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called the Manhattan Company, in 1799. For nearly a decade, the Bank of New-York used its financial leverage to sway political favor and block new entrants from opening rival banks until Aaron Burr and other New York Democratic-Republicans seized an opportunity to open their own bank. Amid the controversy, partisans and bankers confronted the political implications of partisan corporations and the propriety of using credit as a tool in electoral competition.

      Chapter 4 examines the complicated political economy of monopoly rights in the early republic during the beginning of the nineteenth century. Even more so than the corporation, the embrace of monopoly privileges by early American states was a continuation of an imperial practice that was unquestionably monarchical: giving one person or association a long-term exclusive right to a route, waterway, structure, type of business, or stream of revenue. A paradox emerged in the republic’s use of the privilege: a successful monopoly inspired legal and political challenges, forcing its proprietors to be open to partnerships with would-be rivals. In the case of the steamboat, state legal protections were ultimately more useful in maintaining a monopoly’s viability than any federal patent protection for technology.

      Chapter 5 considers the implications of New York lawmakers’ 1817 decision to directly manage and publicly finance the Erie Canal, which fundamentally changed the relationship between the state government and its maturing institutional ecosystem. The diminishing appeal of exclusive privileges led to a fundamental reorientation in state policy with the public mobilization on behalf of the Erie Canal and legislative wrangling over how it would be financed. Although it is thought of as a “public” project and one of the first of its kind, beneath that veneer it was a hybrid—a desirable investment among wide slices of the electorate who included proprietors of incorporated financial institutions and land speculators who stood to benefit from its operation, and a civic project that legislators and merchants realized would bring the western United States into the close orbit of New York, creating the conditions for the city and state to become the commercial epicenter of the eastern seaboard.

      CHAPTER 1

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      “The Most Dangerous and Effectual Engine of Power”

      New York officially became an American city at one o’clock in the afternoon on 25 November 1783. To the sound of pealing bells, Major General Henry Knox and a retinue of horse-mounted dignitaries left Bowling Green, at the foot of Broadway in Manhattan, setting off to the Bull’s Head Tavern on the Bowery, accompanied by a crowd that had assembled at the city’s “Tea-Water Pump” and followed on foot. There they met George Washington, New York governor George Clinton, Chancellor Robert R. Livingston, and other members of a provisional government, which was about to take possession of the southern parts of New York that had been under British occupation for the last seven years.

      The thousands of spectators reviewing columns of troops that day were firsthand witnesses to spectacles of regime change reflected even in the naming of New York’s taverns. Evening festivities were hosted at Cape’s Tavern, a site formerly known as the “Province Arms” and then the “City Arms” when it was a favored haunt for the officers of His Majesty’s occupying forces. After being purchased by John Cape, the new proprietor’s first public act was to replace a thirty-year-old sign that had hung above the door with a new one bearing the armorial insignia of the now-independent state of New York.1

      However meaningful, the symbolic acts of replacing signs and changing flags were inherently complicated by some unpleasant facts concerning New York City’s population and prospects. With the evacuation of more than twenty-nine thousand British Loyalists complete, there remained just twelve thousand people living inside the belt of Manhattan’s terraqueous border.2 Although people could strip away physical vestiges of British dominion and occupation, the uncomfortable truth was that many of those who remained in the city could be classified as British Loyalists: Tories who had cooperated in the British occupation but who were not so loyal that they felt compelled to leave the United States after the war’s end.

      To people like Chancellor Robert Livingston and his circle of correspondents, which included George Washington, foreign affairs minister John Jay, and former New York congressmen Gouverneur Morris and Alexander Hamilton, the presence of those Tories was essential if the city were to rebound as a commercially viable destination for goods and capital. Americans had rejected British imperial governance during the Revolution, but the mercantilist practices and habits of the British Atlantic remained intact and Hamilton in particular was convinced that the new nation needed Tories to help negotiate that world. The willingness of the Tories to participate in American commerce would entangle the city, state, and nation in a web of trade that, both Livingston and Hamilton hoped, would foster geopolitical stability for the United States as a whole. Furthermore, the treatment of those Tories would speak volumes about the intentions and nature of the new American regime and its ability to reconcile with its former kin. And finally, in the view of Livingston’s cohort, New York desperately needed the Tories’ money. The city was hemorrhaging coined metal—gold and silver—that was essential to participate in international trade. There was a real risk that Tories’ capital and connections could be lost for good.

      But not everyone was enthusiastic about continuing to host these former Loyalists. During the Revolution, New York legislators punished British collaborators by confiscating their estates and chopping them up to be sold to (ostensibly) patriotic rent-paying tenants.3 Although the war was now over, such punitive acts showed no signs of abating. For months, vitriolic attacks circulated in New York under the “Whig Party” moniker, while selfidentifying Whigs in the legislature stoked their countrymen’s passions by calling for the expulsion of Tories and pressing for invasive new laws to forever bar them from owning property, holding office, or voting, effectively rendering them civically and financially dead. An August 1783 broadside addressed from “Brutus” to the “Tories of New York”—likely penned by Albany county state senator Abraham Yates—delighted in the “remorse, despair and shame cloud[ed] upon [Tories’] imaginations” by fear of American reprisals. “A review of the treason, murder and robberies, which you [Tories] have committed, with a long catalogue of your aggravated offenses against an oppressed but zealous band of patriots,” would follow the war, he predicted. His advice to Tories was to “flee then while it is in your power, for the day is at hand, when, to your confusion and dismay” they would face “just vengeance” from “collected citizens.”4 The day was coming, these Whigs promised, when Loyalists would not be able to hide from the things they had done.

      As Yates and his colleagues attempted to foment and channel popular anger against Tories, Robert Livingston chalked their motivations up to greed and self-interest. “We have many people who wish to govern this city,” Livingston told his friend Robert Morris, “and who have acquired influence in turbulent times which they are unwilling to loose in more tranquil seasons.” These legislators had won votes from vengeful and frightened voters, and they wanted to keep those voters vengeful and frightened, even if it meant proposing anti-Tory laws they knew they would never actually adopt into law. The chancellor also believed that Whig legislators were using this veneer of patriotism to enrich themselves. Behind their “violent spirit of persecution,” Livingston told Alexander Hamilton, was a “most sordid interest” in “wish[ing] to possess the house of some wretched Tory” or trying to “engross the trade & manufactures of [New York]” for themselves by driving out a Tory “rival” in “trade or commerce.” Some Whigs wanted to avoid repaying lawful debts owed to Tories, and others wanted to lower real estate values and the “price of Living” by “depopulating the town” of Manhattan. “It is a sad misfortune,” Livingston concluded, “that the more we know of our fellow creatures, the less reason we have to esteem them.”5

      But however base these motives might have been, Livingston saw real dangers lurking in New York’s political currents. Calling anti-Tory hostilities a “gathering storm,” he worried that the “smallest spark” might cause the city to “take fire” and overwhelm “all

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