Gospel of Wealth: Definition & Summary

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  • 0:02 American Dreams
  • 0:34 Andrew Carnegie
  • 1:47 The Pros and Cons of…
  • 2:45 Three Options for Wealth
  • 3:35 The Rich and the Poor
  • 4:58 Lesson Summary
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Lesson Transcript
Instructor: Erin Carroll

Erin has taught English and History. She has a bachelor's degree in History, and a master's degree in International Relations

This lesson will discuss the Gospel of Wealth, an article written by Andrew Carnegie in the 19th Century. You will learn why Carnegie wrote it, what the article argued, and reflect on the influence it has had on American society.

American Dreams and Inequality

America has claimed to be a place where if you work hard enough you can become wealthy. In fact, the U.S. has more millionaires than any other country in the world. However, for all that prosperity, the gap between rich and poor has always been large and continues to grow. For over a century, people have tried to fix this inequality. Andrew Carnegie was one of the first to propose a solution. His idea, called 'The Gospel of Wealth,' has influenced American millionaires ever since, including people like Bill Gates.

Andrew Carnegie

The Gospel of Wealth was an article written by Andrew Carnegie in 1889. Carnegie was a Scottish immigrant who became the second richest man in America. By dominating the steel industry, Andrew Carnegie took his place alongside other fabulously wealthy captains of industry like Rockefeller and Vanderbilt. He became convinced that men like him had a responsibility to spend their money to benefit the greater good. This belief became known as the Gospel of Wealth.

Andrew Carnegie
Andrew Carnegie

He argued that the affluent had a unique responsibility to be philanthropic. In other words, the rich should devote themselves to distributing their wealth responsibly to benefit society while they are still alive. He famously ends saying, 'The man who dies thus rich dies disgraced.'

Practicing what he preached, at the time of his death Carnegie had given away $350 million of his own money. That was 90% of his wealth! He gave his money with a particular focus on higher education, establishing a well-known university, a music hall, and over 2,500 libraries. The Gospel of Wealth continues to influence American's perception of the rich, the poor, and the importance of philanthropy.

The Pros and Cons of Capitalism

In order to understand the gospel, we have to understand Carnegie's beliefs about capitalism. The Industrial Revolution and free market capitalism had increased the scale of production and profits exponentially. Carnegie believed that the system ensured that the smartest and most talented businessmen rose to the top, and that they were becoming wealthier than anyone ever before in history. However, this meant that power and wealth was concentrated in the hands of a very few, and the divide between rich and poor had widened considerably. This inequality was disturbing to Carnegie. He began his article considering the issue of inequality and he wondered how to fix it.

Ultimately, he believed that capitalism lifted all boats. In other words, although the divide between rich and poor was enormous, the poor were a little better off than before. Therefore, the answer was not to turn to other systems like Communism to re-distribute wealth. Instead, the answer would come from men like him.

Three Options for Wealth

Carnegie argued that prosperous men must distribute their wealth, and they had three options. Traditionally, wealth was distributed two main ways: leaving it to heirs after death or bequeathing it to public purposes after death. Coming from Europe, Carnegie detested money being handed down in families often to be squandered by heirs who had no real talent or brains. If money was left for public benefit after death, there was no guarantee that it would be administered well by others.

Therefore, Carnegie argued rich men should give their wealth for public good while still alive. He even advocated for the inheritance tax to encourage the wealthy to engage in philanthropy in life. He argued that wealthy men like him had special abilities of hard work, intelligence, and organization, and so they would do the best job of distributing wealth for the common good.

Carnegie Music Hall in New York City
Carnegie Music Hall in New York City

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