The New Robber Barons

Carnegie, Rockefeller, Gates, Ellison: philanthropic robber barons of their times. It takes a certain kind of chutzpah, selfishness, ambition (as well as race and gender) to be considered among the richest people in history, drivers of an era of change.

Andrew Carnegie and J.D. Rockefeller shaped America with their streamlined business pursuit of resources that would make full industrialization of America possible. Both men came from poverty, paying their dues as laborers before climbing the capitalist ladder. Both men were pioneers in constructing the tradition of the monopoly as well as the modern structure of systematic philanthropy.

Just as any great business innovator, Carnegie realized the potential of steel and invested heavily in it – introducing new processes in its production that maximized efficiency and his profit. But in 1892, Carnegie Steel’s workers protested against potentially lowered wages. Although Carnegie was away at the time, the current manager dealt with their workers violently. Many blamed Carnegie and his apparent apathy for mistreatment of his workers.

In due time, however, Carnegie sold off his company and turned to the world of philanthropy. He focused particularly on supporting public libraries as well as education, fueling the movement towards increased literacy as well as widely available education.

Rockefeller found his success in oil innovation, but his established, aggressive monopoly was forced to dissolve. In his later years, like Carnegie, Rockefeller turned to philanthropy – focusing on education and medicine. And yet, their philanthropy did little to redeem their “robber baron” status in their lifetime.

These men were some of the world’s richest men. Noted by the History Channel as among the “men who built America,” Carnegie, Rockefeller, and their contemporaries were drivers of the Gilded Age, considered builders of a new era with the economic track record to prove it. Their money came from providing resources to an economic revolution.

Today’s billionaires established their capital a bit differently. Instead of utilizing resources in the traditional sense, men such as Bill Gates and Larry Ellison established their capital kingdoms in the digital realm, a resource limited only by the human imagination.

Bill Gates, co-founder of Microsoft, and Larry Ellison, co-founder of Oracle, built their empires on improving and propelling the digital technology surge that happened in the late 20th century as we moved away from space and into our own minds. They were gurus of software innovation that made the mass use of computers possible. Of course, computers were a widely adopted tool, but they wouldn’t become so integral to our society until innovators in the mid-90s honed the internet into a consumable, efficient, and addicting product. But those big boys are billionaires of another, although similar, kind.

Gates studied Rockefeller and Carnegie, enamored of their philanthropic endeavors and aspired to model his own good doing (and apparently his monopolistic business structure) after their works. With his wife Melinda, Gates established the Bill & Melina Gates Foundation – a private charitable foundation. Like Rockefeller and Carnegie, Gates is thoroughly public and transparent in his philanthropy. According to Warren Buffet, this transparency is likely to “set an example” of philanthropy for other rich folk.

The Gates Foundation gives money, grants, and support to a wide range of causes from supporting poor female entrepreneurs in Latin America to tackling the education system. Of course, the foundation has earned quite a bit of criticism. Although the Gates are well intentioned, their “philanthrocapitalism” hasn’t been entirely unproblematic.

They’ve largely been criticized for investing in companies that perpetuate poverty in the areas they’re trying to help as well as supporting faulty education policies. Zambian-born economist Dambisa Moyo has criticized the traditional system of philanthropy, claiming that the current state of aid actually does more damage than good. Gates wasn’t too happy about this. And education researchers, teachers, administrators, and parents were furious over the foundation’s support of faulty education reform. In fact, critics are just generally afraid that one man, because of his enormous wealth, can have so much power over social reform.

Still, the Gates Foundation certainly has its successes. In an effort to recruit fellow billionaires in philanthropic endeavors, Warren Buffet and Gates founded The Giving Pledge: “a commitment by the world’s wealthiest individuals and families to dedicate the majority of their wealth to philanthropy.” So far, 127 of the world’s billionaires have signed the pledge – most are American. The campaign has tried to reach an international scope with some, but little, success.

When Ellison was asked to sign the pledge, he admitted in a letter than he had put virtually all his assets into a trust with the intent of giving away 95% of his fortune. For years, he had given privately to issues such as medical research and wildlife conservation efforts but went public when Warren Buffet told him it would help set an example.

But a mogul’s kindness is not just measured by philanthropy. “Trickle-down” zealots Carnegie and Rockefeller weren’t really well received by their factory-working employees. But nowadays, the current hierarchy of employment by billionaire CEOs is a bit more complex than the previous CEO-manager-laborer structure. The tech industry has created a sort of middle class of workers comprised mainly of white and asian males – not the CEO but not the laborers in factories overseas. These workers are geeks, and I mean that in the best way possible. Modern tech gods rule subjects who are essentially on their intellectual level. They aren’t just laborers to be exploited; they’re engineers.

And although Google acknowledges that its nearly impossible interview process only ever accepts a certain kind of geek, a certain way of thinking, the tech industry’s hiring process is “clinical.” And there’s a serious diversity problem. But there is absolutely every opportunity to outshine the boss, to be an innovator even if said employee is a coder whose tasks are akin to the monotony of assembly line work. It’s just harder to get a job.

The sufficiently paying, grueling factory work that was originally considered the backbone of American society in the Gilded Age has been outsourced to countries with less regulations and cheaper wages. The intellectual team of workers becomes the middle class, leaving the lower class with no opportunity. Today, the rich are getting more and more, leaving the middle class with less and the lower class with lesser – in capital and opportunity.

Companies that offer the best employee experience for this “middle class” of workers are typically the dot-com babies: eBay, Google, Facebook – companies that were the result of the mid 90s internet boom. The likes of Sergei Brin and Mark Zuckerberg rank highly on the list of generous billionaires and are seriously responsible for furthering the digital revolution. But these young billionaires that compete with Gates and Ellison still have more years to check in before their wealth could compare considerably. Their moneymaking resource of choice, the internet, is also limitless but relies heavily on the efforts of its consumers. Maybe they’ll care more about the American middle class. Or maybe they’ll just make the internet free.