Back in the early 1800s, New York State went on a capital spending spree. But the 1837 depression brought it to a halt - the state found itself on the brink of bankruptcy when canals and railroads built with bonded debt defaulted.

To address the crisis, a constitutional convention was convened. Reform measures were adopted permitting debt to be incurred only if approval was obtained in a voter referendum. The 1846 convention codified the Jeffersonian principle that unapproved debt that mortgaged future generations was antidemocratic. Convention delegate Michael Hoffman summarized the view of the majority with these words:

Subscribe Now

Access to authoritative analysis and perspective and our data-driven report series.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.