Alexander Hamilton (42 page)

If
Rutgers v. Waddington
made Hamilton a controversial figure in city politics in 1784, the founding of the Bank of New York cast him in a more conciliatory role. The creation of New York’s first bank was a formative moment in the city’s rise as a world financial center. Banking was still a new phenomenon in America. The first such chartered institution, the Bank of North America, had been started in Philadelphia in 1781, and Hamilton had studied its affairs closely. It was the brainchild of Robert Morris, and its two biggest shareholders were Jeremiah Wadsworth and Hamilton’s brother-in-law John B. Church. These two men now cast about for fresh outlets for their capital. In 1783, John Church sailed for Europe with Angelica and their four children to settle wartime accounts with the French government. In his absence, Church named Hamilton as his American business agent, a task that was to consume a good deal of his time in coming years.

When Church and Wadsworth deputized him to set up a private bank in New York, Hamilton warmed to it as a project that could help to rejuvenate New York commerce. He was stymied by a competing proposal from Robert R. Livingston to set up a “land bank”—so called because the initial capital would be pledged mostly in land, an idea Hamilton derided as a “wild and impracticable scheme.”
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Since land is not a liquid asset and cannot be converted into ready cash in an emergency, Hamilton favored a more conservative bank that would conduct business exclusively in notes and gold and silver coins.

When Livingston solicited the New York legislature for a charter, the tireless Hamilton swung into action and mobilized New York’s merchants against the effort. He informed Church that he had lobbied “some of the most intelligent merchants, who presently saw the matter in a proper light and began to take measures to defeat the plan.”
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Hamilton was more persuasive than he realized, and a delegation of business leaders soon approached him to subscribe to a “money-bank” that would thwart Livingston’s land bank. “I was a little embarrassed how to act,” Hamilton confessed sheepishly to Church, “but upon the whole I concluded it best to fall in with them.”
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Instead of launching a separate bank, Hamilton decided to represent Church and Wadsworth on the board of the new bank. Ironically, he held in his own name only a single share of the bank that was long to be associated with his memory.

On February 23, 1784,
The New-York Packet
announced a landmark gathering: “It appearing to be the disposition of the gentlemen in this city to establish a bank on liberal principles…they are therefore hereby invited to meet tomorrow evening at six o’clock at the Merchant’s Coffee House, where a plan will be submitted to their consideration.”
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At the meeting, General Alexander McDougall was voted the new bank’s chairman and Hamilton a director. Snatching an interval of leisure during the next three weeks, Hamilton drafted, singlehandedly, a constitution for the new institution—the sort of herculean feat that seems almost commonplace in his life. As architect of New York’s first financial firm, he could sketch freely on a blank slate. The resulting document was taken up as the pattern for many subsequent bank charters and helped to define the rudiments of American banking.

In the superheated arena of state politics, the bank generated fierce controversy among those upstate rural interests who wanted a land bank and believed that a money bank would benefit urban merchants to their detriment. Within the city, however, the cause of the Bank of New York made improbable bedfellows, reconciling radicals and Loyalists who were sparring over the treatment of confiscated wartime properties. McDougall was a certified revolutionary hero, while the Scottish-born cashier, the punctilious and corpulent William Seton, was a Loyalist who had spent the war in the city. In a striking show of bipartisan unity, the most vociferous Sons of Liberty—Marinus Willett, Isaac Sears, and John Lamb—appended their names to the bank’s petition for a state charter. As a triple power at the new bank—a director, the author of its constitution, and its attorney—Hamilton straddled a critical nexus of economic power.

One of Hamilton’s motivations in backing the bank was to introduce order into the manic universe of American currency. By the end of the Revolution, it took $167 in continental dollars to buy one dollar’s worth of gold and silver. This worthless currency had been superseded by new paper currency, but the states also issued bills, and large batches of New Jersey and Pennsylvania paper swamped Manhattan. Shopkeepers had to be veritable mathematical wizards to figure out the fluctuating values of the varied bills and coins in circulation. Congress adopted the dollar as the official monetary unit in 1785, but for many years New York shopkeepers still quoted prices in pounds, shillings, and pence. The city was awash with strange foreign coins bearing exotic names: Spanish doubloons, British and French guineas, Prussian carolines, Portuguese moidores
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To make matters worse, exchange rates differed from state to state. Hamilton hoped that the Bank of New York would counter all this chaos by issuing its own notes and also listing the current exchange rates for the miscellaneous currencies.

Many Americans still regarded banking as a black, unfathomable art, and it was anathema to upstate populists. The Bank of New York was denounced by some as the cat’s-paw of British capitalists. Hamilton’s petition to the state legislature for a bank charter was denied for seven years, as Governor George Clinton succumbed to the prejudices of his agricultural constituents who thought the bank would give preferential treatment to merchants and shut out farmers. Clinton distrusted corporations as shady plots against the populace, foreshadowing the Jeffersonian revulsion against Hamilton’s economic programs. The upshot was that in June 1784 the Bank of New York opened as a private bank without a charter. It occupied the Walton mansion on St. George’s Square (now Pearl Street), a three-story building of yellow brick and brown trim, and three years later it relocated to Hanover Square. It was to house the personal bank accounts of both Alexander Hamilton and John Jay and prove one of Hamilton’s most durable monuments, becoming the oldest stock traded on the New York Stock Exchange.

ELEVEN

GHOSTS

A
fter the dreary saga of his own childhood, Hamilton wanted a large, buoyant clan, and Dr. Samuel Bard, the family physician, was kept in constant motion with Eliza bringing one little Hamilton after another into the world. On September 25, 1784, the Hamiltons had their first daughter, named Angelica in honor of Eliza’s sister. Not until Hamilton’s fourth and favorite child, James Alexander, came along in 1788 did they christen a baby in homage to the absentee grandfather in the Caribbean. Hamilton never named a child after his mother, Rachel, perhaps hinting at some residual bitterness toward her. In all, Alexander and Eliza produced eight children in a twenty-year span. As a result, Eliza was either pregnant or consumed with child rearing throughout their marriage, which may have encouraged Hamilton’s womanizing.

After their third child, Alexander, was born on May 16, 1786, the Hamiltons performed an exceptional act of kindness that has long been overlooked: they added an orphan child to their burgeoning brood. Colonel Edward Antill, a King’s College graduate and Revolutionary War veteran, had foundered as a lawyer and farmer after the war. When his wife died in 1785, he was grief-stricken and encumbered with six children. By 1787, after suffering a breakdown, he committed his two-year-old daughter, Fanny, to the Hamiltons, who took the bright, cheerful girl into their home. Edward Antill died two years later, so Alexander and Eliza kept the child until she was twelve, when she went to live with a married sister. “She was educated and treated in all respects as [Hamilton’s] own daughter and married Mr. [Arthur] Tappan, an eminent philanthropist of New York,” said son James.
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From London, Angelica Church cheered on her saintly sister, telling Hamilton, “All the graces you have been pleased to adorn me with fade before the generous and benevolent action of my sister in taking the orphan Antle [
sic
] under her protection.”
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That Eliza married one orphan, adopted another, and cofounded an orphanage points up a special compassion for abandoned children that might explain, beyond his obvious merits, her initial attraction to Hamilton.

For ten years, the Hamiltons had a home at 57 (then 58) Wall Street. A sketch of this bygone Wall Street shows a prosperous thoroughfare lined with three-story brick buildings. Well-dressed people saunter down brick sidewalks and roll in carriages over cobblestones at a time when many lanes were still unpaved. The young couple lived comfortably enough and entertained often, although Hamilton’s business records reveal numerous small loans from friends to tide them over. One of his first purchases after leaving the army bespoke the convivial host: he bought decanters, two ale glasses, and a dozen wineglasses. The vivacious Hamiltons stood high on the “supper and dinner list” compiled by Sarah and John Jay when they settled at 8 Broadway after returning from France in 1784. Very fond of drama, Alexander and Eliza were also frequently habitués of the Park Theater on lower Broadway.

Like her husband, Eliza was frugal and industrious, even if often appareled in the rich clothes of a society lady. Skilled in many domestic arts, she made handbags and pot holders, arranged flowers and wove table mats, designed patterns for furniture, cooked sweetmeats and pastry, and sewed undergarments for the children. She served plentiful meals of mutton, fowl, and veal, garnished with generous portions of potatoes and turnips and topped off with fresh apples and pears. The Hamiltons were treated to fresh produce shipped regularly from Albany by the Schuylers, and there were always demijohns of good wine on hand.

An acute disappointment of the Hamiltons’ early married life was their constant separation from Angelica by the Atlantic Ocean. From 1783 to 1785, John Barker Church lingered in Paris while winding up his business affairs with the French government. Angelica never met a famous, intelligent man she didn’t enchant, and she had soon befriended Benjamin Franklin. She prayed that Hamilton might someday sail to Europe and succeed him as American minister. Angelica was chagrined when her husband bought a town house on Sackville Street in London, then a regal country house near Windsor. During the summer of 1785, the Churches returned briefly to America and visited Hamilton, who was in Philadelphia on business, before returning to live in England. Afterward, Hamilton wrote forlornly to Angelica:

You have, I fear, taken a final leave of America and of those that love you here. I saw you depart from Philadelphia with peculiar uneasiness, as if foreboding you were not to return. My apprehensions are confirmed and, unless I see you in Europe, I expect not to see you again. This is the impression we all have. Judge the bitterness it gives to those who love you with the
love of nature
and to me who feel an attachment for you not less lively…. Your good and affectionate sister Betsey feels more than I can say on this subject.
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Outwardly, Angelica thrived in the tony salons of London and Paris and seemed a natural denizen of that risqué, rarefied world, yet she never overcame a certain homesick longing to get back to Eliza, Alexander, and her American roots.

With a perpetually busy husband, Eliza ran the household and supervised the education of the children when they were small. James Hamilton left a delightful vignette of how she taught them each morning. He remembered her “seated, as was her wont, at the head of the table with a napkin in her lap, cutting slices of bread and spreading them with butter for the younger boys, who, standing at her side, read in turn a chapter in the Bible or a portion of Goldsmith’s
Rome.
When the lessons were finished, the father and the elder children were called to breakfast, after which the boys were packed off to school.”
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Like Martha Washington, Eliza was never politically outspoken and did not spur her husband’s ambitions. At the same time, she never deviated from his beliefs, identified implicitly with his causes, and came to regard his political enemies as her own.

As a woman of deep spirituality, Eliza believed firmly in religious instruction for her children. On October 12, 1788, she and Alexander strolled with their children to the west end of Wall Street and had the three eldest—Philip, Angelica, and Alexander—baptized simultaneously at Trinity Church in the presence of the Schuylers, Baron von Steuben, and Angelica Church, who was visiting. After 1790, the Hamiltons rented pew ninety-two, and Alexander performed free legal work for the church, then the meeting ground for the city’s Episcopalian blue bloods. He was now quite changed from the young man who had knelt twice daily in fervent prayer at King’s College. Nominally Episcopalian, he was not clearly affiliated with the denomination and did not seem to attend church regularly or take communion. Like Adams, Franklin, and Jefferson, Hamilton had probably fallen under the sway of deism, which sought to substitute reason for revelation and dropped the notion of an active God who intervened in human affairs. At the same time, he never doubted God’s existence, embracing Christianity as a system of morality and cosmic justice.

Hamilton’s dark view of human nature never dampened his home life but only enhanced it. His eight children never appeared to utter a single unkind word about their father. Admittedly, his early death made such carping distasteful, but complaints don’t even surface in private letters. The second he got home, he shed his office cares and entered into his children’s imaginative world. Son James said, “His gentle nature rendered his house a most joyous one to his children and friends. He accompanied his daughter Angelica when she played and sang at the piano. His intercourse with his children was always affectionate and confiding, which excited in them a corresponding confidence and devotion.”
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