1791 — The idea becomes reality

Early 1791 — Hamilton’s industrial vision

Alexander Hamilton, then U.S. Secretary of the Treasury, was promoting a new economic vision for the young United States: America should develop its own manufacturing capability rather than remain dependent upon British manufactured goods.

Hamilton had long recognized the industrial potential of the Great Falls of the Passaic River. His concept was to create a planned manufacturing community powered by the enormous energy of the Falls.

Hamilton’s vision eventually became what he called a “national manufactory.” The Great Falls provided the natural power source that made the experiment possible.

Tench Coxe

An important but sometimes overlooked figure was Tench Coxe, a Philadelphia merchant and government official.

Coxe promoted the idea of a manufacturing center and helped convince Hamilton to support the creation of the S.U.M.

Thus, the Paterson project was not simply something Hamilton conceived alone. It grew out of a network of American businessmen, government officials and investors interested in creating an American manufacturing economy.

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August 1791 — Organizing the S.U.M.

Hamilton became deeply involved in organizing the Society for Establishing Useful Manufactures (S.U.M.).

Hamilton was already negotiating with people who would become involved in the manufacturing operation. His surviving correspondence shows him arranging contracts with Thomas Marshall, William Hall, Joseph Mort, and others.

This is significant because it shows that Hamilton was not merely advocating manufacturing in theory—he was actively trying to assemble the personnel and machinery necessary to make the project work.

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Aaron Burr enters the story

Aaron Burr was among the people who subscribed to/invested in the S.U.M.

The Library of Congress/American Library Association material concerning Hamilton’s project specifically identifies Aaron Burr on the S.U.M. subscription ledger.

So Burr’s connection to the founding of Paterson is real—but it should be described carefully:

Burr was an investor/subscriber in the S.U.M. project that founded Paterson; Hamilton was the principal visionary and organizer.

That distinction is important when writing an accurate Paterson history.

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November 1791 — New Jersey charters the S.U.M.

November 22, 1791

The New Jersey Legislature granted the S.U.M. its charter.

Governor William Paterson signed the charter on November 22, 1791.

This was a crucial step.

The S.U.M. became a state-sponsored private corporation with broad powers to:

• acquire land
• develop manufacturing
• improve waterways
• construct canals
• harness the Passaic River
• establish manufacturing facilities
• develop the planned industrial community.

The Paterson Museum describes the S.U.M. as New Jersey’s first private corporation.

William Paterson

William Paterson is especially important because:

• he was Governor of New Jersey;
• he supported Hamilton’s industrial plans;
• he signed the S.U.M. charter;
• the new industrial city was ultimately named Paterson in his honor.

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1792 — The City of Paterson is selected

May 17–18, 1792 — The Great Falls are selected

This is arguably the most important date in the actual physical founding of Paterson.

The S.U.M. directors met in May 1792 and decided that the manufacturing center should be located on the Passaic River.

At the May 18 meeting, the directors resolved that the operations of the society should be carried on at a place to be called Paterson.

The S.U.M. subsequently acquired approximately 700 acres surrounding the Great Falls. The National Park Service identifies this purchase as the event that established Paterson.

Why the Great Falls?

The site offered an extraordinary combination of advantages:

• enormous waterpower;
• a substantial elevation drop;
• timber;
• stone;
• proximity to New York;
• proximity to Philadelphia;
• access to financial markets;
• access to ports and potential immigrant labor.

The Falls drop approximately 77 feet, creating enormous potential for mechanical power.

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May 29, 1792 — Survey of the Great Falls

A committee consisting of:

• Nicholas Low
• John Bayard
• Elisha Boudinot

visited the Great Falls.

They were accompanied by General Philip Schuyler, Hamilton’s father-in-law, and others familiar with the region and waterpower.

The committee surveyed the land and studied the possibility of diverting water from above the Falls through canals.

This was the beginning of what eventually became Paterson’s famous raceway system.

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July 1792 — Paterson begins to take shape

The S.U.M. directors met in Newark from July 3–7.

They formally moved ahead with the plan for the manufacturing establishment at Paterson.

Hamilton attended and advised the directors.

July 4, 1792

The committee reported that the Great Falls area was suitable for the project.

They concluded that canals could carry water from above the Falls and distribute it to manufacturing facilities.

Hamilton was consulted and agreed that the principal manufacturing establishment should be located at the Falls.

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July–August 1792 — Pierre Charles L’Enfant

Hamilton and the S.U.M. brought in the famous French-American engineer and planner:

Pierre Charles L’Enfant

L’Enfant had become famous for his work laying out the plan for Washington, D.C.

He was hired to develop the physical plan for Paterson and the system for utilizing the Great Falls.

The idea was revolutionary: instead of simply building mills beside the Falls, the S.U.M. would create a planned industrial city whose factories would receive waterpower through an engineered canal system.

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August 1, 1792 — Hamilton visits Paterson

Hamilton personally attended an S.U.M. committee meeting at Paterson on August 1.

The directors decided that rather than relying entirely upon outside contractors, the S.U.M. would undertake construction itself.

This demonstrates how personally involved Hamilton remained in the project.

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1792–1793 — The first industrial experiment

The S.U.M. attempted to establish actual manufacturing.

Hamilton helped recruit skilled mechanics and workers.

Among the people involved were:

• Thomas Marshall — superintendent associated with the cotton mill.
• William Pearce — English mechanic involved in textile machinery.
• George Parkinson — English mechanic and foreman.
• William Hall — associated with the S.U.M.’s printing operation.
• Joseph Mort — mechanic who was expected to help obtain European workers.
• Peter Colt — later superintendent of the S.U.M. works.

Hamilton personally negotiated several of these arrangements.

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1793 — Peter Colt takes an important role

On February 19, 1793, Peter Colt was appointed superintendent of the S.U.M.’s factory.

Colt would become one of the most important figures in the early development of Paterson.

He was from Hartford, Connecticut, and had experience with manufacturing and business enterprises.

Hamilton continued to advise the S.U.M., even though he did not hold an official executive position in the company.

This distinction is important:

Hamilton was the project’s intellectual and political driving force, but he wasn’t simply the “mayor” or day-to-day administrator of early Paterson.

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1793–1794 — The Raceway System

The most important physical engineering project was the development of the raceways.

Water would be diverted from the Passaic River above the Falls, carried through channels, and dropped through successive levels to power factories.

By 1794, the S.U.M. had completed the first of the canals used to harness the Falls.

This waterpower system ultimately became the foundation upon which Paterson’s industrial economy was built.

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1794 — Early manufacturing

The S.U.M. attempted to produce manufactured goods including textiles.

However, the project encountered serious problems:

• insufficient capital;
• engineering difficulties;
• shortages of skilled workers;
• management problems;
• high construction costs;
• difficulties obtaining British manufacturing technology.

The first manufacturing operation was not immediately successful.

The National Park Service notes that the early S.U.M. experiment suffered from financial and personnel difficulties.

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1795 — Hamilton remains involved

Hamilton continued to maintain an interest in the S.U.M.

He was eventually elected a director of the S.U.M. on November 24, 1795.

This is another important point for Paterson history:

Hamilton’s connection with the project did not end when the S.U.M. acquired the land in 1792.

He remained involved in trying to make the industrial experiment succeed.

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1796 — The S.U.M. manufacturing experiment fails

By 1796 it became apparent that the S.U.M. could not profitably operate its own manufacturing facilities.

On January 25, 1796, the directors concluded that continuing manufacturing would result in further losses.

They ordered that manufacturing operations be wound down and that unnecessary employees be discharged.

This was a major turning point.

But it did not mean the Paterson experiment failed completely.

Instead, the S.U.M. changed its business model.

Rather than trying to manufacture everything itself, it began leasing:

• land;
• mill sites;
• waterpower.

to private manufacturers.

That decision ultimately helped Paterson develop into a genuine industrial city.

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1796–1797 — The S.U.M. changes direction

The S.U.M. increasingly became a land and waterpower company rather than a manufacturing company.

It controlled the crucial infrastructure:

Passaic River → Great Falls → dams → raceways → mill sites → factories

Private entrepreneurs could establish factories while the S.U.M. controlled the waterpower system.

This arrangement would have enormous consequences for Paterson’s future.

The city’s industrial development could continue even though the S.U.M.’s original manufacturing experiment had failed.

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1797–1800 — The foundations of an industrial city

During the final years of the 1790s, Paterson remained a small and struggling settlement.

The grand industrial vision had not yet produced the manufacturing powerhouse Hamilton imagined.

Nevertheless, the essential infrastructure had been created:

The critical pieces were now in place:

1. The Great Falls

The natural power source.

2. The S.U.M.

The corporation that controlled development.

3. The raceway system

The infrastructure that transformed the Falls’ natural energy into usable mechanical power.

4. Land

The S.U.M. controlled the industrial property around the Falls.

5. Entrepreneurs

Private manufacturers could now lease sites and waterpower.

6. A planned town

Paterson had been conceived as an industrial community rather than simply growing accidentally around a pre-existing village.

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The Important People

The surviving Hamilton Papers provide unusually good documentation of the activities of many of these people.

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The Big Picture

The founding of Paterson can therefore be understood as a four-stage process:

1. Hamilton’s idea

1791

Hamilton envisioned using American waterpower to establish a major manufacturing center.

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2. The S.U.M. is created

November 1791

New Jersey legally creates the corporation that will undertake the experiment.

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3. The Great Falls are selected

1792

The S.U.M. purchases approximately 700 acres and establishes Paterson around the Great Falls.

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4. The raceways create the industrial infrastructure

1792–1796

The S.U.M. develops the waterpower system that eventually allows private manufacturers to build mills.

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And where does Aaron Burr fit?

I would characterize Burr’s role in a Paterson history this way:

Aaron Burr was an early financial participant in the Society for Establishing Useful Manufactures, the corporation created in 1791 to establish a manufacturing center at the Great Falls of the Passaic River. His investment connects him directly to the S.U.M. enterprise that founded Paterson, although Alexander Hamilton was the project’s principal visionary and organizer.

That is more historically defensible than saying “Aaron Burr founded Paterson.”

The National Park Service itself calls Hamilton one of Paterson’s literal founders, describing the S.U.M. as the vehicle through which his industrial experiment was established on the Passaic River.

A particularly interesting Paterson connection

There is also a fascinating connection between Hamilton and Burr here: both men were associated with the S.U.M. project that created Paterson before their famous 1804 duel. Burr’s name appears among the S.U.M. subscribers, while Hamilton was its principal promoter and organizer.

For your Paterson History research, this makes the 1791–1800 period one of the most important chapters in the city’s history—it is essentially the story of how a waterfall became the foundation for America’s first planned industrial city.