In their harshest critiques aimed at each other, advocates of both the land and money banks hesitated to openly question the loyalty or motives of their rivals; public letters that can be traced back to the banks’ promoters during the first months of 1784 focus almost exclusively on the merits of their respective proposals, suggesting that these were not rhetorical attacks but efforts to persuade. The land- and money-bank coalitions each believed their charter applications would be strengthened if they could expand their appeal by attracting supporters and investors from the rival cohort or by offering concessions that would consolidate the two proposed institutions into a single pro-bank effort. Even though Alexander Hamilton thought the land bank was “a wild and impracticable scheme” and had worked to array “all the mercantile and monied influence … against it,” he did not take to the city’s newspapers to attack Livingston and his allies.58 Instead, he directly solicited the land bankers’ support by carving out room for their interests within the Bank of New-York. According to notes kept by Hamilton concerning the bank’s charter application, he and his colleagues considered allowing one-fifth of their bank’s capital—up to $200,000—to consist of mortgaged properties.59
Robert Livingston’s critiques were tempered by a reluctance to have the land bank seen as a divisive counterweight to the Bank of New-York. He rejected the claim that “a monied interest and a landed interest of Merchants and Farmers” were necessarily “opposed to each other, when common sense must dictate that they are members of the same body, and mutually support each other.” “The Merchant” he stressed, “could not exist without the Farmer, and the Farmer without the Merchant would be a dissocial solitary animal.”60 Livingston acknowledged that the land bank could be more solicitous of “monied persons” in the future and lauded Alexander Hamilton for “sh[owing] what appears to me faulty in the constitution of the Land Bank.” The quality of mortgaged lands could be improved, he conceded, and it was unfair to ask merchants to “[draw] too much of their stock from trade to vest it in lands” in order to buy shares in the land bank.61 Livingston, therefore, exhaustively highlighted the advantages and shortcomings of both the Bank of New-York and his own land-bank proposal in the weeks when both were being considered before the legislature.
Even writing under a cloak of anonymity, Livingston’s harshest criticisms of the Bank of New-York addressed only the propriety of having merchants serve as bank directors. In the process of pointing this out, Livingston showed that he envisioned a significant public role for his proposed land bank. The land bank, he said, could someday hold state government deposits, something that likely would enable it to multiply the amount of credit it offered to its clients. This prompted the chancellor to ask whether “the Government [could] lodge their money with those who afford them no security but their good characters” in a commercial bank. Could a “careful Guardian leave the money of his Ward with a Bank whose Directors must change every year,” especially when it “circulates more than its capital” and its credit “depend[ed] on the opinion the world entertain of Directors who, from being in trade, are always liable to strong temptations to aid each other?” He warned that the temptations of banking would drive some “Merchants [to] change their profession and become Stockholders.” Merchants, he argued, could not be trusted to oversee a stable and publicly useful bank.62
Both bank cohorts, then, recognized that the petitioning and charter-application process was a dynamic one. Although they did not consider combining their proposals, both offered compromises to attract new supporters and build a more persuasive case for incorporation. The petitioning process therefore not only aggregated financial capital but also encouraged the consolidation of human and political capital as well. Both bank coalitions assumed that the legislature would approve at least one bank petition in 1784. The only question seemed to be which one would clear the hurdle.
The Legislature
Within the legislature, however, that question was far less clear-cut.
As bank partisans offered concessions to each other in the hopes of building consensus around dueling proposals, state legislators—the audience for these petitions—seemed increasingly unwilling to take affirmative steps on behalf of either bank.
Despite the connections that the Bank of New-York enjoyed in the legislature, there remained twelve senators and sixty-eight assemblymen in the legislature who were not directly linked to the proposed bank. New laws had to win majority support not only in both houses, but also in the state’s Council of Revision—a panel composed of the governor, two justices of the state’s supreme court, and the state’s chancellor, who happened to be Robert R. Livingston, the chief supporter of the rival land bank. Only after winning support in the Council of Revision could a bill be laid before the governor for his signature, making it necessary for the promoters of both the commercial Bank of New-York and the land Bank of the State of New York to lobby legislators using a variety of appeals—neither bank was large enough, after all, to give every lawmaker a line of credit or a seat on its board of directors.
Harnessed from across the state and crammed into the narrow quarters of City Hall, New York’s state legislature reflected many of the same tensions and motivations found in the civic and economic lives of the few dozen city blocks that surrounded them near the southern tip of Manhattan. Any person capable of reading a newspaper or entering a tavern was acutely aware of the divisions between loyalist Tories and patriotic Whigs in the city, and vehement anti-Tory passions were expressed by legislators who proposed to strip former Loyalists of their rights to hold office, vote, or own property. A cadre led by Albany County state senator Abraham Yates was hostile even to the notion of reconciliation with Tories and relished questioning the patriotic credentials of Whigs who dared to socialize or do business with onetime Loyalists. One of Robert Livingston’s friends believed that the “narrowness of [Yates’s] mind & the badness of his heart … injures this state more than ever his services will expiate.” “Men of integrity & education,” he fumed, indulged Yates’s “pretended patriotism” and “suffer that old booby to thwart & disconcert whatever has the appearance of wise & sound policy with impunity.”63
The Bank of New-York steered directly into this storm once it published the roster of its managers and directors in city newspapers, making it a target for anti-Tory politicians and their allies. A letter to a New York paper soon wondered what was behind the “present confidence and audacity” of “truly detestable and obnoxious Tories” who appeared in public as bank directors. The Whig directors and bank president McDougall, one writer asserted, had become nothing more than “advocates” for these “bloody-minded villains,” and it was “high time” for the state legislature to once and for all “make a proper discrimination” between “friends and foes of this country” by banishing “sworn enemies” who “endanger the piece of society by parties, factions, and cabals.” The Bank of New-York, the writer concluded, was nothing more than an “absurd and ridiculous system” for advancing Tory interests.64
Other letters made the same critique and pointed to the land bank as a preferable and patriotic alternative. In an “Appeal to the Legislature,” one writer who styled himself “A Real Whig” wrote in the New York Independent Gazette that the most potent British threat to America was a financial one. “We never had so much to fear from [Tory] arms,” read the letter, “as from their influence and wealth”; the author said the Bank of New-York was “the most dangerous and effectual engine of power that can ever be formed in a State,”