Carnegie Corporation

Andrew Carnegie played a major role in the philanthropic history of America, and his famous essay, The Gospel of Wealth, should be required reading, along with Democracy in America, for anyone in the nonprofit field.

This article from the Philanthropy Roundtable notes the 100 year anniversary of the Carnegie Corporation.

An excerpt.

“In 1889, in the first of two essays that have come to be known as “The Gospel of Wealth,” Andrew Carnegie warned of the perils the wealthy faced if they were insufficiently philanthropic during their lifetimes:

“. . . the day is not far distant when the man who dies leaving behind him millions of available wealth, which was free to him to administer during life, will pass away “unwept, unhonored, and unsung,” no matter to what uses he leaves the dross which he cannot take with him.

“About such people, he judged, “the public verdict will then be: ‘The man who dies thus rich dies disgraced.’”

“In 1911, during his 76th year, Carnegie realized that he was at risk of this fate himself. Despite having already given $150 million away, he had seen his fortune grow more rapidly and remained an extremely wealthy man. As a result, with initial gifts totaling $125 million (close to $3 billion today), he established the Carnegie Corporation, a philanthropic trust with a broad mission to “promote the advancement and diffusion of knowledge and understanding.”

“Along with the creation of the Russell Sage Foundation in 1907 and the Rockefeller Foundation in 1913, this marked the beginning of the modern era of foundation philanthropy. Smaller funds with more limited purposes had existed before, but according to the Foundation Center, the combined assets of foundations with endowments of at least $1 million in 1909 amounted to about $1.5 billion (in present-day dollars). Carnegie’s gift alone surpassed that, and others soon followed suit. In the second decade of the 20th century, 78 large foundations were set up, with endowments that would amount to over $16 billion today; during the next, another $16 billion was added in 173 grantmaking organizations. Most are still operating.

“But more than size and scope made the Carnegie Corporation stand out. It also embraced a philosophy of giving known as “scientific philanthropy,” which sought to apply the knowledge of experts, particularly those in the medical and social sciences, to the problems donors wanted to address. “Scientific philanthropy” promised more innovative approaches and more cost-efficient returns, making it especially congenial to an industrialist like Carnegie. After all, both innovation and efficiency were key factors in his business success. Carnegie was among the very first to adopt the Bessemer process and the Siemens-Martin “open-hearth” method for steel-making. In addition, he loathed waste—his motto to managers was, “Well, boys, what can we throw away this year?”—and was eager to see every philanthropic dollar as effectively invested as possible.”

“With a staff heavy in experts and close ties to leading universities and research institutions, the Carnegie Corporation, along with Rockefeller, quickly became known as a principal exponent of this philosophy—and a leader in the world of institutional philanthropy. Even today, though its giving barely places it among the top 50, it remains one of the most prestigious of grantmaking organizations.”