Charles River Bridge Case

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The article “The Charles River Bridge Case,” from Quarrels that have Shaped the Constitution, Revised Edition, edited by John A Garraty, Harper & Row, the author describes Charles River Bridge decision espoused newly popular Jacksonian political beliefs, which favored free enterprise. Arguably, the case altered the course of economic Jurisprudence in the United States. The facts of Charles River Bridge began in 1650 when the state of Massachusetts granted a charter to Harvard College to operate for profit a ferry over the Charles River between Boston and Charlestown. Later, in 1785, the Massachusetts Legislature granted a charter to a group of Charlestown businessmen to build the Charles River Bridge. These entrepreneurs were to fund the bridge's construction and in return the state would allow them to collect revenue from a specified toll for the next forty years. As part of the agreement, the entrepreneurs were to pay an Annuity to Harvard College to replace ferry profits lost by the building of the new bridge.

The bridge was immediately successful and immensely profitable. Prompted by its popularity, the Massachusetts Legislature in 1792 chartered the building of a second bridge, known as the West Boston Bridge. To appease the proprietors of the Charles River Bridge, who faced competition from the West Boston Bridge, the state of Massachusetts extended the Charles River Bridge charter from forty to seventy years. The Boston community was now enjoying the convenience of two bridges, and Harvard College was enjoying annually the use of money in compensatory payments. As the traffic on both spans increased, the tolls poured in and the value of the stock grew apace.

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