 1868 to 1915, when it relocated to New York to become McBride's Magazine. It merged with Scribner's Magazine in 1916....
published an article by Ober about Dungeness
Dungeness (Cumberland Island, Georgia)
Dungeness on Cumberland Island, Georgia, is a ruined mansion that is part of a historic district that was the home of several families significant in American history. James Oglethorpe first built on Cumberland Island in 1736, building a hunting lodge that he named Dungeness...
, a plantation on the barrier island
Barrier island
Barrier islands, a coastal landform and a type of barrier system, are relatively narrow strips of sand that parallel the mainland coast. They usually occur in chains, consisting of anything from a few islands to more than a dozen...
of Cumberland Island
Cumberland Island
Cumberland Island is one of the Sea Islands. Cumberland is the largest in terms of continuously exposed land area of Georgia's barrier islands. It is located on the Atlantic Ocean off the coast of the U.S. state of Georgia and is part of Camden County...
on the southern Atlantic
Atlantic Ocean
The Atlantic Ocean is the second-largest of the world's oceanic divisions. With a total area of about , it covers approximately 20% of the Earth's surface and about 26% of its water surface area...
coast of the state of Georgia
Georgia (U.S. state)
Georgia is a state located in the southeastern United States. It was established in 1732, the last of the original Thirteen Colonies. The state is named after King George II of Great Britain. Georgia was the fourth state to ratify the United States Constitution, on January 2, 1788...
. Although it had suffered an extensive fire in 1866 and was uninhabitable, the mansion had a storied past. The article drew the attention of Lucy Carnegie (who had attended boarding school as a girl in nearby Fernandina), and the Carnegies decided the place would be an ideal summer home. The mansion's owner was ex-Confederate
Confederate States of America
The Confederate States of America was a government set up from 1861 to 1865 by 11 Southern slave states of the United States of America that had declared their secession from the U.S...
General William George MacKay Davis, a first cousin of Confederate President
President of the Confederate States of America
The President of the Confederate States of America was the Head of State and Head of Government of the Confederate States of America, which was formed from the states which declared their secession from the United States, thus precipitating the American Civil War. The only person to hold the...
Jefferson Davis
Jefferson Davis
Jefferson Finis Davis , also known as Jeff Davis, was an American statesman and leader of the Confederacy during the American Civil War, serving as President for its entire history. He was born in Kentucky to Samuel and Jane Davis...
who bought the plantation from its creditors in 1879. Carnegie offered to buy Dungeness on August 25, 1880, for $25,000 but his offer was rejected. But after the death of Gen. Davis' son and grandson at the property, Davis desired to leave the place which had brought him such grief and Carnegie offered and Davis accepted a price of $35,000. The sale for the 4000 acres (1,618.7 ha) property (which included orange and olive groves, gardens, several cottages, and outbuildings) was final on November 17, 1881. Over the next four months, the burned-out mansion was demolished and noted Pittsburgh architect Andrew Peebles designed a massive Queen Anne Style
Queen Anne Style architecture (United States)
In America, the Queen Anne style of architecture, furniture and decorative arts was popular in the United States from 1880 to 1910. In American usage "Queen Anne" is loosely used of a wide range of picturesque buildings with "free Renaissance" details rather than of a specific formulaic style in...
mansion with wraparound verandas, high ceilings, several porches, many turret
Turret
In architecture, a turret is a small tower that projects vertically from the wall of a building such as a medieval castle. Turrets were used to provide a projecting defensive position allowing covering fire to the adjacent wall in the days of military fortification...
s, and a 100 feet (30.5 m) high tower. In April 1882, Carnegie and his cousin, Leander Morris, jointly purchased an adjoining 8240 acres (3,334.6 ha) property. The cornerstone for the new Dungeness was laid on February 26, 1884, and the $285,000, 6720 square feet (624.3 m²) mansion (fully furnished) completed on January 1, 1885. There was even a landing for Thomas Carnegie's steam-powered yacht, the Missoe. The Carnegies visited Dungeness irregularly over the next year, traveling to Georgia in a private railroad car.
The Lucy Furnace and Thomson Works
Thomas Carnegie played a critical role in the expansion of the Carnegie Bros. & Co. company into the production of pig ironPig iron
Pig iron is the intermediate product of smelting iron ore with a high-carbon fuel such as coke, usually with limestone as a flux. Charcoal and anthracite have also been used as fuel...
. Iron ore was usually smelted into pig iron first, a brittle but refined product (often cast in ingot
Ingot
An ingot is a material, usually metal, that is cast into a shape suitable for further processing. Non-metallic and semiconductor materials prepared in bulk form may also be referred to as ingots, particularly when cast by mold based methods.-Uses:...
s) which was usually sold to other companies and turned into wrought iron
Wrought iron
thumb|The [[Eiffel tower]] is constructed from [[puddle iron]], a form of wrought ironWrought iron is an iron alloy with a very low carbon...
or steel. Several investors in the Union Iron Mills wished to invest in companies producing pig iron, but William Coleman advised against it and advocated building a wholly owned modern furnace under the company's control. A division of the Union Iron Mills (named the Isabella Furnace Company) was organized on December 1, 1870, and the company's first blast furnace
Blast furnace
A blast furnace is a type of metallurgical furnace used for smelting to produce industrial metals, generally iron.In a blast furnace, fuel and ore and flux are continuously supplied through the top of the furnace, while air is blown into the bottom of the chamber, so that the chemical reactions...
(named the "Lucy furnace" after Thomas' wife) was constructed on 51st Street in Pittsburgh. Most of the investors who joined the Isabella Furnace Company were Thomas' friends, not Andrew's. Thomas Carnegie supervised the operation of the Lucy furnace, and he was almost alone in contributing to its business success. The Lucy furnace was enormous—75 feet (22.9 m) high with a 20 feet (6.1 m) bosh (the widest part of the furnace and the hottest due to its proximity to the hearth)—and was producing a record-shattering 300 short tons (272.2 t) a day by 1872. A second Lucy furnace was built in 1877. In 1881, a two-thirds share in the company was sold to Wilson, Walker & Co. and James R. Wilson relieved Thomas Carnegie and John Phipps of their duties overseeing the operation of the furnaces.
Thomas Carnegie's experience in running the Lucy furnaces led him to co-found the Edgar Thomson Steel Works. In early 1871, William Coleman became interested in the new Bessemer process
Bessemer process
The Bessemer process was the first inexpensive industrial process for the mass-production of steel from molten pig iron. The process is named after its inventor, Henry Bessemer, who took out a patent on the process in 1855. The process was independently discovered in 1851 by William Kelly...
steel-making furnaces, and he traveled throughout Ohio, New York, and Pennsylvania to view these new works. Coleman invited Thomas Carnegie to join him in building the new steel works, and together they purchased 107 acres (43.3 ha) of land about 10 miles (16.1 km) north of Pittsburgh known as Braddock's Field
Braddock's Field
Braddock's Field is a historic battlefield on the banks of the Monongahela River, at Braddock, Pennsylvania, near the junction of Turtle Creek , about nine miles southeast of the "Forks of the Ohio" in Pittsburgh, Pennsylvania...
(a historic battlefield where French and Indian forces from Fort Duquesne
Fort Duquesne
Fort Duquesne was a fort established by the French in 1754, at the junction of the Allegheny and Monongahela rivers in what is now downtown Pittsburgh in the state of Pennsylvania....
defeated British General Edward Braddock
Edward Braddock
General Edward Braddock was a British soldier and commander-in-chief for the 13 colonies during the actions at the start of the French and Indian War...
on July 5, 1755, in the Battle of the Monongahela
Battle of the Monongahela
The Battle of the Monongahela, also known as the Battle of the Wilderness, took place on 9 July 1755, at the beginning of the French and Indian War, at Braddock's Field in what is now Braddock, Pennsylvania, east of Pittsburgh...
). (Thomas borrowed the money for his investment from his brother.) Coleman and Carnegie lived near one another in Homewood and went to work together on the streetcar, and it was during these daily commutes that the men worked on their plans for the new steel works. Although Thomas asked Andrew to invest in the new mill, Andrew refused (considering it too risky a venture). Thomas then prevailed upon David McCandless, a wealthy Pittsburgh merchant and vice president of the Exchange National Bank. McCandless agreed, and brought in William P. Shinn (a Norman Medal
Norman Medal
The Norman Medal is the highest honor granted by the American Society of Civil Engineers for a technical paper that "makes a definitive contribution to engineering science"....
-winning engineer) as treasurer. In the spring of 1872, Andrew Carnegie (while on a bond
Bond (finance)
In finance, a bond is a debt security, in which the authorized issuer owes the holders a debt and, depending on the terms of the bond, is obliged to pay interest to use and/or to repay the principal at a later date, termed maturity...
-selling trip) made a survey of Bessemer steel works in Europe and returned to the U.S. highly enthusiastic about the new project. Andrew subsequently invested $250,000 in the works. Meanwhile, Coleman, McCandless, Scott, and Thomas Carnegie had purchased a newly plat
Plat
A plat in the U.S. is a map, drawn to scale, showing the divisions of a piece of land. Other English-speaking countries generally call such documents a cadastral map or plan....
ted tract in Pittsburgh, subdivided
Subdivision (land)
Subdivision is the act of dividing land into pieces that are easier to sell or otherwise develop, usually via a plat. The former single piece as a whole is then known in the United States as a subdivision...
it, and sold the lots at a significant profit. The partners then invested $50,000 each in the steel mill. A new company, Carnegie, McCandless & Co., was formed on January 13, 1873, to build the works.
Thomas was on vacation with Andrew and their mother at the upscale resort town of Cresson Springs
Cresson, Pennsylvania
Cresson is a borough in Cambria County, Pennsylvania, east of Pittsburgh. Cresson is an elevated place known for its beauty. Mineral springs add to its attractions. It is above 2,000 feet in elevation. Lumber, coal, and coke yards were industries that had supported the population which numbered...
in September 1873 when they learned of the failure of the investment bank of Jay Cooke & Company
Jay Cooke & Company
Jay Cooke & Company was a U.S. bank from 1861 to 1873. It was the first brokerage house to use telegraph messages to confirm with clients the purchase and sale of securities. Headquartered in Philadelphia, Pennsylvania, it had branches in New York City and Washington, DC...
, which precipitated the Panic of 1873
Panic of 1873
The Panic of 1873 triggered a severe international economic depression in both Europe and the United States that lasted until 1879, and even longer in some countries. The depression was known as the Great Depression until the 1930s, but is now known as the Long Depression...
. The Panic created financial difficulties for the company, and it floated bonds to stay alive. J. Edgar Thomson
John Edgar Thomson
John Edgar Thomson was an American civil engineer and industrialist. Thomson was an entrepreneur best known for his leadership of the Pennsylvania Railroad from 1852 until his death 1874, making it the largest business enterprise in the world and a world-class model for technological and...
, president of the Pennsylvania Railroad and a mentor and close friend to many of the partners, bought many of these bonds late 1873, helping keep the firm afloat. The partners dissolved Carnegie, McCandless & Co. to take advantage of a new Pennsylvania law permitting the formation of limited liability companies
Limited liability company
A limited liability company is a flexible form of enterprise that blends elements of partnership and corporate structures. It is a legal form of company that provides limited liability to its owners in the vast majority of United States jurisdictions...
, and the Edgar Thomson Steel Company Ltd. was created on October 12, 1874. The company took its name from J. Edgar Thomson, who although not a large investor in the works had a superb reputation as an honest and trustworthy person (an important asset in risky financial times).
Over the next several years, Thomas Carnegie generally oversaw the Edgar Thomson Steel Company. His success in this endeavor was summed up by a corporate historian this way:
- Mr. T.M. Carnegie's abilities were too numerous and complex to be summed up in a sentence. He was a man of sterling integrity; and it was a common saying in Pittsburg that his word was better than some men's bond. He had remarkable judgment; and his opinion on commercial questions was valued above that of much older and more experienced men. Quick and keen in his perceptions, cautious but progressive in his ideas, faithful to his engagements, and just in all his dealings, he gave to his company that which corporations are habitually lacking, namely, a conscience.
Other historical assessments conclude Thomas had a solid grasp of the steel business and was a respected manager, even if Andrew considered him overly cautious. William Abbott, chairman of Carnegie, Phipps, & Co., considered Thomas the better businessman than Andrew, "solid, shrewd, farseeing, absolutely honest and dependable." Thomas lacked Andrew's ambition, but "was content with a good, prosperous, safe business and cared nothing for expansion. He disapproved of Andrew's skyrocketing tendencies, regarded him as a plunger and a dangerous leader. Tom wanted earnings in the shape of dividends, whereas Andrew insisted on using them for expansion." Although he shied away from publicity, he was a hard worker and well liked by both management and workers. His one flaw was his drinking: He often left work at noon and drank heavily for the rest of the day.
Crony capitalism
Crony capitalism
Crony capitalism is a term describing a capitalist economy in which success in business depends on close relationships between business people and government officials...
was an important part of American industrialism during this period. Thomas Carnegie, however, was not very adept at it. There is conflicting evidence as to whether he mixed widely in Pittsburgh society, with at least one scholar claiming he did and another that he did not. He was reserved at social gatherings, using his attendance at parties to pick up business gossip and industry buzz. He played cards on a weekly basis with Henry Clay Frick
Henry Clay Frick
Henry Clay Frick was an American industrialist, financier, and art patron. He founded the H. C. Frick & Company coke manufacturing company, was chairman of the Carnegie Steel Company, and played a major role in the formation of the giant U.S. Steel steel manufacturing concern...
, Philander Knox, Andrew and Richard Mellon
Richard B. Mellon
Richard Beatty Mellon , sometimes R.B., was a banker, industrialist, and philanthropist from Pittsburgh, Pennsylvania....
, and George Westinghouse
George Westinghouse
George Westinghouse, Jr was an American entrepreneur and engineer who invented the railway air brake and was a pioneer of the electrical industry. Westinghouse was one of Thomas Edison's main rivals in the early implementation of the American electricity system...
. His closest friend was David A. Stewart, a co-partner in the Thomson works, and Stewart readily defended Thomas against the criticisms and jibes of others (particularly Andrew Carnegie).
Thomas sold half his interest in Edgar Thomson Steel to his older brother in 1876 after disagreement broke out over whether to build another "Lucy furnace." Thomas Carnegie, however, held no position on the Thomson board of directors, a situation Andrew Carnegie wanted rectified the moment a position on the board became available. This occurred in the summer of 1876, but William P. Shinn (the second-largest stockholder in the company) complained bitterly to Andrew (traveling in Europe) that the seat should have gone to him. Nonetheless, Thomas was not only added to the board but made chairman upon Andrew Carnegie's return to the U.S. a few months later. Shinn eventually had enough, and resigned as manager of the Thomson steel works in September 1879. Thomas replaced Shinn as manager.
Andrew Carnegie decided to stop relying solely on his company's own furnaces for coke, and began seeking to buy the fuel on the open market. Thomas and Henry Phipps had alerted Andrew to the need for a greater and steadier supply for coke for the growing steel works. In 1881, Andrew sent Thomas to meet with Henry Clay Frick
Henry Clay Frick
Henry Clay Frick was an American industrialist, financier, and art patron. He founded the H. C. Frick & Company coke manufacturing company, was chairman of the Carnegie Steel Company, and played a major role in the formation of the giant U.S. Steel steel manufacturing concern...
, owner of H.C. Frick & Co.—the largest coke producing company in the U.S. Thomas' goal was to induce Frick to buy the Carnegie coke ovens. In November 1881, Thomas proposed selling the Monastery Coke Works near Latrobe, Pennsylvania
Latrobe, Pennsylvania
Latrobe is a city in Westmoreland County, Pennsylvania in the United States, approximately southeast of Pittsburgh.The city population was 7,634 as of the 2000 census . It is located near the Pennsylvania's scenic Chestnut Ridge. Latrobe was incorporated as a borough in 1854, and as a city in 1999...
, to Frick, or at least have Frick take over the marketing and selling of the coke produced there. Thomas' offer came as Frick was planning his wedding, and it fell to Andrew to meet with Frick and his new bride as they honeymooned in New York City. By this time, Thomas had negotiated most of an agreement with Frick, as well as planned the meeting with Andrew. Carnegie took a 10 percent interest in H.C. Frick & Co., Frick took a 50 percent interest in the Monastery coke works, and H.C. Frick & Co. would become the exclusive supplier of coke to Carnegie Bros. & Co. and the Edgar Thomson Steel Works. Thomas was assigned to negotiate the price of coke on an annual basis with Frick, and over the next two years H.C. Frick & Co. made a 23 percent profit on the coke sold. By 1885, Andrew Carnegie had purchased enough stock in H.C. Frick & Co. to own 50 percent of the company. Frick now attempted to buy into the Carnegie steel companies by selling 12 of the remaining 16 percent of the H.C. Frick which he still owned, but Thomas warned him not to try and to instead seek a position as a manager within the company.
Thomas also played a key role in the consolidation of Andrew's businesses. Thomas had become more involved with the management of Edgar Thomson Steel and less with the Isabella Furnace and Union Iron companies. It was Thomas who suggested to Andrew that the companies be consolidated into a single firm, and that Thomas' stake in the new firm be raised commensurate with his managerial role. His older brother agreed. On April 1, 1888, Andrew Carnegie reorganized his iron and steel businesses into one company, Carnegie Bros. & Co., with Thomas holding 17 percent of the stock. Included in the reorganization were the Lucy and Isabella furnaces, Union Iron Mills, and Homestead works.
Death
With the purchase of his Cumberland Island estate, Thomas Carnegie resolved to retire from business and spend more time in Georgia. The stress of working for his brother had left him exhausted.In late September 1886, Thomas Carnegie fell ill with what he believed to be a cold. He was sick off and on for the next several weeks. On October 16, he left work thinking he was suffering from yet another cold, but died of pneumonia
Pneumonia
Pneumonia is an inflammatory condition of the lung—especially affecting the microscopic air sacs —associated with fever, chest symptoms, and a lack of air space on a chest X-ray. Pneumonia is typically caused by an infection but there are a number of other causes...
just three days later. His wife and all of his children except Margaret (who was attending a boarding school
Boarding school
A boarding school is a school where some or all pupils study and live during the school year with their fellow students and possibly teachers and/or administrators. The word 'boarding' is used in the sense of "bed and board," i.e., lodging and meals...
in New York
New York
New York is a state in the Northeastern region of the United States. It is the nation's third most populous state. New York is bordered by New Jersey and Pennsylvania to the south, and by Connecticut, Massachusetts and Vermont to the east...
) were at his bedside when he died. For most of his life, Thomas had been a member of the Swedenborgian Church
The New Church
The New Church is the name for a New religious movement developed from the writings of the Swedish scientist and theologian Emanuel Swedenborg . Swedenborg claimed to have received a new revelation from Jesus Christ through continuous heavenly visions which he experienced over a period of at least...
. His funeral, however, was conducted by an Episcopalian, and Carnegie was buried on October 21, 1886, in Allegheny Cemetery
Allegheny Cemetery
Allegheny Cemetery is one of the largest and oldest burial grounds in Pittsburgh, Pennsylvania, USA.It is a nonsectarian, wooded hillside park located at 4734 Butler Street in the Lawrenceville neighborhood and bounded by Bloomfield, Garfield, and Stanton Heights...
in Pittsburgh. His mother, also quite ill for some time, died on November 10 (never learning of her younger son's death).
Thomas' death was a serious blow to Andrew Carnegie's financial interests. Thomas had run most of Andrew's enterprises, and to fill his role Andrew Carnegie turned to Henry Clay Frick as his replacement. Frick later played a critical role in the Homestead Strike
Homestead Strike
The Homestead Strike was an industrial lockout and strike which began on June 30, 1892, culminating in a battle between strikers and private security agents on July 6, 1892. It was one of the most serious disputes in U.S. labor history...
and in brokering the deal between Carnegie and J. P. Morgan
J. P. Morgan
John Pierpont Morgan was an American financier, banker and art collector who dominated corporate finance and industrial consolidation during his time. In 1892 Morgan arranged the merger of Edison General Electric and Thomson-Houston Electric Company to form General Electric...
that created U.S. Steel
U.S. Steel
The United States Steel Corporation , more commonly known as U.S. Steel, is an integrated steel producer with major production operations in the United States, Canada, and Central Europe. The company is the world's tenth largest steel producer ranked by sales...
.
Thomas' will named Lucy his sole executrix
Executor
An executor, in the broadest sense, is one who carries something out .-Overview:...
and legatee
Legatee
A legatee, in the law of wills, is any individual or organization bequeathed any portion of a testator's estate.-Usage:Depending upon local custom, legatees may be called "devisees." Traditionally, "legatees" took personal property under will and "devisees" took land under will. Brooker v....
. The will asked (but did not require) her to seek the advice of her brother-in-law Andrew Carnegie and her father (deceased in 1878) in disposing of Thomas' business interests. Although Andrew Carnegie advised her to sell out to him, she refused and retained ownership in businesses which led to rapid rises in her personal wealth over the next several decades.
Both Andrew and Thomas Carnegie had been members of the South Fork Fishing and Hunting Club
South Fork Fishing and Hunting Club
The South Fork Fishing and Hunting Club was a Pennsylvania corporation which operated an exclusive and secretive retreat at a mountain lake near South Fork, Pennsylvania for more than fifty extremely wealthy men and their families...
, a highly exclusive wealthy businessman's club which operated a mountaintop retreat overlooking Lake Conemaugh, one of the largest man-made lakes of the day. Lake Conemaugh was formed by the construction of the South Fork Dam
South Fork Dam
The South Fork Dam was located on Lake Conemaugh, an artificial body of water located near South Fork, Pennsylvania, United States. On May 31, 1889, the South Fork Dam failed catastrophically and 20 million tons of water from Lake Conemaugh burst through and raced 14 miles downstream, causing the...
in 1853, but had been drained and abandoned prior to its purchase by the South Fork organization. The club, which formed in 1879, maintained the South Fork Dam and refilled the reservoir. Andrew and Thomas built a cottage near the clubhouse, and often stayed there. The South Fork Dam failed on May 31, 1889, resulting in the disastrous Johnstown Flood
Johnstown Flood
The Johnstown Flood occurred on May 31, 1889. It was the result of the catastrophic failure of the South Fork Dam situated upstream of the town of Johnstown, Pennsylvania, USA, made worse by several days of extremely heavy rainfall...
.