Would Andrew Carnegie Have Flown Economy?

I went through a phase about ten to fifteen years ago of flying private a few times a year. In hindsight, for me it was an unjustifiable expense.

The expected hourly cost of time “saved” was well in excess of $10,000, and it’s not as if the longer time on a commercial flight was wasted or without its charms. On a commercial flight I’m still with my wife, I can still read or sleep or do anything else I could on a private flight (within the bounds of propriety!).

And we’re not so wealthy that a series of $50,000 plane trips between thickly scheduled routes like NYC-Miami or NYC-San Francisco makes any sense for us.

The brutal truth is that my motivation for flying private was because others I knew were doing it. And it was seductive.¹ A power trip that allowed me to suspend the constraints of airline schedules and airport routines.

We could decide last minute to change the time of our departure. And the plane left when we arrived at the private terminal where, in the depraved depths of my mimetic desires, I’d hope to run into someone I knew on our way to the tarmac.

I believed it conferred status. It announced loudly that I was wealthy.

I’d “take back” most of my private plane conspicuous consumption with a few exceptions:.

• Flying my father-in-law between Florida and New York for medical treatment when his condition made it necessary for him to lie prone.

• My brother’s bachelor party––we three brothers and a best friend––where the private plane was a surprise, and we flew to three destinations over three nights, each one an undisclosed surprise to my brother.

• My wife’s 50^th birthday party when we invited four of our closest couples friends for a long weekend at a Caribbean resort; the plane allowed us to maximize the time we all spent together.

In retrospect, all the other flights were worse than a waste. Because the status and expense were the main points. ²

Andrew Carnegie’s disapproval

Andrew Carnegie would have disapproved of many aspects of my relationship to wealth. Not just the flying private part. A famously self-made man, he would have found fault with the advantages conferred on me through inheritance. He also would have thought it sinful that I made my money in the investment management business rather than from building companies.

Ostentation

In Carnegie’s late 19^th century “Gospel of Wealth” ³ he writes that the wealthy should

“set an example of modest, unostentatious living, shunning display or extravagance.”

In addition to my past private plane habit, albeit now reformed, Carnegie might also have been displeased with our two homes, which are very large for two people and Sophie, our Shih Tzu. Although Sophie does enjoy the room to romp.

Carnegie did recognize that extravagance is a subjective, relative term. His test of extravagance was whether a family was

“chiefly known…[for]…enormous sums ostentatiously spent.”

Compared to many others with wealth, some with similar and many with far larger fortunes, we could claim some relative modesty. We have no plane (nor Netjets), no yacht, no staff of assistants, no “blue chip” art collection (although we do have a homemade, plastic version of the six million dollar banana).

Debbie and I don’t post fabulous pictures on Instagram. We also try our best to be circumspect about our three-and-a-half-second, walk-on-part in Curb Your Enthusiasm.

On the other hand, I write this newsletter, the transparency of which could be viewed as a brazen form of wealth ostentation.

I give us a “C” in this category.

Season Seven, Episode Ten

Inheritance

Carnegie was adamant that giving large sums to children was morally wrong and against the interests of the children. He called a large inheritance a “curse,” and thought those who left great sums to their descendants did so entirely for the selfish purpose of their own “family pride” in continuing their legacy of wealth through their children.

When our children were growing up, we lived more modestly than we do now because we were less wealthy. Having raised our children, however, with a certain standard of comfortable living and having received a head start that turned out not to be a “curse” to us––– our ambitions were not sapped–––we felt it was appropriate to provide our children with similar means.

While we’re happy for our children to have success, financially and otherwise, our pride in our children, the three by birth and the two by marriage, is centered on their kindness and their caring for each other and their families. Our pride is not based on their maintaining a legacy of wealth.

I give us a “B” in this category.

A sacred trust

When you give money to a foundation or to a Donor Advised Fund (much more efficient than foundations unless you’re a Carnegie) that money is legally no longer freely yours. Since we are residents of NYC, the money in our Donor Advised Funds is under the supervision of the Attorney General of New York State.

After providing for non-extravagant expenses and modest provisions for heirs, Carnegie was thinking ethically rather than legally when he wrote:

“surplus wealth should be considered as a sacred trust, to be administered during the lives of the owners…for the best good of the community in which and from which it has been acquired.”

I hear in Carnegie’s words a forerunner of Obama’s 2012 comment, put in its proper context, of “you didn’t build that.”

Because for all his strong emphasis on individualism, Carnegie recognized that it was the American free enterprise system that had given him and other wealthy people the opportunity to build vast fortunes. And he was a strong advocate of paying it back.

So strong in fact that he was an early and fierce advocate for confiscatory estate taxes to discourage hoarding.

He wrote that a man who dies rich dies in disgrace. ⁴

On this score, I’ll give us a “B” whereas ten years ago I’d have given us a “C”. Giving has become an increasingly important part of our lives and our life goals.

Carnegie, though, would have disliked the focus of our giving.

No Hand-Outs

Carnegie was best known for the free libraries he built. He believed that the best giving was to establish community institutions to create opportunities for the most able of men to rise (remember, this was the late 19^thcentury; women didn’t even have the vote).

In addition to libraries, the causes he considered worthwhile included public parks, medical institutions, universities, and museums.

He was flatly against what he called “handouts” to the poor. He thought that community institutions would be sufficient to help raise the poor, provided they had enough talent and drive. With access to fresh air and free books, they could breathe free while teaching themselves, and in a Horatio Alger world, the sky would be the limit.

Here we depart sharply from Carnegie, motivated by our knowledge of systemic poverty and the systemic injustice of our wealthy country not providing basic needs. So we concentrate our giving dollars to make the greatest impact to counter the injustice and suffering of poverty.

Carnegie fell victim to the classic, self-made rich person’s trap that his life experience was unexceptional and could be replicated by others if they just had a little bit more ”get up and go.”

Carnegie might grade our giving a “D” but I give us a “B,” maybe even a “B+/A-” if graded on a curve.

Community assets

Reading Carnegie’s “Gospel of Wealth” has made me consider whether we are doing enough to promote community assets like parks or the arts. We give modest support to the Central Park Conservancy. It’s a great example of a public-private partnership, one that has transformed Central Park into an absolute treasure for all of New York City.

The scale of our capacity for giving, however, does not allow us to move the needle in terms of Central Park; it does not actually qualify as one of the “grass-roots” organizations we increasingly look to support.⁵

When I sit at my desk I can see the Metropolitan Museum of Art, that great repository of the world’s three-dimensional culture. It’s one of the phenomenal community assets of world civilization.

When I look down to write, however, I’m participating in a different, modern, digital community asset–– the Substack platform which hosts this newsletter.

When any of us support a writer on Substack with our attention or our money, we’re planting seeds that can build a mighty digital institution.

We’re in essence creating a living library that Carnegie could never have conceived of.

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Question for the comments: Was Andrew Carnegie a righteous man in his generation, i.e., for the time he lived? This gets at the criteria we use to judge people, including ourselves. Footnote 4 below provides the allusion to biblical Noah.

1.

Tina Brown

wrote a brilliantly entertaining piece on flying private:

“After flying private a few times with gilded friends, I am convinced it’s the single most seductive experience in the world.”

2. A classic example of a Veblen good whose value to the buyer increases as the price rises.

3. I read Carnegie’s “Gospel” thanks to a link in a post by

Librarian of Celaeno

.

4. There’s a famous line in the Torah/Old Testament about Noah and his family being spared from the flood because Noah was righteous in his generation. There’s a debate about what “in his generation” means. Was his goodness all the more exceptional because of the sinfulness of the rest of his community or was his goodness relative to the norms of his time and place? The interpretation I like is that Noah was good compared to all the creeps he was surrounded by. I think of Carnegie like that. By the standards of his generation, he was a good man and mostly did good things.

5. Central Park, grass-roots. You know it’s a weak joke when you need a footnote with bolding to explain it.