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By Harold A. Innis

The Mississippi Valley Historical Review

Vol. 20, No. 3 (Dec., 1933)

It is no easy task to survey the interrelations between the significant and continuous fur trade development characterized by the Canadian trade and that phase of the fur trade in which, to quote Chittenden, “the events have been so diverse, and have borne so little relation to each other, that the task of making a connected narrative has been well-nigh impossible” and “lacking in . . . deep national significance.”^[1] It is possible that such a survey may throw light on the complex problems of the American trade. Although the excellent monographs on the American fur trade, such as those by Kellogg, Stevens, and Chittenden, provide substantial footing for a broader interpretation of the movements of the American trade and throw important light on Canadian development, it is scarcely necessary to emphasize the extent of the work yet to be done in both the Canadian and the American fields before an adequate interpretation is possible.

The beginnings of the fur trade in North America corresponded roughly with the marked rise in prices in Spain which followed the importation of treasure from North America and led to the opening of the Spanish market, the development of the fishing industry, especially dried fish, and the opening up of the Gulf of St. Lawrence, particularly Gaspé, and the progress of settlement in New England.^[2] The accessibility of the St. Lawrence to the forest areas of the Precambrian shield of the northern half of North America led to the rapid growth of trade with the hunting Indians, to the expulsion of the agricultural Indians from the St. Lawrence Valley, and to the beginnings of strife between the Iroquois and the Algonquins and French.

In the United States as in Canada the geographic background had a profound influence on the evolution of the fur trade. The short rivers of the Appalachian drainage basin and especially of New England, and the position of fur as a commodity which commanded an immediate sale and large returns in the European market were factors contributing to the rapid destruction of fur bearing animals following expansion of the fishing industry and the growth of settlement along the New England shore. Profits from the fur trade contributed directly to the growth of industries which displaced it. Organization of the trade was consequently not elaborate and the shift to new activities was made without serious handicaps from vested interests. The character of fur trade development in New England was symbolic of the United States.^[3]

The key to this development from the Atlantic coast was the Hudson River which tapped a wide area and by a narrow height of land reached the interior of the St. Lawrence drainage basin by the Richelieu River and, what was of more significance, by Oswego on Lake Ontario. The Dutch by the Hudson route came in contact with the Iroquois, agricultural Indians at war with the French and the hunting Indians, with the result that trade advanced through middlemen to the interior in competition with the St. Lawrence. The competitive struggle involved destruction of the Hurons in 1648-49 and substantial control of the fur trade in the interior by the Dutch^[4] and the Iroquois. The relatively weak position of the Dutch trading organization on the Hudson restricted by the location of the Iroquois, and the increasing strength of English trade based on the growth of settlement in New England and the expansion of the fishing industry and trade between England, Newfoundland, New England, and the West Indies, and the aggressiveness of the English in attacks on Dutch trade as shown in the Navigation Acts of the fifties and sixties, led to the disappearance of the Dutch from the Hudson in 1664. The limitations imposed on the Dutch trading organization by the Iroquois and the displacement of the Dutch by the English precluded the development of a vigorous trading organization on the banks of the Hudson River.

The disturbance which accompanied the capture of New York by the English in 1664 and the aggressiveness of the French after 1663, following the difficulties attendant on the disappearance of the Hurons and the activity of the Iroquois, enabled the French to expand the trade to the interior by the Ottawa, first by attracting new Indians such as the Ottawas as middlemen and later by sending French traders to the north by the Ottawa and to the south, for example La Salle, by the upper St. Lawrence and the Great Lakes. By the end of the century France had achieved substantial control at the mouth of the Mississippi, on Hudson Bay, and in the interior, but success was destined to be of short duration. The success of the French in penetrating the interior and the relatively weak position of the Iroquois and the English hastened the development of trade through other routes to the interior and particularly to Hudson Bay. Gillam from New England and Radisson and Groseilliers from New France combined with English capital, contributed to the establishment and growth of the Hudson’s Bay Company, 1668-70. Moreover, expansion of the fishing industry and of trade in New England and the trade in slaves and sugar to the West Indies and the consequent improvement of British industry and trade were responsible for the retreat of the French from Nova Scotia and Hudson Bay in the Treaty of Utrecht.

The Treaty of Utrecht released English competition from the north and the south. Expansion of trade with the West Indies and of fishing and of shipbuilding in New England strengthened the position of the English from New York and made possible the development of a trading organization, the establishment of Oswego on Lake Ontario, and the sale of cheap West India rum and superior English cloths and kettles as an attraction to the Indians of the interior. This aggressive support encouraged the Iroquois in the expansion of activities to Detroit and to Lake Michigan and led, through the Fox wars, to the marked decline of French control over trade in the Great Lakes region. The decline of French control of the Upper Lakes from Montreal was offset in part by the expansion of control from New Orleans^[5] by the Mississippi. On the other hand, penetration of the Iroquois and the English implied division of French control from New Orleans and Montreal. Withdrawal of the French from Hudson Bay and occupation of posts by the English led to competition in the interior by the numerous large rivers flowing to Hudson Bay. Pressure from the north and from the center by English trade prompted expansion under La Vérendrye and his successors to the Northwest by way of Lake Superior.

The relatively low heights of land between the drainage basins pointing toward the Atlantic and the Arctic in North America, the character of fur as a commodity with light bulk and high value, the length of the main rivers and the difficulties of control from political centers at the mouth of the rivers, and the relative mobility of the Indian and the trader, facilitated the flow of trade between territories marginal to each drainage basin. Political influence was not adequate to check trade between the St. Lawrence and the Hudson, Hudson Bay and the Mississippi. Traders such as Radisson and Groseilliers moved easily from one sphere of influence to the other. Nevertheless, in spite of this ease of movement in the interior, the drainage basin continued as an important geographical and trade unit; mastery over the main entrance to the drainage basin was therefore of vital importance.

Control from the Atlantic was based largely on the relative success of integration of trade and industry of the European empires. New England and Newfoundland exported cod^[6] and other products to the West Indies and to Europe and received sugar, molasses, and rum from the West Indies, spices and other products from Spain and the Mediterranean, and manufactured products from England. Slaves were purchased with English manufactures and sold to the West Indies for the production of sugar and the consumption of cod. France, on the other hand, found it difficult to link her limited dry fishing from Cape Breton and the Gulf of St. Lawrence to the products of Canada and the French West Indies. The French West Indies became a support to New England rather than New France and to the English fur trade rather than the French. France had no New England, with its shipping, fishing, industry, and trade. The interpretation of the history of North America in terms of rum and brandy has not been written but in the fur trade, rum represented the contribution of the West Indies to trade of the Old Empire, and brandy the emphasis on French vineyards and self-sufficiency. The trade of Great Britain in tropical products made it possible for Anthony Hendry to write in describing the causes of French success in the fur trade in the Northwest in 1754-55 “if they had Brazil tobacco, which they have not, [they] would entirely cut off our trade.” The economic strength supported by this integration of industry and trade weakened the internal position of the French and contributed to the collapse of the French empire brought about by the naval and military victories at the entrance to the St. Lawrence the results of which were embodied in the Treaty of Paris.

In the first decade after the withdrawal of the French, disturbances in the interior, especially Pontiac’s war and the disruption of trading organization to France, were followed by the rapid expansion of the English organization from Albany and from Montreal to the interior. The commissariat organization of the army and existing French experience and technique assisted in the expansion of the fur trade. Supported by West Indies rum and British manufactures, and with the use of boats from Oswego on the Great Lakes, English traders expanded trade to the posts at Detroit and Michilimackinac. Competition especially in the northern posts and at posts located in the Mississippi drainage basin by the French and Spanish from New Orleans, led to the breakdown of regulations restricting traders to the posts and to more rapid penetration to the interior after 1768. Recovery of trade^[7] was the result of the combination of the West Indies rum, the position of Albany and lake boats, and the accessibility of the St. Lawrence to English manufactures and to the interior by canoes and the Ottawa route as well as by the Upper St. Lawrence. The geographic strategy of the St. Lawrence route as shown in the French régime became increasingly evident with expansion of trade to the interior. Canoes and the Ottawa route were important in the relatively rapid transport of furs from the interior to Montreal and England.

Expansion of the internal trade from Albany and Montreal was accompanied by an expansion of trade in the English colonies. This expansion was met by a closer check following the application of Great Britain’s colonial policy and particularly with pressure from the vested interests created in British legislation by the sugar planters of the West Indies. The Molasses Act of 1733, the diplomatic compromise^[8] resulting in the retention of Guadaloupe by France and the taking over of Canada by England, and the Sugar Act of 1764, accentuated the difficulties of the English colonies in meeting the increased demands for sugar, molasses, and rum for the expanding fur trade by prohibiting the acquisition of supplies from the French West Indies. External difficulties contributed to internal difficulties as shown in the extension of the control of the St. Lawrence by extending the boundaries of the province of Quebec under the Quebec Act in 1774 and were followed by the disturbances of the American Revolution. As a result of these disturbances traders moved from Albany to Montreal^[9] and with supplies of manufactured goods from England and of rum^[10] from the West Indies the control of trade from the St. Lawrence to the interior became practically a monopoly. English traders continued to penetrate to the interior and particularly to the Northwest. Again and in part as a result of hostilities they crowded to the far Northwest and in 1778 Pond penetrated to the Athabasca region and opened the trade to the Mackenzie River drainage basin.

The result of these developments was shown in the emergence of the Northwest Company, the first organization to operate on a continental scale in North America. Large scale organizations characterized this Canadian trade and their strength was registered directly in the activities of the weaker organizations of the American trade. This organization was a combination or partnership which brought together aggressive individualistic traders, trained in the school of American commercialism and in the clan and family organization of Scotland. It combined navigation on the Great Lakes and on the Ottawa, and organization of food supplies in meeting the demands of the heavy transportation costs to distant posts in the interior, the support of cheap British manufactures and West India rum, and an effective trading organization in relation first to Albany and later to Montreal, with remarkable success. The completion of an important agreement in the history of the Northwest Company in 1783, the date of the Treaty of Versailles, was probably more than a coincidence, but the trade to the Northwest and to the Southwest continued to be supported from Montreal. Expansion to the Northwest was accompanied by expansion to the Southwest. In the face of competition from Spanish and French from New Orleans, British traders were strongly entrenched in the Upper Mississippi Valley. The problems of the Southwest were accentuated by more rapid decline of the fur trade and eventually by the recovery of the American trade and the withdrawal of Montreal traders from the western posts following the Jay Treaty. This retreat led to the migration of traders to the North and to the intense competition between the New Northwest Company or the XY Co. which culminated in the amalgamation of 1804. The enlargement of the Northwest Company necessitated expansion to new territory and Simon Fraser and David Thompson moved into the Pacific coast drainage basin.

The difficulties of the American trade during the period of hostilities which attended a lack of cheap manufactured goods and the entrenchment of Montreal in the trade in American territory, during and after the hostilities, precluded rapid recovery from Albany. Limited development in the interior was offset by the expansion of external trade. The breakdown of British control in the American Revolution enabled New England vessels to extend their trade to the Pacific. The voyages of Captain Cook along the Pacific coast attracted traders from England and New England. Expansion of the Northwest Company to the Mackenzie River and the discovery of Cook’s Inlet stimulated interest in possibilities of a final discovery of the northwest passage^[11] and led to the expeditions of Mackenzie down the Mackenzie River in 1789 and to the Pacific in 1793. Prospects of this route were communicated through the Northwest Company to New England^[12] and further encouraged New England vessels to participate in Pacific and oriental trade. The failure of the northern passage guaranteed more substantial control in the face of English monopoly of the East India Company and the South Sea Company on the Pacific. New England^[13] shipping expanded rapidly in the exploitation of the sea otter trade of the Pacific coast. Exhaustion of the maritime fur trade on the Pacific coast was accompanied by the gradual recovery of the internal fur trade and the spread of settlement to the Ohio and the Mississippi. In the recovery of the fur trade John Jacob Astor played an important rôle through his success in reëstablishing the position of the Albany and New York route, through his ability to develop the European and English markets, and through his reliance on the experience and organization of the trade from Montreal. The example of the Northwest Company as the first large scale continental organization in North America stimulated Astor in the development of a similar organization in the United States.^[14] Relying on officers and men trained in the Northwest Company and realizing the importance of moving inland, following the exhaustion of the sea otter on the Pacific coast, he attempted to link up the internal trade to the Pacific. His failure was partly the result as suggested above of the entrenched position of the Northwest Company and of the effects of pressure on the Company in the Great Lakes area leading to their expansion on the Pacific. Astor’s defeat on the Pacific facilitated concentration on the Great Lakes trade and enabled him to build up the American Fur Company. The ground had been prepared for his activities in the gradual withdrawal of the British traders after the Jay Treaty and the establishment of the factory system by the government of the United States in 1795-96.^[15] The Louisiana Purchase and the development of the Missouri trade, the emergence of the American Fur Company, the War of 1812, and the Act of 1815 prohibiting British trade in American territory and presumably passed at Astor’s instigation, were factors steadily improving the position of the American traders.^[16]

Increasing strength of the Hudson’s Bay Company particularly, after the War of 1812, and withdrawal of Canadian traders from American territory contributed to the difficulties of the Northwest Company from Montreal and hastened the amalgamation of 1821 and the emergence of supremacy of the Hudson Bay route. American trade after 1815, in a sense, squeezed the two large Canadian companies into one unit. Decline of the St. Lawrence route to the Northwest and its practical disappearance after 1821 released labor for the expansion of the American trade. In a letter dated April, 1817, Ramsay Crooks wrote: “It will still be good policy to admit freely & without the least restraint the Canadian Boatmen, these people are indispensable to the successful prosecution of the trade, their places cannot be supplied by Americans who are for the most part . . . too independent to submit quietly to a proper control, and who can gain any where a subsistence much superior to a man of the interior.”^[17] Amalgamation released not only labor but men trained in the rigorous school of intense competition in the decade from 1810 to 1820. Kenneth Mackenzie became a powerful support to the aggressiveness and expansion of the American Fur Company in the Missouri trade. Amalgamation of the Northwest Company and the Hudson’s Bay Company, the rise of the American Fur Company, and the disappearance of the government factory system were closely interrelated.

In the period after 1821 the close control and centralization of the Hudson’s Bay Company in northwestern Canada provided a substantial check to American expansion. Neutrality between the American and Canadian companies was shown in agreements for handling trade in competitive territory along the border.^[18] Increased settlement weakened the position of company control and led to the development of the small private trader and trading organization. In eastern Canada American traders purchased furs at various centers throughout the country.^[19] The introduction of the steamboat on the Missouri and the Mississippi improved the position of the small trader and led to the development of trade from Minneapolis and St. Paul by the Red River to territory of the Hudson’s Bay Company.^[20] Finally the steamboat to Red River hastened the decline of Hudson’s Bay Company monopoly and the sale of Hudson’s Bay Company territory to Canada. The growth of settlement in the Columbia River region was followed by the retreat of the Hudson’s Bay Company after the settlement of the Oregon boundary dispute in 1846. This change was hastened by the emergence of trading organizations in London designed to handle the furs of large numbers of private traders. The firm of Lampson’s^[21] became an important competitor of the Hudson’s Bay Company and eventually a working agreement was arranged through Sir Curtis Miranda Lampson who reached the highly influential position of deputy governor of the Hudson’s Bay Company (1863-71). In this crucial period the Hudson’s Bay Company lost control to Grand Trunk interests in 1863 and finally to Canada with the sale of Rupert’s Land in 1869. On the other hand the position of the field service of the company, in other words of the wintering partners, led to a struggle headed by Donald Smith in which control of the fur trade was regained. It would carry this paper too far afield to trace the influence of Donald Smith (Lord Strathcona) in the construction of the Canadian Pacific Railway. It is sufficient to note that improvement in transportation facilitated competition and American and Canadian traders have steadily continued to press on the last reserves of the monopoly of the Hudson’s Bay Company. American whalers have become traders and have been followed by traders along the route through Bering Sea to the western Arctic. American traders particularly during the war under the Lamson Hubbard Company of Boston made a determined drive on the position of the Hudson’s Bay Company but without eventual success. The American market assumed new importance in the post war period and supported new competition. Finally during the speculative boom which centered about the New York market it has been charged^[22] that American finance contributed to the expansion of the Hudson’s Bay Company and to its present difficulties. In Canada the boom was accompanied by the construction of railway lines to Churchill and to Moosonee on Hudson Bay.

The fur trade of the North American continent was an index of wide movements. It persisted in space and time with greatest continuity in the forested areas of the Precambrian formation and in relation to the support of a highly industrialized area and a metropolitan market. Throughout the history of the continent the territory restricted in diversity of product and dependent on a staple commodity steadily drifted into the control of a metropolitan market dependent on cheap all the year round water transportation. Cod from Newfoundland, beaver from Canada, and sugar from the West Indies depended on commercial and industrial England. In the face of this drift Spain, Holland, and France disappeared from North America, and because of this drift the United States emerged as a separate entity.

The fur trade of the United States gradually evolved as independent of British control. New England shipping exploited the accessible territory of British Columbia. Rise of settlement was followed by decline of the fur trade and the shift in the trade route from St. Lawrence to Hudson Bay was followed, as has been shown, by a migration of labor and skill to the American West. In the United States the divided character of the upper reaches of the Mississippi drainage basin, particularly in the Missouri^[23] and the Mississippi, the cultural traits of the Indians especially on the plains, the difficulty of obtaining cheap supplies of manufactured products, the following up of settlement on arable land, the importance of coarse furs and hides as in the case of the buffalo and the rapidity of their exploitation, were factors responsible for a development along a different line than was characteristic of the Canadian trade. Lack of continuity, Indian wars, the control exercised by one man or one family as in the case of the Astors, characterized the American rather than the Canadian trade. The American Fur Company deserves thorough investigation as an institution representing the fur trade at its peak in the United States.

The interrelations of theories of development in the United States and Canada have been influenced by studies of the fur trade. The importance of settlement gave the fur trade of the United States an essentially frontier aspect and strengthened the position of Turner’s thesis.^[24] In Canada the fur trade assumed a permanent and not a transient phase. It is significant that during the past year (1932), the Hudson’s Bay Company boat, made no visit to the depot at Charlton Island in James Bay for the first time in over two and a half centuries.

TRANSCRIBER NOTES

Misspelled words and printer errors have been corrected. Where multiple spellings occur, majority use has been employed.

Punctuation has been maintained except where obvious printer errors occur.

A cover which is placed in the public domain was created for this ebook.

[The end of Interrelations between the Fur Trade of Canada and the United States by Harold Adams Innis]