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Fur Trade in Canada: An Introduction to Canadian Economic History

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At the time of its publication in 1930, The Fur Trade in Canada challenged and inspired scholars, historians, and economists. Now, almost seventy years later, Harold Innis's fundamental reinterpretation of Canadian history continues to exert a magnetic influence.

Innis has long been regarded as one of Canada's foremost historians, and in The Fur Trade in Canada he presents several histories in social history through the clash between colonial and aboriginal cultures; economic history in the development of the West as a result of Eastern colonial and European needs; and transportation history in the case of the displacement of the canoe by the York boat. Political history appears in Innis's examination of the nature of French-British rivalry and the American Revolution; and business history is represented in his detailed account of the Hudson's Bay and Northwest Companies and the industry that played so vital a role in the expansion of Canada.

In his introduction to this new edition, Arthur J. Ray argues that The Fur Trade in Canada is the most definitive economic history and geography of the country ever produced. Innis's revolutionary conclusion - that Canada was created because of its geography, not in spite of it - is a captivating idea but also an enigmatic proposition in light of the powerful decentralizing forces that threaten the nation today. Ray presents the history of the book and concludes that "Innis's great book remains essential reading for the study of Canada."

463 pages, Paperback

Published January 1, 1999

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Harold A. Innis

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Profile Image for Andrew.
680 reviews250 followers
June 7, 2016
The Fur Trade in Canada: An Introduction to Canadian Economic History, is an in depth look at the Canadian fur trade, and an application of "staples thesis" where regional development is reliant on the characteristics of staple resources and their trade and business organizations. Written by Harold Innis in the 1930's, this book is still widely considered an important read on the nitty gritty of the fur trade in early Canadian history. Although Innis' Staples Thesis does not necessarily hold a candle to many modern economic theories, for being a bit to simplistic in terms of staples importance to political and social development (ie. centralized businesses such as fur trading made people more accepting of centralized government contr0l). Obviously a few more factors were involved. However, the Staples Thesis also examines Canada's ties to the UK in its early history, due to portfolio style investments by London based businessmen and their use of French and Aboriginal middle men in Quebec (particularly Montreal) and the Northwest Interior. This mutual reliance was based on the need for skilled labour (coureur des bois and Aboriginal trappers) in the fur trading interior, and the need for investment from the UK, as capital was difficult to raise in the Canadian territories. This is an interesting early look at Canadian economic development, and is definitely important in Canadian historical discourse.

The book itself is a very detailed account of the growth and decline of various fur trading ventures. To start, early French settlers began to exploit fur trapping Aboriginal groups. The Aboriginal groups received European goods, like iron knives and ice picks, lightweight copper kettles, guns and shot, cotton and linen goods and so on. In return, the French received fur pelts, the most sought after being the pelt of the Beaver. Beaver pelts also came in many grades, from castor gras (the highest quality) to castor sec. The differences had to do with the lustre of the fur, and the presence or absence of short hairs. Castor gras was actually made by wearing the fur for a period of time, where the short hairs would fall off over time, and the wearers sweat would help treat the fur. The Europeans were basically seeking old clothes! The Aboriginals were often suitably perplexed as to why Europeans would seek old clothes and trade fabulously useful survival goods for them, and ironically, Europeans were often sneering in their contempt for Aboriginals and their lack of understanding as to the value of their old clothes. One of histories strange and funny cross-cultural misunderstandings.

The French began to explore deeper into the Canadian and American interiors as time went on, using their colonies in Quebec to ship goods in for trade, and furs out for the home market. Furs were processed in Paris, and sold around Europe depending on current stylistic tastes in each European nation. The French also developed a highly skilled task force of traders, called coureur de bois, who were excellent navigators, boatman and explorers. These traders were often close to various Aboriginal tribes, and would live and trade with them for seasons at a time. They were also multi-lingual, and were able to converse and deal with a number of tribes in various locations within the interior. Innis argues that the French colonies were highly reliant on the fur trade for survival, as the price of furs dictated the amount of support the colony would receive from Paris. The French government tried to monopolize the fur trade multiple times, but the vast distances of the interior, the high cost of transportation, and their reliance on traders who's allegiances were suspect often foiled them. Traders would often smuggle goods to competitors (like the Dutch in New York, or the English in Moose Factory) if the prices were right.

Innis also looks deeply at Aboriginal tribes in the fur trade. He argues that the fur trade was a new phenomena for most tribes. Many did not engage in trapping at all, and those who did only to use furs as clothing. With the European market opening to them, survival goods that they could not have made themselves tied them deeply to this trading system, to often disastrous results. Competition over trading rights and furs lead to wars, genocides (such as the Huron) and displacements of entire tribes of peoples. The political landscape of North America was forever altered, and altered violently. European powers often used tribes in proxy wars against their competitors. Aboriginal groups themselves made and broke alliances to try and dominate middleman status in the trading of furs. The reliance on European goods was also horrifying. Rum and Brandy were devious trade goods, where traders could use booze to trade for fur, without trading any important survival gear to the Aboriginal groups. The European lust for furs also lead to massive destruction of beaver populations. One of the main reasons for Canada's westward expansion was to move to prime fur trapping locations as the areas behind were exhausted.

The British trade is also examined. The Brits had an easy access to the Atlantic Ocean through the Hudson Bay. They used this position to ring the French trading posts in, and move into more Northwestern trading areas, bringing more Aboriginal groups, like the Inuit, into contact. Rivalry was heated between France and Britain, but also existed with Spain and Russia, (and the Dutch, until the invasion of New York). After the conquest of New France, the British began to rely heavily on Canadian (Quebecois) trappers. Competition also arose between rival companies, such as the Hudson's Bay company, the Northwest Company and the XY Company. This competition waseheated, as each sought greater control over the fur trade, and each tried to expand to new heights, both North and West, building forts and posts out to the Pacific Ocean. Violence, murder and proxy war also took place between the companies, until a merger formed the great Hudson's Bay Company, which at one time controlled almost the entire current Canadian landmass. Competition also existed between the British in Canada and in New York, until the American Revolution. Many of the lenders and merchants in New York fled to Montreal during the upheaval, once again bringing the dominance of the fur trade to Quebec.

Innis' book was fascinating, if a bit dated. The book chronicles much of the trade in extreme detail, down to the exact composition of freight, the various amounts of trade goods and furs in pounds, and the salaries and profit margins of the traders and companies. This detail is often overwhelming, although still quite interesting. Even so, the book is a wonderful look at the early Canadian economy, and its reliance on fur trapping. Recommended for those interested in Canadian environmental or economic history.
119 reviews2 followers
January 25, 2025
(https://en.wikipedia.org/wiki/Drainag...) "A deranged drainage system is a drainage system in drainage basins where there is no coherent pattern to the rivers and lakes... A classic example is the Canadian Shield. During the last ice age, the topsoil was scraped off, leaving mostly bare rock. The melting of the glaciers left land with many irregularities of elevation and a great deal of water to collect in the low points, resulting in the region's many lakes."

It is to such an environment that the beaver (Castor canadensis Kuhl) is adapted.

"Since the beaver was an amphibious animal, its fur was thick and abundant"... "Examined through a microscope the fur has numerous small barbs. It was these barbs which made it unusually suitable for the manufacture of felt and of felt hats."

Furthermore, the value contained in the beaver's fur was intensified by the free (or criminally underpriced) labor of native North Americans. Not only did they do the actual trapping and act as middlemen over long journeys, but they processed the raw material with their bodies.

"The rapid development of trade with these Indians was dependent on their methods of treating the fur and on the character of the felting process. The pelts were taken by the Indians when prime and the inner side scraped and rubbed with the marrow of certain animals. After this treatment each pelt was trimmed into rectangular shape and from five to eight were sewn together with moose sinews into robes which were worn by the Indians with the fur next to the body. The scraping of the inner side of the pelt loosened the deep roots of the long guard hair, and with wearing, this hair dropped out leaving the fur. With constant wearing for fifteen to eighteen months the skin became well greased, pliable, and yellow in colour and the fur downy or cotonné. These furs taken in winter when prime were known later as castor gras d’hiver. It was this fur which was most valuable to the hatmaking industry. The guard hairs had largely disappeared and the fur was especially suited to the felting process."

This was a perfect opportunity for enterprising European settlers (who had initially been attracted to Canada by cod). "The migrant was consequently in search of goods which could be carried over long distances by small and expensive sailboats and which were in such demand in the home country as to yield the largest profit. These goods were essentially those in demand for the manufacture of luxuries, or goods which were not produced, or produced to a slight extent, in the home country as in the case of gold and of furs and fish. The latter was in some sense a luxury under the primitive conditions of agriculture in Europe and the demands of Catholic peoples."

The European settler would trade European manufactured goods, like guns or textiles, in exchange for furs. Innis has been criticized for overemphasizing this point, but I repeat it here: the influx of European goods had a drastic impact on native North American life.

"Above everything the kettle has always seemed to them, and seems still, the most valuable article they can obtain from us... One can say that in those times the immovable kettles were the chief regulators of their lives, since they were able to live only in places where these were."

With the great increase of manufacturing capacity constitutive of the Industrial Revolution, I'm tempted to infer that the real resource the Europeans found in North America was not fur, but a vast new pool of consumers to market to. Not supply, but demand- demand for an excess supply of manufactured products.

". . . The Fur Trade is not the object . . . it is the great consumption of Rum and Indian Presents (manifested by the amazing sums drawn for on those accounts) purchased at a most exorbitant price from the traders."

Conversely, you can look at what happened when the market was flooded with a supply of furs. Did the fur trade stop growing in response to demand having been met? No! Excess supply went in search of further demand and thus further profit.

"the beaver trade in France and Europe is limited to a certain consumption beyond which there is no sale and the beaver remains a pure loss to those charged with the conduct of the trade... it is not sufficient to Canadians to have the desire to sell, it is necessary that they should find at the same time people who wish to purchase and to pay and this does not appear to be possible."

In this sense there's an argument to be made that beaver was not so much of a commodity as simply the fungible currency in which native North American consumers could pay Europeans in. This is literal: the Hudson's Bay company minted coins in the unit of M.B. ("Made Beaver"). This was only later superceded by Canadian currency.

"The one-dollar note has taken the place of the “skin” and poker games are conducted entirely with that denomination."

In this way, the interior of Canada was sparsely settled by European trading posts. The trading posts only existed to reduce the large overhead costs of prosecuting trade deep in the interior. And trading deeper in the interior was a necessity since the beaver quickly became scarce where it was hunted. In short- it takes a while to rebuild a beaver dam.

"... its non-migratory tendencies and elaborate housing facilities made destruction certain. In the language of the economists, the heavy fixed capital of the beaver became a serious handicap with the improved technique of Indian hunting methods, incidental to the borrowing of iron from Europeans. Depreciation through obsolescence of the beaver’s defence equipment was so rapid as to involve the immediate and complete destruction of the animal."

And so the French stretched themselves thin. The situation is familiar to anyone who's played a civ-builder game. You can try to balance your development, or you can min-max: neglect a few areas to gain superiority in others. The French literally min-maxed their beaver build. They neglected agriculture to the point where their small population couldn't militarily defend their beaver trade.

"The monopolists were interested in the fur trade and, as far as possible, evaded the tax laid down in their agreements which required them to promote settlement. In so far as agriculture benefited the trade, it was encouraged."

"Champlain knew the situation when he wrote in 1618:
I saw that a greater fear held them; that if the country were settled their power would diminish, not making in this place all that they wished, and loosing the greatest part of the furs which would fall into the hands of the settlers of the country who would hunt by themselves and who would be brought out at a heavy expense.
The consequent weakness of the colony was shown in the loss of Quebec to the English from 1629 to 1632."

"The trade was carried on in the summer and seriously restricted the supply of labour for agriculture. In M. Du Chesneau’s letter to M. de Seignelay, dated November 13, 1681, he complained that: “Two years absence of five hundred persons [coureurs de bois] (according to the lowest calculation), the best adapted to farm work, cannot increase agriculture; and this is confirmed by the complaints I have received from proprietors of Seigniories who do not participate in the profits of the Coureurs de bois, that they cannot find men to do their work.”

For Innis, this geographically influenced tension between settlement and the fur trade is explanatory of quite a lot- the loss of New France to the English, the location of the border between Canada and the US, and the retention of Canada by the English in the wake of the American Revolution.

"The fur trade was prosecuted most successfully in areas not suitable to agricultural and industrial development, and eventually colonies dependent on the fur trade were destined to take a subordinate position to those geographic areas which gave a more diversified economic development"

You shouldn't go full Jared Diamond, so it's not really a matter of being "destined" as much as it is a matter of understanding. The reason I like books like this is that they do make you look at things today a different way.

Like, about 1.849 billion years ago, an asteroid hit the Earth. The impact caused nickel-containing magma to flow upward into the crater.

"In 1856 while surveying a baseline (for Crown Treaty no. 61) westward from Lake Nipissing, provincial land surveyor Albert Salter located magnetic abnormalities in the area that were strongly suggestive of mineral deposits, especially near what later became the Creighton Mine. The area was examined by Alexander Murray of the Geological Survey of Canada, who confirmed "the presence of an immense mass of magnetic trap"." (https://en.wikipedia.org/wiki/Sudbury...)

And that's why there's a town at Sudbury, Ontario (and more importantly, why there's the https://en.wikipedia.org/wiki/Big_Nickel).

How much of this interaction with geography was predetermined? Was it inevitable that European settlers treat native North Americans in such a cynically extractive manner?

"I had hoped to promote a peace between the Hurons and the Iroquois so that Christianity could be spread among them and to open the roads to trade with many nations who were not accessible but some members of the Company advised me that **it was not expedient** since **if the Hurons were at peace with the Iroquois, the same Iroquois would lead the Hurons to trade with the Dutch** and divert them from Quebec which is more distant."

Did the European surveying techniques that detected the Sudbury Nickel Irruptive have to also enact a threat to people's ways of living, in such a literal way?

"McDougall had sent out surveyors to plot the land according to the square township system used in the Public Land Survey System... Headed by Colonel John Stoughton Dennis, the survey party arrived at Fort Garry on August 20, 1869. The Métis were anxious about the survey since they did not possess clear title to their lands but held a tenuous right of occupancy. In addition, the lots had been laid out according to the French seigneurial colonial system, with long narrow lots fronting the river, rather than the square lots that were preferred by the English. The Métis considered the survey to be a forerunner of increased Canadian migration to the territory, which they perceived as a threat to their way of life. More specifically, they feared a possible confiscation of their farmland by the Canadian government." (https://en.wikipedia.org/wiki/Red_Riv...)

Have we escaped from the forces of this narrative through economic diversification, or do they continue to reverberate? For example, the decline of fur is connected to the rise of the lumber industry. Then...

"The decline of white pine and the existence of large quantities of spruce on the limits facilitated the shift [from lumber] to pulp and paper production"

And then:

"The development of surplus power, chiefly a result of the pulp and paper industry, has stimulated manufactures as in the conspicuous example of Arvida on the Saguenay"

"Arvida was founded as an industrial city by Alcoa in 1927, when the first aluminum smelter was constructed. Located 240 kilometres (150 mi) north of Quebec City, south of the Saguenay River between Chicoutimi and Jonquière, the town was planned from the first day and was developed as a company town, to have a population of about 14,000 inhabitants, four Catholic parishes, and many other denominations, parishes and schools. It was known as "the City Built in 135 Days" and described by The New York Times as a "model town for working families" on "a North Canada steppe" "... The smelter complex at Arvida was the largest aluminum plant in the world from 1943 to 1975 and they produced two-thirds of the aluminum used by the World War II Allied forces." (https://en.wikipedia.org/wiki/Arvida,...)

Is the American perception of "a North Canada steppe" as an opportunity for a return on capital investment altogether unconnected from the geography so amenable to the mercantilist dynamic of the fur trade? Can we draw a line from a trading post to a "company town" to, say, Sidewalk Labs?
340 reviews
June 5, 2022
I had read some sections of this when I was an undergraduate and have long meant to read it in full. After snagging a second-hand copy while home recently, I have done just that.

This book was written almost a century ago and while its wider interpretations have been long since challenged and/or revised, it in many ways has stood the test of time. The "staples thesis", elegant in its simplicity about the importance of natural resource extraction to wider trends of industrialisation and the rise of capitalism in the 18th and 19th centuries, still holds some water. It can certainly be applied to African history and the ivory trade, which was far more exploitative than the fur trade.

Indeed, as subsequent research has shown, the Canadian fur trade was in many ways egalitarian, even as its capital requirements favoured monopoly. Recent research has shown for example that Native Canadians involved in the trade had higher living standards than the English working class of the time. Innis would not have been shocked by that. Indeed, for his area he was sympathetic to Aboriginal peoples, who in his view clearly had agency: they were not pawns or simply victims of colonial forces. Indeed, he notes near the end of this masterpiece (page 392) that: "We have not yet realised that the Indian and his culture were fundamental to the growth of Canadian institutions."

Almost a century later, in "A Fair Country", John Ralston Saul would argue that Canada's egalitarian heritage has at its core an Aboriginal take on the world. Innis I think had a more practical take on this cultural exchange: bushcraft and the birchbark canoe made penetration into the Canadian bush possible, and Europeans could not have learned these things without a guiding Native hand. For this reviewer, it brings to mind my own family's hunting and fishing heritage, which owes far more to Aboriginal culture than many Canadian hunters and anglers realise. (This is a point that Saul misses but he is an urban elitist after all ...).

Innis was a trail blazer in other ways, including his recognition of the importance of natural history and the beaver's traits to the shaping of Canadian history. Much of subsequent Canadian history has, in some senses, been a conversation with this book. And as a researcher he was truly formidable: there is a mass of data and numbers uncovered here and extensive use of primary resources. Innis also set forth by canoe to explore first hand some of the terrain covered in this book. It all serves to give him an air of authority on his subject matter.
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229 reviews1 follower
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February 13, 2021
I will not be rating or reviewing books I read for work.
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126 reviews3 followers
January 6, 2016
Not an easy read by any means. However, Innis's work is immensely important to Canadian history and is a must read for any Canadian. This book is also critical reading for anyone studying the staple theory of economic growth.
50 reviews1 follower
November 23, 2022
Hell yeah. An absolute banger and unfailingly relevant classic. Staples thesis a little outmoded, but has been successfully reworked in dependency theory.
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