to award a bank charter to their favorite interest. Much more was at stake. They were asking the legislators to select a particular kind of bank and—by extension—a particular form of capitalism.
These were weighty options, but they were being laid before New York legislators at a moment when it seemed like lawmakers might welcome a momentous opportunity to shape the state’s future direction by incorporating its first bank. Despite Robert Livingston’s complaint that the state had been stingy in issuing corporate charters, New York City merchants were, in early 1784, already petitioning the state legislature to reintroduce the corporate form to the state’s institutional landscape by reissuing a charter of incorporation to the Chamber of Commerce.15 This move came on the heels of lawmakers intervening in a Whig–Tory dispute among the parishioners of Manhattan’s Trinity Church in late 1783, when the state legislature overturned the election of a Tory rector by opening the church’s 1696 charter of incorporation to vest governing authority in a new state-created board of nine trustees.16 Corporate charters were exceedingly rare in New York in the 1780s, but no more so than in the rest of the nation.17 And although the process of wrangling an act of incorporation from a legislature was no easy task, once state lawmakers had demonstrated their willingness to receive and consider petitions concerning corporate privileges, they created an incentive for new interests to mobilize and lobby for similar benefits. In nearby Philadelphia, some of the city’s wealthiest merchants had recently begun organizing a second bank in their city that would, in the words of Gouverneur Morris, be a “coalition” of “violent Whigs and violent Tories.” Although they had “turned their Backs upon every Body else about two years ago,” these patriots and Loyalists “each performed a Semi Circle and met at the Opposite Point.” New Yorkers need only read their newspapers to learn of these events.18
Therefore, despite the anti-bank and anticorporate suspicions and rhetoric permeating the new nation’s political culture, it was reasonable for New York’s bank promoters in 1784 to think that their state legislature not only could be nudged toward chartering an incorporated bank but also might have actually wanted to receive and approve such a proposal.19 The push for incorporated banks was encouraged by legislators who collaborated with petitioners to define an economy of influence. This helps explain the paradox that emerged in New York City’s (and New York State’s) political economy during the first six months of peaceful American independence: in the immediate aftermath of a revolution waged against monarchy, monopoly, and privilege, New Yorkers saw a stampede in favor of corporations—an imperial vestige that linked all three. Elite merchants and landowners certainly envisioned their proposed corporate banks as mixed-economy public-private institutions that would enable them to gain (and regain) leverage over New York’s official political institutions and policy-making apparatus while profiting from their newfound influence. Yet those proposals also reflected a perceived climate of political opportunity. Livingston, Hamilton, and other political entrepreneurs interwove their business and political strategies to appeal to elected public officials. The corporation was not an unwelcome alien in the early republic; among petitioners and some legislators, it was an invited guest.20
The Land Bank
Robert Livingston was a latecomer to the realization that a corporation—and a bank, specifically—could help him gain financial leverage over New York politics. Initially his plan was to wield power and make profits by speculating in Manhattan real estate. Looking around the city, the chancellor saw prices that he believed were too low and would quickly rebound once the city’s population began to grow.21
Livingston whetted his appetite in late 1783 by buying £2,000 of “good substantial brick houses” that he predicted would bring in £350 of rental income per year. But the estates he truly coveted were far more lavish and ambitious investments. One had recently been the seat of the Loyalist DeLancey family; its current owner, the chancellor suspected, could not afford the home’s upkeep or taxes, and he thought it could be bought for five or six thousand pounds sterling. For Livingston, however, there was a catch: although he was certainly a rich man, he was primarily rich in land. Unless he converted that wealth into credit and cash, he was destined to be little more than a spectator in the real estate boom he was so certain would arrive in the next year.
Livingston’s first instinct was not to seek anything as formal as a corporate charter. He wanted partners with capital, and soon after the British evacuation it seemed Livingston might have found some. Circulating among the merchants trying to mend relations between New York’s Whigs and Tories in late 1783 was Stephen Sayre, a former London sheriff and an ally of the radical journalist and parliamentarian John Wilkes, who supported the American cause during the war. Sayre once ran a private bank in London and had returned to Manhattan—his birthplace—in the fall of 1783 seeking to make a new fortune. There he began attending the Whig-Tory “dancing assemblies,” where he met Major General Henry Knox, Chancellor Livingston, and Livingston’s brother-in-law John Stevens, a merchant. Sayre also resumed a past friendship with Isaac Sears, a longtime member of the New York City Chamber of Commerce. Sayre and Livingston quickly began using these social events as they were intended to be used: as venues to generate business relationships that would sow political reconciliation and reinvigorate commerce. They recruited Stevens and Sears to be their partners in real estate speculation.22
According to Livingston, Sayre first proposed that the cadre broker a Dutch loan that would enable New York’s state government to help repay its war debts. At the time, Sayre claimed to have good contacts in Holland but not in New York; therefore, he needed Livingston, Stevens, and Sears to exercise their influence with decision makers in the state and city to make a Dutch loan palatable at home. If the partners could collect fees and commissions for marketing and handling the transaction, Sayre suggested, they could use those proceeds to build the real estate portfolio Livingston had been eyeing.
Chancellor Livingston was never enthusiastic about this plan, and “discouraged” Sayre from pursuing it any further. Livingston did not want New York, or any state, to “contract a foreign debt independent” of the money “borrowed [abroad] by the United States.” Congress’s national debts, he explained, “help[ed] cement a union that separate [state] debts would weaken.” Livingston was therefore unwilling to put profits ahead of principles if it meant jeopardizing the union that existed among the new states.23
In response, Sayre pitched a second idea: why not simply use a Dutch line of credit to make “loan[s] to individuals on real property”? This plan would appeal to Livingston, who was eager to see his vast land holdings become a source of ready, liquid money; it would provide him with cash and make him a patron who could offer credit to others.
Livingston liked the idea. However, he also seemed to believe that his aristocratic name alone could open doors and opportunities that were off limits to others. Before committing himself to support Sayre’s initiative, the chancellor wanted to find out for himself whether Sayre’s Dutch contacts would find it acceptable. He also wanted to see if he could go behind the backs of his partners to carve out a more lucrative side deal for himself. So he wrote to the Dutch minister to the United States, Peter J. Van Berckel, to find out whether he “approved or disapproved” of a credit-for-land idea. He explained to Van Berckel that “in every monied transaction” he preferred to “deal with the Lenders himself than (by a Broker) thru a third person.”
Livingston plainly hoped that he could enlist Van Berckel to use his influence at home and abroad, swaying Dutch investors to support a landinvestment plan and structure their loan in a way that would make Livingston the leading partner by displacing Stephen Sayre. To the Dutch minister, Livingston offered unequivocal support for the propriety and profitability of land investments. The departure of Tories who had “quited the state,” he said, combined with the “little command that any persons among us have of money,” had “opened a large field” for investments in real estate. He predicted that before “ten or twelve months or the restoration of commerce & the arrival of strangers” in New York City, these land purchases could
