Venturi's Franklin Museum in Franklin Court

Franklin Court Museum

When Judge Edwin O. Lewis was seized with the idea of making a national monument out of Colonial Philadelphia, he wanted it big. Forty or so years later, it's big all right, but not big enough to encompass the whole of America's most historic square mile. Government ownership in the form of a cross now extends five blocks north from Washington Square to Franklin Square, and four blocks East from Sixth to Second Streets. Restoration and historic display have spread considerably beyond that cross, however, and the Park Service has created ingenious walkways within the working city in the neighborhood. If you thread your way through these walkways, you can stroll for miles within the world of William Penn and Benjamin Franklin. One such unexpected walkway is now called Franklin Court, which essentially cuts from Market to Chestnut Streets, within the block bounded by 3rd and 4th Streets. Hidden in the center is the reconstructed ghost of Franklin's quite large house, sitting in an interior courtyard bounded by a colonial post office, and a newspaper office once operated by Franklin's grandson. And, along the side of the walkway near Chestnut Street, is a fascinating museum of Franklin's personal life, built by no less than Frank Venturi, and operated by Park Rangers in the polished but low-key manner for which the U.S. Park Service is famous.

For some reason, this jewel of a museum has not received the high-powered publicity it deserves. It's off the main Park premises, as we mentioned, and some of the problem has to be attributed to Venturi. As you walk through, you don't expect a huge museum to be there, and it can look pretty inconspicuous as you walk past because it is mostly underground. Take my word for it, it's worth a visit. There are long descending ramps inside the doors, which can be pretty daunting if you are elderly and tired. But, also inconspicuous, there's an elevator if you look around for it. Venturi didn't seem to like windows very much, which is a problem for some people.

There's a movie theater inside there, playing a long list of fascinating documentaries. There's an ingenious automated display of statuettes which utilize spot lights and revolving stages to present Franklin in Parliament, resisting the Stamp Act, Franklin being his charming self before the French monarchs, and the frail dying Franklin getting the Constitutional Convention to approve the document. There are also a variety of ingenious inventions of Franklin's on display in the original, including bifocal glasses, the first storage battery, a simplified clock, several library devices, the Franklin stove, and so on. In some ways, the highlight is the Armonica.

The Armonica is the musical instrument invented by Franklin, for which both Beethoven and Mozart composed special music to exploit its haunting tone. If you ask the nice Park Ranger, she will be flattered to play you a tune on it.

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Armonica, Momentarily Mesmerizing

Ben Franklin's Glass Armonica

Everyone knows Ben Franklin spent a lot of time holding a wine glass. Evidently, he noticed a musical note emerges if you run your finger around the open mouth of the drinking glass, and systematically studied how the tone can be varied by varying the level of liquid in the glass. The same variation in emitted tone relates to variations in thickness of the glass. So, he set up a series of different sized glasses impaled on a horizontal broomstick, enough to cover three octaves, rotated the broomstick with a treadle like those used for spinning wheels -- and made music. The tone has a haunting penetration to it, which induced both Beethoven and Mozart to write special compositions for the armonica, and the Eighteenth Century went wild with enthusiasm.

Glass Armonica

Unfortunately, a number of the young ladies who played the armonica went mad. We now recognize that since the finest crystal glass was used, with a very high lead content, the mad ladies were suffering from lead poisoning after repeatedly wetting their fingers on their tongues. As a matter of fact, port wine at that time was stored in lead-lined casks, resulting in the same unfortunate consequences, which included stirring up attacks of gout. Franklin himself was a famous sufferer from gout, which was more likely related to the port wine than playing the armonica, in his particular case.

Anyway, the reputation for inducing madness added to the spooky sort of sound the instrument made, attracting the attention of a montebank named Franz Anton Mesmer, who falsely claimed to be the the father of hypnotism. Mesmer enhanced the notiety of his stage performances by hypnotizing subjects while an assistant played the armonica, meanwhile relating all sorts of wild tales about animal magnetism. This was pretty sensational at the time, until a young man in an audience suddenly died. It is now speculated that the victim probably had an epileptic seizure, but the news of this public fatal event pretty well finished Mesmer as an evangelist, and the armonica as a musical instument.

Franklin Court

There's a replica of an armonica on display in the Franklin Court Museum around 3rd and Chestnut, which we are vigorously assured is not made with leaded crystal glass. The Park Rangers put on two daily performances by request, at noon, and 2:30 PM.

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Joseph Priestley, Shaker and Mover

Priestly

Joseph Priestley, sometimes also spelled Priestly, is surely one of the more undeservedly neglected men of history. He has been called, with justice, the Father of the Science of Chemistry. He might also be called with equal justice, the father of the First Unitarian Church . The First Unitarian Church of Philadelphia, at 21st and Walnut, is the first and oldest Unitarian church, and was indeed started at the urging of Priestley. Priestly wrote a scholarly work on the teachings of Jesus, which so captivated Thomas Jefferson that Jefferson wrote him the outline of another book that needed writing. Apparently, Priestley didn't have time, so in 1803 Jefferson wrote it himself, in the four languages he was fluent in, English, French, Latin and Greek. Although those were simpler times, there have been few if any others who have told a President of the United States that he was just too busy to respond to a presidential request, particularly when the President could then find he had time to do it himself.

Priestley's theological teachings were based on scientific reasoning. They were highly controversial, to say the least. He rejected the concept of a Trinity (he was a Calvinist minister, mind you), the divinity of Christ, and the immortality of the soul. Essentially, he rejected the concept of an immortal soul on the reasoning that perceptions and thought were functions of material structures in the human brain (Edmund O. Wilson's idea of Conscience is largely similar), and therefore will not outlive the cerebral tissue which produced them. In 1791, mobs burned his house in Birmingham, England, his patronage was revoked, and he hastily emigrated to Philadelphia. It isn't hard to see why these ideas were unpopular with the Anglican church, which is probably the main reason he was made into a non-person, and his scientific ideas denigrated as the product of other people.

That's too bad, because he really was a scientist of immense importance. As a young man, he encountered Benjamin Franklin in England, and he was certainly a man after Franklin's heart. He noticed funny things about gases that rose from swamps and over mercury salts, and Franklin encouraged him to systematize and analyze his observations into theory. Although he called it anti-phlogiston, he discovered oxygen. And then hydrogen, and nitrous oxide, and sulfur dioxide, and hydrochloric acid. He really was the first scientific chemist, the Father of Chemistry. Franklin, Lavoisier, and Priestley became fast friends, and enthusiastically exchanged ideas and observations, eventually leading to Lavoisier's fundamental principle: Matter is neither created nor destroyed, it only changes its form. But in the end, it made no difference. Priestly had offended some pretty large religions, so nothing he did in chemistry was going to get much attention. He went up to Northampton, Pennsylvania, now two hours drive North, establishing a little religious colony the relics of which anybody can now visit, but hardly anyone now does visit. He died in 1804, just after his friend and co-religionists Thomas Jefferson became President of the United States.

Priestley's life can be summarized in one of his own most quoted remarks. "In completing one discovery we never fail to get an imperfect knowledge of others of which we could have no idea before, so that we cannot solve one doubt without creating several new ones."

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Alexander Hamilton, Celebrity

He had the kind of taudry private life and flashy public behavior that Philadelphia will only tolerate in aristocrats, sometimes.

It comes as a surprise that most of the serious, important things Alexander Hamilton did for his country were done in Philadelphia, while he lived at 79 South 3rd Street. That surprises because much of his more colorful behavior took place elsewhere. He was born on a fly-speck Caribbean island, the "bastard brat of a Scots peddler" in John Adams' exaggerated view, was orphaned and had to support himself after age 13. The orphan then fought his way to Kings College (now Columbia University) in New York in spite of hoping to go to Princeton, and has been celebrated ever since by Columbia University as a son of New York. He did found the Bank of New York, and he did marry the daughter of a New York patroon, and he was the head of the New York political delegation. As you can see in the statuary collection at the Constitution Center, he was a funny-looking little elf with a long pointed nose, frequently calling attention to himself with hyperkinetic behavior. Even as the legitimate father of eight children, Hamilton had some overly close associations with other men's wives, probably including his wife's sister. Nevertheless, he earned the affection of the stiff and solemn General Washington, probably through a gift of gab and skill getting things done, while outwardly acting as court jester in a difficult and dangerous guerilla war. There is a famous story of his shaking loose from the headquarters staff and fighting in the line at Yorktown, where he insolently stood on the parapet before the British enemy troops, performing the manual of arms. Instead of using him for target practice, the British troops applauded his audacity. Harboring no such illusions, Aaron Burr later killed him in a duel as everyone knows; it was not his first such challenge.

Alexander Hamilton

Columbia University President Nicholas Murray Butler told other stories of celeb behavior to reinforce Hamilton's New York flavor. But in the clutch, General Washington learned he could always trust Hamilton, who wrote many of his letters for him and acted as his reliable spymaster. When the first President faced signing or not signing the fateful bill to create the National Bank, a perplexed Washington had to choose between: the violent opposition of Thomas Jefferson and James Madison, or the bewildering complexity of Alexander Hamilton's reasoning in arcane economics. On the one hand, there was the simple principle that owing money was seemingly always evil; on the other was the undeniable truth that for every debit created, you create a balancing credit somewhere. Washington ultimately chose to go with Hamilton, whose reasonings he likely didn't understand very well. If you doubt the difficulty, try reading Hamilton's Report on the Bank, written to persuade the nation and its first President of the soundness of his ideas. And then consider the violence of even present-day arguments about such "supply side" economics.

Nicholas Murray Butler

All of these momentous events happened in Philadelphia at places now easily visited in a morning's stroll. But Hamilton's image as a Philadelphian, doing great things in and for Philadelphia, was forever tarnished at one single dinner he hosted. Jefferson and Madison, his political opponents but his guests, were persuaded to provide Virginia's votes for the federal takeover of state Revolutionary War debts, in return for offering New York's votes for moving the nation's capital to the banks of the Potomac. True, Pennsylvania allowed itself to be pacified with having the capital remain here for ten years while the southern swamps were being drained. But it was Hamilton who cooked up this deal and sold it to the other vote swappers. Philadelphia felt it was entitled to the capital without needing to ask, felt that Hamilton was deliberately under-counting Pennsylvania's war debts, and this city has never appreciated the insolent idea that its entitlements were forever in the hands of wine-swilling hustlers. As the economic consequences of this backroom deal became evident during the 19th Century, it was increasingly unlikely that Philadelphia would lionize the memory of the man responsible for it. Let New York claim him, if it likes that sort of thing. When Albert Gallatin, who was more or less a Pennsylvania home town boy, attacked Hamilton as a person, as a banker, and as a Federalist -- he had a fairly easy time persuading Philadelphians that this needle-nosed philanderer was an embarrassment best forgotten.

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Carpenters Hall

Carpenters Hall

The birthplace of our nation is both smaller than you would expect, and larger. The fire marshall now says no more than 83 people may rent it for a sit-down affair, or 103 for a stand-up gathering. However, the internal partitions have been removed from what was once a center-hall building with a meeting room on either side; it now is a large open room in the form of a Greek cross. At the time of the revolution, Benjamin Franklin's Library Company occupied the second floor, so the First Continental Congress had to find a way to do its work in the side rooms of the first floor, to the side of the center hall. There were 53 delegates, and presumably some staff and visitors.

Independence Hall

That sounds rather crowded, but it was nevertheless the largest rentable public space in the city. John Adams arrived early for the convention, conniving with several other early arrivals at the City Tavern. Adams made the following notation in his diary: Monday. At ten the delegates all met at the City Tavern, and walked to the Carpenters' Hall, where they took a view of the room, and of the chamber where is an excellent library; there is also a long entry where gentlemen may walk, and a convenient chamber opposite to the library. The general cry was, that this was a good room, and the question was put, whether we were satisfied with this room? and it passed in the affirmative." Alternative places to meet would have been in churches, which presented awkwardness, or in the State House (Independence Hall) which was then under the control of Tories.

Continental Congress

France and the rebellious colonies was a complicated one, with intrigue and mistrust at every turn. One interesting episode had to do with Franklin's library on the second floor. The French ministry had sent over a spy, to size up the colonists before the French risked too much on them. So, the spy was led up to the library and allowed to overhear some bellicose conversations going on downstairs -- thoroughly stage-managed for the benefit of the "hidden" French visitor.

The Carpenters Company was a guild of what we would now call builders and architects, and architects continue to use it. The first floor usually displays a few Windsor chairs dating to the Continental Congress, covered with a rich black patina that really lets you know what a patina was. Upstairs, the staff quarters are now, well, a little on the elegant side so you can't visit. The guild was formed in 1724, and fifty years later had just completed its building, in time for its historic role in 1774.

Elfreth's Alley

With the whole continent available for building, it is still not entirely clear why Colonial Philadelphia crowded itself into half a square mile, with crowded little row houses on crowded little alleys. But that's the way it was, now visible in the location of Carpenters' Hall down a little cobbled alley, in the center of a block. Elfreth's Alley gives you the same feeling, and perhaps Camac,Mole, and Latimer Streets. Carpenters' is a lovely little place, with lots of interesting features, but the main interest lies in what took place there. For that you have to read a few books.

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American Philosophical Society

Charles Wilson Peale (1741-1827) The Artist in His Museum 1822, Oil on canvas (The Joseph Harrison Jr. Collection) Courtesy of the Pennsylvania Academy of Fine Arts.

all of the red brick buildings on Independence Square look as though they were part of Independence Hall, but there is one exception. The building facing Fifth Street is Philosophical Hall, one of the four buildings of the American Philosophical Society. Right now, Philosophical Hall is used as a museum. It could be called the first museum in America, but not the oldest, because it had interruptions and different proprietorships. Charles Wilson Peale started his museum of curiosities there, and then moved it to the second floor of Independence Hall, where he painted the famous portrait of himself holding up the curtain. In recent years, Philosophical Hall has again become a museum, holding treasures and curiosities belonging to the Philosophical Society itself. The docent is pleased to alternate between calling it America's new oldest museum, and America's oldest new museum. And, yes, the newell post has an Amity Button.

American Philosophical Society

Patents were established by the Constitution when it was a piece of parchment lying on a table fifty feet away from here, and the early patent office required the submission of a working model of every application for patent. After a while that got to be a lot of working models lying around, and many of the more interesting ones are on display in the museum. Like the model of Fitch's first steamboat, or the gadget Jefferson used, to make simultaneous copies of documents he was writing. That's right near the Gilbert Stuart copy of Washington's portrait, and von Neumann's first algorithm to be stored in his stored program machine, or computer, and Neil Armstrong's speech on the moon, concerning one step for mankind and all. It's a splendid museum, full of the real stuff, in a handsome Georgian building with sparkling immaculate marble staircases.

John Fitch received a US Patent for the Steamboat August 26, 1791

In the Eighteenth Century, Natural Philosophy was what we now call science. That's why PhDs get a degree of Doctor of Philosophy when they study chemistry and physics. The idea for forming a scientific society in America apparently originated with John Bartram. As so often happens, the originator couldn't quite get it established, and had to call on Ben Franklin that impressario of publicity, to get it off the ground. To be fair about it, Franklin was probably the more distinguished scientist of the two. To be even more fair about it, the organization struggled a bit until Thomas Jefferson (that's the one who was President of the United States) gave it a real publicity shove. During the depths of the 1930s depression, one of the members left it several million dollars with the stipulation that the investments should focus on common stock. Since buying stock in 1935 was widely regarded as about the stupidest thing an investor could do, this little episode reinforced a strong impression that membership in the APS is given to people who are very smart, not merely famous. The four buildings, the many fellowships, and the big endowment were largely made possible by this contraries investment decision.

There are eight hundred members, of whom 93 have won Nobel Prizes. Over the years, two hundred members have been awarded Nobel Prizes, but you must remember that the organization existed for 150 years before there was such a prize. Several U.S. Supreme Court justices are members, and lots and lots of people who are famous. The docent comments that they look pretty much like everyone else. There's a rumor that Bill Gates turned down the offer of membership, so now we will just see. He's young enough to have several decades' opportunity to reconsider an offer, although the APS might just be old enough to lack interest in any second chances.

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Franklin Declares Independence a Year Early

Joseph Priestly

Joseph Priestly became a close friend of Benjamin Franklin almost as soon as they met. Priestly was an Anglican clergyman who broke loose and formed the Unitarian Church, and meanwhile his scientific discoveries also entitle him to be called the Father of Chemistry. It would be hard to be sure which of the two was the more brilliant. In July, 1775, Franklin wrote the following letter to Priestly, which makes a trenchant case that the American colonies should, and would, break away from England. Since some legal authorities, following Lincoln's lead, maintain that Jefferson's manifesto "informs" the United States Constitution, it might be well to begin referring to this letter as an even clearer statement of the mind set of America's founding leaders.

General Thomas Gage

" Dear Friend,

"The Congress met at a time when all minds were so exasperated by the perfidy of General Gage, and his attack on the country people, that propositions of attempting an accommodation were not much relished; and it has been with difficulty that we have carried another humble petition to the crown, to give Britain one more chance, one opportunity more of recovering the friendship of the colonies; which however I think she has not sense enough to embrace, and so I conclude she has lost them for ever.

"She has begun to burn our seaport towns; secure, I suppose, that we shall never be able to return the outrage in kind. She may doubtless destroy them all; but if she wishes to recover our commerce, are these the probable means? She must certainly be distracted; for no tradesman out of Bedlam ever thought of encreasing the number of his customers by knocking them on the head; or of enabling them to pay their debts by burning their houses.

"If she wishes to have us subjects and that we should submit to her as our compound sovereign, she is now giving us such miserable specimens of her government, that we shall ever detest and avoid it, as a complication of robbery, murder, famine, fire and pestilence.

"You will have heard before this reaches you, of the treacherous conduct to the remaining people in Boston, in detaining their goods, after stipulating to let them go out with their effects; on pretence that merchants goods were not effects; -- the defeat of a great body of his troops by the country people at Lexington; some other small advantages gained in skirmishes with their troops; and the action at Bunker's-hill, in which they were twice repulsed, and the third time gained a dear victory. Enough has happened, one would think, to convince your ministers that the Americans will fight, and that this is a harder nut to crack than they imagined.

"We have not yet applied to any foreign power for assistance; nor offered our commerce for their friendship. Perhaps we never may: Yet it is natural to think of it if we are pressed.

"We have now an army on our establishment which still holds yours besieged.

"My time was never more fully employed. In the morning at 6, I am at the committee of safety, appointed by the assembly to put the province in a state of defence; which committee holds till near 9, when I am at the congress, and that sits till after 4 in the afternoon. Both these bodies proceed with the greatest unanimity, and their meetings are well attended. It will scarce be credited in Britain that men can be as diligent with us from zeal for the public good, as with you for thousands per annum. -- Such is the difference between uncorrupted new states, and corrupted old ones.

"Great frugality and great industry are now become fashionable here: Gentlemen who used to entertain with two or three courses, pride themselves now in treating with simple beef and pudding. By these means, and the stoppage of our consumptive trade with Britain, we shall be better able to pay our voluntary taxes for the support of our troops. Our savings in the article of trade amount to near five million sterling per annum.

"I shall communicate your letter to Mr. Winthrop, but the camp is at Cambridge, and he has as little leisure for philosophy as myself. * * * Believe me ever, with sincere esteem, my dear friend, Yours most affectionately."

[Philadelphia, 7th July, 1775.]

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What Happened in Philadelphia on July 4, 1776?

Spirit of 76'

Although the origins of the American Revolution are subtle and complex, even historically controversial, there is less excuse for being muddled about what happened on July 2, 1776, proclaimed in public two days later. The Thirteen Colonies stated they had now changed their goals in the controversy with the British monarchy. For a year before that, the Continental Congress had been corresponding and meeting in Carpenters Hall with the goal of achieving representation in the British parliament -- "No taxation without representation". But the appearance of seven hundred British warships in American waters showed that not only was Parliamentary representation out of the question, but King George III was going to play rough about any colonial challenge. The restructured goal was no longer just representation, it was independence. If we were going to resist a military occupation at the risk of being hanged as traitors, we might as well do it for something more substantial than representation. The meeting had a number of Scotch-Irish Princeton graduates, whose basic loyalty to England was small. Pacifist Pennsylvania, chief among the wavering hold-outs, was mostly won over by its own Benjamin Franklin, who was confident the French could be enlisted to help us. He was promptly dispatched back to Paris to make it happen; Washington was dispatched to hold off that British fleet in the meantime. Jefferson was designated to write a proclamation of righteousness, which even after editing is still pretty unreadable beyond the first couple of sentences. Meeting adjourned. This brief account may not qualify as a serious examination of the causes of the American Revolution, but it comes close to the way it seemed to the colonist in the street.

Colonist's Complaint

The rebels then spent eight years convincing the British they were serious, and have been independent ever since. But, just a minute,here. Reflect on the fact that fighting had been going on for a year in Massachusetts, and that Lord Howe's fleet had set sail a month before the Declaration, actually landing on Staten Island at just about the same time as the Fourth of July. Add the fact that only John Hancock actually signed the document on July 4th, and some of the signers even waited until September. You can sort of see why John Adams never got over the idea that Thomas Jefferson had a big nerve implying the whole thing was his idea. What's more, there's a viewpoint that New England subsequently had to endure a President from Virginia for thirty-two of the first thirty-six years of the new nation because loud talk from New England made the rest of the country nervous. Philadelphia may have been the cradle of Independence, but that was not because it was a colony hot for war, dragging the others along with it. Rather, it was the largest city in the colonies, centrally located. It had a strong pacifist tradition, and it had the most to lose from a pillaging enemy war machine. When Independence was finally stated as the goal, many of its leading citizens moved to Canada.

New England was in the position of having started hostilities, and was about to be subdued by overwhelming force. The Canadians were not going to come to their aid, because they were French, and Catholic, and enough said. What New England and the Scotch-Irish needed was WASP allies, stretching for two thousand miles to the South. By far the largest colony was Virginia, which included what is now Kentucky and West Virginia; it even had some legal claims for vastly larger territory. The rest of the English colonies had plenty of assorted grievances against George III, and almost all of them could see that America was rapidly outgrowing the dependency on the British homeland, without any sign that Parliament was ever going to surrender home rule to them. Perhaps it was unfortunate that New Englanders were so impulsive, but it looked as though a confrontation with the Crown was inevitably coming. Without support, New England was likely to be subdued like Carthage.

And the last hope for flattery and diplomacy, for guile and subtlety, had recently stepped off the boat. Benjamin Franklin, our fabulous man in London, had finally had it "up to here" with the British ministry. He finally was saying what others had been thinking. It was now, or never.

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After the Convention:Hamilton and Madison

Signers Declaration Independence

The Federalist Papers were written by three of the founding fathers after the Constitution was completed, to be published in New York newspapers for the purpose of persuading that State to ratify the proposal. It should be more emphasized that The Federalist was composed of arguments most likely to persuade New York, and that the authors held back from discussing matters of more concern to other regions of the nation. John Jay only wrote five of the essays, almost entirely concerned with issues of foreign relations. The remaining essays were written by Alexander Hamilton and James Madison, who became the leaders of two bitterly opposed political parties almost as soon as the Constitution was ratified. It is true that Madison's essays were mainly concerned with relations between the several states, while Hamilton's were overweighted somewhat with considerations of the powers of the various branches of government. But it is nevertheless striking that two men who proved to harbor strikingly opposed visions could suppress them to collaborate so extensively on discussions of the topic with such apparent unity of purpose. To some extent this paradox will probably always seem perplexing, but some of us are comfortable with the idea that it dramatically illustrates the speed and power of political adherents to reshape the mind of their leader. Today, it is common to slur politicians for pandering to lobbyists and special interests, but that too is a slanted description of more powerful forces shaping leadership opinion.

As a curious thing, both Hamilton and Madison were short and elfin, and both relied heavily on their ability to influence the mind of

George Washington

George Washington, who was quite a large formidable personage. Washington had no strong inclination to run things and, once elected, no particular agenda except to preside in a way that would meet general approval. He had mainly wanted a new form of government so the country could defend itself, and its soldiers get paid. Madison was a principal author of the Constitution while Hamilton's role in the design was small. On the other hand, the proceedings of the Constitutional convention were kept secret, and the official history was written by Madison. It would not be the last convention in which the real decisions were taken outside of the chamber, and often misunderstood by reading descriptions written by an activist secretary.

The difference between the two men immediately appeared in the way they chose a role to play. Madison the Virginian chose to dominate the legislative process as the leader of the largest state delegation within the

Alexander Hamilton

House of Representatives, in those days the dominant chamber. Hamilton sought to be Secretary of the Treasury, in those days the largest and most powerful department of the executive branch. It's now a familiar pattern: one wanted to form policy through dominating the board of directors, while the manager wanted to run things his way, even if that led in a different direction. Both of them knew they were setting the pattern for the future, and each of them pushed his ideas as far as they would go. Essentially, this could go on until Washington roused himself.

After a short time in office, Hamilton wrote four historic papers about two general goals: a modern financial system, and a modern economy. For the first goal, he wanted a dominant national currency with a mint to produce it and a bank to control it. Second, he also wanted the country to switch from an agricultural base to a manufacturing one. You could even say he really wanted only one thing, a national switch to manufacturing, with the necessary financial apparatus to support it. Essentially, Hamilton was the first influential American to recognize the power of the Industrial Revolution which began in England at much the same time as the American Revolution. Hamilton was swept up in dreams of its potential for America, and while puzzled -- as we continue to be today -- about some of its sources, became convinced that the secrets lay in the economic theories of

David Hume

David Hume and Adam Smith in Scotland, and of Necker in France. Impetuous Hamilton saw that Time was the essence of opportunity; we quickly needed to gather the war debts of the various states into the national treasury, we quickly needed a bank to hold them, and a mint to make more money quickly as liquidity was needed. It seemed childishly obvious to an impatient Hamilton that manufacturing had a larger profit margin than agricultural products did; it was obvious, absolutely obvious, that this approach would inspire huge wealth for the new nation.

Industrial Revolution

Well, to someone like Madison who was incredulous that any gentleman would think manufacturing was a respectable way of life, what was truly obvious was that Hamilton must be grabbing control of the nation's money to put it all under his own control. He must want to be king; we had just got rid of kings. Furthermore, Hamilton was all over the place with schemes and deals; you can't trust such a person. In fact, it takes a schemer to know another schemer at sight, even when the nature of the scheme was unclear. Madison and Jefferson couldn't understand how anyone could look at the vast expanses of open continent stretching to the Pacific without recognizing in this must lie the nation's true destiny. Why would you fiddle with pots and pans when with the same effort and daring you could rule a plantation and watch it bloom? If anyone had used modern business jargon like "Win, win strategy", the Virginian might well have snorted back, "When you say that to me, friend, smile."

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Andrew Hamilton (1676-1741)

Philadelphia City Hall

An admirer of Philadelphia Reflections recently asked who is the most under-appreciated Philadelphian, and the quick answer would be William Penn. The He's inadequately praised right at the present time, perhaps, but after all the whole State of Pennsylvania is named after him, along with countless universities and institutions, and his thirty-seven foot statue is on top of City Hall. The Pennsylvanian who seems most under appreciated on a more or less permanent basis is Andrew Hamilton.

Andrew Hamilton

That is definitely notAlexander Hamilton, nearly a century younger and no relation. Andrew was born in Virginia but moved to Philadelphia in 1716, aged 30. He is frequently referred to as the finest lawyer of his era in America, holding numerous public offices. He was Speaker of the Pennsylvania House of Representatives in 1735, and 59 years old, when he took on the task of defending John Peter Zenger the New York publisher. For this successful case he is mainly known today, but it is not true at all that he was then a young unknown lawyer trying to establish a reputation as, the lawyers say, a rainmaker. Rather, he took up the task of defending Zenger in another colony, without fee, because he felt there existed a threat to the entire judicial system and someone had to assert leadership about it. Zenger was in conflict with the Governor of New York, evidently a ruthless sort of person, and the Governor had disbarred Zenger's two defense lawyers for opposing him. Hamilton felt it was the duty of an eminent lawyer from another colony to come forward and see that justice was defended. It was surely not immodest of him to feel that even a wild and wooly governor would not dare disbar the famous chief legislative officer of Pennsylvania. There was probably still some personal risk, and even some risk to professional reputation, because Zenger seemed clearly guilty of breaking the libel laws as they were then understood.

Trial

Zenger had published articles describing the outrageous conduct of the Governor, and could not deny he had published them. In the common view, he had libelled the Governor. The judge refused to hear evidence that the published stories were true, because the law stated that truth was not a defense. The only defense seemingly possible was that the stories somehow did not meet the definition of libel, and the judge suggested to Hamilton that he get on with arguing that particular escape-hatch. Hamilton, however, would have none of it.

William Penn

His first statement in defense was that he and his client readily admitted the published articles met the definition of libel, so he would save the prosecutor's time presenting witnesses on the point. He turned to the jury and urged them to nullify any law which prevented injured people from making a truthful complaint, as William Penn had established they had a right to do, nearly a century earlier. In a sense, both Penn and Hamilton were going back to the Magna Charta, where a jury was seen able to set a limit on what any king could do to an Englishman. The judge intervened that a jury may do what they were instructed to do. Yes, said Hamilton, and they may do otherwise. Although the jury had surely never heard of such legal fine points, they didn't like the idea of punishing a man for telling the truth, and firmly declared that Peter Zenger was therefore not guilty of anything, including libel, for doing so.

These principles were destined to become imbedded in the United States Constitution fifty years later, and were greeted with great praise and published applause by Benjamin Franklin, then the young publisher of the largest newspaper in Pennsylvania. Evidently, Franklin and Hamilton sought each other out, and in time Franklin became the protege and main political associate of Hamilton in the Pennsylvania Legislature.

Philadelphia Bar

The Zenger case established the fame of Philadelphia lawyers for all time, and Hamilton is honored by the Philadelphia bar association as their patron saint. No doubt he welcomed the praise of his colleagues, but he certainly did not need it. He had already risen to the top before this case, and it was for that reason he took it on, not as a duty to Zenger, but as a duty to the Law. Like so many people who achieve a little eminence, he had everything to lose and nothing to gain by taking risks. But unlike the common lot of prominent people, he felt a duty to do what he had to do.

Ind Hall

Details of the rest of Andrew Hamilton's life are surprisingly sketchy, but property records establish that he was remarkable in a lot of other ways, too. He purchased the land on which Independence Hall is situated, and gave it to the public. He purchased five hundred acres in the wilderness and founded the City of Lancaster on it. And he purchased two hundred fifty acres, later expanded to six hundred, on the high bank of the Schuylkill where European settlement had been first begun by the Dutch, at Gray's Ferry. His son built Woodlands as a country estate, established Woodland Cemetery along Woodland Avenue, and built Hamilton Village as the place in West Philadelphia where the Drexels, Weightmans, Pauls and other wealthy families put their mansions. If you like, you can stroll down the center of the University of Pennsylvania campus, on Hamilton Walk.

Penn Railroad

Someday, the glory of all this will surely return. Meanwhile, the Pennsylvania Railroad and successors have made the Gray's Ferry area nearly uninhabitable. Woodland sits behind a thicket of untended bramble, hidden from the trains except for the briefest glimpse if you know to look. The Veteran's Administration Hospital sits on the edge of Woodland, blocking the view unless you know to use Google Earth to see it sitting there begging to be visited. The University has turned its back on Woodland, using it mostly as a backdoor driveway toward its numerous parking garages, fearful the world might notice how close it is to deplorable slums.

Water Works

ut some day, we can confidently expect that vision will re-emerge, the Schuylkill waterfront should resemble the Seine through Paris, linking Woodland to Bartram's Gardens, and perhaps on to Fort Mifflin. When that day dawns, maybe more people will also remember who Andrew Hamilton was.

http://www.philadelphia-reflections.com/blog/1191.htm

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French Philadelphia

Henry Wadsworth Longfellow

Since American relations with France are a little strained at the moment, it may not be completely welcome to hear it said that Philadelphia food is Creole. The reference is not to the several downtown French restaurants of outstanding quality, but to the two episodes when Philadelphia experienced waves of French immigration. The first of these was during the French and Indian War, when the Acadian French ("Cajun") were driven out of Nova Scotia, largely went to Louisiana and then were allowed to return. A lot of them stopped off in Philadelphia both going and coming. Henry Wadsworth Longfellow depicted, in his poem Evangeline, the tearful reunion of Evangeline and Gabriel in the hospital. And since, for sixty years the Pennsylvania Hospital was the only hospital in the country, Longfellow had to put them here.

The second wave of French immigration was provoked by the guillotine in Paris, and the black revolution in French Haiti. Most people today are unaware that Talleyrand lived here, and LaRochefoucauld. The Duke of Orleans, future king of France, lived at 4th and Locust Streets, proposed to a (rich) Philadelphia lady, and was rejected by her father ("Sir, if you do not become king of France, you will be no match for her, and if you do become king, she will be no match for you.") Napoleon's brother Joseph lived at 9th and Spruce, and one of his marshals lived at 6th and Spruce. Really. Tallyrand had a deformed foot, and this somehow made him pals with Governor Morris who had a wooden leg. This friendship was part of the reason the Louisiana Purchase was possible, because they shared the favors of the same French lady, and had frequent occasion to meet. Both Franklin and Jefferson were ambassadors to France, it may be remembered, and for a while Jefferson was quite a fan of the French Revolution, although the treatment of LaFayette by the French Revolutionaries did not exactly encourage that. The French treated Franklin like a God, but then so did Mozart and the King of England, and Franklin harbored many bitter memories of the French and Indian War all the while he was romancing the French into bankruptcy to pay for our revolution. The French refugees from Haiti brought Yellow Fever with them, and Dengue too, thus definitively terminating Philadelphia's hope of remaining the permanent capitol of the nation.

It was during this Francophone period that Philadelphia cuisine acquired some characteristics which allow some food historians to call it Creole. Philadelphia Pepper Pot soup, for example, substituted tripe for terrapin. Those who know about these things say that many dishes now thought to be distinctly Philadelphian in fact had a French origin.

http://www.philadelphia-reflections.com/blog/1099.htm

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The Richest Men in America

Robert Morris

Charles Peterson developed the idea but was unsuccessful in popularizing it, that Spruce Street in central Philadelphia might be regarded as an architectural museum. It stretches from river to river, but has no bridge or ferry landing at either end, so traffic is less. The house near the Delaware River was built in 1702, with each house just a little older as you progress toward Broad (14th) Street where houses were built around 1880, and then on into the early Twentieth Century as you cross Broad Street and go toward the Schuyylkill. For a century or more Spruce Street was the place where doctors had their offices, much like Harley Street in London, which it somewhat resembles. A number of these houses are just plain too big to be attractive as single family houses these days, and Spruce Street has lagged Society Hill and other sections in restoring its buildings. Perhaps in a few decades that will happen, and perhaps in the meantime the present relics will be preserved enough to revive some day the idea of a museum of house design.

So let's take a simpler idea. For about a century, the current richest man in America lived in one of several houses located within seven blocks of each other, easy walking distance for a tour. The first was Robert Morris. Morris made his money in shipping, maybe even a little privateering, and then went into banking to keep his money at work. It is said that his personal fortune, adjusted for changes in the currency and economy, was considerably larger than Bill Gates' would be today. As most people know, he financed the American Revolution personally, went broke, ending up in debtor's prison. The house he lived in was opposite Independence Hall on Market Street, and was the place that Admiral Gates lived in while he was in charge of the British occupation, and the place where Washington lived during most of his presidency; the house burned down in 1832. This house is not to be confused with either the house built for Washington at 9th and Market but never occupied by him, or Morris's later mansion which he also never occupied because of his financial difficulties. That house still stands on Eighth Street, on the Eight Street, on the east side near Walnut. A duPont heiress once bought and fixed it up, but her husband told me that no one could sleep in that house because a subway had been built underneath it and rattled the timbers. Next door to the Morris house rises a fifty story apartment house , where as a precaution against the rattles, the first nine stories have nothing but parking spaces. Since the apartment building is owned by Arabs, it is likely they are pretty rich but not necessarily richer than Bill Gates.

William Bingham

But on the Northeast corner of Third and Spruce Street, once lived William Bingham, the richest man in America. Although sadly the house burned down, it is displayed in one of the famous prints by William Birch in his notable Eighteenth Century collection , widely available in bookstores. The striking thing about Bingham was that he was only twenty-eight years old when he achieved richest-man status and built the house. He made his pile three times over. First, running a privateer operation in the Caribbean for his partner Robert Morris. On returning home, he bought up any worthless Continental currency he could stuff into barrels, and then persuaded his friend Alexander Hamilton to redeem the currency at par. And then, as if he didn't have enough money already, he invested enough gold bars to finance the Louisiana Purchase for Jefferson, since Napoleon wanted gold, please, no paper money. Among the various things he invested in was the area in upstate New York, now called Binghamton, and he lost a pile of money buying the land we now call the State of Maine, since post-revolutionary Westward migration turned toward Ohio rather than into his holdings once the British prohibition on colonizing past the Allegheny mountains was lifted. Bingham's sister-in-law wanted to become engaged to the heir of the Crown of France, who was living in temporary exile around the corner on Walnut Street. In a famous, possibly fictional, response, the Dauphin was told, No. If you do not become the King of France, you will be no match for her. If you do become the King, she will be no match for you. The fascinating story of Bingham, this comparatively unknown man, is detailed in a book called ""The Golden Voyage". Quite a good read, and of particular interest to Philadelphia lawyers to learn that Bingham died in 1804, but his estate was not settled until 1960.

Stephen Girard

Stephen Girard built several houses a few steps west on Spruce Street, identifiable by having marble facing on their lower few feet; Charles Peterson lives in one of them. Girard made his money in the China trade, as a ship's factor. Like Morris, he needed to keep his money at work and founded the First Bank of America, now a museum (Peale portraits, architectural fragments) of the Park Service on Third Street. His wife was insane, and spent most of her life at the Pennsylvania Hospital at Eight and Spruce, and was eventually buried there. Girard left thirty million dollars to found the Girard College for"poor, white , orphan boys". The 1830 will withstood all legal attacks until the mid-Twentieth Century, but was eventually broken. The school now has many black girls, the definition of orphan has expanded to include any child whose parents are separated, and the definition of poor is several times greater than the national definition of the poverty level. In his will, Girard specified that the estate should purchase what is now Schuylkill County and hold it for a century. Shortly thereafter, coal was discovered in the region and Girard College became far richer.

Nichlos Biddle

Nicholas Biddle had "old money", made in the traditional way of buying real estate, particularly in Ohio. He thus made a better guess than Bingham about the likely path of westward migration. But like Morris and Girard, he needed a bank to keep his money working. Biddle acted as the reserve bank for the myriads of currencies then issued by individual rural banks, and charged a transaction fee to translate Kentucky money into something useful in Philadelphia and abroad. Martin Van Buren, who was the political manipulator behind Andrew Jackson and who became his eventual successor, stirred up trouble about this reserve role, and Jackson "broke" Biddle's bank. Ultimately, the Ferderal Reserve was created in 1838, the richest man, Anthony J. Drexel, moved over the Schuylkill River on Walnut Street, amidst what is now the University of Pennsylvania, but not far from Drexel University. He walked to work each day, however, at 4th and Chestnut Streets. Drexel was the first big banker to make his money in banking. The earlier big bankers started out with money they had made in shipping or land speculation, but Drexel somehow saw that banking was a way to get rich, deftly filling in the gap created by Andrew Jackson shuttering Nicholas Biddle's Second Bank. Part of the idea in Van Buren's mind was to shift the focus of American banking from Philadelphia's Chestnut Street to New York's Wall Street, and he was quickly quite successful. J.P. Morgan had started a Wall Street bank in correspondence with his father, Junius Morgan, who ran an international bank in London. In the era just after the Civil War, there was a lot of money in Europe that was anxious to invest in the railroads and other booming American industries. The Morgans provided a vehicle for transferring such investment capital between continents, but the Morgans were viewed as having excessively sharp practices. As it happened, Junius Morgan had been trained in this transoceanic concept by George Peabody , a former Baltimore resident who had moved to London, the banking capital of the world.

George Peabody earlier had also been involved with Anthony J. Drexel, and Drexel was the more successful of the two international bankers. The whole issue with European investors was whether you could trust those wild and wooly Americans, and Drexel consistently demonstrated he was entitled to be called a straight arrow. As related by a very good book by Dan Rottenberg Drexel decided that he needed the vigor of the Morgans and invited them to join him in a New York-Philadelphia partnership. From that point forward, JP Morgan was the shining star of honesty and straight dealing, a lesson he evidently learned from Drexel. Indeed, he and his biographers repeatedly stress this feature of him -- "I will never do business with a man I don't trust". He didn't mention women, but his behavior seems to show he probably did not include them in the concept. Drexel, on the other hand, led a quiet sober life in West Philadelphia, reading books , starting his university, and helping his neice, who was later made a Saint in the Catholic Church, start numerous charities. Although the Drexel children more or less drifted out of sight, Drexel's business successor Stotesbury led a wild and extravagant lifestyle that is the subject of many songs and stories. His wife, for example, never washed the sheets; she always had brand new ones put on the bed. Morgan, of course, spent lots of money in a conspicuous way. The term Metropolitan identifies most of his projects, The Metropolitan Art Museum, The Metropolitan Opera, The Metropolitan Club on Fifth Avenue, with membership originally limited to his partners. The name Corsair also was a trademark, the name of his yachts, and a quiet statement about his approach to things. Another difference between the Morgans and the Drexels was similarly in the New York-Philadelphia character. When Jack Morgan, the son of JP, died in the 1930's he left an estate of "only" three million dollars. It would be hard to say what the Drexel fortune was worth at that time, but it is safe to say it would dwarf that, considerably.

http://www.philadelphia-reflections.com/blog/1087.htm

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Charles Peterson and Amity Buttons

Charles Peterson

Charles Peterson, the famous architectural historian and preservationist, died just before his 98th birthday on August 19, 2004. It is to him we largely owe the redevelopment of Society Hill, and the design of the Independence National Park, as well as a host of restorations from the Adams Mansion of Quincy , Massachusetts, to the early French settlements along the Mississippi. He conceived of many national historic preservation projects, the most notable of which is the Historic American Buildings Survey (HASB) of the Department of the Interior.

The Adams Mansion

While he was most notable for large visions and huge projects, he also had a keen appreciation for fastidious accuracy in small matters, of which the Amity Button would be a vivid example. In the surviving Colonial buildings of Philadelphia, it is common to find a plain ivory coat button nailed to the top of the newel post of the main staircase. There's one in Independence Hall, another in the grand staircase of the Pennsylvania Hospital, and there is one in Charlie Peterson's own home, the one where he was the first Society Hill gentrification pioneer, a house originally built by Stephen Girard around 3rd and Spruce.

The Free Quaker Meeting House

There is a strong tradition in Philadelphia that these strange buttons are Amity Buttons, nailed there by the Quaker builder at the moment when the new owner had fully settled his construction debt, symbolizing the amity between a willing buyer and a willing seller. Countless visitors to Society Hill have been shown these curious buttons, and it always seems to produce a warm glow of appreciation for the discovery. If you have one of these in your own house, you can be very proud.

Unfortunately, Charlie Peterson couldn't find any evidence for the truth of this fable, and you can be sure he subjected the matter to a totally dedicated search. You might think there would be some notations in the deeds, or in the correspondence of the day, or in the literature of the times. You would think that someone who repeats this tale would be able to relate where he got it, and that would lead to some letters in an attic, and that if you work hard enough, you will find it. But when the button matter came up, Mr. Peterson would suddenly become grim-lipped and sad, and repeat the mantra that there is no evidence to support the story. He even awarded prizes to architectural students for essays on newel posts, bannisters and stair rails, but no student essay ever turned up any authentication of the Amity Button story. Absence of evidence is of course not the same as evidence of absence, so it is remotely possible that the story will some day be vindicated.

Indeed, you have to believe there was something or other to start the story. Victor Failmetzger and his wife, who have a notable reputation for authenticating old house parts, relate that in Colonial Virginia it was common to have hollow newel posts on the stairway, and occasionally to find the deed to the house secreted in one of them. So the search goes on.

In fact, it always seemed likely that Charles Peterson very much wanted to believe the fable was true. But until some evidence turned up, he was going to go to his grave with the declaration that there existed no evidence for it.

http://www.philadelphia-reflections.com/blog/946.htm

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Stephen Girard 1750-1831

Stephen Girard

Girard was born in Bordeaux, France and never went to school. By the age of 23 he had become a sea captain, like his father and grandfather. By the age of 27, he owned his own ship, and was thus launched on a successful career in a very dangerous occupation. Depending on the destination and weather during that era, up to forty percent of sailors were lost at sea on long voyages. From the point of view of the passengers and shippers, when you were selecting a captain you wanted one who had returned unharmed from many voyages. It was irrelevant whether he had been lucky, or diligent, or had learned a lot from his relatives in the trade.

Stephen Girard did start with a handicap, being born blind in one eye. It may have been a personality disorder which drove him to precise, minute instructions to his subordinates in excruciating detail; he might now be called a "control freak" and be disliked for it. For example, he kept a handwritten copy of all letters he wrote, and at his death there were 14,000 of them, sorted and filed. His wife went insane, and after spending years at the Pennsylvania Hospital, was buried on the grounds. If this is the price of being rich, some might consider remaining poor. During his working years in Philadelphia, he would normally get to the counting-house at 5AM, go to his bank at noon, and go to work on his 600-acre farm in South Philadelphia after 5PM. He said he liked farm work the best. The image left behind by this role model, then, was workaholic. Nevertheless, if you wanted to become the richest man in America, here was the pattern to follow.

Girard probably came as close as any rich man in history, to "taking it with him" when he died. His innately compulsive personality, combined with the sure knowledge that his relatives and others would probably try to break his will for their own benefit, led to the construction of a last will and testament that withstood a century of court challenges. It launched a remarkable philanthropy for thousands of orphans, and organized the whole Delaware Valley into an industrial machine unlike anything else in the country. Although he left the largest estate in the nation's history, that estate continued to accumulate money from his minute instructions to executors, eventually enlarging his vast fortune fifty-fold, a century after his death. In retrospect, Philadelphia might well have slowly declined into obscurity after the nation's capital moved to Washington in 1800. Instead, the coal, canal, railroad and industrial empire of the Philadelphia region became the "arsenal of the North" during the Civil War, and the main wealth generator of the Gilded Age which followed.

Girard's business career can be somewhat oversimplified as consisting of shipping at the base of his early good fortune, followed by banking during the era when banking was poorly understood and usually ineptly managed. He ended his career with an eager and successful embrace of the emerging Industrial Revolution. Throughout all of this, he characteristically took great risks for great profits, through recognizing what others were too timid to accept fully. On many occasions, his risky ventures resulted in very large losses, made acceptable by other risky ventures proving unexpectedly successful. An example would be Girard's Bank. When the Federal Government first started and then abandoned the First National Bank, Girard bought up the remnants and made a great private success of banking, where he had little previous experience. He saw the potential of the canals, and later the railroads when others were content to be farmers or country gentlemen. When he was 79 years old, he purchased vast tracts of wilderness containing some outcroppings of coal, because he could foresee a great industrial future for the region. No pain, no gain.

Another way of looking at Girard was as the most prominent French-American citizen of his time. He arrived in Philadelphia at about the same time Benjamin Franklin stepped off another boat, returning from abusive treatment by British officials which finally flipped him for American independence. Franklin recognized that independence from England meant an alliance with France, or else it meant defeat. It is possible to view the American Revolution as an episode of France searching for an American foothold after its expulsion fifteen years earlier in the French and Indian War; trouble between Britain and its colonies might re-open opportunities for France. Girard was extremely friendly with Thomas Jefferson, the most Francophile of founders and early American presidents. When the War of 1812 with Great Britain threatened disaster for the new American state, Girard staked $8 million dollars, his whole fortune, on financing that war. During the entire period from 1776 to the Louisiana Purchase, America was wavering between its gratitude to France, and underlying loyalty to the English-speaking community. During that long formative period, Girard the very rich Frenchman was hovering in the background, probably influencing American foreign policy more than is known, even today. But the France that Girard stood for was neither aristocratic of the LaFayette variety, nor intellectual of the Robespierre sort. It was France of the French peasant, crabbed, acquisitive, and morose, forever responding to a "hidden hand" of his own self-interest in a way that paradoxically benefited his whole community, and thus would have hugely amused the Scotsman Adam Smith.

http://www.philadelphia-reflections.com/blog/738.htm

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Jewelers Row

Jewelers Row

Since 1851, jewelers have clustered on Samson Street mostly between 7th and 8th Streets, and for a block or two in all directions. About 150 jewelry and jewelry-related businesses are located in this district, and their outward appearance suggests progressively improving prosperity for them. Perhaps some of this reflects the fear of impending inflation (national budget deficits and all that), or a possible decline in the value of the dollar, which amounts to the same thing. During inflationary times, the value of commodities increases; gold and diamonds are the ultimate commodities. Diamonds even suit themselves to be hidden in the heel of your shoe, if things get tough enough.

Jeweler Shops

However, J. E. Caldwell's just moved out of the center of the city, and Bailey, Banks and Biddle was sold to people from Texas or somewhere. So the jewelry trade is not universally prosperous, just Samson Street, the Jewelers' Row. Why in the world would 150 little jeweler shops want to cluster together, where people mostly can't tell one from the other, and the products look pretty much alike to anybody who isn't in love and looking for an engagement ring? You would think a competitor next door on either side, and another competitor upstairs, and still others across the street, would be something a shrewd merchant would flee, not seek out. Come to think of it, the same thing is true of Antique Row, or the fabric cluster, or a dozen similar clusters in New York City. In New York, it is possible to see a dozen shops next to each other, every one of them selling trombones.

Professor Michael Porter

Michael Porter of the Harvard Business School has offered an explanation of the economics of a business cluster as an "Innovation cluster". He feels clustering is one of the important ways businesses hold down costs and improve productivity, by innovating rather than merely stressing efficiency. If efficiency and productivity sound like the same thing, it may help to know that efficiency is only a part of productivity, with profitability to the owner of the firm only increasing if the quality of the product steadily improves, which holds up retail prices. Let's put the idea in another way: the innovative, latest and greatest, of any product commands the highest mark up among similar objects. If you position yourself as producing the latest and greatest, you are going to get a continuously higher markup. In an era of declining prices, the higher markup may express itself as simply maintaining the old prices, so anyway being a part of an innovation cluster assures you of the highest profit available, if you must be in that business. Clusters provide vigorous price competition, all right, and that automatically assures that true prices levels (i.e. after a little bargaining) are likely to be trustworthy measures of value, even in a shabby little hole-in-the-wall. Making jewelry is not rocket science, but there's enough to it that it helps to be located in an area with an abundant supply of skilled and experienced employees. Philadelphia's diamond cluster is the oldest, and still the second largest, jewelry district in the country.

Extra Policing

Having a lot of portable but largely unidentifiable merchandise concentrated in a few blocks creates a special need for police protection. These shops all have safes, and probably most of them have handguns, but there is a great deal of street traffic among shops, carrying valuable gems in their hip pockets. The City provides extra policing out of recognition of the risk, and the local merchants contribute to hiring extra private detectives to lounge around. When basement flooding at the local electric power substation recently caused a blackout, a lot of extra police were immediately dispatched to Jewelers' Row, just in case somebody got the idea that looting might be attractive. And then it is said, just rumored, that some of the merchants who have a great deal of goods loaned to their neighbors on consignment, employ private protection of an unlicensed sort, in case they have a problem getting their goods back.

It must be pretty boring to sit all day every day in a little shop that makes one or two sales a week, except at special holidays. One jeweler I know has a portable computer under the counter and spends a lot of time day-trading , which is buying stocks in the morning and selling them in the afternoon. Although competition in the district goes well beyond vigorous, there is an active fraternity of jewelers in the area, steering customers to each other when they don't have a requested item themselves, eating lunch at one of the local bistros, exchanging gossip of the trade, carefully observing the traffic up and down the sidewalks. And then, if there is no traffic they can always have their wives, daughters or neighbors sit on a high stool in front of the counter. Trying on jewelry.

http://www.philadelphia-reflections.com/blog/1071.htm

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