The Origins of the Carnegie Foundation for the Advancement of Teaching and the Birth of TIAA-CREF
Grantees in this story
While serving as a Trustee at Cornell University, Andrew Carnegie was shocked to discover that teachers, “one of the highest professions,” in his words, earned less than his clerks and lacked retirement benefits. In 1905, he established the Carnegie Teachers Pension Fund— which later received a national charter by Act of Congress and became The Carnegie Foundation for the Advancement of Teaching—with a $10 million endowment to provide free pensions to college and university teachers. The organization was headed by President H.S. Pritchett.
The document below hints at the differing visions of what the Carnegie Foundation for the Advancement of Teaching (CFAT) should become. Andrew Carnegie and Henry S. Pritchett disagreed. Pritchett hoped that the Foundation would be “one of the Great Agencies… in standardizing American education.” Carnegie, on the other hand, felt that the organization should provide retirement allowances for teachers, stating, “I don’t think you should disguise the fact that it is first and foremost a pension fund.”
By 1917, the CFAT trustees concluded that the pension system, paid out of income at no cost to the beneficiary, was expensive beyond all estimates. Under an arrangement negotiated by Andrew Carnegie and CFAT, the Corporation gave $1 million to found the Teachers Insurance Annuity Association of America. The nonprofit stock of the association was owned outright by the Corporation until 1938, when it was transferred to an independent board of trustees. Today called TIAA-CREF, its story points out the extraordinary effect that Andrew Carnegie’s philanthropy has had on the quality of American higher education.