George, Carnegie, and the Great Divide

Henry George and Andrew Carnegie had disparate views on the usefulness of capitalism. Through examining the works Progress and Poverty by Henry George and “Wealth” by Andrew Carnegie, I will attempt to support the above thesis. I will look closely at what problems they may contend might exist with capitalist development. Subsequently I will examine how they believe any problems with capitalism could come to a resolution and how they might visualize a just society.

First, let us explore how Henry George feels about the three tenets of capitalism: free exchange of goods in a laissez-faire market, limited taxes, and private ownership of land. As for the first two principles of capitalism, I feel that George is moderately supportive. In fact, George comes to the defense of the capitalist. In his tirade over rent levied by private landowners he says, “…it claims the just reward of the capitalist and the fruits of the inventor’s patient effort…”[1] So, he admits that capitalists are due rewards. However, George is incredibly harsh and critical of private land ownership; equating it to a cause of a condition of perpetual slavery for the working classes. “Our boasted freedom will continue to involve slavery, so long as one man can claim exclusive ownership of the land from which other men must live.”[2] The free market does not completely get a pass from George. He identifies the material progress promoted by the open market as a core part of the problem created by capitalism, stating, “Private ownership of land is the nether millstone. Material progress is the upper millstone. Between them, with an increasing pressure, the working classes are being ground.”[3] However, he does a slight capitulation by stating that capitalistic material progress can be a good thing so long as it is something to which everyone has equal access. “…the laws of the universe do not deny the natural aspirations of the human heart; that the progress of society might be, and, if it is to continue, must be, toward equality, not toward inequality…”[4]

In comparison, Andrew Carnegie is an avid proponent capitalism. He sees capitalism as an inevitable evolution of the human socio-economic condition. ”But whether the change be for the good or ill, it is upon us, beyond our power to alter, and there fore to be accepted and made the best of. It is a waste of time to criticize the inevitable.”[5] Carnegie concedes that there is a price to pay for capitalistic progress, stating, “The price we pay for this salutary change is, no doubt, great.”[6]  However, he seems to use a felicific calculus in justifying its existence. “The poor enjoy what the rich could not before afford. What were the luxuries have become the necessaries of life.”[7]  Often he avails himself of the language of Social Darwinism in his defense of capitalism. He warns against a communist-style revolution, in his eyes, a devolution from the evolved state of man. “This is not evolution, but revolution. It necessitates the changing of human nature itself a work of oeons, even if it were good to change it, which we cannot know.”[8]

Both authors are quick to acknowledge that the primary issue for humanity is an ever-widening gap between the rich and the poor. George contends that this matter is a ferocious problem with exactly one largest distinct cause, the ownership of private property. Historically he accounts, “The ownership of land is the basis of aristocracy.”[9] Further he attests, ”The English landowner of today has essentially all the power over his tenants that his feudal predecessor had.”[10] It seems for George that many of the ills of humanity traces back to the ownership of private property. Carnegie considers the cause of the gap between the haves and the have-nots a disruption of homogeneity. Carnegie views this as less of a terminal quagmire in itself and more a natural state that results from the prospering of a few men with a talent for organization. This differentiation of humanity causes discord. “All intercourse between them is at an end. Rigid Castes are formed, and, as usual, mutual ignorance breeds mutual distrust. “[11] For Carnegie, the discontent is a transitive state of affairs moving toward a state where things will work themselves out naturally. Seeing how George and Carnegie view the gap between the rich and the poor differently, we can move on a discussion of their wildly disparate solutions.

George’s solution is based on the wholesale dissolution of private property. A one generational predecessor of George, John Stuart Mill, had also posited that the problem with the wealth gap might be related to land. Mill’s plan centered on fixing the value of land for the owner and “nationalizing the future ‘unearned increase in the value of land’” [12] However, George is critical of Mill’s plan. George laments,”But it would leave, for all the future,one class in possession of the enormous advantage over others which they now have.”[13] Of Mill’s plan, George says that it can serve best as a discussion starter. “… their discussion is a hopeful sign, as it shows the entrance of the thin end of the wedge of truth.”[14] George’s more radical communal ownership of land where land owners pay rent to the state goes far to promote a capped capitalist sensibility. In Georgist capitalism, the open market and limited taxation find a credible firmament with property ownership common and a man only able to rent from the state the land he could afford by the means of his successful endeavors.

Carnegie’s solution rested on the idea that the wealth gap is something to which humanity would adjust. The dissonance would cease when the wealthy evolved to their true calling. “Individualism will continue, but the millionaire will be but a trustee for the poor; intrusted for a season with a great part of the increased wealth of the community, but administering it for the community far better than it could or would have done for itself.”[15] Carnegie’s solution is a call to action for the wealthy to use their elite acumen to administer their wealth, while alive, for the benefit of humanity. This was not a directive for rampant alms giving. Rather, Carnegie states,“…one of the serious obstacles to the improvement of our race is indiscriminate charity.”[16] Carnegie’s vision of the most legitimate solution to the class divide is an amelioration of the deserving in the lower classes through works done by the wealthy. “The best means of benefiting the community is to place within its reach the ladders on which the aspiring can rise—parks, and means of recreation, by which men are helped in body and mind; works of art, certain to give pleasure and improve the public taste, and public institutions of various kinds, which will improve the general condition of the people.”[17]

To conclude, it seems quite sure that George and Carnegie agree to some extent on the usefulness of capitalism. George is a proponent of spoils for toil; that one should keep the profits of one’s labor. Quite succinctly he states, “Thus there is to everything produced by human exertion a clear title, perfectly consistent with justice.”[18] However, he constrains this entitlement to the fruits of one’s labor and denounces private entitlement to natural resources. “Nature acknowledges no ownership or control in man save as the result of exertion.”[19] In contrast, Carnegie agrees with all three tenants of capitalism and puts a check on it twofold by the charging the wealthy to “set an example of modest, unostentatious living” [20] and admonishing those that die with great wealth. “The man who dies thus rich dies disgraced.”[21] In reflection, both men seem to have a keen understanding of the problem that the wealth gap creates, but divergent views on how to solve such a morass.

Bibliography

Carnegie, Andrew. 1995. “Carnegie.html.” http://www.swarthmore.edu. June 27. Accessed 9 30, 2015. http://www.swarthmore.edu/SocSci/rbannis1/AIH19th/Carnegie.html.

George, Henry. 1886. Progress and Poverty. New York, NY: D. Appleton and Company.

[1] Henry George, Progress and Poverty, Book VII, Chpt. 3, paragraph 15, available at: http://progpov.menaceofprivilege.com/book07_chapter3.pdf

[2] Ibid., Chpt. 2, paragraph 19, available at: http://progpov.menaceofprivilege.com/book07_chapter2.pdf

[3] Ibid., Chpt. 2, paragraph 20

[4] Ibid., Book VI, Chpt. 2, paragraph 10, available at: http://progpov.menaceofprivilege.com/book06_chapter2.pdf

[5] Andrew Carnegie, “Wealth,” North American Review, June 1889, available at: http://www.swarthmore.edu/SocSci/rbannis1/AIH19th/Carnegie.html

[6] Ibid.

[7] Ibid.

[8] Ibid.

[9] Henry George, Progress and Poverty, Book VII, Chpt. 2, paragraph 11, available at: http://progpov.menaceofprivilege.com/book07_chapter2.pdf

[10] Ibid.

[11] Andrew Carnegie, “Wealth,” North American Review, June 1889, available at: http://www.swarthmore.edu/SocSci/rbannis1/AIH19th/Carnegie.html

[12] Henry George, Progress and Poverty, Book VII, Chpt. 3, paragraph 11, available at: http://progpov.menaceofprivilege.com/book07_chapter3.pdf

[13] Ibid.

[14] Ibid., paragraph 12

[15] Andrew Carnegie, “Wealth,” North American Review, June 1889, available at: http://www.swarthmore.edu/SocSci/rbannis1/AIH19th/Carnegie.html

[16] Ibid.

[17] Ibid.

[18] Henry George, Progress and Poverty, Book VII, Chpt. 1, paragraph 4, available at: http://progpov.menaceofprivilege.com/book07_chapter1.pdf

[19] Ibid., paragraph 6

[20] Andrew Carnegie, “Wealth,” North American Review, June 1889, available at: http://www.swarthmore.edu/SocSci/rbannis1/AIH19th/Carnegie.html

[21] Ibid.

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About hunterpauldrake

May all of my faults, travails, and errors, be of worth to others....

Posted on October 19, 2015, in Uncategorized. Bookmark the permalink. Leave a comment.

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