I’m two-thirds of the way through Andrew Carnegie by David Nasaw. He became the richest man in the world in 1901 after selling his steel company to J.P. Morgan, collecting $120 billion in today’s dollars. From page 600:
Carnegie had decided long before that America’s largest universities, “such as Harvard and Columbia… were large enough; that further growth was undesirable; that the smaller institutions (the colleges especially) were in greater need of help and that it would be a better use of surplus wealth to aid them.”
I would go further and suggest that his money was better spent on his libraries (in towns across the entire United States) than on secondary education institutions. Better access to knowledge for more people.
There is an interesting analysis from the Yale Endowment’s 2005 annual report on the difference between Carnegie’s $10M initial foundation gift — which has been managed prudently thereafter and grown in real purchasing power — relative to gifts to endowments like Harvard and Yale which are distinguished from Carnegie by the continued support they receive:
”Gifts Maintain the Endowment’s Relevance
Examining the experience of Harvard, Yale, and the Carnegie Institution over the past 95 years provides insight into the importance of gifts. The Carnegie Institution of Washington, one of Andrew Carnegie’s many philanthropies, pursues cutting-edge scientific research in astronomy, plant biology, embryology, global ecology, terrestrial magnetism, and earth sciences. Establishing the institution in 1902 with a $10 million gift, Carnegie made subsequent gifts to bring the 1910 endowment to $22 million, nearly equal to Harvard’s 1910 fund balance of $23 million and vastly exceeding Yale’s $12 million.
Over the course of the past 95 years, the Carnegie Institution endowment more than kept pace with inflation, with June 30, 2005 assets of $650 million comfortably ahead of the approximately $450 million needed to match the rise in price levels. But the formerly comparable Harvard endowment, now at $25.9 billion, and the previously smaller Yale endowment, currently at $15.2 billion, dwarf the Carnegie fund. Because the three institutions followed roughly comparable investment and spending policies, the absence of continuing gift inflows constitutes the single most important reason for Carnegie’s failure to keep pace. The result is that Carnegie’s endowment, once one of the largest in the country, now ranks far lower.”
I’ve read several Carnegie books – if you have tolerance for more than one give Carnegie by Peter Krass a try.
Just to correct the record in David Nasaw’s book on Andrew Carnegie. David Brooks, who hired Andrew in the Pittsburgh Telegraph office, was not a “Scotsman” but sixth generation in this country (Henry, Thomas, Enos, David, David, to himself). He is my great great uncle and I still live in the house in Cheshire, CT, where David Brooks was born. Also, Henry O’Reilly, who was putting the financing together, was married to Marcia Brooks, David’s cousin (Henry, Thomas, Enos, David, Micah, Marcia.) The story in our family from David was that he and Andrew’s father played checkers together and the father suggested his 14 year old son was too bright to just work in the clothing mills, so David said send him over and hired him. David then brought in an old Morse clicker so Andrew could learn the code.
Well, the other relative is Frederick Law Olmsted, who did the Carnegie landscaping. His aunt and uncle were David and Linda Hull Brooks, the second listed David in the family line. Fred’s mother was Charlotte Hull, younger sister of Linda.
To see a trend over the past 3 centuries, just look at who the richest men in the United States were and where/how their wealth was created. The greatest fortunes of the 1800s/early 1900s were made in real industry, such as steel and oil. That progressed to the retail and information age which made people like Sam Walton and Bill Gates wealthiest. Finally, in this new third stage of supposed economic progress, witness the immense fortunes of people such as Warren Buffett and other investors who have created their wealth through the stock market and other financial instruments.
Ultimately, money is not economy. This is especially true for paper money. Real economic value is created through the productive labors of people like Carnegie who actually manufactured (through the companies they owned) goods.
Colin’s comment implies a question: If you wanted to help motivated people with limited means increase their knowledge, what would be the best way to do that today? Would it still be building and running libraries? If not, what would it be? Free medium-speed Internet? Prizes and payments for authors and publishers of free tutorial information on the Internet? Tutoring or face-to-face peer-to-peer programs to take place in the existing physical libraries?
As far as a Colin’s comment goes, the wiki system is pretty amazing, and I also fairly well enjoy the MIT OCW stuff. That said, it only addresses the bottom level task in Bloom’s taxonomy. In order for your wetware to be a crappy, mobile wiki, you have to learn to synthesize the data, and I don’t know how to incentivize that. Usually, my desire to learn more is begotten by the synthesis of something else.
As far as Mott’s comment goes, I think that is the point that Phil is trying to make. The Carnegie Institution has probably more than enough money to make judicious grants to researchers. Harvard pretends to be the Mecca of The Academy, when it is more the Emerald City.
As far as I can tell, medical journal articles are currently generally only available at medical libraries, which sometimes don’t exactly go out of their way to open their doors to those who aren’t college students. And sometimes access to those articles can be helpful in debugging one’s health problems and evaluating how much you trust your doctor and whether to go looking for another doctor.
There seem to be similar problems with getting access to case law in understanding legal issues. I’m sure that interpreting case law without talking to a lawyer has its perils, but being able to gather the case law in order to form questions to ask a lawyer would be valuable.
I wish someone were bribing publishers to just make this data publicly available on the web. I’m under the impression that it already is available on the web for the most part, but only if you pay a fortune for a subscription. Somehow I suspect some of the medical journals might be willing to agree to forever publish their work on the web for free in exchange for a large enough endowment.
There’s still a lot of content that’s only available in the form of printed books, and I don’t know if the right answer is to find a way to get publishers to make the contents of the books freely available on the web, or if better interlibrary loan is the answer, or what. In the short term, at least, there’s going to be lots of material that’s only in books, so maybe interlibrary loan really is the answer there.
It saddens me to see the two greatest fortunes of the last 50 years being spent as they are: not creating anything of lasting value.
I’d far rather see 10 new professorships funded inside each of the 100 major universities of the world, functioning like Simonyi’s endowed chair for Richard Dawkin’s: giving intellect a platform… somewhere to stand secure and let the world know what’s real and what’s rhetoric.
As for replicating the second of Cargnegie’s great achievments: the libraries. The modern equivalent would be to make available currently expensive content for free on the internet.
I liked the idea of comment 8 (Joel Weber – to create free access to the expensive academic journals in perpetuity). That would be the equivalent of the library for the 21st century. The easiest way to achieve it would be to endow PLoS with enough funds to replicate all the major journals, charge no fees to authors, and distribute all content free (free to download AND free under a creative commons license).
philg: Given society’s expanding obsession with credentials, and the ready and inexpensive availability of information (per internet, libraries, paperbacks, etc), I’d argue free or inexpensive (but rigorous) certification tests would probably have more societal impact—by allowing people of limited means to improve their means by demonstrating knowledge—than yet another attempt to recreate the public library or free university.