New York, Newark and Chicago: Their Beginnings and Early Growth

Professor Barr

Themes

• Three cities prominent role in U.S. during the 19th and 20th centuries.

• Three different circumstances regarding their founding:– NY: merchant City– Newark: Puritan “separatist” village.– Chicago: Transportation hub.

• Rapid growth all linked with canals.

Background

• The European “age of discovery” which began in the mid-15th century was:– A quest to increase trade and access to resources (as

such was inherently an economic phenomena).– Was a natural outgrowth of the rise nation-states in

Western Europe.– Search by European powers to the west and south

was a result of:• Attempt to minimize travel costs to Asia• Thwart monopolies of Mediterranean trade routes by

Ottoman Empire

Background: The Players• Spain:

– 1492 re-conquest of Iberian Peninsula– Columbus and conquest of Latin America

• Portugal and Prince Henry– Trade routes around africa.

• France– Exploration of North America.– Eg. Cartier

• England– Explorations of North America

• The Netherlands– Merchant Republic– Global search for trade routes

New York

• 1609: Henry Hudson a British navigator employed by Dutch East India company, NY Bay and Hudson River.

• He was search for highly sought after “North West Passage” to Asia.

• 1624 The Dutch West India company finances first colonial settlement of New Netherlands and New Amsterdam.

• The Dutch claim all territory between Connecticut River and Delaware River.

• The Hudson River was originally referred to as the North River

New York Harbor• Near ideal port for European Power:– Central location between Caribbean, North America and

Europe.• Ideal port in general:– NY Bay calmed ocean waters.– High concentration of salt in Hudson and East Rivers

reduced freezing in winters.– Deep water channel to the port– Access to interior:

• North via Hudson.• East River to Long Island Sound and New England.• Easy access to south.

New Amsterdam

• Founded a merchant town: Trade was it’s sine qua non.

• Polyglot town from the get go.• Geographically well-situated: offered low

transportation costs to the region.

Dutch West India Company

• Established in 1621 as a trading company with monopoly privileges over all trading in the Western Hemisphere.

• New Amsterdam was established in order to trade with Indians: especially furs and wood-based products.

• Expected to be self-sufficient.• All colonists were employed by the Company

and all trade was on behalf of the colonists.

New York

• 1664: the English take over New Amsterdam and change it to New York, in honor of James Stuart, Duke of York, and future Catholic king of England who would eventually be forced to abdicate the throne during the “Glorious Revolution” which restored protestant rulers to the throne.

New Amsterdam• As a commercial venture, it was a financial failure.• Colonists were not self-sufficient.• All were employees and had little incentive to

maximize output.• Easy to cheat the system by trading with the English to

the north.• In 1647, Peter Stuyvesant was brought in to bring

some “order” to the badly managedNew Amsterdam.• He helped to promote growth and order.• In the end, New Amsterdam was too weak to defend

itself against the British.

The Seal of NYC• Arms: Upon a shield, saltire wise, the sails of a windmill. Between the

sails, in chief a beaver, in base a beaver, and on each flank a flour barrel. • Supporters: Dexter, a sailor, his right arm bent, and holding in his right

hand a plummet; his left arm bent, his left hand resting on the top of the shield; above his right shoulder, a cross-staff. Sinister, an Indian of Manhattan, his right arm bent, his right hand resting on top of the shield, his left hand holding the upper end of a bow, the lower end of which rests on the ground. Shield and supporters rest upon a horizontal laurel branch.

• Date: Beneath the horizontal laurel branch the date 1625, being the year of the establishment of New Amsterdam.

• Crest: An American eagle with wings displayed, upon a hemisphere. • Legend: Upon a ribbon encircling the lower half of the design the words

"Sigillum Civitatis Novi Eboraci," meaning Seal of the City of New York. • The whole is encircled by a laurel wreath. The City Clerk is the custodian

of the City Seal.

1625(?)

The Erie Canal• Completed in 1825• Connected Buffalo with Troy, which connected with the

Hudson.• Put NY in a new center with the Midwest.• Canal dramatically reduced transportation costs to the

interior and dramatically increased trade between mid-west and east:

• Farm output moving east; people and finished goods moving west.

• The canal was perhaps the single most important “spark” that cemented New York’s place as the nation’s largest and most important city.

• It was a highly profitable venture for the state. Organically called DeWitt Clinton’s “Big Ditch”, its effect on the growth of development of both the US and NYC can not be overstated.

Newark

• Founded in 1666 when Robert Treat and band of families left CT to start their own Puritan town.

• Until the early 19th century, it was a small and relatively isolated agricultural village.

• Developed skills in leather, iron manufacturing and agriculture.

Newark• There was relatively little trade/production and

most of it was for local consumption.• Meadowlands/salt marshes acted a natural

barrier to interaction.• There were however ties to New York and New

Jersey that developed.• Newark was along the post road between Philly

and New York.• Newark was small but distinctly “middle class”:

Puritans stressed education. The land was fertile and produced good income (The “Garden State)

Newark

• Starting in the early 19th century, Newark experienced a radical transformation into an industrial city.

• Relative early comparative advantage in leather, due to– “first mover advantage”– Low cost supply of inputs: cows and

• The industry grew rapidly due to:– Availability of southern slave markets via the port of New

York.– Agglomeration economies related to leather production.– Profitable innovations.

Morris Canal

• Completed in 1837• Ran through essentially from Delaware River

to Hudson River, through Newark.• Instantly helped Newark’s economy grow.• Used to import iron and coal from west.

Newark

• Moses Combs in 1790 first mass producer of leather shoes.

• Sold for slaves in south.• Started a school for craftsmen.• Seth Boyden, inventor• 1826, everse engineered patent-leather:

sparked growth in leather industry.• Invented steam engines.

Chicago

• Was French territory until 1763• Originally explored as early as 1673.• Seen as a natural location between Great Lakes

and Mississippi River value.• Was a natural Indian portage: place were canoes

were carried between two bodies of water.• Was left undeveloped given:– A) cost of developing the land– B) lack of local markets.

Chicago

• At the start of industrial revolution, Chicago’s economic advantage was becoming worth the costs of developing it.

• 1822, Congress authorized Illinois to survey and take land for a canal.

• 1830, Chicago was formally incorporated.• 1848, the Illinois & Michigan Canal joined the Chicago

River with the Illinois River • The canal provided a direct water link between the

Great Lakes and the Mississippi River, and helped to shift the center of Midwestern trade to Chicago.