It is difficult to select a more popular or satisfactory administration than was Jay's first three years as governor. Opposition growing out of his famous treaty had entirely subsided, salutary changes in laws comforted the people, and with Hamilton's financial system, then thoroughly understood and appreciated, came unprecedented good times. To all appearances, therefore, Jay's re-election in 1798 seemed assured by an increased majority, and the announcement that Chancellor Livingston was a voluntary rival proved something of a political shock.[81] For many years the relations between Jay and Livingston were intimate. They had been partners in the law, associates in the Council of Revision, colleagues in Congress, co-workers in the formation of a state constitution, and companions in the Poughkeepsie convention. Jay had succeeded Livingston in 1784 as secretary of foreign affairs under the Confederation, and while the charming Mrs. Jay was giving her now historic dinners and suppers at 133 Broadway, her cousin, Robert R. Livingston, of No. 3 Broadway, was among her most distinguished guests. In her home Livingston made those arrangements with Hamilton and Jay, the Morrises and the Schuylers, that resulted in the overthrow of Governor Clinton and his supporters in the convention which ratified the Federal Constitution.

But after Washington's inauguration, and Jay's appointment as chief justice of the United States Supreme Court, the Chancellor had been as intense, if not as violent an opponent of Federalism as Brockholst Livingston. In their criticism of Jay's treaty these two cousins had been especially bitter. The Chancellor attacked it as "Cato," Brockholst as "Decius;" the one spoke against it on the platform with Aaron Burr, the other voluntarily joined the mob—if he did not actually throw the stone—that wounded Hamilton; while the Chancellor saw a copy of the treaty slowly destroyed at Bowling Green, Brockholst coolly witnessed its distinguished author burned in effigy "in the Fields." Relationship did not spare John Jay. Cousin and brother-in-law had the "love frenzy for France," which finally culminated in celebrating the ninth anniversary of the treaty of alliance between France and America, at which Brockholst became proudly eloquent, and the Chancellor most happy in the felicity of an historic toast: "May the present coolness between France and America produce, like the quarrels of lovers, a renewal of love."

Chancellor Livingston was now in the fifty-first year of his age, tall and handsome, with an abundance of hair already turning gray, which fell in ringlets over a square high forehead, lending a certain dignity that made him appear as great in private life as he was when gowned and throned in his important office.[82] In the estimation of his contemporaries he was one of the most gifted men of his time, and the judgment of a later age has not reversed their decision. He added learning to great natural ability, and brilliancy to profound thought; and although so deaf as to make communication with him difficult, he nearly concealed the defect by his remarkable eloquence and conversational gifts. Benjamin Franklin called him "the Cicero of America." His love for the beautiful attracted Edmund Burke. It is doubtful if he had a superior in the State in the knowledge of history and the classics, and in the study of science Samuel L. Mitchill alone stood above him. He lacked the creative genius of Hamilton, the prescient gifts of Jay, and the skill of Burr to marshal men for selfish purposes, but he was at home in debate with the ablest men of his time, a master of sarcasm, of trenchant wit, and of felicitous rhetoric.

Livingston's candidacy for governor was clearly a dash for the Presidency. He reasoned, as every ambitious New York statesman has reasoned from that day to this, that if he could carry the State in an off year, he would be needed in a presidential year. This reasoning reduces the governorship to a sort of spring-board from which to vault into the White House, and, although only one man in a century has performed the feat, it has always figured as a popular and potent factor in the settlement of political nominations. George Clinton thought promotion would come to him, and Hamilton inspired Jay with a similar notion, although it is doubtful if the people ever seriously considered the candidacy of either; but Livingston, sanguine of better treatment, was willing voluntarily to withdraw from the professional path along which he had moved to great distinction, staking more than he had a right to stake on success. In his reckoning, as the sequel showed, he miscalculated the popularity of Jay as much as Hamilton did that of George Clinton in 1789.

The Chancellor undoubtedly believed the tide of Federalism, which had been steadily rising for six years, was about to ebb. There were sporadic indications of it. Perhaps Livingston thought it had already turned, since Republicans had recently won several significant elections. Two years before DeWitt Clinton and his associates had suffered defeat in a city which now returned four assemblymen and one senator with an average Republican majority of more than one thousand. This indicated that the constant talk of monarchical tendencies, of Hamilton's centralising measures, and of the court customs introduced by Washington and followed by Adams, was beginning to influence the timid into voting with Republicans.

But counteracting influences were also at work, which Livingston, in his zeal for political honours, possibly did not observe. New England Federalists, attracted by the fertile valleys of the Hudson and the Mohawk, had filled the western district, and were now holding it faithful to the party of Jay and Hamilton. Just at this time, too, Federalists were bound to be strengthened by the insulting treatment of American envoys sent to France to restore friendly intercourse between the two republics. President Adams' message, based upon their correspondence, asserted that nothing could be accomplished "on terms compatible with the safety, honour, and essential interests of the United States," and advised that immediate steps be taken for the national defence. What the President had withheld for prudential reasons, the public did not know; but it knew that the Cabinet favoured an immediate declaration of war, and that the friends of the Administration in Congress were preparing for such an event. This of itself should have taken Livingston out of the gubernatorial contest; for if war were declared before the April election, the result would assuredly be as disastrous to him as the publication of Jay's treaty in April, 1795, would have been hurtful to the Federalists. But Chancellor Livingston, following the belief of his party that France did not intend to go to war with America, accepted what he had been seeking for months, and entered the campaign with high hopes.

Jay had intended retiring from public life at the close of his first term as governor.[83] For a quarter of a century he had been looking forward to a release from the cares of office, and to the quiet of his country home in Westchester; but "the indignities which France was at that time heaping upon his country," says William Jay, his son and biographer, "and the probability that they would soon lead to war, forbade him to consult his personal gratification."[84] On the 6th of March, therefore, he accepted renomination on a ticket with Stephen Van Rensselaer for lieutenant-governor.

It is significant that the anti-Federalists failed to nominate a lieutenant-governor on the ticket with Livingston. Stephen Van Rensselaer was a Federalist of the old school, a brother-in-law of Hamilton, and a vigorous supporter of his party. It is difficult to accept the theory that none of his opponents wanted the place; it is easier to believe that under existing conditions no one of sufficient prominence cared to make the race, especially after President Adams had published the correspondence of the American envoys, disclosing Talleyrand's demand for $240,000 as a gift and $6,000,000 as a loan, with the threat that in the event of failure to comply, "steps will be taken immediately to ravage the coast of the United States by French frigates from St. Domingo." The display of such despicable greed, coupled with the menace, acted very much as the fire of a file of British soldiers did in Boston in 1770, and sent the indignant and eloquent reply of Charles C. Pinckney, then minister to France, ringing throughout the country—"Millions for defence, but not a cent for tribute." Within four weeks Congress authorised the establishment of a navy department, the construction of ten war vessels, the recapture of American ships unlawfully seized, the purchase of cannon, arms, and military stores, and the raising of a provisional army of ten thousand, with the acceptance of militia volunteers. The French tri-colour gave place to the black cockade, a symbol of patriotism in Revolutionary days, and "Hail Columbia," then first published and set to the "President's March," was sung to the wildest delight of American audiences in theatres and churches.

In the midst of this excitement occurred the election for governor. The outcome was a decided change, sending Jay's majority up to 2380.[85] It is not easy to estimate how much of this result was influenced by the rising war cloud, and how much is to be credited to the individuality of the candidates. Both probably entered into the equation. But the fact that Jay carried legislative districts in which Republicans sent DeWitt Clinton and Ambrose Spencer to the Senate, would indicate that confidence in Jay, if not dislike of Livingston, had been the principal factor in this sweeping victory. "The result of this election terminated, as was foreseen," wrote William P. Van Ness, four years later, "in the defeat and mortification of Mr. Livingston, and confirmed the conviction of the party, that the people had no confidence in his political integrity, and had been disgusted by his unwarrantable expectations. His want of popularity was so well known that nothing could have induced this inexpedient measure, but a desire to show the futility of his pretensions, and thus in future avoid his hitherto unceasing importunities."[86]

Livingston's search for distinction in the political field seems to have resulted in unhappiness. The distinguished ability displayed as chancellor followed him to the end, but the joy of public life vanished when he entered the domain of partisan politics. Had he possessed those qualities of leadership that bind party and friends by ties of unflinching services, he might have reaped the reward his ambition so ardently craved; but his peculiar temper unfitted him for such a career. Jealous, fretful, sensitive, and suspicious, he was as restless as his eloquence was dazzling, and, although generous to the poor, his political methods savoured of selfishness, making enemies, divorcing friends, and darkening his pathway with gathering clouds.