His older brother Andrew made a good deal of money from stock investing, and in 1853 purchased their rented home on Rebecca Street. In 1858, after Andrew had been appointed Thomas Scott's assistant, the Carnegie family sold their Rebecca Street home and bought a large home in
Altoona. Andrew was appointed superintendent of the western division of the
Pennsylvania Railroad in 1859, and he made Thomas (who had quit school) his assistant. (This was not the end of Thomas' schooling. As an adult, he would later take classes at Duff College.) In 1859, the family moved back to Pittsburgh and resided at 10 Hancock Street (later renamed Eighth Street, and now part of the
Downtown Pittsburgh central business district). But the pollution from nearby factories and iron forges proved too much, and after only a few short months on Hancock Street, Andrew purchased a
Victorian home for Thomas and their mother in
Homewood, then a middle-class village on the edge of Pittsburgh. Andrew and Thomas rode the train to and from work together, and attended the theater frequently. In 1861, Andrew persuaded Thomas to invest in the Columbia Oil Company, and it paid off handsomely. That Andrew Carnegie should ask an 18-year-old boy to be a stock investor was not unusual. When Andrew traveled to Scotland with his mother and a friend in 1862, he left Thomas in charge of his numerous business affairs (assets by that time nearing $47,860 or roughly $8.5 million in 2009 inflation-adjusted dollars).
Union Iron Mills Thomas' business ventures were often pulled along in the wake of his older brother's interests, and he made his fortune in iron and steel because of Andrew. In 1861, Thomas N. Miller,
Henry Phipps (the son of the shoemaker Margaret Carnegie did home work for), Anthony Kloman, and Andrew Kloman organized the Iron City Forge in Pittsburgh to take advantage of the booming need for iron products during the
American Civil War. Miller subsequently bought out Anton Kloman's share. Phipps and Miller later learned that Andrew Kloman had sold a one-ninth share in the business to a local man who subsequently died during the war, and Miller bought his share (raising his ownership in the business to four-ninths). Kloman, Miller, and Phipps were soon at odds over these transactions and one another's refusal to sell out to the others, and they sought Andrew Carnegie's assistance in resolving the dispute. On September 1, 1863, Carnegie drew up new incorporation papers which made Miller a "special partner" in the firm and which also made Thomas Carnegie a partner in the business. The money for Thomas' investment came from Andrew. A clause in the contract permitted Kloman and Phipps to oust Miller and make him a silent partner, which they quickly did. Miller did so. Meanwhile, Miller established a rival firm, the Cyclops Iron Company, with Andrew Carnegie as an investor. The Cyclops firm opened in October 1864. Thomas, however, was deeply concerned that the Cyclops company would harm his own interests in Iron City Forge, and successfully prevailed on Andrew to merge the two firms. (It may also be true that Andrew always intended to merge the two firms in order to gain control of both, and used Thomas for this purpose.) Kloman and Phipps at first refused, but Thomas made an offer of all the shares in Cyclops plus an additional payment of $50,000 (a very large sum at the time). On May 1, 1865, the new Union Iron Mills Company was formed. Thomas was to "help out" as needed, and appointed vice president of the firm. While Andrew and Miller spent the better part of the next year touring Europe, Thomas flourished at the Union Iron Mills. The company struggled financially as the end of the Civil War led to sharp drops in the need for iron products, but Thomas proved to be a warm and friendly executive where his brother was cold and austere. Thomas' ability to make friends allowed the firm to receive numerous contracts and even infusions of capital when needed, and it is unlikely the company would have survived without him. From Europe, Andrew also badgered Thomas to make improvements to their home in America, and decided to call the rapidly expanding mansion "Fairfield." Thomas' judgement proved to be more prescient than Andrew's when, in July 1865, Andrew became fascinated with the "Dodd process," a new English method of welding steel facing to iron railroad rails and, despite Thomas' misgivings, he purchased the American patent for the process. The process proved unworkable, and although he made additional investments in retooling the mill, the rails produced by the new process were just as brittle and breakable as those formerly manufactured. Thomas advised him to conserve his money, but Andrew purchased yet another steel welding patent to try to fix the process. Meanwhile, Thomas began courting Lucy Coleman, daughter of Pittsburgh iron manufacturing magnate William Coleman. Coleman provided Thomas with critical advice on how to improve the Union Iron Mills, and inside information on the coming railroad building boom. Andrew diverted much of Piper & Shiffler's contracts to the Union Iron Mills, further bolstering the company's profits. Thomas often tried to rein in some of his brother's excesses, but to no avail. For example, in 1866 Andrew proposed purchasing a pipe works adjacent to the old Cyclops Iron Works. Thomas opposed the purchase, arguing that the time for expansion was not ripe and that the pipe works used a kind of iron which the Union Iron Mills did not produce. The pipe works turned out to be a
white elephant, but they burned down shortly thereafter (saving the firm from further losses).
The Lucy Furnace and Thomson Works Thomas Carnegie played a critical role in the expansion of the Carnegie Bros. & Co. company into the production of
pig iron. Iron ore was usually smelted into pig iron first, a brittle but refined product (often cast in
ingots) which was usually sold to other companies and turned into
wrought iron or steel. Several investors in the Union Iron Mills wished to invest in companies producing pig iron, but William Coleman advised against it and advocated building a wholly owned modern furnace under the company's control. A division of the Union Iron Mills (named the Isabella Furnace Company) was organized on December 1, 1870, and the company's first
blast furnace (named the "
Lucy Furnace" after Thomas' wife) was constructed on 51st Street in Pittsburgh. Most of the investors who joined the Isabella Furnace Company were Thomas' friends, not Andrew's. Thomas Carnegie supervised the operation of the Lucy furnace, and he was almost alone in contributing to its business success. The Lucy furnace was enormous— high with a bosh (the widest part of the furnace and the hottest due to its proximity to the hearth)—and was producing a record-shattering a day by 1872. A second Lucy furnace was built in 1877. In 1881, a two-thirds share in the company was sold to Wilson, Walker & Co. and James R. Wilson relieved Thomas Carnegie and John Phipps of their duties overseeing the operation of the furnaces. Coleman invited Thomas Carnegie to join him in building the new steel works, and together they purchased of land about east of Pittsburgh known as
Braddock's Field (a historic battlefield where French and Indian forces from
Fort Duquesne defeated British General
Edward Braddock on July 5, 1755, in the
Battle of the Monongahela). (Thomas borrowed the money for his investment from his brother.) Coleman and Carnegie lived near one another in Homewood and went to work together on the streetcar, and it was during these daily commutes that the men worked on their plans for the new steel works. Although Thomas asked Andrew to invest in the new mill, Andrew refused (considering it too risky a venture). Thomas then prevailed upon David McCandless, a wealthy Pittsburgh merchant and vice president of the Exchange National Bank. McCandless agreed, and brought in William P. Shinn (who would, 11 years later, be awarded the
Norman Medal, the top award for civil engineering, in 1883) as treasurer. In the spring of 1872, Andrew Carnegie (while on a
bond-selling trip) made a survey of Bessemer steel works in Europe and returned to the U.S. highly enthusiastic about the new project. Andrew subsequently invested $250,000 in the works. Meanwhile, Coleman, McCandless, Scott, and Thomas Carnegie had purchased a newly
platted tract in Pittsburgh,
subdivided it, and sold the lots at a significant profit. The partners then invested $50,000 each in the steel mill. A new company, Carnegie, McCandless & Co., was formed on January 13, 1873, to build the works. The Panic created financial difficulties for the company, and it floated bonds to stay alive.
J. Edgar Thomson, president of the Pennsylvania Railroad and a mentor and close friend to many of the partners, bought many of these bonds in late 1873, helping keep the firm afloat. The partners dissolved Carnegie, McCandless & Co. to take advantage of a new Pennsylvania law permitting the formation of
limited liability companies, and the Edgar Thomson Steel Company Ltd. was created on October 12, 1874. Over the next several years, Thomas Carnegie generally oversaw the Edgar Thomson Steel Company. His success in this endeavor was summed up by a corporate historian this way: :Mr. T.M. Carnegie's abilities were too numerous and complex to be summed up in a sentence. He was a man of sterling integrity; and it was a common saying in Pittsburg that his word was better than some men's bond. He had remarkable judgment; and his opinion on commercial questions was valued above that of much older and more experienced men. Quick and keen in his perceptions, cautious but progressive in his ideas, faithful to his engagements, and just in all his dealings, he gave to his company that which corporations are habitually lacking, namely, a conscience. Other historical assessments conclude Thomas had a solid grasp of the steel business and was a respected manager, even if Andrew considered him overly cautious. William Abbott, chairman of Carnegie, Phipps, & Co., considered Thomas the better businessman than Andrew, "solid, shrewd, farseeing, absolutely honest and dependable." Thomas lacked Andrew's ambition, but "was content with a good, prosperous, safe business and cared nothing for expansion. He disapproved of Andrew's skyrocketing tendencies, regarded him as a plunger and a dangerous leader. Tom wanted earnings in the shape of dividends, whereas Andrew insisted on using them for expansion." and another that he did not. His closest friend was David A. Stewart, a co-partner in the Thomson works, and Stewart readily defended Thomas against the criticisms and jibes of others (particularly Andrew Carnegie). Thomas sold half his interest in Edgar Thomson Steel to his older brother in 1876 after disagreement broke out over whether to build another "Lucy furnace." Thomas Carnegie, however, held no position on the Thomson board of directors, a situation Andrew Carnegie wanted rectified the moment a position on the board became available. This occurred in the summer of 1876, but William P. Shinn (the second-largest stockholder in the company) complained bitterly to Andrew (traveling in Europe) that the seat should have gone to him. Nonetheless, Thomas was not only added to the board but made chairman upon Andrew Carnegie's return to the U.S. a few months later. Shinn eventually had enough, and resigned as manager of the Thomson steel works in September 1879. Andrew Carnegie decided to stop relying solely on his company's own furnaces for
coke, and began seeking to buy the fuel on the open market. Thomas and Henry Phipps had alerted Andrew to the need for a greater and steadier supply for coke for the growing steel works. Thomas' goal was to induce Frick to buy the Carnegie coke ovens. Thomas' offer came as Frick was planning his wedding, and it fell to Andrew to meet with Frick and his new bride as they honeymooned in New York City. By this time, Thomas had negotiated most of an agreement with Frick, as well as planned the meeting with Andrew. Carnegie took a 10 percent interest in H.C. Frick & Co., Frick took a 50 percent interest in the Monastery coke works, and H.C. Frick & Co. would become the exclusive supplier of coke to Carnegie Bros. & Co. and the Edgar Thomson Steel Works. By 1885, Andrew Carnegie had purchased enough stock in H.C. Frick & Co. to own 50 percent of the company. Frick now attempted to buy into the Carnegie steel companies by selling 12 of the remaining 16 percent of the H.C. Frick which he still owned, but Thomas warned him not to try and to instead seek a position as a manager within the company. Thomas also played a key role in the consolidation of Andrew's businesses. Thomas had become more involved with the management of Edgar Thomson Steel and less with the Isabella Furnace and Union Iron companies. It was Thomas who suggested to Andrew that the companies be consolidated into a single firm, and that Thomas' stake in the new firm be raised commensurate with his managerial role. Included in the reorganization were the Lucy and Isabella furnaces, Union Iron Mills, and Homestead works. The previous year, the Carnegies had met reporter Frederick Ober while on vacation in
Fernandina Beach, Florida. The mansion's owner was ex-
Confederate General William George MacKay Davis, a
first cousin of
Confederate President Jefferson Davis who bought the plantation from its creditors in 1879. Carnegie offered to buy Dungeness on August 25, 1880, for $25,000 but his offer was rejected. The sale for the property (which included orange and olive groves, gardens, several cottages, and outbuildings) was final on November 17, 1881. Over the next four months, the burned-out mansion was demolished and noted Pittsburgh architect Andrew Peebles designed a massive
Queen Anne Style mansion with wraparound
verandas, high ceilings, several porches, many
turrets, and a high tower. In April 1882, Carnegie and his cousin, Leander Morris, jointly purchased an adjoining property. The cornerstone for the new Dungeness was laid on February 26, 1884, and the $285,000, mansion (fully furnished) completed on January 1, 1885. There was even a landing for Thomas Carnegie's steam-powered yacht, the
Missoe. The Carnegies visited Dungeness irregularly over the next year, traveling to Georgia in a private railroad car. The South Fork Dam failed on May 31, 1889, resulting in the disastrous
Johnstown Flood. ==Personal life==