HISTORY OF CANADIAN WEALTHCHAPTER IV
WARS OF THE FUR TRADERS AND COMPANIES
In the long and desperate contest between English and French traders to get control of the fur trade, the supremacy gradually passed to the English. This triumph resulted from the purely economic advantages they possessed, and from their ability to supply rum and cloth cheaper than the French.
As early as 1708 the French Government complained to its officials in Canada that the English gave nearly double the price that the French did for beaver ; that, moreover, their articles of merchandise were cheaper, and that a remedy must be sought for this unfortunate state of things.1 But no remedy ever came. In a communication dated November 10, 1724, to Governor William Burnett, of New York, Cadwallader Colden, a crown official and later lieutenant-governor of that province, set forth conditions in his Memoir on the Fur Trade. Of Canada he said that the Governor and other officers have but a scanty allowance from the King, and could not subsist were it not for the perquisites they have from this Trade. Neither could their Priests find any means to satisfy their ambition and Luxury without it. So that all heads and hands are employed to advance it.2 Then proceeding to describe the various difficulties of the French in transporting goods via the St. Lawrence, Colden went on :
Besides these difficulties in the Transportation, the French labor under greater in the purchasing of Indian goods proper for the Indian market, for the most considerable and most valuable part of their Cargo consists in Strouds, Duffils, Blankets and other Woolens which are bought at a much cheaper rate in England than in France. The Strouds which the Indians value more than any other clothing, are only made in England, and must be transported into France before they can be carried to Canada.
Rum is another considerable Branch of the Indian Trade, which the French want, by reason they have no commodities in Canada fit [to exchange] for the West India Markets. This they supply with Brandy at a much dearer rate than Rum can be purchased at New York though of no more value with the Indians. Generally all the goods used in the Indian Trade except Gunpowder and a few trinkets are sold at Montreal for twice their value at Albany, [N. Y.] The English, Colden concluded, had much the advantage of the French, and the Indians will certainly buy where they can at the cheapest rate.3
English Traders Sell Cheaper than the French
The reports of the French officials confirmed Colden's statements. The English, reported De Vaudreuil and Begon, May 7, 1726, in their memorandum on the Affairs of Canada, adopt every means to accomplish their purpose ; making presents to the Indians, furnishing them goods at a very low rate, and supplying them with Rum which is their favorite beverage. They added that Sieur de Longueuil, in the course of his voyage to Niagara, met more than 100 canoes carrying peltries to the English and carrying back rum.4
The British Government issued orders prohibiting the debauching of Indians with rum, but it was impossible to enforce this order in the great stretches of wilderness far removed from official eyes.
Moreover, many of the officials not only connived at the traffic but were themselves financially interested in the trading operations. A petition, in 1764, signed by many of the foremost merchants in the province of New York men who became founders of rich and aristocratic American families Henry Bleeker, John De Puyster, Abraham Schuyler, and sundry others sent a remonstrance to the Lords of Trade against the order prohibiting rum. Complaining that the prohibition against rum and other liquors had resulted in a considerable decrease of trade, they protested that the prohibition was an infringement upon the Indians' liberty of trade ; highly solicitous were they of the full and unrestricted right of the Indians to submit to debauchery, cheating and impoverishment. Whereas, the petition read on, when they Vent of liquors is allow'd amongst them, it spurs them on to an unwearied application in hunting in order to supply the Trading places with Furs and Skins in exchange for Liquors.5
Cheap Rum Beats Dear Brandy
The war of the fur traders resolved itself in one aspect, then, into rum against brandy ; and rum, the cheaper drink, succeeded in winning the Indians' trade in the contested districts.
Of the profits of the French East India Company there is little available record ; dispatches from Canada, in 1749, to the French Government stated that the India Company has experienced no real loss, as it pretends, but even that in the two years of 1746 and 1747 it has realized a profit from the Beaver trade of 430,785 livres.6 Lieutenant-Governor Milnes informed Lord Hobart, in 1802, that the entire value of furs exported by the French East India Company (which had had the sole privilege of exporting beaver peltries), never exceeded £140,000 sterling, and that it was often less, particularly in 1754, when it amounted to £64,ooo, and in 1755 to £52,000 only, when it was considered a declining trade.7 It was during this time that Marquis De La Jonquiere (Governor of Canada from 1749-1752), arrogated to himself a monopoly of the peltry traffic, and amassed an immense fortune ; an incorrigible miser, he denied himself the veriest necessities of life even in his last moments.
The commercial superiority of the English was rapidly undermining the French traders and merchants everywhere, despite the advantage that the French had of drastic laws and armed forces. This constant process was assisted by the prevalence of widespread corruption and graft among French officials in Canada, which had much to do with preparing the way for British conquest.
Official Graft and Corruption
Heading the band of official pirates was Intendant Francois Bigot. His chief confederate was Joseph Cadet, son of a Quebec butcher. Bigot, in 1756, got Joseph Cadet appointed Commissary General. In the next two years the industrious Cadet, well seconded by his accomplices, P'ean, Maurin, Corpron and Pennisseault, sold to the King, as the State, for about 23,000,000 francs, army provisions and other supplies which had cost them 11,000,000 francs. The audacious plunderers pocketed a profit of about 12,000,000 francs.
But this was only one of their numerous ways of grafting. They accumulated fortunes from the transportation of military stores and in other lines of similar activity, and they speculated in grain and other commodities of which Bigot, by reason of his authority, was conveniently able to raise or depress the price with the most agreeable results.
Meanwhile Bigot was giving sumptuous entertainments at his palace in Quebec and gambling lavishly ; he lost 204,000 francs in 1758,not an irremediable disaster, by any means, since he well knew how to refill his chest. Cadet became the richest man in the colony.8
The King's Minister in France soon knew of this great plundering. I am no longer astonished that immense fortunes are seen in Canada, wrote Berryer to Bigot, January 19, 1759. General Montcalm wrote from Montreal to Versailles three months later, declaring that the Colony was going to ruin because of Governor Vaudreuil's incapacity and the rapacity of Bigot and accomplices who were busy enriching themselves.9
Thefts of 24,000,000 Francs
The full thefts of Bigot and his crew amounted to perhaps 24,000,000 francs. The testimony at Cadet's trial in Paris showed that both civil and military officers at all the principal forts had been bribed to attest the legitimacy of his accounts.10 Bigot and another were banished for life and their property confiscated, and certain other members of the clique were banished, for a limited period. The total amount in restitution that the judgment of the court, in 1763, compelled Bigot and his numerous band of confederates to pay was 11,400,000 francs, of which sum Cadet was condemned to pay 6,000,000 francs.11 This crew of grafters could congratulate themselves on their easy sentences ; they were not put to the torture, as they had ordered done to common soldiers, and they completely escaped that lashing, shackling, mutilating, branding or hanging to which they, during the very time that they were committing their enormous frauds and thefts, had relentlessly condemned poor offenders whose only crime was that they had committed some petty theft or violated some inconsequential law.
English Become Masters of the Fur Trade
Following the battle of Quebec and the British conquest of Canada, the English became absolute masters of the fur trade.
Reporting, on April 24, 1780, to General Haldimand on the state of the fur trade, Charles Grant, a leading fur trader, estimated that in recent years it had produced an annual return to Great Britain in furs of £200,000 sterling. There were, perhaps, he stated, 90 to 100 canoes in the fur trade yearly leaving Montreal alone for the Great Lakes ; and that besides carrying dry goods, every canoe carries about 200 gallons of rum and wine.12
Lieutenant-Governor Milnes reported to Lord Hobart, in 1802, that, Since the Conquest the Spirit of British Commerce has brought the Fur Trade into Regular Form ; it is now carried on upon System, and a large capital is invested by a Company of Merchants long since known by the name of the North West Company, who have extended the Fur Trade very far into the Interior of the North West parts of this Continent, where they have established numerous Trading Houses.13 Lieutenant-Governor Milnes, it may be remarked, was extremely partial to the schemes and demands of the powerful fur traders who, in return for his good-will, preserved a discreet silence on the extensive land grants fraudulently given under his administration. Milnes was not only generous to others in this respect but to himself ; he contrived to get 48,082 acres of the public domain by signature of the Duke of Portland, Governor General of Canada. Nearly all of the leading men in the North West Company likewise profited by gratuitous gifts of public land made by Milnes.14 We shall have need of referring to these facts more in detail hereafter.
The North West Company
Formed by a number of Montreal merchants and mercantile firms, the North West Company, a distinctively Canadian concern, developed into the most formidable competitor of the Hudson's Bay Company.
Among the original founders of this Company were Simon McTavish, Todd and McGill, Charles Grant, Benjamin and Joseph Frobisher, the firm of McGill and Patterson and five other merchants and firms. The greater part of the capital used in the later operations of the North West Company was supplied by Alexander Ellice, whose son Edward subsequently became so powerful and leading a capitalist, first in that Company, and subsequently in the Hudson's Bay Company. A number of Montreal merchants including such firms as Taylor and Forsyth, and Robert Ellice and Company, were, it appears, rolling up fortunes in extortionate charges for goods supplied to the British Government for the Indians ; Taylor and Forsyth in particular were accused of falsification of accounts and prosecuted.15 General Haldiman wrote to Major De Peyster, May 8, 1780, that he had determined to order Indian presents from England to save the enormous expense caused by the greed of traders.16 Much of the capital invested in the North West Company by the Montreal merchants came from this process of charging exorbitant prices on government contracts.
Returns of $250,ooo a Year
In 1780 the North West Company estimated its annual returns at 150,000 sterling in furs which have served to remit to Great Britain in payment of the manufactures imported from the Mother Country.17 Basing its application upon its services in discovering and extending trade in new territory, far in the North West, the Company, in 1784, petitioned for an exclusive license. This petition was favored by Lieutenant-Governor Hamilton on the ground that were the trade suddenly laid open to greedy and needy adventurers, the returns might be very great for a short period, but the Indians would be drowned in rum, and exclusive of that consideration, it would be the cause of endless quarrels, and bloodshed must be of consequence.18
Rum, Violence and Murder
The success of the North West Company, and the great and rapid fortunes which many of those in it had amassed, Lieutenant-Governor Milnes wrote in 1802, led to the establishment, in 1800, of a second Canadian Company, called the X. Y. Company, headed by Sir Alexander Mackenzie and Company. This Company had the command of a capital equal to that of the North West Company.19
Between the two companies a furious competition set in. Employe often murdered employe in disputes over furs and territory, and rum was used in the most widespread and shameless way to debauch the Indian tribes, each Company seeking to outdo the other in its excesses in order to get trade, fearless of future punishment, because they know that the Courts of the Canadas cannot take cognizance of Crimes committed where they traffick.20
The murders and other crimes were so numerous that the Grand Jury at Montreal, September 10, 1802, handed in a presentment calling attention to the great disorders in the Indian Country, and calling for a remedy.21 At this time the North West Company had 117 trading posts, and a total force of 1,058 men.22 The number of peltries shipped from Quebec for the nine years from 1793 to 1801, inclusive, was enormous ; 137,558 beaver skins, 38,368 martin, 18,349 otter, 11,329 mink, 5,483 fisher, 10,141 foxes, 19,286 bear, 169,811 deer, 144,439 raccoons, 57,151 musk rats, and furs of thousands of wild cat, elk, wolf, kitt, squirrel, hare, seal and other peltries.23
In the war of the two companies, Indians were incited to pillage and fire upon canoes of the X. Y. Company ; attempts often successful were made to debauch and entice away its employes ; and its property was destroyed by treachery and other underhand acts.24 As the force of the North West Company was two-thirds greater than that of the X. Y. Company, it was not easy for the younger company to retaliate, but it did so when it could. Later in 1805 the two companies fused.
Conflict of the Two Large Fur Companies
But this conflict, murderous as it was to both Indians and whites, was insignificant compared to the long and sanguinary war soon breaking out between the North West Company and the Hudson's Bay Company. Here we shall have to turn to the testimony given in 1857 before the British Parliamentary Committee, by Edward Ellice, then loaded with wealth, and a Right Honorable Member of the House of Commons, besides. As Ellice had been connected with all of the companies, his testimony can, perhaps, be accepted as accurate and unprejudiced.
When he went to Canada, in 1803, Ellice testified, the whole of the Canadian Society, every person of eminence and consequence there, was then engaged in the fur trade, it being the only trade of importance in the Country. Ellice explained that this did not include the seigneurs, and went on : The trade was carried on with countries that are now civilized regions, and where large cities are established. It was carried on upon the lakes, Lake Ontario, Lake Erie, through the Michigan territory, upon the Ohio, the Missouri, the Mississippi, and in all of the countries to the north of Canada. I was perfectly acquainted with the details of that trade in 1803, and with the persons interested in it.
Carrying on its trade westward of Lake Superior, the North West Company come into acute collision with the forces of the Hudson's Bay Company. The North West Company had the advantage of being directed by aggressive Canadian merchants and traders on the spot ; one of its most active subalterns was Donald Mackenzie, a young Scotchman who served it eight years, and then became a partner in the United States of John Jacob Astor who was deriving returns of $5oo,ooo a year by systematically debauching the Indian tribes with whiskey and by cheating, impoverishing and indirectly murdering them.25 The Hudson's Bay Company was, on the other hand, a British concern, directed from London ; it had long since passed into the control of British merchants, although many of the titled aristocracy were among its stockholders.
Indians Complain of Being Wheedled
Bloody collisions between the two companies kept increasing. Ellice testified further that, in 1811, Lord Selkirk, who brought over a shipload of tenants founded a settlement, now Winnipeg, on the Red River, and joined the Hudson's Bay Company. According to a remonstrance sent by Chief Peguis of the Salteau Tribe, on the Red River, to the Aborigines Protection Society, London, Lord Selkirk had by dubious methods obtained from that tribe an immensely valuable area of land.
The settlers sent in advance by Selkirk promised the Indians that a great chief who was to follow would pay the Salteau tribe well for their land, 20 to 24 miles Of it, along the Red River. The tribe then consented to the settlers occupying the land. When the Silver Chief (as the Indians called Selkirk) arrived, he told us that he had little with which to pay us for our lands when he made this arrangement, in consequence of the troubles with the North West Company. He, however, asked us what we most required for the present, and we told him we would be content until the following year, when he promised to return, to take only ammunition and tobacco.
The Silver Chief never returned, and either his son or the Hudson's Bay Company have ever since paid us annually for our lands only the small quantity of ammunition which, in the first instance, we took as a preliminary to a final bargain about our lands. This pathetic communication went on to say that this surely was repaying the Indian Chief poorly for having saved the Silver Chief's life, when Cuthbert Grant with 116 warriors had made plans to waylay him a move frustrated by Chief Peguis and his entire tribe. Peguis bitterly complained that in return for the small quantity of ammunition and tobacco paid yearly to his tribe, the Hudson's Bay Company (which had paid Selkirk's executors £84,111,18 shillings, 5 pence for his Red River Settlement)26 now (1857) claim all of the lands between the Assiniboin and Lake Winnipeg, a quantity of land nearly double of what was first asked from us. We hope the Great Mother [Queen Victoria] will not allow us to be treated so unjustly as to allow our lands to be taken from us in this way.27
Selkirk's Heir Gets $420,000
This digression will give an instance of the methods by which a great area of landed property, then of much value, and later of enormous value, came into possession of the Hudson's Bay Company, after enriching the new Earl of Selkirk to the sum of about $420,000, for proprietary rights for which (if we may believe the protest of the Salteau tribe), neither he nor the Hudson's Bay Company had actually ever paid. Ellice testified in 1857 that Selkirk, in addition to being a stockholder in the Hudson's Bay Company, was the proprietor of a large tract of land on the Red River, and claimed that this territory was a free grant made by the Hudson's Bay Company to Selkirk. But Ellice did not touch upon the vital point of when and how the Company had ever bought it from the Indians, and admitted that the alleged grant of the Company to Selkirk was a private transaction and was never published.28
Slaughter in the Trade War
During the course of the sanguinary conflicts between the two companies, an action took place on the Red River, in 1815, between the armed forces, and 16 of them were killed. Selkirk seized William M'Gillivray, principal partner of the North West Company and his property, accusing him of having instigated these murders, and M'Gillivray made counter charges. Kenneth Mackenzie and Simon Frazer were also arrested. Powerful as the Hudson's Bay Company was in England, however, the North West Company was all powerful in Quebec. Its members almost completely controlled the acts of the Government and the Governor in Council, and finally secured acquittal. The well-known judge Reid, says a biographer, had married M'Gillivray's sister, and this mighty influence had something to do with the final issue.29
Rum the Great Inducement
The methods used in inciting the Indians during this trading war were graphically described by Ellice in his testimony before the Parliamentary Investigating Committee.
Rum, he said, was given to the various parties acting in competition, to the Indians and half breeds ; the whole country was demoralized ; the Indian tribes were in conflict one against the other. In fact, whatever a particular trader carrying on his business at a particular post thought was likely to ruin his competitor and to advance his own interest was done without the least regard to morality and humanity. Ellice further testified that the use of spirits was constantly employed, but blamed its necessity on the American traders. If there was a contest about a trading post on the frontier, he said, the universal article used to corrupt the Indians is spirits.30 But, in turn, the United States Government was making indignant remonstrances, charging the Canadians with responsibility for the rum traffic.
The Warring Companies Merge
Such a war was extremely costly, was the conclusion of both companies. Ellice testified that it was he who in 1819 or 1820 succeeded in uniting all interest in the two companies. This merger of the two companies into what has remained the present Hudson's Bay Company was accompanied by two notable incidents. One of these was the claim now advanced by the Hudson's Bay Company (contrary to its previous claims) that its territory extended west of the Rocky Mountains. The other incident was the further inflation of the capital stock to £400,000 an amount still later increased. An Act passed in 1821 gave the Hudson's Bay Company a license for the exclusive trade for 21 years. This rounded out the merger, and assured a definite period of complete monopoly.
From the profits of the North West Company were derived great fortunes which later were conspicuous in banks, steamboats, railroads, and other capitalist channels. When, for instance, Simon McTavish, one of the heads of that Company, died in 1804, his fortune was estimated at £126,000 sterling, an immense sum in those days, says a biographer.31
1 Report on Canadian Archives, 1899 Vol., p. 414
2 London Documents, Documents Relating to the Colonial History of the State of New York, Vol. V, p. 727. (For purposes of abbreviation these documents are frequently referred to hereafter as N. Y. Col. Docs.)
3 1bid., pp, 729-730. All of the strouds carried by the French into Indian territories, as well as other large quantities of goods for use among the French themselves were conveyed from Albany to Montreal.
4 Paris Docs., N. Y. Col. Docs., Vol. IX, p. 953
5 London Docs., N. Y. Col. Docs., Vol. VII, p. 613.
6 Paris Docs., N. Y. Col. Docs., Vol. X, p. 201.
7 Canadian Archives, Series Q., Vol. 89, p. 144.
8 Parkman's Montcalm and Wolfe, Vol. II, p. 28.
9 Report on Can. Archives, 1887 Vol, p. ccxix.
10 Parkman quotes a writer of the time on Canada : This is the land of abuses, ignorance, prejudice and all that is monstrous in government. Peculation, monopoly and plunder have become a bottomless abyss. Montcalm and Wolfe, Vol. II, p. 29.
11 Report on Can. Archives, 1899 Vol., pp. 187-189.
12 Report on Can. Archives, 1888 Vol., Note E., pp. 59-60.
13 Ibid., 1892 Vol., Note E., p. 135.
14 List of Lands Granted by the Croum in the Province of Quebec from 1763 to Dec. 31, 1890. Printed by Order of the Quebec Legislature, 1891, pp. 8-11. See Chapter V of this volume for fuller details.
15 Report on Canadian Archives, 1887 Vol., pp. 101-116.
16 Ibid., p. 225.
17 Ibid., 1888 Vol., p. 61.
18 Ibid., 189o Vol., Note C., p. 48.
19 Ibid., 1892 Vol., Note E., Milnes to Lord Hobart, Courts of Justice for the Indian Country, pp. 135-136.
20 Report on Canadian Archives, 1892 Vol., p. 137.
21 Ibid., pp. 139-140.
22 Ibid., p. 142.
23 Ibid., p. 143.
24 John Richardson to H. W. Ryland, from Montreal, October 21, 1802.Ibid., p. 145.
25 See the specific facts in the chapters on the Astor Fortune, Vol. 1, History of the Great American Fortunes, citing government documents.
26 Report from the Select, Committee on the Hudson's Bay Co., House of Commons, 1857, Appendix No. xvii, p. 449.
27 1bid., Appendix, XVI, pp. 444, etc. See sequel later.
28 Ibid., p. 323.
29 Borthwick's History of Montreal, p. 398.
30 Report from the Select Committee on the Hudson's Bay Co., etc., House of Commons, 1857, p. 326. Yet during this very time the Hudson's Bay Company was boasting that its missionaries were civilizing the heathen.
31 Borthwick's History of Montreal, pp. 213-214. The possession of $25,000 in those days, says Borthwick earlier in his work (p. 55), made a rich man, and $100,000 a very wealthy man.