"The Feds and the Fur Trade": History Colloquium with Grad Fellow Jonathan Jones

The Institute’s Friday “Pursuit of Happiness Hour” Colloquium Series, Kinder Graduate Fellow Jonathan Jones noted that conversations about the entanglement of government and business frequently tend to start at the Gilded Age and move forward from there. As he would go on to show in outlining his doctoral research, the question underlying and in many respects motivating his dissertation is whether or not this scholarly approach to examining American political economy unduly gives short shrift to the early Republic.

Specifically, issues raised by the collision of profit-seeking and government regulation in the late-nineteenth and early-twentieth centuries appeared in various degrees in the relationship between the state and fur traders in post-Louisiana Purchase America. The acquisition of land west of the Mississippi, he explained, created a leadership void, and as the state struggled to find agents familiar enough with the territory to govern it, they often turned to fur traders for help. As we see in the example of Pierre Chouteau, who actively (and successfully) lobbied Jefferson, Gallatin, and Dearborn for the position of upper-Louisiana Indian Agent, the consequence of relying on fur traders to resolve leadership quandaries was that it provided them with incredible latitude to dictate trade agreements, policies, and other business arrangements to their benefit in their assigned territories. The flip-side to this arrangement was that traders increasingly came not only to rely on but also to expect government support for their capital enterprises. During the War of 1812, for example, John Jacob Astor of the American Fur Co. called on Madison for military assistance in retrieving a cache of goods that the British seized on Mackinaw Island (Madison, of course, complied). And even before that, Astor appealed to the government for exclusive rights to establish a trading post at the mouth of the Columbia River in what is now Oregon. While Jefferson and others insisted on countering Astor’s requests with rhetoric encouraging competition and self-government in the area—with light demands that the land be placed in the hands of the citizens plural—they nonetheless pledged federal assistance for what was, for all intents and purposes, a monopolistic venture.

Jones concluded by noting that this relationship between government and business perhaps got most blurry when it came to treaty negotiation with Native American tribes in the territories west of the Mississippi. Treaties, he argued, became a subsidy of sorts for fur traders who, in executing the annuity agreements whereby tribes received money and goods in exchange for lands, often re-routed funds to themselves as debt repayment. And though the re-organization of the Indian Department in 1834 began to introduce greater competition to markets in the American West, hints of monopoly remained, with independent traders paying deposit and license fees to…the large fur companies who then channeled much of this income into diverse business interests on the east coast.