Daniel Guggenheim life and biography

Daniel Guggenheim picture, image, poster

Daniel Guggenheim biography

Date of birth : 1856-07-09
Date of death : 1930-09-28
Birthplace : Philadelphia, Pennsylvania
Nationality : American
Category : Famous Figures
Last modified : 2011-02-14
Credited as : Industrialist, and philantropist,

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Daniel Guggenheim was a member of one of the wealthiest and most powerful families in the world during the early twentieth century. He led his family's mining enterprise, which controlled much of the world's metal industry. When Guggenheim retired at the age of 67, he turned his attention to philanthropy.

Daniel Guggenheim was born July 9, 1856 in Philadelphia, Pennsylvania. He was the second son and one of 11 children born to Swiss immigrants Meyer and Barbara Guggenheim. Meyer Guggenheim was a hard-working peddler. He and his father had become successful by manufacturing stove polish and "coffee essence," an inexpensive coffee substitute. During the Civil War, Meyer sold wholesale supplies to the Union Army. He also had a lace and embroidery business. By 1880, he had $800,000 in the bank.

Although the family was Jewish, Daniel Guggenheim attended a Catholic high school in Philadelphia until the age of 17. When Meyer Guggenheim determined that Daniel would never be a scholar, he sent him to Switzerland to study the Swiss lace and embroidery business and serve as a buyer for Meyer's importing business, M. Guggenheim's Sons.

While his son was in Switzerland, Meyer invested in two Leadville, Colorado, lead and silver mines. The mines proved to be extremely productive. Meyer founded the Philadelphia Smelting and Refining Company and built a smelter in Pueblo, Colorado, so that he could control both the mining and refining of his ore. Soon Meyer was earning $750,000 a year. Meyer closed the lace business and, in 1884, asked Daniel to return to the United States and help
the family manage the mining company. The same year, Daniel married Florence Schloss. The couple had three children, Robert, Harry and Gladys.

In 1888, Meyer Guggenheim, his six sons and their families moved to New York City, where they managed their business and sought to dominate the mining industry in North America. Daniel was considered the most ambitious of the sons and became the business's primary negotiator and organizer.

In 1890, a tariff was placed on imported ore and the price of the Mexican lead and silver the Guggenheims refined in Colorado rose dramatically. They responded by buying Mexican mines and building their own smelter in that country. Daniel successfully negotiated the new venture. His father and brothers were so impressed with his business acumen that they assigned him to oversee the company's mining and smelting business and to plan future expansion.

At 34, Daniel was driven to achieve wealth and stature. His father had arrived in America penniless and wanted to make every one of his sons a multi-millionaire. Biographer John H. Davis described Daniel as "short, quick, intense, of medium build" and "a born general, in whom command was instinctive." During his years in Switzerland he had acquired a European air. He felt comfortable with aristocratic society, which helped him negotiate business contracts. His years in Germany had also taught him to be dogmatic, industrious and disciplined. He was a tireless worker, and extremely autocratic.

By 1895, the Mexican operation was producing a profit of $1 million a year. The Guggenheims formed the Guggenheim Exploration Company and named Daniel president. The independent corporation searched for mines throughout the world, purchased and developed them, then invited public participation in them. Soon another American mining concern, American Smelting and Refining Company (ASARCO), backed by the Rockefeller family, began to challenge them. Daniel Guggenheim took the lead in negotiating on behalf of the family and, after a lengthy struggle, the family acquired majority control of ASARCO. Daniel was named chairman of the board. Meyer died in 1905. He had lived to see his sons become multi-millionaires.

Following his father's death, Daniel assumed control of the family and its enterprises. He was power hungry and tenacious. He suffered repeatedly with stomach ulcers and hypertension. With firm control of mining in the Western Hemisphere, the Guggenheims went on to dominate mining and metallurgy throughout the world during the next three decades. Through ASARCO and their family-owned companies, the Guggenheims mined tin in Bolivia, gold in the Yukon, diamonds and rubber in the Belgian Congo, diamonds in Angola, copper in Alaska, Utah, and Chile. Daniel Guggenheim's business policies affected entire nations. "It was said that Daniel could make or break a government with a telegram," Davis said.

The Guggenheims' strategy required large sums of money to find mining properties and overcome engineering obstacles to move the ore out. They utilized modern technological processes to mine and process the ore, often using low-grade metals that others found unprofitable. In 1912, the Guggenheims joined with J. P. Morgan and Jacob Schiff to mine copper in Kennecott Creek in Alaska. The syndicate built a railroad over a moving glacier to get to the mountain of copper. At Chuquicamata, Chile, in 1911, workers had to get to a mine at 9,500 feet, 45 miles from a water supply and 85 miles for a power supply.

During World War I, the Guggenheims were criticized for profiteering. This led to a wave of anti-Semitism, as the family was the most prominent Jewish family in the United States. When the press, Congress and President Woodrow Wilson demanded that the company lower the price of copper during World War I, the Guggenheims refused until Wilson threatened to nationalize the metals industries.

The Guggenheims had a reputation for being tough on labor. Daniel Guggenheim claimed to favor labor unions. During a meeting with Samuel Gompers, president of the American Federation of Labor (AFL), in 1917, the two men embraced and appeared to agree on labor issues. In reality, Daniel, like many other capitalists of the day, paid his employees starvation wages and forcibly broke strikes. In 1912, when workers at Guggenheim's Perth Amboy mine struck, the company brought in strikebreakers and four strikers were shot. In 1916, the Guggenheims evicted strikers from their bunkhouses in Alaska when they struck over poor conditions and low wages. The laborers were left in minus 30 degree weather.

Guggenheim was also criticized for his flagrant disregard for conservation. Gifford Pinchot, chief of the U.S. Forest Service, battled the Guggenheim-Morgan syndicate for mining Alaskan land that Pinchot said belonged to all the American people. The Guggenheims won the battle with the help of their brother, Simon, a United States senator.

Guggenheim amassed enormous wealth through his mining enterprises. By 1918, the family fortune was estimated at $250 million to $300 million, making them among the richest people in the world.

Over the years, a rift had developed among the seven Guggenheim brothers. The two youngest brothers, Will and Ben, often disagreed with their siblings' business decisions. The older brothers believed that Will and Ben didn't want to work hard, since they had grown up after the family had become wealthy and didn't have the same work ethic as their father. The family empire began to collapse during a series of events in the early 1920s. Younger brother Will Guggenheim accused his older brothers of excluding him from a profitable copper mine in Chile. The well-publicized case attracted attention around the world. It was settled for an undisclosed sum when the older brothers decided they didn't want the family's finances revealed to the public.

In 1922, the older Guggenheims were accused of milking ASARCO, which they controlled, to the benefit of their family business, Guggenheim Brothers. The ASARCO board voted the brothers out of control. Then, in 1923, the family had the opportunity to sell the Chilean copper mine for $70 million. The older brothers, who were ready to retire, wanted to take the offer. Will and some of the Guggenheims' sons disagreed. When the older family members won the battle, some of the sons resigned from Guggenheim Brothers, leaving the family business without firm guidance from the next generation. The family's final indignity occurred when Daniel led the family into a bad investment in Chilean nitrates.

With their reputations tarnished, the four older brothers, Daniel, Sol, Murray and Simon, retired. They each set up foundations and in essence, established new careers as philanthropists, trying to outdo each other with their generosity. Daniel, who retired in 1923 at the age of 67, retreated to his castle-like home overlooking Long Island Sound where he enjoyed the life of an aristocrat. In 1924, he established the Daniel and Florence Guggenheim Foundation, which supported education, arts and medicine all over the world. Benefactors included Mount Sinai Hospital in New York, the New York Botanical Gardens and New York's Guggenheim Museum.

But Daniel's principal interest was in the field of aviation. His son Harry first got Daniel interested in aviation after he returned from World War I. Harry was appalled to discover that the United States was far behind Europe in aviation development. America's idea of aviation was airmail pilots and barnstormers. The public had no desire to develop aviation for personal travel. Daniel set out to develop the American aviation industry by volunteering $500,000 to create a school of aeronautics at New York University. In 1926, he established the Daniel Guggenheim Fund for the Promotion of Aeronautics to promote aeronautical education, research and transportation. The fund established schools at a number of universities and proved the necessity of two-way radio communications, navigation aids and weather reporting during flights. The fund was liquidated in 1930 after Guggenheim determined that its goals were accomplished.

The Daniel and Florence Guggenheim Foundation went beyond aviation and contributed to the aerospace industry. It supported the experiments of Dr. Robert H. Goddard of Clark University, a young scientist who believed that rockets could propel themselves into outer space. It also helped train aerospace engineers and laboratories, helping to usher in the age of rocketry. In 1929, Guggenheim earned the American Society of Mechanical Engineers' first aeronautical medal in recognition of his support of the aviation industry. In 1930 he received an honorary degree of Doctor of Commercial Science from New York University.

Guggenheim died on September 30, 1930 in Sands Point, New York, at the age of 74. By the time of his death, the man who had been hated for being a greedy, union-busting capitalist had earned a reputation as the "father of aviation." Known for his generosity, few people today realize how Daniel Guggenheim amassed his fortune.




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