WEDDING OF THE WATERS The Erie Canal and the Making of a Great Nation
WEDDING OF THE WATERS
The Erie Canal and the
Making of a Great Nation
By Peter L. Bernstein
Norton; 448pp; $24.95
The Good A deftly written, insightful account of a major historical development.
The Bad Sometimes too much detail on New York politics, ancient history.
The Bottom Line A fun read that benefits from the author's deep understanding of global economic history.
A book about a 363-mile-long ditch dug through the middle of New York State almost 200 years ago and not used much since the 1950s? At first it seems an odd topic for Peter L. Bernstein, an economist and the author of the best-selling Against the Gods: The Remarkable Story of Risk. But to Bernstein, the Erie Canal was more than a manmade waterway between Buffalo and Albany that afforded access to New York City via the Hudson River. It was an early step toward globalization and a worldwide complex of transportation routes that today "is the glue that binds the world together." In the end, Bernstein's deft writing and deep understanding of global economic history makes Wedding of the Waters not just a convincing brief for the project's importance but a fun read as well.
The book starts out with an almost too exhaustive review of the history of canals, beginning with those built by the Babylonians in 2200 B.C. Then it takes up the early trials of finding a route that would tie the original 13 states to the growing populations west of the Appalachian Mountains. New York was not the first state to seek a link between the cities and ports of the Eastern seaboard and the livestock and wheat farms of what's now the Midwest. In 1785, Virginian George Washington pursued his own scheme, using the Potomac River Valley.
The Potomac project was unable to overcome geographic hurdles, however, and in the end it would be the Erie Canal that provided the link, passing through the Appalachians via the Mohawk River gorge. But before the canal would open in 1825 it would take nine decades of research and argument and a final 15 years of sharp political maneuvering by New York statesmen, including Governor DeWitt Clinton and powerful state legislator (and later U.S. President) Martin Van Buren. Manifest Destiny aside, it was an economic argument that carried the day: Bernstein cites an 1808 estimate by engineer and steamboat pioneer Robert Fulton that a ton of cargo could be moved 100 miles along the canal for $1. By road the cost would be 10 times that.
The canal wasn't the only place where new ground was broken. Financing for the Erie was unconventional, too. The U.S. had yet to develop a public bond market. The federal government had not begun footing the bills for interstate transportation. And the banking system, though starting to grow, was still limited to lending based on gold specie in vaults. Debtors' prison was the last stop for the overstretched -- and more than one of the players in Bernstein's book ends up there.
In the early 19th century, it was wealthy individuals who financed big projects. Recognizing that such resources alone would be insufficient for a project so large, the Erie's promoters pioneered a new form of finance: state-backed bonds supported by the anticipated revenue stream from the canal tolls. These canal bonds were issued around the time that New York's Bank for Savings was established, aiming to encourage the working class to save money. Through it the bonds came to be widely held by ordinary people. "Like a beach composed of many fine pieces of sand," Bernstein writes, "the bank pooled enough of these little deposits to become one of the largest investors in canal loans."
Bernstein's writing shines in these passages on finance. Somewhat less inspired are lengthy sections devoted to political battles that supporters -- particularly DeWitt Clinton -- had to win before the canal could be built.
The Erie was pivotal to the development of New York City, among other places. Before the canal, Philadelphia was the nation's largest exporter and importer. By 1830, only five years after the canal opened, New York's exports had grown to four times those of Philly. Bernstein also credits the canal with much of the growth of Ohio. In the end, he writes, the Erie Canal changed the axis of the country from North-South to East-West and opened up trade to Europe on a whole new level.
One of the book's treats is its detail about life in the early 1800s. In our world of tightly guarded limos it's hard to imagine that the U.S. President once traveled unaccompanied on horseback. Nor is it easy in an era of sound bites to appreciate the depth of knowledge that once backed popular political debate -- or the sophistication of the debaters' language. This was a canal dug by hand that would become a keystone of U.S. culture, inspiring plays, songs, and poems. With all the progress America has seen, it's bittersweet to consider some of the valuable things we have lost.
By Nanette Byrnes