"You do not mean that? I was wholly unconscious of it. I am surprised!" said the General.

"Yes, I do mean it. It is even beginning to be a subject of comment among your officers."

"Why did you not tell me before? I'll never drink a drop of liquor again."

He never did. Time after time in later years, dining with the Grants in New York, I have seen the General turn down the wine-glasses at his side. That indomitable will of his enabled him to remain steadfast to his resolve, a rare case as far as my experience goes. Some have refrained for a time. In one noted case one of our partners refrained for three years, but alas, the old enemy at last recaptured its victim.

Grant, when President, was accused of being pecuniarily benefited by certain appointments, or acts, of his administration, while his friends knew that he was so poor that he had been compelled to announce his intention of abandoning the customary state dinners, each one of which, he found, cost eight hundred dollars—a sum which he could not afford to pay out of his salary. The increase of the presidential salary from $25,000 to $50,000 a year enabled him, during his second term, to save a little, although he cared no more about money than about uniforms. At the end of his first term I know he had nothing. Yet I found, when in Europe, that the impression was widespread among the highest officials there that there was something in the charge that General Grant had benefited pecuniarily by appointments. We know in America how little weight to attach to these charges, but it would have been well for those who made them so recklessly to have considered what effect they would produce upon public opinion in other lands.

The cause of democracy suffers more in Britain to-day from the generally received opinion that American politics are corrupt, and therefore that republicanism necessarily produces corruption, than from any other one cause. Yet, speaking with some knowledge of politics in both lands, I have not the slightest hesitation in saying that for every ounce of corruption of public men in the new land of republicanism there is one in the old land of monarchy, only the forms of corruption differ. Titles are the bribes in the monarchy, not dollars. Office is a common and proper reward in both. There is, however, this difference in favor of the monarchy; titles are given openly and are not considered by the recipients or the mass of the people as bribes.

When I was called to Washington in 1861, it was supposed that the war would soon be over; but it was seen shortly afterwards that it was to be a question of years. Permanent officials in charge would be required. The Pennsylvania Railroad Company was unable to spare Mr. Scott, and Mr. Scott, in turn, decided that I must return to Pittsburgh, where my services were urgently needed, owing to the demands made upon the Pennsylvania by the Government. We therefore placed the department at Washington in the hands of others and returned to our respective positions.

After my return from Washington reaction followed and I was taken with my first serious illness. I was completely broken down, and after a struggle to perform my duties was compelled to seek rest. One afternoon, when on the railway line in Virginia, I had experienced something like a sunstroke, which gave me considerable trouble. It passed off, however, but after that I found I could not stand heat and had to be careful to keep out of the sun—a hot day wilting me completely. [That is the reason why the cool Highland air in summer has been to me a panacea for many years. My physician has insisted that I must avoid our hot American summers.]

Leave of absence was granted me by the Pennsylvania Railroad Company, and the long-sought opportunity to visit Scotland came. My mother, my bosom friend Tom Miller, and myself, sailed in the steamship Etna, June 28, 1862, I in my twenty-seventh year; and on landing in Liverpool we proceeded at once to Dunfermline. No change ever affected me so much as this return to my native land. I seemed to be in a dream. Every mile that brought us nearer to Scotland increased the intensity of my feelings. My mother was equally moved, and I remember, when her eyes first caught sight of the familiar yellow bush, she exclaimed:

"Oh! there's the broom, the broom!"

Her heart was so full she could not restrain her tears, and the more I tried to make light of it or to soothe her, the more she was overcome. For myself, I felt as if I could throw myself upon the sacred soil and kiss it.[22]

[Footnote 22: "It's a God's mercy I was born a Scotchman, for I do not see how I could ever have been contented to be anything else. The little dour deevil, set in her own ways, and getting them, too, level-headed and shrewd, with an eye to the main chance always and yet so lovingly weak, so fond, so led away by song or story, so easily touched to fine issues, so leal, so true. Ah! you suit me, Scotia, and proud am I that I am your son." (Andrew Carnegie, Our Coaching Trip, p. 152. New York, 1882.)]

In this mood we reached Dunfermline. Every object we passed was recognized at once, but everything seemed so small, compared with what I had imagined it, that I was completely puzzled. Finally, reaching Uncle Lauder's and getting into the old room where he had taught Dod and myself so many things, I exclaimed:

"You are all here; everything is just as I left it, but you are now all playing with toys."

The High Street, which I had considered not a bad Broadway, uncle's shop, which I had compared with some New York establishments, the little mounds about the town, to which we had run on Sundays to play, the distances, the height of the houses, all had shrunk. Here was a city of the Lilliputians. I could almost touch the eaves of the house in which I was born, and the sea—to walk to which on a Saturday had been considered quite a feat—was only three miles distant. The rocks at the seashore, among which I had gathered wilks (whelks) seemed to have vanished, and a tame flat shoal remained. The schoolhouse, around which had centered many of my schoolboy recollections—my only Alma Mater—and the playground, upon which mimic battles had been fought and races run, had shrunk into ridiculously small dimensions. The fine residences, Broomhall, Fordell, and especially the conservatories at Donibristle, fell one after the other into the petty and insignificant. What I felt on a later occasion on a visit to Japan, with its small toy houses, was something like a repetition of the impression my old home made upon me.

Everything was there in miniature. Even the old well at the head of Moodie Street, where I began my early struggles, was changed from what I had pictured it. But one object remained all that I had dreamed of it. There was no disappointment in the glorious old Abbey and its Glen. It was big enough and grand enough, and the memorable carved letters on the top of the tower—"King Robert The Bruce"—filled my eye and my heart as fully as of old. Nor was the Abbey bell disappointing, when I heard it for the first time after my return. For this I was grateful. It gave me a rallying point, and around the old Abbey, with its Palace ruins and the Glen, other objects adjusted themselves in their true proportions after a time.

My relatives were exceedingly kind, and the oldest of all, my dear old Auntie Charlotte, in a moment of exultation exclaimed:

"Oh, you will just be coming back here some day and keep a shop in the High Street."

To keep a shop in the High Street was her idea of triumph. Her son-in-law and daughter, both my full cousins, though unrelated to each other, had risen to this sublime height, and nothing was too great to predict for her promising nephew. There is an aristocracy even in shopkeeping, and the family of the green grocer of the High Street mingles not upon equal terms with him of Moodie Street.

Auntie, who had often played my nurse, liked to dwell upon the fact that I was a screaming infant that had to be fed with two spoons, as I yelled whenever one left my mouth. Captain Jones, our superintendent of the steel works at a later day, described me as having been born "with two rows of teeth and holes punched for more," so insatiable was my appetite for new works and increased production. As I was the first child in our immediate family circle, there were plenty of now venerable relatives begging to be allowed to play nurse, my aunties among them. Many of my childhood pranks and words they told me in their old age. One of them that the aunties remembered struck me as rather precocious.

I had been brought up upon wise saws and one that my father had taught me was soon given direct application. As a boy, returning from the seashore three miles distant, he had to carry me part of the way upon his back. Going up a steep hill in the gloaming he remarked upon the heavy load, hoping probably I would propose to walk a bit. The response, however, which he received was:

"Ah, faither, never mind, patience and perseverance make the man, ye ken."

He toiled on with his burden, but shaking with laughter. He was hoist with his own petard, but his burden grew lighter all the same. I am sure of this.

My home, of course, was with my instructor, guide, and inspirer, Uncle Lauder—he who had done so much to make me romantic, patriotic, and poetical at eight. Now I was twenty-seven, but Uncle Lauder still remained Uncle Lauder. He had not shrunk, no one could fill his place. We had our walks and talks constantly and I was "Naig" again to him. He had never had any name for me but that and never did have. My dear, dear uncle, and more, much more than uncle to me.[23]

[Footnote 23: "This uncle, who loved liberty because it is the heritage of brave souls, in the dark days of the American Civil War stood almost alone in his community for the cause which Lincoln represented." (Hamilton Wright Mabie in Century Magazine, vol. 64, p. 958.)]

I was still dreaming and so excited that I could not sleep and had caught cold in the bargain. The natural result of this was a fever. I lay in uncle's house for six weeks, a part of that time in a critical condition. Scottish medicine was then as stern as Scottish theology (both are now much softened), and I was bled. My thin American blood was so depleted that when I was pronounced convalescent it was long before I could stand upon my feet. This illness put an end to my visit, but by the time I had reached America again, the ocean voyage had done me so much good I was able to resume work.

I remember being deeply affected by the reception I met with when I returned to my division. The men of the eastern end had gathered together with a cannon and while the train passed I was greeted with a salvo. This was perhaps the first occasion upon which my subordinates had an opportunity of making me the subject of any demonstration, and their reception made a lasting impression. I knew how much I cared for them and it was pleasing to know that they reciprocated my feelings. Working-men always do reciprocate kindly feeling. If we truly care for others we need not be anxious about their feelings for us. Like draws to like.



CHAPTER IX

BRIDGE-BUILDING

During the Civil War the price of iron went up to something like $130 per ton. Even at that figure it was not so much a question of money as of delivery. The railway lines of America were fast becoming dangerous for want of new rails, and this state of affairs led me to organize in 1864 a rail-making concern at Pittsburgh. There was no difficulty in obtaining partners and capital, and the Superior Rail Mill and Blast Furnaces were built.

In like manner the demand for locomotives was very great, and with Mr. Thomas N. Miller[24] I organized in 1866 the Pittsburgh Locomotive Works, which has been a prosperous and creditable concern—locomotives made there having obtained an enviable reputation throughout the United States. It sounds like a fairy tale to-day to record that in 1906 the one-hundred-dollar shares of this company sold for three thousand dollars—that is, thirty dollars for one. Large annual dividends had been paid regularly and the company had been very successful—sufficient proof of the policy: "Make nothing but the very best." We never did.

[Footnote 24: Mr. Carnegie had previous to this—as early as 1861—been associated with Mr. Miller in the Sun City Forge Company, doing a small iron business.]

When at Altoona I had seen in the Pennsylvania Railroad Company's works the first small bridge built of iron. It proved a success. I saw that it would never do to depend further upon wooden bridges for permanent railway structures. An important bridge on the Pennsylvania Railroad had recently burned and the traffic had been obstructed for eight days. Iron was the thing. I proposed to H.J. Linville, who had designed the iron bridge, and to John L. Piper and his partner, Mr. Schiffler, who had charge of bridges on the Pennsylvania line, that they should come to Pittsburgh and I would organize a company to build iron bridges. It was the first company of its kind. I asked my friend, Mr. Scott, of the Pennsylvania Railroad, to go with us in the venture, which he did. Each of us paid for a one fifth interest, or $1250. My share I borrowed from the bank. Looking back at it now the sum seemed very small, but "tall oaks from little acorns grow."

In this way was organized in 1862 the firm of Piper and Schiffler which was merged into the Keystone Bridge Company in 1863—a name which I remember I was proud of having thought of as being most appropriate for a bridge-building concern in the State of Pennsylvania, the Keystone State. From this beginning iron bridges came generally into use in America, indeed, in the world at large so far as I know. My letters to iron manufacturers in Pittsburgh were sufficient to insure the new company credit. Small wooden shops were erected and several bridge structures were undertaken. Cast-iron was the principal material used, but so well were the bridges built that some made at that day and since strengthened for heavier traffic, still remain in use upon various lines.

The question of bridging the Ohio River at Steubenville came up, and we were asked whether we would undertake to build a railway bridge with a span of three hundred feet over the channel. It seems ridiculous at the present day to think of the serious doubts entertained about our ability to do this; but it must be remembered this was before the days of steel and almost before the use of wrought-iron in America. The top cords and supports were all of cast-iron. I urged my partners to try it anyhow, and we finally closed a contract, but I remember well when President Jewett[25] of the railway company visited the works and cast his eyes upon the piles of heavy cast-iron lying about, which were parts of the forthcoming bridge, that he turned to me and said:

"I don't believe these heavy castings can be made to stand up and carry themselves, much less carry a train across the Ohio River."

[Footnote 25: Thomas L. Jewett, President of the Panhandle.]

The Judge, however, lived to believe differently. The bridge remained until recently, though strengthened to carry heavier traffic. We expected to make quite a sum by this first important undertaking, but owing to the inflation of the currency, which occurred before the work was finished, our margin of profit was almost swallowed up. It is an evidence of the fairness of President Edgar Thomson, of the Pennsylvania, that, upon learning the facts of the case, he allowed an extra sum to secure us from loss. The subsequent position of affairs, he said, was not contemplated by either party when the contract was made. A great and a good man was Edgar Thomson, a close bargainer for the Pennsylvania Railroad, but ever mindful of the fact that the spirit of the law was above the letter.

In Linville, Piper, and Schiffler, we had the best talent of that day—Linville an engineer, Piper a hustling, active mechanic, and Schiffler sure and steady. Colonel Piper was an exceptional man. I heard President Thomson of the Pennsylvania once say he would rather have him at a burnt bridge than all the engineering corps. There was one subject upon which the Colonel displayed great weakness (fortunately for us) and that was the horse. Whenever a business discussion became too warm, and the Colonel showed signs of temper, which was not seldom, it was a sure cure to introduce that subject. Everything else would pass from his mind; he became absorbed in the fascinating topic of horseflesh. If he had overworked himself, and we wished to get him to take a holiday, we sent him to Kentucky to look after a horse or two that one or the other of us was desirous of obtaining, and for the selection of which we would trust no one but himself. But his craze for horses sometimes brought him into serious difficulties. He made his appearance at the office one day with one half of his face as black as mud could make it, his clothes torn, and his hat missing, but still holding the whip in one hand. He explained that he had attempted to drive a fast Kentucky colt; one of the reins had broken and he had lost his "steerage-way," as he expressed it.

He was a grand fellow, "Pipe" as we called him, and when he took a fancy to a person, as he did to me, he was for and with him always. In later days when I removed to New York he transferred his affections to my brother, whom he invariably called Thomas, instead of Tom. High as I stood in his favor, my brother afterwards stood higher. He fairly worshiped him, and anything that Tom said was law and gospel. He was exceedingly jealous of our other establishments, in which he was not directly interested, such as our mills which supplied the Keystone Works with iron. Many a dispute arose between the mill managers and the Colonel as to quality, price, and so forth. On one occasion he came to my brother to complain that a bargain which he had made for the supply of iron for a year had not been copied correctly. The prices were "net," and nothing had been said about "net" when the bargain was made. He wanted to know just what that word "net" meant.

"Well, Colonel," said my brother, "it means that nothing more is to be added."

"All right, Thomas," said the Colonel, entirely satisfied.

There is much in the way one puts things. "Nothing to be deducted" might have caused a dispute.



He was made furious one day by Bradstreet's volume which gives the standing of business concerns. Never having seen such a book before, he was naturally anxious to see what rating his concern had. When he read that the Keystone Bridge Works were "BC," which meant "Bad Credit," it was with difficulty he was restrained from going to see our lawyers to have a suit brought against the publishers. Tom, however, explained to him that the Keystone Bridge Works were in bad credit because they never borrowed anything, and he was pacified. No debt was one of the Colonel's hobbies. Once, when I was leaving for Europe, when many firms were hard up and some failing around us, he said to me:

"The sheriff can't get us when you are gone if I don't sign any notes, can he?"

"No," I said, "he can't."

"All right, we'll be here when you come back."

Talking of the Colonel reminds me of another unusual character with whom we were brought in contact in these bridge-building days. This was Captain Eads, of St. Louis,[26] an original genius minus scientific knowledge to guide his erratic ideas of things mechanical. He was seemingly one of those who wished to have everything done upon his own original plans. That a thing had been done in one way before was sufficient to cause its rejection. When his plans for the St. Louis Bridge were presented to us, I handed them to the one man in the United States who knew the subject best—our Mr. Linville. He came to me in great concern, saying:

"The bridge if built upon these plans will not stand up; it will not carry its own weight."

"Well," I said, "Captain Eads will come to see you and in talking over matters explain this to him gently, get it into proper shape, lead him into the straight path and say nothing about it to others."

[Footnote 26: Captain James B. Eads, afterward famous for his jetty system in the Mississippi River.]

This was successfully accomplished; but in the construction of the bridge poor Piper was totally unable to comply with the extraordinary requirements of the Captain. At first he was so delighted with having received the largest contract that had yet been let that he was all graciousness to Captain Eads. It was not even "Captain" at first, but "'Colonel' Eads, how do you do? Delighted to see you." By and by matters became a little complicated. We noticed that the greeting became less cordial, but still it was "Good-morning, Captain Eads." This fell till we were surprised to hear "Pipe" talking of "Mr. Eads." Before the troubles were over, the "Colonel" had fallen to "Jim Eads," and to tell the truth, long before the work was out of the shops, "Jim" was now and then preceded by a big "D." A man may be possessed of great ability, and be a charming, interesting character, as Captain Eads undoubtedly was, and yet not be able to construct the first bridge of five hundred feet span over the Mississippi River,[27] without availing himself of the scientific knowledge and practical experience of others.

[Footnote 27: The span was 515 feet, and at that time considered the finest metal arch in the world.]

When the work was finished, I had the Colonel with me in St. Louis for some days protecting the bridge against a threatened attempt on the part of others to take possession of it before we obtained full payment. When the Colonel had taken up the planks at both ends, and organized a plan of relieving the men who stood guard, he became homesick and exceedingly anxious to return to Pittsburgh. He had determined to take the night train and I was at a loss to know how to keep him with me until I thought of his one vulnerable point. I told him, during the day, how anxious I was to obtain a pair of horses for my sister. I wished to make her a present of a span, and I had heard that St. Louis was a noted place for them. Had he seen anything superb?

The bait took. He launched forth into a description of several spans of horses he had seen and stables he had visited. I asked him if he could possibly stay over and select the horses. I knew very well that he would wish to see them and drive them many times which would keep him busy. It happened just as I expected. He purchased a splendid pair, but then another difficulty occurred about transporting them to Pittsburgh. He would not trust them by rail and no suitable boat was to leave for several days. Providence was on my side evidently. Nothing on earth would induce that man to leave the city until he saw those horses fairly started and it was an even wager whether he would not insist upon going up on the steamer with them himself. We held the bridge. "Pipe" made a splendid Horatius. He was one of the best men and one of the most valuable partners I ever was favored with, and richly deserved the rewards which he did so much to secure.

The Keystone Bridge Works have always been a source of satisfaction to me. Almost every concern that had undertaken to erect iron bridges in America had failed. Many of the structures themselves had fallen and some of the worst railway disasters in America had been caused in that way. Some of the bridges had given way under wind pressure but nothing has ever happened to a Keystone bridge, and some of them have stood where the wind was not tempered. There has been no luck about it. We used only the best material and enough of it, making our own iron and later our own steel. We were our own severest inspectors, and would build a safe structure or none at all. When asked to build a bridge which we knew to be of insufficient strength or of unscientific design, we resolutely declined. Any piece of work bearing the stamp of the Keystone Bridge Works (and there are few States in the Union where such are not to be found) we were prepared to underwrite. We were as proud of our bridges as Carlyle was of the bridge his father built across the Annan. "An honest brig," as the great son rightly said.

This policy is the true secret of success. Uphill work it will be for a few years until your work is proven, but after that it is smooth sailing. Instead of objecting to inspectors they should be welcomed by all manufacturing establishments. A high standard of excellence is easily maintained, and men are educated in the effort to reach excellence. I have never known a concern to make a decided success that did not do good, honest work, and even in these days of the fiercest competition, when everything would seem to be matter of price, there lies still at the root of great business success the very much more important factor of quality. The effect of attention to quality, upon every man in the service, from the president of the concern down to the humblest laborer, cannot be overestimated. And bearing on the same question, clean, fine workshops and tools, well-kept yards and surroundings are of much greater importance than is usually supposed.

I was very much pleased to hear a remark, made by one of the prominent bankers who visited the Edgar Thomson Works during a Bankers Convention held at Pittsburgh. He was one of a party of some hundreds of delegates, and after they had passed through the works he said to our manager:

"Somebody appears to belong to these works."

He put his finger there upon one of the secrets of success. They did belong to somebody. The president of an important manufacturing work once boasted to me that their men had chased away the first inspector who had ventured to appear among them, and that they had never been troubled with another since. This was said as a matter of sincere congratulation, but I thought to myself: "This concern will never stand the strain of competition; it is bound to fail when hard times come." The result proved the correctness of my belief. The surest foundation of a manufacturing concern is quality. After that, and a long way after, comes cost.

I gave a great deal of personal attention for some years to the affairs of the Keystone Bridge Works, and when important contracts were involved often went myself to meet the parties. On one such occasion in 1868, I visited Dubuque, Iowa, with our engineer, Walter Katte. We were competing for the building of the most important railway bridge that had been built up to that time, a bridge across the wide Mississippi at Dubuque, to span which was considered a great undertaking. We found the river frozen and crossed it upon a sleigh drawn by four horses.

That visit proved how much success turns upon trifles. We found we were not the lowest bidder. Our chief rival was a bridge-building concern in Chicago to which the board had decided to award the contract. I lingered and talked with some of the directors. They were delightfully ignorant of the merits of cast- and wrought-iron. We had always made the upper cord of the bridge of the latter, while our rivals' was made of cast-iron. This furnished my text. I pictured the result of a steamer striking against the one and against the other. In the case of the wrought-iron cord it would probably only bend; in the case of the cast-iron it would certainly break and down would come the bridge. One of the directors, the well-known Perry Smith, was fortunately able to enforce my argument, by stating to the board that what I said was undoubtedly the case about cast-iron. The other night he had run his buggy in the dark against a lamp-post which was of cast-iron and the lamp-post had broken to pieces. Am I to be censured if I had little difficulty here in recognizing something akin to the hand of Providence, with Perry Smith the manifest agent?

"Ah, gentlemen," I said, "there is the point. A little more money and you could have had the indestructible wrought-iron and your bridge would stand against any steamboat. We never have built and we never will build a cheap bridge. Ours don't fall."

There was a pause; then the president of the bridge company, Mr. Allison, the great Senator, asked if I would excuse them for a few moments. I retired. Soon they recalled me and offered the contract, provided we took the lower price, which was only a few thousand dollars less. I agreed to the concession. That cast-iron lamp-post so opportunely smashed gave us one of our most profitable contracts and, what is more, obtained for us the reputation of having taken the Dubuque bridge against all competitors. It also laid the foundation for me of a lifelong, unbroken friendship with one of America's best and most valuable public men, Senator Allison.

The moral of that story lies on the surface. If you want a contract, be on the spot when it is let. A smashed lamp-post or something equally unthought of may secure the prize if the bidder be on hand. And if possible stay on hand until you can take the written contract home in your pocket. This we did at Dubuque, although it was suggested we could leave and it would be sent after us to execute. We preferred to remain, being anxious to see more of the charms of Dubuque.

After building the Steubenville Bridge, it became a necessity for the Baltimore and Ohio Railroad Company to build bridges across the Ohio River at Parkersburg and Wheeling, to prevent their great rival, the Pennsylvania Railroad Company, from possessing a decided advantage. The days of ferryboats were then fast passing away. It was in connection with the contracts for these bridges that I had the pleasure of making the acquaintance of a man, then of great position, Mr. Garrett, president of the Baltimore and Ohio.

We were most anxious to secure both bridges and all the approaches to them, but I found Mr. Garrett decidedly of the opinion that we were quite unable to do so much work in the time specified. He wished to build the approaches and the short spans in his own shops, and asked me if we would permit him to use our patents. I replied that we would feel highly honored by the Baltimore and Ohio doing so. The stamp of approval of the Baltimore and Ohio Railroad would be worth ten times the patent fees. He could use all, and everything, we had.

There was no doubt as to the favorable impression that made upon the great railway magnate. He was much pleased and, to my utter surprise, took me into his private room and opened up a frank conversation upon matters in general. He touched especially upon his quarrels with the Pennsylvania Railroad people, with Mr. Thomson and Mr. Scott, the president and vice-president, whom he knew to be my special friends. This led me to say that I had passed through Philadelphia on my way to see him and had been asked by Mr. Scott where I was going.

"I told him that I was going to visit you to obtain the contracts for your great bridges over the Ohio River. Mr. Scott said it was not often that I went on a fool's errand, but that I was certainly on one now; that Mr. Garrett would never think for a moment of giving me his contracts, for every one knew that I was, as a former employee, always friendly to the Pennsylvania Railroad. Well, I said, we shall build Mr. Garrett's bridges."

Mr. Garrett promptly replied that when the interests of his company were at stake it was the best always that won. His engineers had reported that our plans were the best and that Scott and Thomson would see that he had only one rule—the interests of his company. Although he very well knew that I was a Pennsylvania Railroad man, yet he felt it his duty to award us the work.

The negotiation was still unsatisfactory to me, because we were to get all the difficult part of the work—the great spans of which the risk was then considerable—while Mr. Garrett was to build all the small and profitable spans at his own shops upon our plans and patents. I ventured to ask whether he was dividing the work because he honestly believed we could not open his bridges for traffic as soon as his masonry would permit. He admitted he was. I told him that he need not have any fear upon that point.

"Mr. Garrett," I said, "would you consider my personal bond a good security?"

"Certainly," he said.

"Well, now," I replied, "bind me! I know what I am doing. I will take the risk. How much of a bond do you want me to give you that your bridges will be opened for traffic at the specified time if you give us the entire contract, provided you get your masonry ready?"

"Well, I would want a hundred thousand dollars from you, young man."

"All right," I said, "prepare your bond. Give us the work. Our firm is not going to let me lose a hundred thousand dollars. You know that."

"Yes," he said, "I believe if you are bound for a hundred thousand dollars your company will work day and night and I will get my bridges."

This was the arrangement which gave us what were then the gigantic contracts of the Baltimore and Ohio Railroad. It is needless to say that I never had to pay that bond. My partners knew much better than Mr. Garrett the conditions of his work. The Ohio River was not to be trifled with, and long before his masonry was ready we had relieved ourselves from all responsibility upon the bond by placing the superstructure on the banks awaiting the completion of the substructure which he was still building.

Mr. Garrett was very proud of his Scottish blood, and Burns having been once touched upon between us we became firm friends. He afterwards took me to his fine mansion in the country. He was one of the few Americans who then lived in the grand style of a country gentleman, with many hundreds of acres of beautiful land, park-like drives, a stud of thoroughbred horses, with cattle, sheep, and dogs, and a home that realized what one had read of the country life of a nobleman in England.

At a later date he had fully determined that his railroad company should engage in the manufacture of steel rails and had applied for the right to use the Bessemer patents. This was a matter of great moment to us. The Baltimore and Ohio Railroad Company was one of our best customers, and we were naturally anxious to prevent the building of steel-rail rolling mills at Cumberland. It would have been a losing enterprise for the Baltimore and Ohio, for I was sure it could buy its steel rails at a much cheaper rate than it could possibly make the small quantity needed for itself. I visited Mr. Garrett to talk the matter over with him. He was then much pleased with the foreign commerce and the lines of steamships which made Baltimore their port. He drove me, accompanied by several of his staff, to the wharves where he was to decide about their extension, and as the foreign goods were being discharged from the steamship side and placed in the railway cars, he turned to me and said:

"Mr. Carnegie, you can now begin to appreciate the magnitude of our vast system and understand why it is necessary that we should make everything for ourselves, even our steel rails. We cannot depend upon private concerns to supply us with any of the principal articles we consume. We shall be a world to ourselves."

"Well," I said, "Mr. Garrett, it is all very grand, but really your 'vast system' does not overwhelm me. I read your last annual report and saw that you collected last year for transporting the goods of others the sum of fourteen millions of dollars. The firms I control dug the material from the hills, made their own goods, and sold them to a much greater value than that. You are really a very small concern compared with Carnegie Brothers and Company."

My railroad apprenticeship came in there to advantage. We heard no more of the Baltimore and Ohio Railroad Company entering into competition with us. Mr. Garrett and I remained good friends to the end. He even presented me with a Scotch collie dog of his own rearing. That I had been a Pennsylvania Railroad man was drowned in the "wee drap o' Scotch bluid atween us."



CHAPTER X

THE IRON WORKS

The Keystone Works have always been my pet as being the parent of all the other works. But they had not been long in existence before the advantage of wrought- over cast-iron became manifest. Accordingly, to insure uniform quality, and also to make certain shapes which were not then to be obtained, we determined to embark in the manufacture of iron. My brother and I became interested with Thomas N. Miller, Henry Phipps, and Andrew Kloman in a small iron mill. Miller was the first to embark with Kloman and he brought Phipps in, lending him eight hundred dollars to buy a one-sixth interest, in November, 1861.

I must not fail to record that Mr. Miller was the pioneer of our iron manufacturing projects. We were all indebted to Tom, who still lives (July 20, 1911) and sheds upon us the sweetness and light of a most lovable nature, a friend who grows more precious as the years roll by. He has softened by age, and even his outbursts against theology as antagonistic to true religion are in his fine old age much less alarming. We are all prone to grow philosophic in age, and perhaps this is well. [In re-reading this—July 19, 1912—in our retreat upon the high moors at Aultnagar, I drop a tear for my bosom friend, dear Tom Miller, who died in Pittsburgh last winter. Mrs. Carnegie and I attended his funeral. Henceforth life lacks something, lacks much—my first partner in early years, my dearest friend in old age. May I go where he is, wherever that may be.]

Andrew Kloman had a small steel-hammer in Allegheny City. As a superintendent of the Pennsylvania Railroad I had found that he made the best axles. He was a great mechanic—one who had discovered, what was then unknown in Pittsburgh, that whatever was worth doing with machinery was worth doing well. His German mind made him thorough. What he constructed cost enormously, but when once started it did the work it was intended to do from year's end to year's end. In those early days it was a question with axles generally whether they would run any specified time or break. There was no analysis of material, no scientific treatment of it.

How much this German created! He was the first man to introduce the cold saw that cut cold iron the exact lengths. He invented upsetting machines to make bridge links, and also built the first "universal" mill in America. All these were erected at our works. When Captain Eads could not obtain the couplings for the St. Louis Bridge arches (the contractors failing to make them) and matters were at a standstill, Kloman told us that he could make them and why the others had failed. He succeeded in making them. Up to that date they were the largest semicircles that had ever been rolled. Our confidence in Mr. Kloman may be judged from the fact that when he said he could make them we unhesitatingly contracted to furnish them.

I have already spoken of the intimacy between our family and that of the Phippses. In the early days my chief companion was the elder brother, John. Henry was several years my junior, but had not failed to attract my attention as a bright, clever lad. One day he asked his brother John to lend him a quarter of a dollar. John saw that he had important use for it and handed him the shining quarter without inquiry. Next morning an advertisement appeared in the "Pittsburgh Dispatch":

"A willing boy wishes work."

This was the use the energetic and willing Harry had made of his quarter, probably the first quarter he had ever spent at one time in his life. A response came from the well-known firm of Dilworth and Bidwell. They asked the "willing boy" to call. Harry went and obtained a position as errand boy, and as was then the custom, his first duty every morning was to sweep the office. He went to his parents and obtained their consent, and in this way the young lad launched himself upon the sea of business. There was no holding back a boy like that. It was the old story. He soon became indispensable to his employers, obtained a small interest in a collateral branch of their business; and then, ever on the alert, it was not many years before he attracted the attention of Mr. Miller, who made a small investment for him with Andrew Kloman. That finally resulted in the building of the iron mill in Twenty-Ninth Street. He had been a schoolmate and great crony of my brother Tom. As children they had played together, and throughout life, until my brother's death in 1886, these two formed, as it were, a partnership within a partnership. They invariably held equal interests in the various firms with which they were connected. What one did the other did.

The errand boy is now one of the richest men in the United States and has begun to prove that he knows how to expend his surplus. Years ago he gave beautiful conservatories to the public parks of Allegheny and Pittsburgh. That he specified "that these should be open upon Sunday" shows that he is a man of his time. This clause in the gift created much excitement. Ministers denounced him from the pulpit and assemblies of the church passed resolutions declaring against the desecration of the Lord's Day. But the people rose, en masse, against this narrow-minded contention and the Council of the city accepted the gift with acclamation. The sound common sense of my partner was well expressed when he said in reply to a remonstrance by ministers:

"It is all very well for you, gentlemen, who work one day in the week and are masters of your time the other six during which you can view the beauties of Nature—all very well for you—but I think it shameful that you should endeavor to shut out from the toiling masses all that is calculated to entertain and instruct them during the only day which you well know they have at their disposal."

These same ministers have recently been quarreling in their convention at Pittsburgh upon the subject of instrumental music in churches. But while they are debating whether it is right to have organs in churches, intelligent people are opening museums, conservatories, and libraries upon the Sabbath; and unless the pulpit soon learns how to meet the real wants of the people in this life (where alone men's duties lie) much better than it is doing at present, these rival claimants for popular favor may soon empty their churches.

Unfortunately Kloman and Phipps soon differed with Miller about the business and forced him out. Being convinced that Miller was unfairly treated, I united with him in building new works. These were the Cyclops Mills of 1864. After they were set running it became possible, and therefore advisable, to unite the old and the new works, and the Union Iron Mills were formed by their consolidation in 1867. I did not believe that Mr. Miller's reluctance to associate again with his former partners, Phipps and Kloman, could not be overcome, because they would not control the Union Works. Mr. Miller, my brother, and I would hold the controlling interest. But Mr. Miller proved obdurate and begged me to buy his interest, which I reluctantly did after all efforts had failed to induce him to let bygones be bygones. He was Irish, and the Irish blood when aroused is uncontrollable. Mr. Miller has since regretted (to me) his refusal of my earnest request, which would have enabled the pioneer of all of us to reap what was only his rightful reward—millionairedom for himself and his followers.

We were young in manufacturing then and obtained for the Cyclops Mills what was considered at the time an enormous extent of land—seven acres. For some years we offered to lease a portion of the ground to others. It soon became a question whether we could continue the manufacture of iron within so small an area. Mr. Kloman succeeded in making iron beams and for many years our mill was far in advance of any other in that respect. We began at the new mill by making all shapes which were required, and especially such as no other concern would undertake, depending upon an increasing demand in our growing country for things that were only rarely needed at first. What others could not or would not do we would attempt, and this was a rule of our business which was strictly adhered to. Also we would make nothing except of excellent quality. We always accommodated our customers, even although at some expense to ourselves, and in cases of dispute we gave the other party the benefit of the doubt and settled. These were our rules. We had no lawsuits.

As I became acquainted with the manufacture of iron I was greatly surprised to find that the cost of each of the various processes was unknown. Inquiries made of the leading manufacturers of Pittsburgh proved this. It was a lump business, and until stock was taken and the books balanced at the end of the year, the manufacturers were in total ignorance of results. I heard of men who thought their business at the end of the year would show a loss and had found a profit, and vice-versa. I felt as if we were moles burrowing in the dark, and this to me was intolerable. I insisted upon such a system of weighing and accounting being introduced throughout our works as would enable us to know what our cost was for each process and especially what each man was doing, who saved material, who wasted it, and who produced the best results.

To arrive at this was a much more difficult task than one would imagine. Every manager in the mills was naturally against the new system. Years were required before an accurate system was obtained, but eventually, by the aid of many clerks and the introduction of weighing scales at various points in the mill, we began to know not only what every department was doing, but what each one of the many men working at the furnaces was doing, and thus to compare one with another. One of the chief sources of success in manufacturing is the introduction and strict maintenance of a perfect system of accounting so that responsibility for money or materials can be brought home to every man. Owners who, in the office, would not trust a clerk with five dollars without having a check upon him, were supplying tons of material daily to men in the mills without exacting an account of their stewardship by weighing what each returned in the finished form.

The Siemens Gas Furnace had been used to some extent in Great Britain for heating steel and iron, but it was supposed to be too expensive. I well remember the criticisms made by older heads among the Pittsburgh manufacturers about the extravagant expenditure we were making upon these new-fangled furnaces. But in the heating of great masses of material, almost half the waste could sometimes be saved by using the new furnaces. The expenditure would have been justified, even if it had been doubled. Yet it was many years before we were followed in this new departure; and in some of those years the margin of profit was so small that the most of it was made up from the savings derived from the adoption of the improved furnaces.

Our strict system of accounting enabled us to detect the great waste possible in heating large masses of iron. This improvement revealed to us a valuable man in a clerk, William Borntraeger, a distant relative of Mr. Kloman, who came from Germany. He surprised us one day by presenting a detailed statement showing results for a period, which seemed incredible. All the needed labor in preparing this statement he had performed at night unasked and unknown to us. The form adapted was uniquely original. Needless to say, William soon became superintendent of the works and later a partner, and the poor German lad died a millionaire. He well deserved his fortune.

It was in 1862 that the great oil wells of Pennsylvania attracted attention. My friend Mr. William Coleman, whose daughter became, at a later date, my sister-in-law, was deeply interested in the discovery, and nothing would do but that I should take a trip with him to the oil regions. It was a most interesting excursion. There had been a rush to the oil fields and the influx was so great that it was impossible for all to obtain shelter. This, however, to the class of men who flocked thither, was but a slight drawback. A few hours sufficed to knock up a shanty, and it was surprising in how short a time they were able to surround themselves with many of the comforts of life. They were men above the average, men who had saved considerable sums and were able to venture something in the search for fortune.

What surprised me was the good humor which prevailed everywhere. It was a vast picnic, full of amusing incidents. Everybody was in high glee; fortunes were supposedly within reach; everything was booming. On the tops of the derricks floated flags on which strange mottoes were displayed. I remember looking down toward the river and seeing two men working their treadles boring for oil upon the banks of the stream, and inscribed upon their flag was "Hell or China." They were going down, no matter how far.

The adaptability of the American was never better displayed than in this region. Order was soon evolved out of chaos. When we visited the place not long after we were serenaded by a brass band the players of which were made up of the new inhabitants along the creek. It would be safe to wager that a thousand Americans in a new land would organize themselves, establish schools, churches, newspapers, and brass bands—in short, provide themselves with all the appliances of civilization—and go ahead developing their country before an equal number of British would have discovered who among them was the highest in hereditary rank and had the best claims to leadership owing to his grandfather. There is but one rule among Americans—the tools to those who can use them.

To-day Oil Creek is a town of many thousand inhabitants, as is also Titusville at the other end of the creek. The district which began by furnishing a few barrels of oil every season, gathered with blankets from the surface of the creek by the Seneca Indians, has now several towns and refineries, with millions of dollars of capital. In those early days all the arrangements were of the crudest character. When the oil was obtained it was run into flat-bottomed boats which leaked badly. Water ran into the boats and the oil overflowed into the river. The creek was dammed at various places, and upon a stipulated day and hour the dams were opened and upon the flood the oil boats floated to the Allegheny River, and thence to Pittsburgh.

In this way not only the creek, but the Allegheny River, became literally covered with oil. The loss involved in transportation to Pittsburgh was estimated at fully a third of the total quantity, and before the oil boats started it is safe to say that another third was lost by leakage. The oil gathered by the Indians in the early days was bottled in Pittsburgh and sold at high prices as medicine—a dollar for a small vial. It had general reputation as a sure cure for rheumatic tendencies. As it became plentiful and cheap its virtues vanished. What fools we mortals be!

The most celebrated wells were upon the Storey farm. Upon these we obtained an option of purchase for forty thousand dollars. We bought them. Mr. Coleman, ever ready at suggestion, proposed to make a lake of oil by excavating a pool sufficient to hold a hundred thousand barrels (the waste to be made good every day by running streams of oil into it), and to hold it for the not far distant day when, as we then expected, the oil supply would cease. This was promptly acted upon, but after losing many thousands of barrels waiting for the expected day (which has not yet arrived) we abandoned the reserve. Coleman predicted that when the supply stopped, oil would bring ten dollars a barrel and therefore we would have a million dollars worth in the lake. We did not think then of Nature's storehouse below which still keeps on yielding many thousands of barrels per day without apparent exhaustion.

This forty-thousand-dollar investment proved for us the best of all so far. The revenues from it came at the most opportune time.[28] The building of the new mill in Pittsburgh required not only all the capital we could gather, but the use of our credit, which I consider, looking backward, was remarkably good for young men.

[Footnote 28: The wells on the Storey farm paid in one year a million dollars in cash and dividends, and the farm itself eventually became worth, on a stock basis, five million dollars.]

Having become interested in this oil venture, I made several excursions to the district and also, in 1864, to an oil field in Ohio where a great well had been struck which yielded a peculiar quality of oil well fitted for lubricating purposes. My journey thither with Mr. Coleman and Mr. David Ritchie was one of the strangest experiences I ever had. We left the railway line some hundreds of miles from Pittsburgh and plunged through a sparsely inhabited district to the waters of Duck Creek to see the monster well. We bought it before leaving.

It was upon our return that adventures began. The weather had been fine and the roads quite passable during our journey thither, but rain had set in during our stay. We started back in our wagon, but before going far fell into difficulties. The road had become a mass of soft, tenacious mud and our wagon labored fearfully. The rain fell in torrents, and it soon became evident that we were in for a night of it. Mr. Coleman lay at full length on one side of the wagon, and Mr. Ritchie on the other, and I, being then very thin, weighing not much more than a hundred pounds, was nicely sandwiched between the two portly gentlemen. Every now and then the wagon proceeded a few feet heaving up and down in the most outrageous manner, and finally sticking fast. In this fashion we passed the night. There was in front a seat across the wagon, under which we got our heads, and in spite of our condition the night was spent in uproarious merriment.

By the next night we succeeded in reaching a country town in the worst possible plight. We saw the little frame church of the town lighted and heard the bell ringing. We had just reached our tavern when a committee appeared stating that they had been waiting for us and that the congregation was assembled. It appears that a noted exhorter had been expected who had no doubt been delayed as we had been. I was taken for the absentee minister and asked how soon I would be ready to accompany them to the meeting-house. I was almost prepared with my companions to carry out the joke (we were in for fun), but I found I was too exhausted with fatigue to attempt it. I had never before come so near occupying a pulpit.

My investments now began to require so much of my personal attention that I resolved to leave the service of the railway company and devote myself exclusively to my own affairs. I had been honored a short time before this decision by being called by President Thomson to Philadelphia. He desired to promote me to the office of assistant general superintendent with headquarters at Altoona under Mr. Lewis. I declined, telling him that I had decided to give up the railroad service altogether, that I was determined to make a fortune and I saw no means of doing this honestly at any salary the railroad company could afford to give, and I would not do it by indirection. When I lay down at night I was going to get a verdict of approval from the highest of all tribunals, the judge within.

I repeated this in my parting letter to President Thomson, who warmly congratulated me upon it in his letter of reply. I resigned my position March 28, 1865, and received from the men on the railway a gold watch. This and Mr. Thomson's letter I treasure among my most precious mementos.

The following letter was written to the men on the Division:

PENNSYLVANIA RAILROAD COMPANY SUPERINTENDENT'S OFFICE, PITTSBURGH DIVISION PITTSBURGH, March 28, 1865

To the Officers and Employees of the Pittsburgh Division

GENTLEMEN:

I cannot allow my connection with you to cease without some expression of the deep regret felt at parting.

Twelve years of pleasant intercourse have served to inspire feelings of personal regard for those who have so faithfully labored with me in the service of the Company. The coming change is painful only as I reflect that in consequence thereof I am not to be in the future, as in the past, intimately associated with you and with many others in the various departments, who have through business intercourse, become my personal friends. I assure you although the official relations hitherto existing between us must soon close, I can never fail to feel and evince the liveliest interest in the welfare of such as have been identified with the Pittsburgh Division in times past, and who are, I trust, for many years to come to contribute to the success of the Pennsylvania Railroad Company, and share in its justly deserved prosperity.

Thanking you most sincerely for the uniform kindness shown toward me, for your zealous efforts made at all times to meet my wishes, and asking for my successor similar support at your hands, I bid you all farewell.

Very respectfully

(Signed) ANDREW CARNEGIE

Thenceforth I never worked for a salary. A man must necessarily occupy a narrow field who is at the beck and call of others. Even if he becomes president of a great corporation he is hardly his own master, unless he holds control of the stock. The ablest presidents are hampered by boards of directors and shareholders, who can know but little of the business. But I am glad to say that among my best friends to-day are those with whom I labored in the service of the Pennsylvania Railroad Company.

In the year 1867, Mr. Phipps, Mr. J.W. Vandevort, and myself revisited Europe, traveling extensively through England and Scotland, and made the tour of the Continent. "Vandy" had become my closest companion. We had both been fired by reading Bayard Taylor's "Views Afoot." It was in the days of the oil excitement and shares were going up like rockets. One Sunday, lying in the grass, I said to "Vandy":

"If you could make three thousand dollars would you spend it in a tour through Europe with me?"

"Would a duck swim or an Irishman eat potatoes?" was his reply.

The sum was soon made in oil stock by the investment of a few hundred dollars which "Vandy" had saved. This was the beginning of our excursion. We asked my partner, Harry Phipps, who was by this time quite a capitalist, to join the party. We visited most of the capitals of Europe, and in all the enthusiasm of youth climbed every spire, slept on mountain-tops, and carried our luggage in knapsacks upon our backs. We ended our journey upon Vesuvius, where we resolved some day to go around the world.

This visit to Europe proved most instructive. Up to this time I had known nothing of painting or sculpture, but it was not long before I could classify the works of the great painters. One may not at the time justly appreciate the advantage he is receiving from examining the great masterpieces, but upon his return to America he will find himself unconsciously rejecting what before seemed truly beautiful, and judging productions which come before him by a new standard. That which is truly great has so impressed itself upon him that what is false or pretentious proves no longer attractive.

My visit to Europe also gave me my first great treat in music. The Handel Anniversary was then being celebrated at the Crystal Palace in London, and I had never up to that time, nor have I often since, felt the power and majesty of music in such high degree. What I heard at the Crystal Palace and what I subsequently heard on the Continent in the cathedrals, and at the opera, certainly enlarged my appreciation of music. At Rome the Pope's choir and the celebrations in the churches at Christmas and Easter furnished, as it were, a grand climax to the whole.

These visits to Europe were also of great service in a commercial sense. One has to get out of the swirl of the great Republic to form a just estimate of the velocity with which it spins. I felt that a manufacturing concern like ours could scarcely develop fast enough for the wants of the American people, but abroad nothing seemed to be going forward. If we excepted a few of the capitals of Europe, everything on the Continent seemed to be almost at a standstill, while the Republic represented throughout its entire extent such a scene as there must have been at the Tower of Babel, as pictured in the story-books—hundreds rushing to and fro, each more active than his neighbor, and all engaged in constructing the mighty edifice.

It was Cousin "Dod" (Mr. George Lauder) to whom we were indebted for a new development in our mill operations—the first of its kind in America. He it was who took our Mr. Coleman to Wigan in England and explained the process of washing and coking the dross from coal mines. Mr. Coleman had constantly been telling us how grand it would be to utilize what was then being thrown away at our mines, and was indeed an expense to dispose of. Our Cousin "Dod" was a mechanical engineer, educated under Lord Kelvin at Glasgow University, and as he corroborated all that Mr. Coleman stated, in December, 1871, I undertook to advance the capital to build works along the line of the Pennsylvania Railroad. Contracts for ten years were made with the leading coal companies for their dross and with the railway companies for transportation, and Mr. Lauder, who came to Pittsburgh and superintended the whole operation for years, began the construction of the first coal-washing machinery in America. He made a success of it—he never failed to do that in any mining or mechanical operation he undertook—and he soon cleared the cost of the works. No wonder that at a later date my partners desired to embrace the coke works in our general firm and thus capture not only these, but Lauder also. "Dod" had won his spurs.



The ovens were extended from time to time until we had five hundred of them, washing nearly fifteen hundred tons of coal daily. I confess I never pass these coal ovens at Larimer's Station without feeling that if he who makes two blades of grass grow where one grew before is a public benefactor and lays the race under obligation, those who produce superior coke from material that has been for all previous years thrown over the bank as worthless, have great cause for self-congratulation. It is fine to make something out of nothing; it is also something to be the first firm to do this upon our continent.

We had another valuable partner in a second cousin of mine, a son of Cousin Morrison of Dunfermline. Walking through the shops one day, the superintendent asked me if I knew I had a relative there who was proving an exceptional mechanic. I replied in the negative and asked that I might speak with him on our way around. We met. I asked his name.

"Morrison," was the reply, "son of Robert"—my cousin Bob.

"Well, how did you come here?"

"I thought we could better ourselves," he said.

"Who have you with you?"

"My wife," was the reply.

"Why didn't you come first to see your relative who might have been able to introduce you here?"

"Well, I didn't feel I needed help if I only got a chance."

There spoke the true Morrison, taught to depend on himself, and independent as Lucifer. Not long afterwards I heard of his promotion to the superintendency of our newly acquired works at Duquesne, and from that position he steadily marched upward. He is to-day a blooming, but still sensible, millionaire. We are all proud of Tom Morrison. [A note received from him yesterday invites Mrs. Carnegie and myself to be his guests during our coming visit of a few days at the annual celebration of the Carnegie Institute.]

I was always advising that our iron works should be extended and new developments made in connection with the manufacture of iron and steel, which I saw was only in its infancy. All apprehension of its future development was dispelled by the action of America with regard to the tariff upon foreign imports. It was clear to my mind that the Civil War had resulted in a fixed determination upon the part of the American people to build a nation within itself, independent of Europe in all things essential to its safety. America had been obliged to import all her steel of every form and most of the iron needed, Britain being the chief seller. The people demanded a home supply and Congress granted the manufacturers a tariff of twenty-eight per cent ad valorem on steel rails—the tariff then being equal to about twenty-eight dollars per ton. Rails were selling at about a hundred dollars per ton, and other rates in proportion.

Protection has played a great part in the development of manufacturing in the United States. Previous to the Civil War it was a party question, the South standing for free trade and regarding a tariff as favorable only to the North. The sympathy shown by the British Government for the Confederacy, culminating in the escape of the Alabama and other privateers to prey upon American commerce, aroused hostility against that Government, notwithstanding the majority of her common people favored the United States. The tariff became no longer a party question, but a national policy, approved by both parties. It had become a patriotic duty to develop vital resources. No less than ninety Northern Democrats in Congress, including the Speaker of the House, agreed upon that point.

Capital no longer hesitated to embark in manufacturing, confident as it was that the nation would protect it as long as necessary. Years after the war, demands for a reduction of the tariff arose and it was my lot to be drawn into the controversy. It was often charged that bribery of Congressmen by manufacturers was common. So far as I know there was no foundation for this. Certainly the manufacturers never raised any sums beyond those needed to maintain the Iron and Steel Association, a matter of a few thousand dollars per year. They did, however, subscribe freely to a campaign when the issue was Protection versus Free Trade.

The duties upon steel were successively reduced, with my cordial support, until the twenty-eight dollars duty on rails became only one fourth or seven dollars per ton. [To-day (1911) the duty is only about one half of that, and even that should go in the next revision.] The effort of President Cleveland to pass a more drastic new tariff was interesting. It cut too deep in many places and its passage would have injured more than one manufacture. I was called to Washington, and tried to modify and, as I believe, improve, the Wilson Bill. Senator Gorman, Democratic leader of the Senate, Governor Flower of New York, and a number of the ablest Democrats were as sound protectionists in moderation as I was. Several of these were disposed to oppose the Wilson Bill as being unnecessarily severe and certain to cripple some of our domestic industries. Senator Gorman said to me he wished as little as I did to injure any home producer, and he thought his colleagues had confidence in and would be guided by me as to iron and steel rates, provided that large reductions were made and that the Republican Senators would stand unitedly for a bill of that character. I remember his words, "I can afford to fight the President and beat him, but I can't afford to fight him and be beaten."

Governor Flower shared these views. There was little trouble in getting our party to agree to the large reductions I proposed. The Wilson-Gorman Tariff Bill was adopted. Meeting Senator Gorman later, he explained that he had to give way on cotton ties to secure several Southern Senators. Cotton ties had to be free. So tariff legislation goes.

I was not sufficiently prominent in manufacturing to take part in getting the tariff established immediately after the war, so it happened that my part has always been to favor reduction of duties, opposing extremes—the unreasonable protectionists who consider the higher the duties the better and declaim against any reduction, and the other extremists who denounce all duties and would adopt unrestrained free trade.

We could now (1907) abolish all duties upon steel and iron without injury, essential as these duties were at the beginning. Europe has not much surplus production, so that should prices rise exorbitantly here only a small amount could be drawn from there and this would instantly raise prices in Europe, so that our home manufacturers could not be seriously affected. Free trade would only tend to prevent exorbitant prices here for a time when the demand was excessive. Home iron and steel manufacturers have nothing to fear from free trade. [I recently (1910) stated this in evidence before the Tariff Commission at Washington.]



CHAPTER XI

NEW YORK AS HEADQUARTERS

Our business continued to expand and required frequent visits on my part to the East, especially to New York, which is as London to Britain—the headquarters of all really important enterprises in America. No large concern could very well get on without being represented there. My brother and Mr. Phipps had full grasp of the business at Pittsburgh. My field appeared to be to direct the general policy of the companies and negotiate the important contracts.

My brother had been so fortunate as to marry Miss Lucy Coleman, daughter of one of our most valued partners and friends. Our family residence at Homewood was given over to him, and I was once more compelled to break old associations and leave Pittsburgh in 1867 to take up my residence in New York. The change was hard enough for me, but much harder for my mother; but she was still in the prime of life and we could be happy anywhere so long as we were together. Still she did feel the leaving of our home very much. We were perfect strangers in New York, and at first took up our quarters in the St. Nicholas Hotel, then in its glory. I opened an office in Broad Street.

For some time the Pittsburgh friends who came to New York were our chief source of happiness, and the Pittsburgh papers seemed necessary to our existence. I made frequent visits there and my mother often accompanied me, so that our connection with the old home was still maintained. But after a time new friendships were formed and new interests awakened and New York began to be called home. When the proprietors of the St. Nicholas opened the Windsor Hotel uptown, we took up our residence there and up to the year 1887 that was our New York home. Mr. Hawk, the proprietor, became one of our valued friends and his nephew and namesake still remains so.

Among the educative influences from which I derived great advantage in New York, none ranks higher than the Nineteenth Century Club organized by Mr. and Mrs. Courtlandt Palmer. The club met at their house once a month for the discussion of various topics and soon attracted many able men and women. It was to Madame Botta I owed my election to membership—a remarkable woman, wife of Professor Botta, whose drawing-room became more of a salon than any in the city, if indeed it were not the only one resembling a salon at that time. I was honored by an invitation one day to dine at the Bottas' and there met for the first time several distinguished people, among them one who became my lifelong friend and wise counselor, Andrew D. White, then president of Cornell University, afterwards Ambassador to Russia and Germany, and our chief delegate to the Hague Conference.

Here in the Nineteenth Century Club was an arena, indeed. Able men and women discussed the leading topics of the day in due form, addressing the audience one after another. The gatherings soon became too large for a private room. The monthly meetings were then held in the American Art Galleries. I remember the first evening I took part as one of the speakers the subject was "The Aristocracy of the Dollar." Colonel Thomas Wentworth Higginson was the first speaker. This was my introduction to a New York audience. Thereafter I spoke now and then. It was excellent training, for one had to read and study for each appearance.

I had lived long enough in Pittsburgh to acquire the manufacturing, as distinguished from the speculative, spirit. My knowledge of affairs, derived from my position as telegraph operator, had enabled me to know the few Pittsburgh men or firms which then had dealings upon the New York Stock Exchange, and I watched their careers with deep interest. To me their operations seemed simply a species of gambling. I did not then know that the credit of all these men or firms was seriously impaired by the knowledge (which it is almost impossible to conceal) that they were given to speculation. But the firms were then so few that I could have counted them on the fingers of one hand. The Oil and Stock Exchanges in Pittsburgh had not as yet been founded and brokers' offices with wires in connection with the stock exchanges of the East were unnecessary. Pittsburgh was emphatically a manufacturing town.

I was surprised to find how very different was the state of affairs in New York. There were few even of the business men who had not their ventures in Wall Street to a greater or less extent. I was besieged with inquiries from all quarters in regard to the various railway enterprises with which I was connected. Offers were made to me by persons who were willing to furnish capital for investment and allow me to manage it—the supposition being that from the inside view which I was enabled to obtain I could invest for them successfully. Invitations were extended to me to join parties who intended quietly to buy up the control of certain properties. In fact the whole speculative field was laid out before me in its most seductive guise.

All these allurements I declined. The most notable offer of this kind I ever received was one morning in the Windsor Hotel soon after my removal to New York. Jay Gould, then in the height of his career, approached me and said he had heard of me and he would purchase control of the Pennsylvania Railroad Company and give me one half of all profits if I would agree to devote myself to its management. I thanked him and said that, although Mr. Scott and I had parted company in business matters, I would never raise my hand against him. Subsequently Mr. Scott told me he had heard I had been selected by New York interests to succeed him. I do not know how he had learned this, as I had never mentioned it. I was able to reassure him by saying that the only railroad company I would be president of would be one I owned.

Strange what changes the whirligig of time brings in. It was my part one morning in 1900, some thirty years afterwards, to tell the son of Mr. Gould of his father's offer and to say to him:

"Your father offered me control of the great Pennsylvania system. Now I offer his son in return the control of an international line from ocean to ocean."

The son and I agreed upon the first step—that was the bringing of his Wabash line to Pittsburgh. This was successfully done under a contract given the Wabash of one third of the traffic of our steel company. We were about to take up the eastern extension from Pittsburgh to the Atlantic when Mr. Morgan approached me in March, 1901, through Mr. Schwab, and asked if I really wished to retire from business. I answered in the affirmative and that put an end to our railway operations.

I have never bought or sold a share of stock speculatively in my life, except one small lot of Pennsylvania Railroad shares that I bought early in life for investment and for which I did not pay at the time because bankers offered to carry it for me at a low rate. I have adhered to the rule never to purchase what I did not pay for, and never to sell what I did not own. In those early days, however, I had several interests that were taken over in the course of business. They included some stocks and securities that were quoted on the New York Stock Exchange, and I found that when I opened my paper in the morning I was tempted to look first at the quotations of the stock market. As I had determined to sell all my interests in every outside concern and concentrate my attention upon our manufacturing concerns in Pittsburgh, I further resolved not even to own any stock that was bought and sold upon any stock exchange. With the exception of trifling amounts which came to me in various ways I have adhered strictly to this rule.

Such a course should commend itself to every man in the manufacturing business and to all professional men. For the manufacturing man especially the rule would seem all-important. His mind must be kept calm and free if he is to decide wisely the problems which are continually coming before him. Nothing tells in the long run like good judgment, and no sound judgment can remain with the man whose mind is disturbed by the mercurial changes of the Stock Exchange. It places him under an influence akin to intoxication. What is not, he sees, and what he sees, is not. He cannot judge of relative values or get the true perspective of things. The molehill seems to him a mountain and the mountain a molehill, and he jumps at conclusions which he should arrive at by reason. His mind is upon the stock quotations and not upon the points that require calm thought. Speculation is a parasite feeding upon values, creating none.

My first important enterprise after settling in New York was undertaking to build a bridge across the Mississippi at Keokuk.[29] Mr. Thomson, president of the Pennsylvania Railroad, and I contracted for the whole structure, foundation, masonry, and superstructure, taking bonds and stocks in payment. The undertaking was a splendid success in every respect, except financially. A panic threw the connecting railways into bankruptcy. They were unable to pay the stipulated sums. Rival systems built a bridge across the Mississippi at Burlington and a railway down the west side of the Mississippi to Keokuk. The handsome profits which we saw in prospect were never realized. Mr. Thomson and myself, however, escaped loss, although there was little margin left.

[Footnote 29: It was an iron bridge 2300 feet in length with a 380-foot span.]

The superstructure for this bridge was built at our Keystone Works in Pittsburgh. The undertaking required me to visit Keokuk occasionally, and there I made the acquaintance of clever and delightful people, among them General and Mrs. Reid, and Mr. and Mrs. Leighton. Visiting Keokuk with some English friends at a later date, the impression they received of society in the Far West, on what to them seemed the very outskirts of civilization, was surprising. A reception given to us one evening by General Reid brought together an assembly creditable to any town in Britain. More than one of the guests had distinguished himself during the war and had risen to prominence in the national councils.

The reputation obtained in the building of the Keokuk bridge led to my being applied to by those who were in charge of the scheme for bridging the Mississippi at St. Louis, to which I have already referred. This was connected with my first large financial transaction. One day in 1869 the gentleman in charge of the enterprise, Mr. Macpherson (he was very Scotch), called at my New York office and said they were trying to raise capital to build the bridge. He wished to know if I could not enlist some of the Eastern railroad companies in the scheme. After careful examination of the project I made the contract for the construction of the bridge on behalf of the Keystone Bridge Works. I also obtained an option upon four million dollars of first mortgage bonds of the bridge company and set out for London in March, 1869, to negotiate their sale.

During the voyage I prepared a prospectus which I had printed upon my arrival in London, and, having upon my previous visit made the acquaintance of Junius S. Morgan, the great banker, I called upon him one morning and opened negotiations. I left with him a copy of the prospectus, and upon calling next day was delighted to find that Mr. Morgan viewed the matter favorably. I sold him part of the bonds with the option to take the remainder; but when his lawyers were called in for advice a score of changes were required in the wording of the bonds. Mr. Morgan said to me that as I was going to Scotland I had better go now; I could write the parties in St. Louis and ascertain whether they would agree to the changes proposed. It would be time enough, he said, to close the matter upon my return three weeks hence.

But I had no idea of allowing the fish to play so long, and informed him that I would have a telegram in the morning agreeing to all the changes. The Atlantic cable had been open for some time, but it is doubtful if it had yet carried so long a private cable as I sent that day. It was an easy matter to number the lines of the bond and then going carefully over them to state what changes, omissions, or additions were required in each line. I showed Mr. Morgan the message before sending it and he said:

"Well, young man, if you succeed in that you deserve a red mark."

When I entered the office next morning, I found on the desk that had been appropriated to my use in Mr. Morgan's private office the colored envelope which contained the answer. There it was: "Board meeting last night; changes all approved." "Now, Mr. Morgan," I said, "we can proceed, assuming that the bond is as your lawyers desire." The papers were soon closed.



While I was in the office Mr. Sampson, the financial editor of "The Times," came in. I had an interview with him, well knowing that a few words from him would go far in lifting the price of the bonds on the Exchange. American securities had recently been fiercely attacked, owing to the proceedings of Fisk and Gould in connection with the Erie Railway Company, and their control of the judges in New York, who seemed to do their bidding. I knew this would be handed out as an objection, and therefore I met it at once. I called Mr. Sampson's attention to the fact that the charter of the St. Louis Bridge Company was from the National Government. In case of necessity appeal lay directly to the Supreme Court of the United States, a body vying with their own high tribunals. He said he would be delighted to give prominence to this commendable feature. I described the bridge as a toll-gate on the continental highway and this appeared to please him. It was all plain and easy sailing, and when he left the office, Mr. Morgan clapped me on the shoulder and said:

"Thank you, young man; you have raised the price of those bonds five per cent this morning."

"All right, Mr. Morgan," I replied; "now show me how I can raise them five per cent more for you."

The issue was a great success, and the money for the St. Louis Bridge was obtained. I had a considerable margin of profit upon the negotiation. This was my first financial negotiation with the bankers of Europe. Mr. Pullman told me a few days later that Mr. Morgan at a dinner party had told the telegraphic incident and predicted, "That young man will be heard from."

After closing with Mr. Morgan, I visited my native town, Dunfermline, and at that time made the town a gift of public baths. It is notable largely because it was the first considerable gift I had ever made. Long before that I had, at my Uncle Lauder's suggestion, sent a subscription to the fund for the Wallace Monument on Stirling Heights overlooking Bannockburn. It was not much, but I was then in the telegraph office and it was considerable out of a revenue of thirty dollars per month with family expenses staring us in the face. Mother did not grudge it; on the contrary, she was a very proud woman that her son's name was seen on the list of contributors, and her son felt he was really beginning to be something of a man. Years afterward my mother and I visited Stirling, and there unveiled, in the Wallace Tower, a bust of Sir Walter Scott, which she had presented to the monument committee. We had then made great progress, at least financially, since the early subscription. But distribution had not yet begun.[30] So far with me it had been the age of accumulation.

[Footnote 30: The ambitions of Mr. Carnegie at this time (1868) are set forth in the following memorandum made by him. It has only recently come to light:

St. Nicholas Hotel, New York, December, 1868

Thirty-three and an income of $50,000 per annum! By this time two years I can so arrange all my business as to secure at least $50,000 per annum. Beyond this never earn—make no effort to increase fortune, but spend the surplus each year for benevolent purposes. Cast aside business forever, except for others.

Settle in Oxford and get a thorough education, making the acquaintance of literary men—this will take three years' active work—pay especial attention to speaking in public. Settle then in London and purchase a controlling interest in some newspaper or live review and give the general management of it attention, taking a part in public matters, especially those connected with education and improvement of the poorer classes.

Man must have an idol—the amassing of wealth is one of the worst species of idolatry—no idol more debasing than the worship of money. Whatever I engage in I must push inordinately; therefore should I be careful to choose that life which will be the most elevating in its character. To continue much longer overwhelmed by business cares and with most of my thoughts wholly upon the way to make more money in the shortest time, must degrade me beyond hope of permanent recovery. I will resign business at thirty-five, but during the ensuing two years I wish to spend the afternoons in receiving instruction and in reading systematically.]