New York’s postwar recovery proved to be quick and convincing, though not quite problem-free. Annoyingly enough, Britain and France once again closed down the West Indies to American trade, and British exporters began using the Pearl Street auction houses to dump a huge backlog of cheap manufactures on the American market. But if local importers and retailers suffered for a time, deep-water merchants and shipbuilders adjusted without serious difficulty—partly because the success of anticolonial revolutions in Latin America cracked open markets once monopolized by the Spanish and Portuguese, but mainly because industrializing and urbanizing Europeans remained willing to pay high prices for American cotton and wheat.
Whether or not New York would continue to dominate the trade in those lucrative commodities was an open question, however. Thousands of settlers were flooding into the Ohio and Mississippi valleys every year, shifting the heartland of American agricultural production ever westward, ever farther from Manhattan. Every year, too, increased the likelihood that the output of these myriad farms and plantations would be siphoned off by rival ports—New Orleans, for example, or Philadelphia (now linked to Pittsburgh by turnpike), or Baltimore (eastern terminus of the new National Road, which ran to Wheeling on its way toward Columbus and Indianapolis).
It was the heightened urgency of maintaining New York’s connections to the West that enabled De Witt Clinton to bring his campaign for the Erie Canal to fruition. At the end of December 1815, he assured a conclave of businessmen at the City Hotel that the canal would make New York “the greatest commercial emporium in the world” and easily persuaded them to sign a memorial to the legislature calling for construction to begin as quickly as possible. Although his Tammany opponents denounced the “big ditch” as a costly folly and depicted it—not incorrectly—as a vehicle for Clinton’s political ambitions, the legislature established a Canal Commission to consider costs and routes. When the Madison administration refused federal aid, an action some saw as a Virginiabased effort to forestall New York’s ascendancy, Clinton persuaded the state to proceed on its own. In April 1817 Albany formally authorized the project. Two months later Clinton was elected governor. On July 4, three days after he assumed office, construction commenced on the state-owned, state-financed, state-run enterprise.
THE WEDDING OF THE WATERS
Work on the canal advanced swiftly, despite the carping of skeptics, daunting natural obstacles, and a financial crisis that shook the country in 1819, when—in part reflecting a severe postwar depression in England—the price of American cotton in Europe fell off sharply, dragging down western land values and triggering an avalanche of bank failures and foreclosures. Eight years after the first spade went into the ground and an amazing two years ahead of schedule, the great project was finally done—a marvel of human ingenuity and sacrifice by its engineers, who learned their trade on the job, and its laborers, many of them Irish and Welsh. Three hundred sixty-three miles long, forty feet wide, and four feet deep, the canal rose and descended a distance of 660 feet through eighty-three massive stone locks and passed over eighteen stately aqueducts.
On October 26, 1825, in Buffalo, Governor Clinton and assorted dignitaries boarded a flat-bottomed canal boat, the Seneca Chief, to begin a triumphal “aquatic procession” east to Albany and down the Hudson to New York harbor. Their arrival ten days later touched off one of the most spectacular celebrations in the city’s history—a grand Festival of Connection. On November 4—one of those brilliant autumn days for which the city is famous—the Seneca Chief drew near the Battery and was hailed by city officials on an elegantly appointed steamboat: “Whence come you and where are you bound?” “From Lake Erie,” came the reply, “bound for Sandy Hook!” Crossing the Upper Bay, the procession wound its way through an “Aquatic Display” of gaily decorated vessels while bands played, the Battery’s guns fired salutes, and dense masses of cheering spectators packed the wharves and rooftops of Manhattan and Brooklyn. When it reached the Narrows, the Seneca Chief was met by the U.S. schooner Porpoise—a “Deputation from Neptune”—and Governor Clinton solemnized the “wedding of the waters” by pouring two casks of Erie water into the sea.
Everyone then returned to the Battery for a “Grand Procession” through the streets of Manhattan. As in the Federal Procession of 1788, the seven thousand marchers lined up in ranks, each “bearing their respective standards and the implements of their arts”—lawyers, physicians, militia officers, firemen, and artisans of every description—tangible affirmation that all elements of the social order endorsed the canal and understood its significance for the city’s future. (Only the presence of some journeymen’s societies, marching apart from the master craftsmen, hinted at the ongoing conflict in the shops.) Up Greenwich Street they marched, six abreast, to Canal and over to Broadway, up to Broome and across to the Bowery, and down Pearl to the Battery again, whence they rolled up Broadway to City Hall. As they marched they passed through a throng estimated at over one hundred thousand people—nearly two-thirds of the city’s entire population. It was the largest such gathering ever witnessed in North America.
As night fell, New York came ablaze. Private houses and public buildings, theaters and hotels, coffeehouses and museums, all were brilliantly illuminated. Most impressive was City Hall, lit up with 1,542 wax candles and 764 oil lamps and covered with glowing transparencies depicting the canal. At ten P.M. ten thousand people elbowed into the Park for a dazzling display of fireworks.
Grand Canal Celebration, drawn by Archibald Robertson and lithographed by Anthony Imbert, 1826. The building in the background, called Castle Clinton when built as a harbor fortification in 1808, was now a theater known as Castle Garden. (I. N. Phelps Stokes Collection. Miriam and Ira D. Wallach Division of Art, Prints and Photographs. The New York Public Library. Astor, Lenox and Tilden Foundations)
Cadwallader Golden (grandson of the colonial governor and one of the Erie Canal’s most energetic promoters) boasted that “this extensive channel” would make New York “one of the greatest commercial cities in the world” before the end of the century. But even he underestimated the speed and scope of the canal’s impact. Within the year, Erie boatmen were steering forty-two barges a day through Utica, bearing a thousand passengers, 221,000 barrels of flour, 435,000 gallons of whiskey, and 562,000 bushels of wheat. Shipping costs from Lake Erie to Manhattan plummeted from a hundred dollars a ton to under nine dollars. A few more years of this brought the annual value of freight transported along the canal up to fifteen million dollars, double that reaching New Orleans via the Mississippi; by mid-century the figure would approach two hundred million. Enough money would be collected in tolls—nearly half a million dollars the first year alone—to repay the cost of construction and help subsidize an additional six hundred miles of canals in the state over the next fifteen years.
At first, most of the goods cascading down the Erie Canal toward New York came from farms and villages along the canal’s route. Its success inspired a frenzy of digging elsewhere in the country, however, and a burgeoning network of canals between western waterways and the Great Lakes soon drew more distant agricultural regions into the city’s orbit: Ohio by 1830, Indiana by 1835, Michigan by 1836. Produce and timber that once rafted southward along the Ohio River now reversed course and headed east toward Manhattan. One collateral consequence was the transformation of agriculture on Long Island: when local wheat, barley, corn, and rye proved unable to compete with cereal grains from the West, Queens farmers switched to market gardening, raising potatoes, cabbage, peas, beans, asparagus, and tomatoes for booming Manhattan and Brooklyn.
The growing power of the New York market to pull commodities out of distant regions was confirmed by a trio of “anthracite canals” that funneled coal from the mines of northeastern Pennsylvania to Manhattan: the Delaware and Hudson Canal (1828), which linked the Lackawanna Valley to Kingston; the Morris Canal (1832), which connected the Lehigh Valley to Newark and Jersey City; and the Delaware and Raritan Canal (1834), which ran from Bordentown to New Brunswick.
UNDER STEAM AND SAIL
When Robert Fulton died in 1815, his fame as inventor of the steamboat earned him a hero’s funeral in Trinity Church and the rare distinction of having his name attached to the streets that ran down to the Brooklyn Ferry terminals on both sides of the East River. Not everyone mourned his passing, however. A charter from the state legislature had given him and his partner, Robert Livingston, a monopoly of the steamboat business in New York. With the help of eminent lawyers like Thomas Addis Emmet and Cadwallader Golden, the duo had ruthlessly suppressed one competitor after another. Even Livingston’s brother-in-law, Colonel John L. Stevens, couldn’t get permission to operate a steamboat of his own design across the Hudson to develop his property near Hoboken. After both partners died, their company continued to swat down rivals, forcing them to settle for the use of horse ferries—a much slower form of transport that employed eight draft animals to drive a central water wheel. By 1820 many New Yorkers considered the Fulton-Livingston monopoly as annoying an obstacle to the city’s growth as the swamps and escarpments that confronted engineers on the Erie Canal. But in this case it would be the United States Supreme Court, not pick and shovel, that would solve the problem.
Aaron Ogden, onetime governor of New Jersey, had purchased a franchise from the monopoly to operate a steamboat between Manhattan and Elizabethport, New Jersey. From there, passengers could continue to New Brunswick on a steamboat run by Thomas Gibbons, a tough and irascible lawyer from Savannah. Gibbons didn’t need a New York franchise, because his route lay entirely within New Jersey. But in 1818 Gibbons and Ogden had a falling out. The Georgian decided to steam all the way to New York, in direct competition with Ogden and in open defiance of the monopoly. To pilot his vessel into these lawyer-infested waters, Gibbons turned to a lanky, quick-fisted young Staten Islander named Cornelius Vanderbilt.
Vanderbilt’s family traced its New York origins to Jan Aertsen van der Bilt, who had arrived in Flatbush from Holland somewhere around 1650. In 1715 Jan’s grandson established a farm near New Dorp, Staten Island, from where he and his descendants carried their produce to Manhattan markets in their own small boats. Cornelius, born in 1794 at Port Richmond on Kill van Kull, loathed farming, however. He escaped it by hauling freight and passengers in a flat-bottomed, two-masted periauger that the brawny six-footer poled through the marshes rimming the island. During the War of 1812 the sandy-haired young Dutchman made great profits delivering beef and firewood to blockaded Manhattan and also won a lucrative military contract to ferry supplies to the harbor’s six forts. He gained a reputation for reliability, pugnacity, thriftiness (some said meanness), and world-class profanity. After the war, it was obvious to Vanderbilt that “b’ilers”—steamboats—were the wave of the future, and when Gibbons offered him command of his Mouse of the Mountain, he leapt at the chance. He dodged writs brandished by the monopoly’s lawyers with such skill that Gibbons gave him the helm of a much larger boat, the 142-ton Bellona. Again, Vanderbilt successfully evaded sheriffs and process servers, darting into different Manhattan landings to offload passengers and hiding in secret onboard compartments to avoid the law.
When the enraged Ogden won an injunction against Gibbons and Vanderbilt from the New York courts, Gibbons hired Daniel Webster and appealed the case to the Supreme Court. A powerful current then running through American jurisprudence favored eliminating legal constraints on capitalist enterprise, and Chief Justice John Marshall was also eager to assert greater national authority over the states. Accordingly, in Gibbons v. Ogden (1824), the court ruled the monopoly unconstitutional on the grounds that only Congress could impose constraints on interstate commerce.
New York greeted the decision with enthusiasm, and within a year the number of steamboats serving the city jumped from six to forty-three. Steamer traffic on the East River, the Hudson River, and Long Island Sound grew so rapidly that competition between rival operators often degenerated into brawling and boat-ramming. It was a game Cornelius Vanderbilt soon proved he could play better than anyone else. By the end of the 1830s he had reestablished a degree of order in the business and was worth half a million dollars, making him one of the richest men in New York. People called him “the Commodore.”
Steamboats, like the Erie Canal, ensured that the sprawling interior of the United States would remain within the economic orbit of New York. But no steam-powered vessel was yet capable of crossing the open sea, which meant that corresponding improvements in the city’s ties to foreign markets—its ability to find buyers for huge quantities of Ohio wheat or Mississippi cotton while keeping up with the domestic demand for imports—would have to come by less conventional means.
One snowy day in January 1818, a small crowd gathered at the East River docks. Notices in local newspapers had promised that at an appointed date every month the new Black Ball Line would dispatch one of its four ships to Liverpool. “The regularity of their times of sailing, and the excellent condition in which they deliver their cargoes,” it was said, “will make them very desirable opportunities for the conveyance of goods.”
This innovation, the brainchild of Jeremiah Thompson, a transplanted English merchant, met with considerable skepticism. Traditionally, ships sailed only when their holds were full, and only in reasonably fair weather, so people turned out on the appointed day to see if the firm would make good. Despite the snow squall and a light cargo of passengers, mail, and fine freight, the square-rigged James Monroe weighed anchor precisely as St. Paul’s clock struck ten. It reached Liverpool twenty-five days later. Battling in the opposite direction through westerly winter gales, its sister ship took forty-nine days to make New York.
The Black Ball’s punctuality impressed Manchester magnates, who, with their capital tied up in plants and labor, could ill afford cotton shortages. It also attracted competitors. An eccentric Connecticut whaling captain named Preserved Fish and his cousin-partner Joseph Grinnell shifted from hawking New Bedford whale oil to running the Swallowtail line. Others followed, and within two decades fifty-two packets would be traveling regularly from New York to Liverpool and Le Havre, an average of three sailings weekly, with an average transit time of thirty-nine days.
The packets also carried human cargoes. At first, the lines sought only wealthy passengers; those with more limited means had to find a captain willing to take them in “steerage”—between decks, near the rudder. In 1815, however, Belfast merchants started a full-time passenger trade, and after 1820 merchants in Liverpool began buying space on New York-bound packets, into which they stuffed the maximum number of immigrants (an art they had perfected in the slave trade). The result was that as more and more people left for the United States, more and more of them followed existing trade routes to New York. Between 1820 and 1832 the number of immigrants entering the port rose from thirty-eight hundred to some thirty thousand; in 1837 it swelled to nearly sixty thousand—almost 75 percent of the national total. Fed by this stream of humanity as well as internal migration, Manhattan’s population climbed from 124,000 in 1820 to 166,000 in 1825 and 197,000 in 1830. By 1835 it exceeded 270,000. No other place in the country was growing so fast.
Joining the packets on the Atlantic run were ships flying the distinctive pennants of the city’s principal commercial houses. Some of these, like LeRoy, Bayard, and Company, were venerable Knickerbocker establishments. But in the 1820s mercantile supremacy passed to New England Yankees: the Grinnells, Griswolds, Howlands, and Goodhues who had come down in the Napoleonic boom and a swarm of newcomers that now followed them.
The newcomers tended to specialize in particular commodities. Anson G. Phelps and Elisha Peck, originally from Hartford, opened a metal import firm in 1818. Phelps, in New York, shipped southern cotton to England. Peck, in Liverpool, used the proceeds from cotton sales to purchase tin plate, sheet copper, and brass wire, which he sent over to New York. Phelps then shipped the metal goods south by packet or, via the Erie Canal, upstate and out west to thousands of country stores. When Peck retired in 1832, Phelps partnered with another Connecticut Yankee, his son-in-law William Earl Dodge. Like Phelps, Dodge, and Company, the Tappan Brothers carved out a specialty niche in the European trade. Arthur Tappan moved from Boston to New York City in 1815. By 1827, when his brother Lewis came down to join him, he had built up the nation’s largest silk-importing house, drawing on suppliers in England and Italy.
Other New York firms broke into new Latin American markets. Spain and Portugal’s South American colonies had long been off limits to American traders, but now the Creole revolutions were in full swing. John Jacob Astor ran guns and flour past Spanish blockades to revolutionary governments, a profitable if dangerous enterprise. With independista victories, a steadier and more sedate trade emerged: between 1816 and 1822 the number of ships returning to Manhattan from Central and South America rose from nine to fifty-two; by 1825 it had climbed to in. In their holds were Brazilian coffee, hides from Argentina (a specialty of the De Forests), and Mexican silver (a speciality of Edward K. Collins). In exchange, the New Yorkers sent flour, domestic textiles, furniture, carriages, horses, and machinery for sugar mills. In manufactures, however, they were at a disadvantage because the British could better tailor their products to local markets. Despite President Monroe’s insistence that Europeans should clear out of the hemisphere, British finance, British industry, British diplomacy, and the British navy remained paramount in the region.
In the Caribbean, however, British policy backfired. By stubbornly blocking American trade to Jamaica, as it had done since the Revolution, Britain succeeded only in destroying the island’s economy while New York merchants moved on to new opportunities in Cuba and Puerto Rico. Though the islands were still Spanish possessions, the mother country had opened them up to free trade, lest they join South America in revolt. Proximity gave New Yorkers an advantage over their British rivals, and the city finally reestablished its old Caribbean lifeline. South Street commission merchants took up residence in Havana, Cuban planters fell into chronic debt, and Spain’s former ward became an economic dependency of the United States in general, and of New York in particular.
In the 1820s the city also assumed the lead in trade between China and the United States. The Chinese preferred to be paid in silver or gold for their wares—those teas, silks, furniture, fabrics, and blue porcelain tureens, platters, and punch bowls so beloved by well-to-do New Yorkers. With no American mines to supply precious metals in quantity, merchants had to rely on expensive silver imports from Mexico, and they were always on the lookout for cheaper alternatives. Fur was one—which was why John Jacob Astor dominated the China trade in the postwar years. His American Fur Company shipped skins from Mackinac and St. Louis to company warehouses in New York, where clerks repacked them for shipment to Canton.
Another alternative to specie was opium, and in 1816 Astor became America’s first large-scale drug dealer, smuggling five thousand pounds of Turkish opium from Smyrna to Canton. In the 1820s Astor shifted into other ventures and was replaced by Thomas H. Smith, a speculator who in 1826 brought in so much tea that he glutted the market and went bankrupt. By the early 1830s great firms like Griswold, Goodhue, Grinnell-Minturn, and Rowland and Aspinwall were preeminent in the Pacific. These in turn gave way to the House of Low, launched in 1829 when Seth Low moved his business from Salem to New York. It would be brought to fruition by Abiel Abbot Low, the eldest of Seth’s twelve children, who went out to Canton in 1833, spent seven years learning the business, and returned with enough contacts and market knowledge to dominate the industry. Yet here too the British remained the primary power, not least because the Empire controlled access to the opium of Bengal, while Astor and his successors were relegated to supplying an inferior Levantine product.
The web of canals, steamboats, and packets that New York flung out across the world in the 1820s and 1830s captured a wider and wider share of the nation’s import business—from 38 percent in 1821 to 62 percent in 1836. It also brought an unprecedented multitude of ships into the harbor. One day in 1824 there were 324 at anchor off Manhattan, a huge number by comparison with prior years, but nothing in light of those to come. On a single day in 1836, 921 vessels lined the East River bulkhead, their bowsprits and carved figureheads looming over South Street, while another 320 bobbed along the Hudson (still known to sailors as the North River).
With this increased traffic came important changes in the scale, organization, and tempo of the city’s commercial life. Dozens of new wharves, hastily constructed of hewn log frames filled with loose stone and earth, sprouted out from the shores of both the East River and the Hudson River, all tidily numbered (a practice that began in 1815, when the municipality began to rationalize the waterfront as it had the streets).1 The auction system created a new breed of businessman, the wholesale merchant or “jobber,” who bought, say, cheap imported British manufactured goods at auction and shipped them, on commission, to far-off country storekeepers via coastal packets and the Erie Canal. The low cost and abundance of these goods further spurred rural demand, inducing farmers to concentrate more and more heavily on the production of food and fuel for the Manhattan market—which in turn drew still more city merchants into the business. By 1840, in addition to the 417 commercial houses active in foreign trade, New York had 918 commission firms that consigned goods to domestic markets in every region of the country.
South Street from Maiden Lane, by William J. Bennett, c. 1828. Only a few years after the opening of the Erie Canal, activity along the East River waterfront had increased dramatically. That well-dressed family in the center appears ready to board the Leeds, one of the Swallowtail packets. (The Metropolitan Museum of Art, Bequest of Edward W.C. Arnold, 1964. The Edward W.C. Arnold Collection of New York Prints, Maps and Pictures)
Every spring and fall, moreover, thousands of the most prosperous and adventuresome storekeepers converged on the city in person, prowling its countinghouses and auction rooms in search of bargains. The clamor for space in boardinghouses, inns, and the city’s few hotels (only eight in 1818) attracted the attention of builders and investors, who flung up a score of new hotels during the 1820s and 1830s. Grandest of the lot was the six-story, three-hundred-room Park Hotel that John Jacob Astor opened on Broadway, directly west of City Hall Park, in 1836. Eventually renamed Astor House, it remained the nation’s most prestigious hostelry for decades.
In 1827 two brothers from Switzerland named Giovanni and Pietro Del-Monico— the one a wine importer, the other a pastry chef—opened a shop on William Street with a half-dozen pine tables where customers could sample fine French pastries, coffee, chocolate, wine, and liquor. Three years later, the Delmonicos (as John and Peter now called themselves) opened a “Restaurant Francais” next door that was among the first in town to let diners order from a menu of choices, at any time they pleased, and sit at their own cloth-covered tables. This was a sharp break from the fixed fare and simultaneous searings at common hotel tables—so crowded (one guidebook warned) that your elbows were “pinned down to your sides like the wings of a trussed fowl.” New Yorkers were a bit unsure about fancy foreign customs at first, and the earliest patrons tended to be resident European agents of export houses, who felt themselves marooned among a people with barbarous eating habits. The idea soon caught on, however; more restaurants appeared, and harried businessmen abandoned the ancient practice of going home for lunch.
Visitors and native New Yorkers alike shopped in retail outlets, another new and specialized institution. Previously, importers had sold off their ships, and artisans from their workshops. As importers withdrew from retail and artisans concentrated on production, the gap was filled by independent stores clustered on streets behind the waterfront and along fashionable Broadway, which sold sugar, coffee, hardware, and other commodities harvested by the city’s merchants. After 1827 well-to-do consumers could stroll though the New York Arcade, a skylight-covered corridor shared by forty stores, which ran parallel to Broadway between Maiden Lane and John Street. Display methods too grew more sophisticated. Where an 1817 Broadway clothier simply hung samples of his ready-mades outside the door, leaving “the coat-tails and pantaloons” (one visitor warned) to “flap around the face of the pedestrian, like the low branches in a woodpath,” by the 1830s, as another traveler observed, “plates of the newest London Fashions” were “displayed in the shop windows of every tailor in New York.”
But it was a clutch of dry-goods stores that made the most lasting impression on the city’s commercial history. In 1818 Connecticut-born Henry Sands Brooks founded a men’s clothing store on Cherry Street, a waterfront location that he described as convenient to “the Gentry and Seafaring Men alike.” (His sons, who inherited the concern on his death in 1833, would later adopt the name Brooks Brothers.) In 1825 Englishman Aaron Arnold opened a small Pine Street establishment dealing in “silks, woolens, laces, shawls, and novelties from Europe and the Orient.” By the 1830s, when he took on James Mansell Constable as a partner, his thriving firm had relocated to Canal Street near Mercer. In 1826 another English immigrant, Samuel Lord, went partners with George Washington Taylor, his wife’s cousin, to sell “plaid silks for misses’ wear,” hosiery, and “elegant Cashmere long shawls” at their Catherine Street store.
The proliferation of mercantile firms multiplied the number of clerks, bookkeepers, copiers, and errand boys: the Tappans alone had a clerical staff of more than twenty. Virtually all were males, many were sons of the merchant’s kin or associates, and most were, in effect, merchants-in-training. Some labored over manifests and correspondence, seated on high stools and supervised by a chief clerk ensconced on a raised platform in the rear, rather like a ship’s quarterdeck. Others were deployed as salesmen or dispatched to lodging houses to “drum up” sales from visiting storekeepers.
Manual as well as mental labor was required of these early white-collar workers. Before William Earl Dodge joined Anson Phelps as a partner, his clerical duties had included fetching water from the pump at Peck and Pearl with which to sweep the sidewalk, putting out refuse to be collected by the city’s “dirt-carts,” taking letters to the post office, delivering goods, stocking shelves, and distributing handbills in the streets. Still heavier labor could be demanded. When longshoremen hauled barrels, bales, crates, or sacks out of ships’ holds, they lugged them across the wharves to South Street. There cartmen set them on horse-drawn wagons and rumbled them through crowded cobbled streets to the warehouses, where the clerks winched them up and in, using a thick hemp cable strung over a hoisting wheel.
The mercantile firms that housed all this activity bulked ever larger on the cityscape, growing in size as well as complexity. By the 1820s three- to five-story office buildings and warehouses cost as much as a brig. By the late 1830s some cost as much as a full-rigged ship. Their style changed too, from Georgian brick to granite-faced Greek Revival (the earliest example of which, designed by Ithiel Town for Arthur and Lewis Tappan, went up on Pearl Street at Hanover Square in 1829). In 1832 Phelps and Peck built a new store and warehouse that towered six stories over the corner of Cliff and Fulton. It was one of the wonders of the city—until it collapsed under the weight of cotton bales within, killing seven clerks.
Similarly, because the mounting volume and complexity of commercial transactions made it inefficient to conduct business in coffeehouses, city merchants responded eagerly when William Backhouse Astor (John Jacob’s son) and Stephen Whitney proposed construction of a building where they might “transact in a few minutes, the business, which, if each were to seek the other at his counting-house, would require as many hours to accomplish.” By 1827 the two had raised a hundred thousand dollars for a new Merchants’ Exchange on Wall Street. Faced in Westchester marble, the neoclassical building boasted a fifteen-foot-high statue of Alexander Hamilton in its grand rotunda and a cavernous Exchange Room, as well as rooms for auction sales of real estate and stocks, a post office, and the Chamber of Commerce.
Bowne & Co.’s stationery shop on Pearl Street, c. 1830. As in other retail establishments, its clerks not only dealt with customers but hoisted wares for storage on the building’s upper floors. (Bowne & Co. Stationers, South Street Seaport Museum)
New York’s attractiveness as a marketplace was further enhanced by the adoption of gas lighting in the mid-twenties. Nobody liked the smoky oil lamps—few in number and not much brighter than lightning bugs—that had provided unreliable illumination on Manhattan thoroughfares since the 1760s. When Baltimore became the first American city to install gas lights, following the example of London, the Common Council decided to try an experiment. In 1816 a crude gasworks was set up near City Hall and tin pipes run down to several street lamps and store windows on Broadway. Merchants loved the new system, but opposition from tallow interests and a dispute over the merits of public versus private development delayed further action. Finally, in 1823, the city awarded a franchise to the New York Gas-Light Company, a private firm organized by banker Samuel Leggett and others. By early 1825 the company had a gasworks up and running at Hester and Rhynder—one of the largest edifices in the city—and over the next couple of years it ran cast-iron lines into the principal commercial streets. First to be lit was Broadway from the Battery up to Grand Street, soon followed by Wall, Pearl, Broad, William, Nassau, and Maiden Lane. The city paid for installing the street lamps, for “fitting” them up to the mains, and for gas consumed. Office buildings, fine stores, and plush hotels arranged their own connections, and printed warnings—“Don’t Blow Out the Gas!”—began appearing on the bedroom walls of up-to-date hostelries.
By the early 1830s, as Frances Trollope noted, many of the city’s retail shops, now brilliantly illuminated, stayed open as late as those of London and Paris, giving New York a lively nighttime appearance in marked contrast to Philadelphia’s. The contrast with other parts of New York City was equally striking. The gas company did lay mains under residential streets, but only fashionable (hence profitable) ones, leaving most neighborhoods, especially the working-class wards on the east side, blanketed in a darkness punctured only feebly by oil lamps.
THE WORD FROM MANHATTAN
In 1815 New York newspapers still closely resembled their colonial predecessors in form and function. Aimed primarily at merchants, their pages featured lists of ship arrivals and departures, current wholesale prices, money conversion rates, stock and bond quotations, real estate transactions, and—in long columns of minute type—“advertisements” placed by wholesalers, retailers, patent medicine vendors, and transport companies. Many, though not all, contained accounts of events in Albany or Washington or Europe (often clipped from papers elsewhere and typically well out of date), extracts from congressional speeches, and political editorials. None could claim to have many readers. In 1820 the two largest papers in New York were the Commercial Advertiser, edited by Colonel William Leete Stone, and the Evening Post, Alexander Hamilton’s old sheet, still edited by William Coleman. Neither sold more than two thousand copies daily.
Over the next decade, however, publishers awoke to the fact that no other city in the country was receiving better information about distant markets and conditions, or getting it faster—or making more money from it. In 1824 the price of cotton in Liverpool shot up unexpectedly. When the news reached New York a few weeks later via the Black Ball Line, its owner, Jeremiah Thompson, dispatched agents by fast pilot boat to New Orleans, where they turned a quick profit buying cotton at the old price from unsuspecting suppliers. Stories like this, repeated over and over as canals and steamboats quickened the flow of intelligence toward Manhattan, whetted the entrepreneurial imaginations of a new generation of publishers. By 1830 New York had forty-seven newspapers, eleven of them dailies, each determined to bring the news to its readers ahead of the others.
Semaphore or “telegraph” poles on Staten Island, visible by telescope from the Battery, already signaled the arrival of packets from Europe off Sandy Hook, and another semaphore, atop the Exchange, was adjusted accordingly, relaying the information to all interested parties. Impatient and aggressive editors now dispatched swift news boats to dart out and retrieve the latest overseas intelligence in time for an extra edition; some even ordered construction of schooners that could range a hundred miles into the open sea to intercept incoming vessels. For domestic news, they arranged teams of relay riders and steamboats that could make the trip up from Washington, Baltimore, and Philadelphia in a couple of days or less.
Most influential of the new papers was the Courier and Enquirer (1829), the offspring of a strange political marriage between James Watson Webb, editor of the Morning Courier, and Mordecai M. Noah, editor of the Enquirer. Bellicose and supercilious, Webb, a West Point graduate, had fought in the War of 1812, fought Indians in the Northwest, and fought duels with fellow officers. He also loathed blacks, Irish immigrants, and Jews—especially, among the latter category, Mordecai Noah. Noah had moved to New York after a brief diplomatic career and established himself as a journalist, playwright, and Tammany influential. Appointed interim high sheriff of New York in 1821, he failed to win relection the following year when opponents raised a rumpus about having a Jew supervise the hanging of Christians. (“Pretty Christians to need hanging at all” was Noah’s tart retort.) In 1825 Noah proposed to found a refuge for Jews of the world on an island in the Niagara River and proclaimed himself “high sheriff of the Jews.” When that project failed, he turned to editing the Enquirer, with the aid of a squint-eyed Scotsman named James Gordon Bennett. After Noah supported Andrew Jackson for president in 1828, the victorious Jackson appointed him “surveyor and inspector of the New York Port,” a sinecure that allowed him to continue editing the Enquirer. But Webb too had backed Jackson, and in 1829 party pressure forced the two editors to combine their papers.
The new Courier and Enquirer became the largest and most powerful paper in the United States, famous for the lengths to which Webb would go to scoop his rivals. In 1830 he contrived to get his hands on the text of President Jackson’s annual message to Congress in twenty-seven and a half hours. But this coup failed to discourage Arthur Tappan’s Journal of Commerce (1827), which retaliated with an express system of twenty-four horses that covered the distance from Washington to New York in twenty hours flat. The Journal’s readers were often privy to the proceedings of Congress and news from the South as much as two days ahead of everyone else.
New York’s hegemony as a clearinghouse for foreign and domestic news pulled in subscribers from every part of the country and compelled editors elsewhere to cannibalize Manhattan papers for stories. By 1828 160,000 newspapers were shipped out monthly through the New York post office; by 1833 nearly a million. In 1838 some two tons of mail left each day for the South alone, three-fourths of it printed matter.
Not surprisingly, and for many similar reasons, it was during these same years that Manhattan became the center of book publishing in the United States. New York’s leading authors—Irving, Paulding, Halleck, and two newcomers in the 1820s, James Fenimore Cooper and William Cullen Bryant—now commanded national audiences, and the printers who brought out their books were handsomely rewarded; one, Charles Wiley, did so well that he became a full-time publisher. The big money, however, came from pirated editions of English authors (who didn’t have to be paid royalties because the United States government refused as yet to recognize foreign copyrights). Printers and book dealers in New York and Philadelphia competed furiously to bring out the first American editions of new English novels. Some sent agents to England with orders to grab volumes from bookstalls, or sheets from printshops, and ship them west by fast packet. Copy was then rushed from the dock to the composing room, presses run night and day, and books hurried to the stores or hawked in the streets like hot corn.
No one was better at this than the Harper brothers of New York. Their firm began as a printshop in 1817 and evolved over the next decade into a full-time publishing house that kept popular titles in circulation (birthing the backlist). On one celebrated occasion, borrowing techniques from the newspaper trade, the Harpers retrieved the third volume of Walter Scott’s Peveril of the Peak from a packet before it docked. Working nonstop, they got the finished product to the bookstalls twenty-one hours later, well in advance of the edition issued in Philadelphia by Mathew Carey. It was the Harpers, too, who became the first American commercial publishers to make effective use of stereotyping, a printing process brought to the United States from England in 1811 that was ideal for books frequently reprinted in large editions.
What really assured New York of an unassailable lead in the book trade was cheap and easy access to western readers via the Erie Canal. Every fall, just before the onset of winter, and then again in the spring—a seasonal pattern that still rules the industry—city publishers dispatched crate after crate of books via the canal to retailers scattered across upstate New York, around the Great Lakes, and along the Ohio and Mississippi rivers. Like small-town newspaper editors, local book printers were hard-pressed to compete with the low prices and big-name authors offered by their Manhattan counterparts. The canal helped make it clear, indeed, that selling books wasn’t so very different from peddling hats or chamber pots, and the business soon attracted men who knew nothing about printing but had a talent for marketing. Daniel Appleton, for one, was a Massachusetts storekeeper who moved to New York in 1825 and began to sell books along with groceries. He prospered and by 1831 had decided to become a publisher.
After 1815, if not earlier, the greatest concentration of shipbuilding facilities in the United States lay along the shores of the East River, two or three miles above the Battery. On the Manhattan side, circling around Corlear’s Hook, were the yards of Foreman Cheeseman, Charles Brownne, Henry Eckford, Christian Bergh, Adam and Noah Brown, and other principal builders—piled high with stacks of fresh-cut white oak, live oak, locust, and cedar (some now brought down the canal), the air fragrant with the smells of pitch, tar, and burning coke in the blacksmiths’ forges. Directly across the river, at the mouth of Wallabout Creek, sprawled the rapidly growing Brooklyn Navy Yard, which in 1815 launched the Fulton (the inventor’s war frigate) and in 1820 the Ohio, the country’s first ship of the line and its largest vessel yet. All told, they would send a prodigious number and variety of vessels down the ways over the next couple of decades—sturdy packets for the Black Ball Line, sharp brigs and schooners for the China trade, swift slavers that could outrun naval patrols, warships for the navies of several different nations, and steamboats by the score.
At first glance, the basic processes of shipbuilding hadn’t changed much over the previous century or more. Vessels of every description were still constructed by teams of leather-aproned axmen, carpenters, riggers, caulkers, and other craftsmen, employing tools and materials and techniques known to their trades for generations. To control costs and keep pace with demand, however, leading builders had already taken the first steps toward a more factory-like organization of their yards. Where smaller firms made hulls and subcontracted out the final stages of construction—making and raising masts, painting hulls, finishing cabins—to the city’s host of independent specialists, the bigger yards hired the necessary workmen directly, in some cases boosting the number of their employees to several hundred or more. They added specialized buildings, covered the ways with sheds, and embraced the use of steam power to drive saws, derricks, and pumps. The Browns even built a boardinghouse for two hundred apprentices. In 1824 several of the biggest builders banded together to form the New York Dry Dock Company, which was incorporated, given banking privileges, and capitalized at seven hundred thousand dollars the following year. By 1826 trials had begun on a three-hundred-foot-long inclined marine railway, installed at the foot of East 10th Street, capable of pulling vessels out of the water for repairs and application of copper sheathing to their hulls.
The transformation of shipbuilding on the East River owed much to the vision and diligence of James Allaire, a gifted mechanic who had worked on Fulton’s first steamboat. Allaire proved so adept at assembling engines shipped from England that he began to build them himself. When Fulton died, Allaire purchased the Fulton-Livingston engine shop in Jersey City and moved it to his ironworks on Cherry Street, close to the Corlear’s Hook shipyards. The yards awarded him contract after contract (in 1818 he turned out the Bellona for Gibbons and Vanderbilt), his designs became larger and more elaborate, and by 1829, with hundreds of employees, Allaire had become the premier manufacturer of engines and boilers in the country.
Nor was shipbuilding the only industry in New York to be transformed by the introduction of steam power or the reorganization of production into larger and larger units. Ropewalks and sugar refineries experienced comparable changes, as did the leather-making business, aided by an influx of hides from Argentina (Gideon Lee’s New York Tannery Company was capitalized at sixty thousand dollars). Printing too was transformed: in 1823 Jonas Booth printed an Abridgment of Murray’s English Grammar, the first American book manufactured by steam power; in 1830 Robert Hoe imported the country’s first Napier cylinder press, then improved it, and soon Harpers was using the new machine in a four-story plant on Cliff Street. By 1824 a sixteen-acre site on the north shore of Staten Island was occupied by a textile dye and printing works that employed 150 hands and had become the center of a growing community named Factoryville (later West New Brighton). Visiting dignitaries hailed it with a toast to “the Ladies and Gentlemen of New York and its vicinity—may they all resolve to dye on Staten Island.”
But the industrial revolution in New York wasn’t primarily about big machinery and factories. The great bulk of manufacturing after 1815 took place in small frame or brick houses near the waterfront, without steam power or other elaborate equipment, and typically involved the production of light consumer goods—shoes, furniture, and clothing—for wholesalers or auction houses. After 1815 Brooklyn was a beehive of small shops that churned out playing cards, pocketbooks, combs, tinware, patent leather, iron chests, marble mantles, mustard, writing ink, pencil cases, white lead, paint, glass, and more. It was exactly in places such as these, moreover, that the decay of artisanal skills and traditions advanced most quickly as masters-turned-employers—among them Duncan Phyfe, now a wealthy furniture manufacturer—struggled to get ahead at the expense of their employees. Ambitious shoemakers, for example, coped with competition from New England factory towns by packing their workrooms with low-paid apprentices, distributing cheap leather to journeyman outworkers, and hiring women and girls as binders.
The process was particularly quick and brutal in the men’s clothing trade. Before 1820 the bulk of the male population wore clothes made at home by their wives, mothers, and daughters or made to order by custom tailors. Only poor seamen, laborers, apprentices, and hapless bachelors wore the cheap ready-made clothing known as “slops.” Between 1825 and 1835, however, New York wholesalers, auctioneers, and jobbers presided over the creation of a huge new national market in men’s ready-mades. Local retailers and country storekeepers received generous credit to stock up on “negro cottons” for slaves and dungarees for farmers and miners, as well as slops for the urban working classes. Manufacturers, who were likewise given easy terms for the purchase of raw materials, stepped up production by expanding the number of women employed. As they worked in their own households, “outwork” saved on overhead (no small consideration at a time when real estate was becoming more and more expensive), and it avoided the managerial and disciplinary problems presented by a large, concentrated workforce. Female outwork was particularly attractive because it saved on wages—the wages of women were less than half those of men—while reinforcing the conventional wisdom that a woman’s place was in the home. By the 1830s some New York shops had five hundred women on the payroll, and men’s garment making had become one of the city’s (and the nation’s) most important industries.
Western farmers and southern planters, notoriously cash-poor, usually bought goods from country storekeepers on credit—who in turn acquired their stock from wholesale jobbers in New York, also on credit. Although this chain of indebtedness was good for business, it also left New York creditors waiting for payment, usually until harvest time. Commercial banks solved the problem by turning accounts payable into cash. A Pearl Street jobber, for example, might send a thousand dollars’ worth of goods to an Ohio storekeeper. He would include a bill requesting payment in ninety days, which the Ohioan would sign and return to New York. The jobber could now wait three months and (hopefully) collect his full thousand. Or he could take the storekeeper’s promissory note to a bank and get, say, $950 immediately—his thousand less the percentage (or “discount”) charged by the bank—thereby gaining immediate access to most of his capital. When necessary, the jobber could also borrow from the bank to replenish his stock, or even purchase goods with a bank draft or “check” drawn against his account (a service that was becoming quite common in the early decades of the nineteenth century).
In 1815 there were only five banks in the city—among them Hamilton’s Bank of New York and Burr’s Bank of the Manhattan Company—and their boards were top-heavy with old-stock Knickerbocker merchants who preferred loaning money only among themselves. The relentless expansion of domestic and international trade created a demand for new banks, however, and within the next two decades eighteen more would extract charters from the legislature (including one created in 1824 by the directors of a Hudson River chemical plant, who dubbed it the Chemical Bank).
In theory, these institutions kept their credit under tight control, following the conservative precepts of a banker and banking philosopher named Isaac Bronson. Bronson had come down from Connecticut after the Revolution, made a fortune speculating in securities, and become one of New York’s ten wealthiest men. To his way of thinking, banks should provide only short-term credit (no longer than ninety days) and accept only the best collateral (actual goods in transit). Nor should banks give their money to farmers, manufacturers, and other high-risk borrowers: that was a job for independent investors.
Because their counterparts elsewhere tended to be less cautious with their assets, New York bankers wanted Congress to create a new national bank that could rein in irresponsible lenders and stabilize the country’s financial system. John Jacob Astor, having invested heavily in federal securities during the War of 1812, helped secure the legislation that established the second Bank of the United States in 1816.
Headquartered in Philadelphia, the BUS was to be the fiscal agent of the federal government—holding its revenues, paying its bills, and ensuring a uniform currency. As a central bank, it would restrain state banks’ lending by refusing to accept their notes if not adequately backed with specie and by demanding payment as soon as it did accept them. It also had the authority to open offices in other parts of the country. Astor, a director of the parent body, became the first president of the Manhattan branch.
Disaster struck the national bank almost immediately. In the get-rich-quick climate of 1817—18, Astor and his friend Stephen Girard of Philadelphia, the two most conservative members of its board, lost control to incompetent and corrupt plungers who issued loans far in excess of reserves. When swooning cotton prices on the European market brought sudden ruin to thousands of unwary land and commodity speculators, the BUS called in its loans to overextended state banks—which then demanded payment from their customers. A financial panic swept the nation in 1819, followed by two or three years of deflation and stagnation that caused great suffering in the South and West. Although the BUS survived, it was widely blamed for the crisis; some casualties, among them a planter named Andrew Jackson, vowed revenge.
In the meantime, a new kind of bank was making its New York debut, summoned into existence to help finance the Erie Canal. The legislature had resolved to pay for the project by selling bonds, but commercial banks as well as wealthy individual investors hung back, unconvinced they would get their money back if the canal failed (all the more so once the panic started). To solve this problem, William Bayard, John Pintard, Thomas Eddy, and other canal men proposed creation of a savings bank. Its capital would consist entirely of deposits made by working people, and it would be allowed to invest only in government securities—thus encouraging thrift among the improvident classes and having them bear risks that the rich considered unacceptable. In 1819, impressed by the ingenuity of this scheme, the legislature chartered the Bank for Savings in the City of New York; within five years it boasted thirty thousand depositors and assets of $1.5 million and was the single largest holder of Erie bonds. More savings banks weren’t far behind—the Seamen’s Bank for Savings (1829), Greenwich Savings Bank (1833), and Bowery Savings Bank (1834), among others.
Concurrent with the appearance of savings banks was the advent of a second new institution, the investment bank. Its story centers on the stout, short figure of Nathaniel Prime. A onetime coachman to a Boston merchant, Prime had arrived in New York in 1795. He made money buying and selling bank stocks; married Cornelia Sands, daughter of a wealthy merchant; and became a private banker, holding customers’ funds on deposit and loaning them money. As the business grew, he took in partners—first Samuel Ward, scion of an aristocratic New England family, then the commission merchant James Gore King. In the early twenties the firm moved into loan contracting, a field that Astor’s syndicate had pioneered during the war when it bought government bonds wholesale and sold them retail (a radical departure from the previous practice of selling new issues of stocks or bonds directly to purchasers). Prime, Ward, and King applied the same technique to Erie Canal bonds, buying up large quantities for resale to their clients.
Among their best clients was the highly respected Baring Brothers firm of London. Britain’s leading “American house,” the Barings had sold the bonds of the young republic since its foundation, helped it finance the purchase of Louisiana, and acted on its behalf even during the War of 1812. In 1823 the Barings bought their first Erie Canal bonds from Prime, Ward, and King. Eager British investors snapped them up, and the Barings began to buy more. Other financial houses jumped in, and by 1829 a majority of Erie Canal debt was owned overseas.
Prime, Ward, and King moved on to underwrite internal improvements in the American West. The firm purchased bond issues offered by Ohio, Louisiana, and Mississippi and retailed them to London banking houses. The Bank for Savings too looked west, financing a canal that connected Cleveland, on Lake Erie, with Portsmouth, on the Ohio River. These initiatives were not only fabulously profitable in themselves, but they also ensured the diversion of more and more commerce toward the Erie Canal.
New York’s prominence in national and international banking was enhanced by yet another canal-related phenomenon: the quickening tempo of trade on the floor of the Tontine Coffee House stock exchange. In 1817, no longer content with the old “Buttonwood Agreement” of 1792, the city’s several dozen brokers had formed the New York Stock and Exchange Board, tapping Nathaniel Prime to serve as its first president. The ability of the reorganized market to attract capital was confirmed by the millions of dollars that soon poured through the doors of the Coffee House in pursuit of canal stocks—not only those of the Erie but of private ventures like the Delaware and Hudson (whose promoters set up a grate in the Coffee House to demonstrate the value of anthracite coal as a fuel). The profitable and regular trading in canal securities gave new vitality to Manhattan’s capital markets, but the Exchange also proved a source of instability. In 1825 unscrupulous dealers whipsawed the stocks of the Morris Canal and Banking Company, driving the price up and down until the entire market broke under the strain and required several years to recover fully.
Rampant speculation could be good for the banks, however. Speculators borrowed heavily from bankers, who were happy to make “call” loans—payable whenever the bank “called” or demanded repayment—because the stocks that served as collateral could be sold without difficulty. It was a wonderfully profitable business, and it enabled New York banks to pay higher rates of interest than those in other cities. This in turn induced out-of-town “correspondent” banks to leave their excess funds in Manhattan, swelling the amount available for loans to speculators.
By 1830—less than two decades after construction began on the Erie Canal—New York had overtaken Philadelphia as the nation’s premier money market. Its banks controlled significantly more capital (and were safer too, because the state had just established an insurance fund to guarantee notes issued by member banks). The New York Stock and Exchange Board handled a greater volume of stocks, and its prices, quoted in newspapers throughout the country, were now the norm everywhere. So, too, the collective assets of the city’s insurance companies exceeded those of Philadelphia, Boston, and Baltimore combined.
New York’s ascendancy in finance inspired a burst of architectural assertiveness along Wall Street, which like Pearl Street got a facelift during the 1820s. No longer satisfied with quarters in renovated private residences, some dating from before the Revolution, prosperous bankers and brokers now demanded proper offices of suitable scale and grandeur. In 1825 Martin Euclin Thompson, a carpenter turned architect-builder, finished a monumental Federal-style building for the Branch of the Bank of the United States (its sixty-foot facade now stands in the American Wing of the Metropolitan Museum of Art). Two years later, in 1827, the Stock and Exchange Board moved into Thompson’s new Merchants’ Exchange, and he completed a new home for the Phoenix Bank that was the city’s first taste of the new Greek Revival style in architecture, rivaling the BUS headquarters on Chestnut Street in Philadelphia.
It was the latter institution, in fact, that presented the only obstacle to New York’s complete domination of the nation’s finances. Although conservative New York bankers applauded BUS commitment to a stable currency, they chafed at regulations constraining their own freedom of action and squirmed when the giant bank undercut their interest rates, putting downward pressure on profits. Most galling of all was the knowledge that the BUS continued to serve as the depository for the revenues of the federal government, although the great bulk of these came from customs receipts collected at the Port of New York. Like Andrew Jackson, the New Yorkers watched and waited for a chance to strike back.
Speculation in western lands was an old game for Manhattan merchants with extra money in their pockets, and the very thought of the Erie Canal, lancing toward the Great Lakes through mile after mile of prime real estate, had them quivering with temptation. Every year the canal advanced, tens of thousands of acres along its route were feverishly bought, sold, and sold again by many of the same men who at first shunned canal stock as too risky an investment. The mercantile house of LeRoy and Bayard acquired over three hundred thousand acres; De Witt Clinton himself bought up choice parcels he expected to rise in value with the completion of his big ditch.
None did more than banker Isaac Bronson to make an exact science of the business. Going beyond mere speculation, Bronson employed local businessmen, judges, and politicians to steer him toward the best land. He then resold it to farmers, granting fiveyear mortgages at 6 percent to those whose financial standing his agents had scrutinized and certified. By the early 1820s Bronson owned or held mortgages on property in over half the counties of the state. His enterprise was so solid that conservative bankers like Prime, Ward, and King invested substantial sums with him.
For the adventurous speculator, though, there was still no place like home. Manhattan land values had risen 750 percent between the Revolution and the War of 1812, and with the Erie Canal in place the future looked even more promising. Plenty of land awaited development in the rolling countryside north of 14th Street. But much of it was tightly held—either by assorted Stuyvesants and Brevoorts and Dyckmans, descendants of seventeenth- and eighteenth-century landowners, or by merchants and artisans who had acquired their estates in the Revolutionary era and fiercely clung to them as talismans of gentility. Although a few speculators got their hands on parcels here and there during the 1820s, new purchasers often hung on to their lands for rural retreats. Scottish merchant Robert Lenox, for one, bought thirty uptown acres between 68th and 74th streets, put up a country house, and refused to sell or develop his new estate.
Downtown was a different story. Astor, who before the war had amassed substantial holdings just above the settled city, now prepared for new arrivals. In 1820 he had Aaron Burr’s old Richmond Hill mansion rolled downhill on logs to a site on the corner of Charlton and Varick streets. In 1822, to lend tone to the neighborhood, he reopened it as a “public house, with a Music Room, Reading Room, newspapers, gardens, wines, liquores, etc.” He then leveled the hill, opened streets Burr had previously charted, and sold or leased lots to carpenters and masons, who erected row after row of houses on speculation. By the mid-twenties this once remote neighborhood was full of people, and Astor had multiplied his initial investment many times over.
Astor’s prescience seemed about to be rewarded again in the village of Greenwich, where he had been amassing real estate ever since 1805, until planned development touched off a vigorous backlash, led by a most unlikely agitator. Clement Clarke Moore was a conservative Knickerbocker whose father had been Episcopal bishop of the Diocese of New York for thirty-five years. Clement too was deeply involved in church affairs, and a classical scholar as well. He was also proprietor of Chelsea, the largest estate in the area, which consisted mainly of open countryside. When the city, obedient to the commissioners’ 1811 grid plan, thrust Ninth Avenue through the middle of his property in 1818, Moore penned an indignant pamphlet. Addressing his fellow “Proprietors of Real Estate,” he decried urban development as a destructive conspiracy by patronage-hungry and politically well connected “cartmen, carpenters, masons, pavers and all their host of attendant laborers.” More galling still, the city was taxing Moore to pay for this and other street openings, in effect compelling him “to become a capitalist for the public”—a tyranny “no monarch in Europe would dare to exercise.”
The Common Council backed down in 1818, agreeing not to extend the grid into the area west of Sixth Avenue from Houston Street up to 14th—a corner of Manhattan still famed for the eccentric and baffling pattern of its streets. Two years later the victorious Moore helped Trinity organize a parish church on Hudson Street. Its name—St. Luke’s in the Fields—evoked the pastoral nature of the area and, by association with the physician-apostle, Greenwich’s role as haven for the multitudes fleeing disease in the city. It proved all too apt a name.
In 1822 yellow fever again broke out in New York, this time on the stylish streets west of Broadway and near the Battery, supposedly the healthiest part of town. The municipal government declared everything below City Hall an “infected district” and established a picket-fence barricade along Chambers Street. Thousands of residents fled north. “From daybreak till night one line of carts, containing boxes, merchandise, and effects, were seen moving towards Greenwich Village,” one paper reported. The city pitched tents for refugees, and carpenters hastily erected hundreds of wooden houses.
Although many refugees went home when the fever broke, enough stayed on that local builders had their hands full trying to keep up with the demand for housing. St. Luke’s trustees had carpenter James Wells flank the church with brick row houses, which it maintained as rental property, while Hudson Street filled with residences equipped with such middle-class conveniences as brass grates for burning the new anthracite coal, brick cisterns with pumps, and servants’ apartments. Smaller houses went up on other streets to accommodate a burgeoning number of artisans, especially the carpenters, masons, painters, and stonecutters employed in the booming construction trades. Christopher Street was paved and its sidewalks flagged by 1825, and the blocks around Newgate Prison became so residential that no one complained when the state shut it down in 1829 (having just opened a new facility, Sing Sing, up the river at Ossining).
North of 14th Street, meanwhile, even Clement Clark Moore had begun to play the landlord, carving out lots along Ninth Avenue and promoting them to genteel purchasers. To provide a community anchor, Moore gave the Episcopal diocese an apple orchard lying west of Ninth between 20th and 21st streets, where construction of the General Theological Seminary got under way in 1827; a second Moore-donated parcel, along 20th Street east of Ninth, became the site of the elegant St. Peter’s Episcopal Church a decade later.
Astor’s successes at Richmond Hill and Greenwich would be duplicated a mile or so to the east, where in 1804 he had purchased a large garden farm near what is now Astor Place. A Frenchman named Delacroix then leased the site from Astor to build Vauxhall Gardens, a resort for fashionable New Yorkers that offered leafy walks, pavilions serving juleps and ice cream, bands, theatrical entertainments, and fireworks. By 1809 the city had extended and paved Broadway all the way up to Vauxhall, and by 1820 streets just to the south—Bleecker, Bond, and Great Jones—were rapidly filling up with genteel residents. In 1825, when the Vauxhall lease expired, Astor cut a broad street through the gardens that he named Lafayette Place, in honor of the Revolutionary War hero (who had just paid a return visit to the city.) Lots along both sides of Lafayette Place sold briskly, earning Astor many times what he had paid for the property twenty-one years before.
By 1830, now in his late sixties, Astor had become the richest man in the United States—almost as rich, according to certain estimates, as European magnates like the duke of Bedford, Sir Francis Baring, and Nathan Rothschild. He had also created something akin to a perpetual moneymaking machine. Between 1800 and 1820 he invested $715,000 in Manhattan real estate, roughly two-thirds of which had come out of the profits of his fur and tea businesses. Between 1820 and 1835 he purchased another $445,000 worth of land on the island, but most of this sum derived from the sale, lease, or rental of property he already owned. By 1830 he had pulled out of the China trade entirely, sold his interest in the American Fur Company, and was running a real estate operation that employed a sizable staff of rental agents, contractors, accountants, bookkeepers, and lawyers—all overseen by his son, the colorless but meticulous William Backhouse Astor, who could recite the family’s rent rolls by heart. Between 1835 and his death in 1848, Astor and his son would put another $832,000 into New York real estate, a sum generated entirely from rents on existing properties. Small wonder that he is supposed to have said, just before he died: “Could I begin life again, knowing what I now know, and had money to invest, I would buy every foot of land on the Island of Manhattan.”
ON THE HEIGHTS OF BROOKLYN
Across the East River, another speculative drama was unfolding on Brooklyn Heights. Hezekiah Beers Pierrepont, grandson of a minister-founder of Yale, had come south from New England, made good money speculating in the national debt, founded a mercantile firm in 1793 that exported provisions to Paris, and in 1802 married Anna Marie Constable, whose father, William Constable, one of the largest landowners in the state, gave the couple half a million acres as a wedding present. Abandoning commerce for manufacturing, Pierrepont bought Philip Livingston’s gin distillery at the foot of modern Joralemon Street and added a large wharf, a windmill, and storehouses. His Anchor Gin proved successful, but in 1819, after competitors diluted his profits, he abandoned the business. By then he had discovered his true calling, land development.
Pierrepont began purchasing property on Clover Hill, the bluff overlooking Brooklyn Village, eventually amassing sixty acres, including an eight-hundred-foot stretch overlooking the harbor. His plan was to subdivide the property into large plots on which wealthy merchants and professionals could build substantial houses. But Pierrepont knew that (unlike Astor) he couldn’t expect the right kinds of buyer to appear unless they were pulled in from across the river. His realtor rivals John and Jacob Hicks, descendants of a Dutch artisanal family, faced no such problem. They too had been acquiring property on Brooklyn Heights, to the north of Pierrepont’s holdings, but their intention was to create numerous small lots, cheap enough for the tradesmen and artisans who already lived down by the ferry landing.
Pierrepont’s vision of the future began to look more promising in 1814, when his good friend Robert Fulton formed the New York and Brooklyn Steam Ferry Boat Company. Pierrepont eagerly contributed money and influence, knowing that improved transportation to New York would do wonders for Brooklyn real estate values, and after Fulton’s death he became a part owner and director of the operation. Soon the Nassau—the East River’s first steam ferry—was shuttling people, carriages, and wagons back and forth to Brooklyn forty times a day, each trip lasting a mere four to eight minutes.
In 1816 Pierrepont and a committee of prominent Brooklyn residents successfully petitioned the state legislature for a village charter, which authorized a new board of trustees to open streets, build sidewalks, install water pumps, and establish a watch—much-needed improvements that would enhance Brooklyn’s image among affluent New Yorkers. When the trustees received a street plan that favored the Hickses’ vision of development, Pierrepont hired his own surveyor, worked up an alternative proposal, and got it adopted for the area south of Clark Street, leaving the Hickses predominant above that line. Pierrepont likewise blocked the powerful Schermerhorns from establishing a ropewalk in his part of the Heights, forcing them (and their workers) over to what is now Schermerhorn Street.
Pierrepont’s readiness to combine the roles of land speculator, local politician, and community booster—so unlike Astor, who preferred to work behind the scenes—began to pay off during the yellow fever epidemic that struck New York in 1822. Like Greenwich, Brooklyn received an influx of well-to-do refugees (the steam ferry Nassau skipped downtown Manhattan and plied back and forth between the two locations), and Pierrepont began at once to advertise his lots on the Heights. They were “elevated and perfectly healthy at all seasons,” he wrote—ideal for “Families who may desire to associate in forming a select neighborhood and circle of society” and especially convenient for “Gentlemen whose business or profession requires daily attendance into the city.” These and similar claims by Hoyts, Boerums, and other landowners stimulated a construction boom that raised nine hundred new buildings on and around the Heights over the next half-dozen years. By 1830 Brooklyn had become the country’s first commuter suburb, and Hezekiah Pierrepont a very rich man.
“THE LONDON OF THE NEW WORLD”
As the Erie Canal neared completion, the Times of London predicted it would make New York “the London of the New World.” The city’s meteoric growth over the next ten or fifteen years largely bore out that prediction. Though the Hudson River town could hardly be compared with the colossus of the Thames, it had established itself as America’s preeminent seaport, emporium, and financial center. After an 1831 visit, even the hard-to-please Mrs. Trollope found herself gushing about New York that, “situated on an island, which I think it will one day cover, it rises, like Venice, from the sea, and like that fairest of cities in the days of her glory, receives into its lap tribute of all the riches of the earth.”
New York’s success owed much to the entrepreneurial daring of its businessmen, who had proven themselves more willing than counterparts in other cities to take risks in pursuit of profit. Immigrant Yankee and European capitalists, having demonstrated their feistiness in the very act of relocating, seemed more flexible, less bound by tradition. They didn’t always succeed—New York firms failed more often than did the dynastic enterprises of Boston—but their collective ambition stoked the city’s economic furnace.
Yet if New Yorkers were willing to hustle in the marketplace, it was a marketplace both cosseted and regulated by the state. Public enterprise was as much a part of New York’s civic culture as private ambition, and a raft of governmental initiatives helped the city embrace and enhance its natural advantages.
Above all, it was the state-run Erie Canal that secured New York City’s position as the nation’s entrepôt, galvanizing its commerce, its banking, its stock market, and its manufacturing sectors: in 1825, the year the Erie commenced operation, five hundred new mercantile operations opened their doors in the city. Government aided entrepreneurs in many other ways as well. Fulton and Livingston perfected their steamboat under the aegis of a state monopoly without which they would not likely have spent the time, money, and energy it took to bring the project to completion. A similar monopoly encouraged the New York Gas-Light Company to illuminate the streets—by warding off competitors, subsidizing construction, and guaranteeing an initial market. State law also undergirded the monopolistic auction system, which generated some of the largest fortunes of the era, and its Safety Fund assured local bankers of the most stable operating environment in the nation. Finally—the ultimate boon—the New York legislature dispensed, in ever-increasing numbers, the privileges of incorporation, a grant of limited liability originally intended to achieve public purposes, which now became a device to undergird private profitability.
Federal initiatives, too, provided an extensive support system for Manhattan’s risktakers. Washington dispensed shipbuilding contracts, dispatched the navy to protect city merchants in hostile waters, maintained forts to safeguard the harbor, banned foreign vessels from the American coastal trade, and, by charging the same postage for long- as for short- haul mailings, helped New York publishers undersell their regional competitors.
Municipal government continued to serve as custodian of the economic order by exercising a broad regulatory authority. In 1828 the Common Council licensed or appointed nearly seven thousand people—including the cartmen, porters, longshoremen, dray carriers, and hackney-coach drivers who moved commodities and people around the port—and municipal regulations had an impact on 255 occupations. Manhattan also maintained an expanding public market system. Though the old Fly Market closed in 1821, the Franklin Market opened that same year at Old Slip, the Fulton Market arrived in 1822, and in 1828 Washington Market was expanded by filling in adjacent wetlands, becoming by the end of the 1830s the leading revenue producer of the city’s twelve venues.
The city corporation, moreover, while continuing to run its own “estate” (with some ancient franchises, notably the ferries, now more lucrative than ever), focused more attention on providing a planned and predictable public environment within which market actors could operate and invest. Waterfront improvements and mandated low wharfage rates kept the docks competitive. The grid underwrote real estate development by making clear where property-enhancing roads would run. The new administrative agencies created back at the turn of the century worked to abate public nuisances and speed the flow of commerce. And tax policies favored capital accumulation: real and personal property were flagrantly underassessed, while bank stocks, bonds, and mortgages were not taxed at all until 1823.
Laissez-faire rumblings did emerge from several quarters. The Rev. John McVickar, professor of moral philosophy at Columbia and scion of a leading mercantile family, was a disciple of David Ricardo and a stout opponent of government intervention in the economy. “I cannot but reverence the claims of free commerce as something holy,” he declared. Yet even McVickar, in his Outlines of Political Economy (1825), admitted there was a role for government in executing expensive infrastructure projects, and he specifically praised the Erie Canal.
It was easier for most Manhattan businessmen to hew to mercantilist convictions inasmuch as, given their continuing hold on political power, public projects were in effect overseen by the merchants themselves. Beyond that, the commercial elite’s belief that they were entitled to direct the workings of the municipal economy was rooted in a still deeper sense of stewardship—a conviction, bolstered by their ongoing preeminence in a wide array of civic arenas, that New York City remained a little republic, over which it was their right, indeed their duty, to exercise a collective oversight.