and private investments on behalf of a project that would serve “both the public and individuals,” legislators suggested giving him a legal privilege that looked more like a monopoly grant instead. Colles’s plan “merit[ed] encouragement,” but lawmakers simply had no appetite “to cause that business to be undertaken at public expense” by giving him access to public lands.9 Without a corporate charter or those 250,000 acres, however, it was unlikely that Colles would ever be able to attract sufficient investments to complete his proposed work. The corporate form, after all, was an attractive way to organize a business because, when ideally executed, it offered a way to legally structure a coalition of financiers, lobbyists, and promoters who could capitalize a firm, allowing the company’s board of directors to then hire managers who could competently run the enterprise. Without such a charter, Colles would have to instead recruit a wealthy patron or scramble to assemble less durable partnerships by promising them percentages of a monopoly privilege.
But even this less-than-ideal possibility never came to fruition. Despite a positive recommendation from one of their own committees, New York’s state assembly hesitated to act on Colles’s petition in 1784. He applied again to the legislature in 1785; instead of recommending a monopoly grant, lawmakers appropriated $125 for Colles to research and write “an essay toward removing certain obstacles in the Mohawk River” for their consideration. In 1786 Colles again sought aid from the legislature, this time petitioning the state senate, but he was once again rebuffed. Colles made no further petitions to the legislature with plans to finance inland navigation between the Hudson River and the Great Lakes, nor did anyone else for the remainder of the 1780s—a period one canal promoter later called a “profound silence.”10
The idea of building a canal persisted, however. In 1791 a more state-centered vision of commercial development was outlined by New York governor George Clinton in his annual legislative address. “[O]ur frontier settlements … are rapidly increasing,” wrote the governor, “and must soon yield extensive resources for profitable commerce.” Therefore, he recommended a “policy of continuing to facilitate the means of communication with them, as well to strengthen the bands of society, as to prevent the produce of those fertile districts passing to other markets,” meaning Quebec. Legislators responded by vowing to investigate “the most eligible move of effecting and defraying the expense” of improving the Hudson and Mohawk Rivers, and later adopted a bill that funded a survey to “estimate … the probable expense that would attend the making of canals sufficient for loaded boats to pass.”
By 1792 that report was complete, and Governor Clinton again touted an Albany-to-Lake Ontario canal as a “measure, so interesting to the community” that it would “command the attention due to its importance” in part because of its “very moderate expense.” His call mobilized two associations of investors to begin lobbying state lawmakers for corporate privileges to build two canals, one to link portions of the Mohawk River near Little Falls, New York, and another to join Lake Champlain to the Hudson River. Each canal was seen as a rapidly achievable project, and because the investors assured lawmakers that they would rely entirely on private capital for construction they claimed they would need the state to bear only the expense of land surveys, for which lawmakers appropriated £100 in March 1791.11
Undertaking an ambitious project—or a pair of them—by handing it to a corporation was less controversial in the 1790s than it had been in the 1780s. By the 1790s, such a project seemed feasible because of a greater availability of capital and credit. In New York City, Alexander Hamilton’s plans for a national bank, with the national government’s assumption of state debts, was helping to make the city a center for financial transactions and exchanges: money could be borrowed or repaid, stocks and U.S. bonds could be traded, and insurance policies could be taken out on recently placed shipping orders.12 With more brokers and bankers handling more financial instruments—stocks, bonds, banknotes, checks, and bills of exchange, to name a few—New York’s microeconomy was becoming more financialized, offering political entrepreneurs more opportunities to participate in a growing economy of influence.
Yet to one New Yorker, the plans being proposed in the spring of 1792 were too modest. Elkanah Watson had personally surveyed a westward canal route in late 1791 and thought Governor Clinton’s wished-for canal would—and should—be far more ambitious (and expensive). He quickly sought to convince state senator Philip Schuyler of the same. In Albany, both Watson and Schuyler had reputations for being political entrepreneurs involved with development projects that blended private capital with public authority. Schuyler, however, was a far wealthier man than Watson, and he preferred to pave routes to prosperity with paper. When Watson approached him, he was pressing colleagues to support the incorporation of the Bank of Albany, one of the pet projects Schuyler adopted after returning to the state senate once he had completed a term as a U.S. senator.
Watson tried to convince Schuyler that a lack of vision and imagination—rather than actual capabilities or capacities—was hindering state legislators from demanding more ambitious plans of petitioners seeking to form canal companies. The two proposals recently approved by lawmakers to create the Northern and Western Inland Lock Navigation companies had been passed after considerable lobbying by Schuyler, but to Watson they represented only “half the business” of canal building in New York State. “The charter[s] should stretch,” he said, “to admit the commerce of the great lakes into the Hudson River, and vice versa.” Legislators had instead settled for too meager a set of proposals, and Watson felt that Schuyler agreed with his sentiments. “No one of that body,” Watson wrote, referring to the legislature, and “not even the Governor,” he continued, “appears to soar beyond Fort Stanwix [present day Rome, New York] except yourself.”13
For Watson, visionary ambition in canal building had patriotic connotations. He later explained that much of his inspiration was drawn from a two-day visit he had made to George Washington’s home at Mount Vernon in 1785. Four years before becoming the first U.S. president, Washington organized and became president of a canal company called the Patowmack Company, a venture jointly supported by the governors of Maryland and Virginia to improve the channels of the Potomac River, dig smaller branch canals, and build locks to traverse its waterfalls. Watson pronounced the project “worthy of the comprehensive mind of Washington” because it was to link the Atlantic Ocean with the Mississippi River and reach as far as Detroit. “Hearing little else for two days from the persuasive tongue of this great man,” Watson recalled, “I confess completely infected me with the canal mania, and enkindled all my enthusiasm.” It lit, Watson said, “the canal flame in my mind.”14
Recalling this visit and seeing a need to act as boldly as the hero of the Revolution, Watson pressed Schuyler in the spring of 1792 to use his influence in the state house to block passage of the two pieces of canal legislation—bills Schuyler had lobbied to pass—on the grounds that the proposed projects would be too small to sufficiently develop the state’s resources. Watson boasted that, unlike most state legislators, he had traveled through both western New York and Europe. He had seen firsthand how “luxuriance of soil, mildness of climate, and easy access to market” could be brought together with a canal, telling Schuyler,
Perhaps no part of the world, so distant from the sea as our western country, presents such irresistible allurements to emigrants, as well from the eastern hive as from Europe…. Nothing will tend with so much certainty to accelerate the progress of these great events, and to open a door to the happiness of unborn millions, as to render a water communication at once cheap and easy of access. Exclusive of continuing an intercourse with the greatest chain of lakes in the known world, it will give a powerful stimulus to a new creation in the very heart of this State.15
Watson therefore did not believe that a larger canal would simply emulate European exemplars; he predicted it would spark transformative economic development.
From his perspective as a traveled observer, a vantage point he considered superior to that of legislators mired in institutional habits and precedents, Watson thought he had the credibility to put forth a new
