Bankrupt Millionaire

Steelmakers and financiers had a first-rate mystery to tussle with last week. Veteran Steelman Charles Michael Schwab once made $2,000,000 a year as U.S. Steel’s first president. Then he bought Bethlehem, built its assets from $15,000,000 to $719,760,397. Even in his declining years he got $250,000 a year as Bethlehem’s chairman. Yet when Charles Schwab died two years ago, at 77, he was broke.

A preliminary accounting of his New York estate filed last March listed debts of $2,262,280 (chiefly to banks), assets of only $353,810. Last week a report on his Pennsylvania estate listed $300,000 in debts, only $51,094 in assets. Among the Pennsylvania assets were an old automobile sold at an administrator’s sale for $20, carpenter’s tools sold for $4.

Even after allowing for his charities (including a $2,000,000 endowment for Pennsylvania’s Saint Francis College) and his expensive tastes, it was still hard to figure what had happened to his fortune. Most likely guess: it disappeared in the stockmarket crashes of 1929 and 1937. Whatever the reason, Charles Schwab had left no more to his heirs than if he had kept working at the $1-a-day job in which he entered the steel business in 1881.