This article is by Jack Kelly, the author of Heaven’s Ditch: God, Gold, and Murder on the Erie Canal (St. Martin’s Press), a lively account of the canal and the many excitement generated along its banks that was published in July.
It’s no exaggeration to say that the Erie Canal made the Big Apple. In the early decades of the nineteenth century, a number of cities were competing to be the nation’s greatest port and commercial center. That honor depended on tapping the abundant supply of grain, lumber and other resources of the vast Middle West. The audacious, 360-mile waterway that New York State built between 1817 and 1825 solidified New York’s claim, pushing the city ahead of New Orleans, Baltimore and Philadelphia. Today, signs of that great project are scattered around New York, although the city itself is the greatest symbol of the canal’s phenomenal success.
Former Bank for Savings (note sign on the facade) at 270-280 Park Avenue South at 22nd Street Jim.Henderson
New York State planned to finance the canal’s construction by issuing bonds. But the long ditch was a risky venture and neither commercial banks nor wealthy individuals were eager to take a chance. Canal backer Thomas Eddy suggested establishing a savings bank–the city’s first–to allow working and middle class families to invest in the project. The Bank for Savings was chartered in 1819, two years after canal construction began.
Founders predicted $50,000 of deposits in the first year. Instead, eager savers invested $155,000 in the first six months of the bank’s existence. The bank became the largest owner of canal bonds. Depositors were rewarded as the Erie paid off in spades. The bank inspired other savings banks and endured, through several name changes, until the 1990s. You can find one of its former locations at 270-280 Park Avenue South at 22nd Street, with “The Bank for Savings” still visible on the facade.