Mr. Astor's Proposal
In February 1808, Thomas Jefferson, sixty-five years old and in the waning months of his second term as president, received a letter from the New York merchant John Jacob Astor asking him to support a far-flung trading venture beyond the Mississippi.
Astor had already begun to amass an enormous fortune in trading furs and exporting and importing goods, yet he was not widely known outside New York and Montreal, where he did much of his trading. The president had never met Astor -- in fact, he had likely never heard of him, though Astor cited his fellow New Yorker, George Clinton, Jefferson's vice president, as someone who could attest to his good character and accomplishments. Based on the ambitious proposal Astor outlined in his letter to Jefferson, however, the nation's chief executive may well have concluded its author was either a man of great ambition and vision or perhaps someone suffering from delusions of grandeur.
Astor wanted to create a great fur-trading company that would operate through a network of posts he intended to build along the route followed by Lewis and Clark from St. Louis all the way to the Pacific. To be called the American Fur Company (AFC), this enterprise would put the entire fur trade in the northern half of Louisiana Territory -- all the area included in the Louisiana Purchase of April 30, 1803 -- under U.S. control within four or five years, Astor asserted. To succeed, the company needed the president's blessing as well as the full support of the American government.
The proposal captured Jefferson's attention. Assuming Astor had the resources and business and organizational acumen to mount such an ambitious and costly endeavor -- and the president was well aware that few men in the United States possessed such qualifications -- this fur-trading enterprise of his might well serve Jefferson's own agenda for bringing Louisiana into the bosom of the Republic.
In 1803, Jefferson received congressional approval and an appropriation of twenty-five hundred dollars to send a military expedition to explore the upper Missouri River to its headwaters in the Rocky Mountains. From there, what would become known as the "Corps of Discovery" was to follow the first westward-flowing river the explorers came upon to the Pacific Ocean. Jefferson had chosen his private secretary, Captain Meriwether Lewis, to lead the expedition. In turn, Lewis asked his friend William Clark to serve as coleader. Their chief objectives were twofold: advance the geographic and scientific knowledge of the continent and pave the way for advancement of the American fur trade to the various Indian tribes they encountered on their journey. In the three years that elapsed between the time Lewis and Clark began to organize their expedition in the summer of 1803 and their return to St. Louis in the fall of 1806, the Corps of Discovery had traveled eight thousand miles and had accomplished its mission, setting the stage for expansion into the trans-Mississippi West.
The commercial gains that Jefferson had assured Congress would come as the result of the expedition, however, had been slow to materialize. By the time Jefferson received Astor's letter, almost five years since the United States had acquired Louisiana from France and eighteen months since the return of Meriwether Lewis and William Clark, the president's enemies were still characterizing the Louisiana Purchase as a costly folly. Worse, the government's efforts to extend America's commercial reach beyond the Mississippi had faltered badly, especially in upper Louisiana Territory, then known as the Old Northwest. There, two major Canadian trading companies -- North West Company (NWC) and the more recently formed Michilimackinac, a NWC subsidiary -- were securing huge quantities of furs from the Indians of the region while turning these tribes against the United States.
At the time, the fur trade ranked as perhaps the largest business in North America. Some six million pelts -- mostly beaver for felt hats worn by European and American gentry; sable, ermine, and marten for coats, fur muffs, and trimming; as well as less valuable muskrat, fox, buffalo, and raccoon hides -- were sold annually at prices ranging from fifteen cents to five thousand dollars per pelt.
With the North West traders encroaching on the upper Missouri and Old Northwest and Michilimackinac rapidly gaining control of the upper Great Lakes and Mississippi, American traders were being excluded from their own territory by what had emerged as a quasimonopoly. Moreover, the pelts secured by the Canadians and British traders in U.S. territory were sold at a significant premium within the United States, which imported three-fourths of its furs from Canada and England. In other words, Americans were paying more for furs that had been trapped within their own borders than were the British.
Jefferson had done what he could to counter the Canadian influence. In 1807, he sent William Clark back to St. Louis to serve as superintendent of Indian affairs. Meriwether Lewis was scheduled to join Clark there in March, when he would take office as governor of Missouri Territory. Jefferson was counting on the two former Corps of Discovery commanders to be his eyes and ears on the frontier and do what was needed to aid in the further development of Louisiana.
The government had also dispatched an expedition lead by Zebulon Pike up the Mississippi to warn off British traders while convincing a reluctant Congress to fund the building of trading posts west of the Mississippi on the Arkansas, Natchitoches, and Bellefontaine rivers. Subsidized by the government, these outposts would, Jefferson hoped, serve as supply bases for American traders and a means of attracting the Indians with prices that were far more competitive than those being paid by the British.
But, by itself, the American government didn't have the resources to match the Canadians. Together the NWC and Michilimackinac had a capitalization of close to two million dollars, almost as much as the entire federal budget at the time. Then, too, three years into his second term and getting ready to retire, Jefferson had shifted his own focus, out of necessity, to foreign affairs.
With Great Britain and Napoleonic France at war, both countries routinely blockaded U.S. shipping and seized American vessels with impunity. On one such instance, on June 22, 1807, the HMS Leopard, acting under the orders of British Vice Admiral George C. Berkeley, fired repeated broadsides at the defenseless American frigate Chesapeake after Commodore James Barron, in command, refused to allow the British to search for English deserters. Three Americans were killed and eighteen wounded.
Enraged, Jefferson responded by enacting the Embargo Act of 1807, which prevented all exports and most imports, and put himself in charge of enforcing it, a role that normally would have fallen to Secretary of the Treasury Albert Gallatin. Intended to force the British and French to recognize American sovereignty without provoking outright war, the embargo proved largely counterproductive and hugely unpopular, especially in the Federalist Northeast, which suffered most from the lack of foreign commerce.
In the meantime, the president was receiving reports of British agents operating on the western frontier and raids on American trading parties by the Aricaras and other tribes along the upper Missouri. Jefferson suspected that the British traders had incited these attacks.
Astor's proposal had come at a propitious time. Perhaps his chain of commercial trading posts would serve to keep the British and Canadians in check, acting as a commercial barricade extending to the western sea. But who exactly was this man? What were his bona fides? Jefferson asked Secretary of War General Henry Dearborn to find out all he could about Astor from New York Governor De Witt Clinton. "Governor speaks well of Astor, as a man of large property & fair character, and well acquainted with the fur & peltry business," Dearborn reported on April 8, 1808. That was enough to satisfy Jefferson. A few days later, he gave the New Yorker his blessing for the plan to undertake trans-Mississippi trade with the western Indians.
"All beyond the Mississippi is ours exclusively, and it will be in our power to give our own traders great advantages over their foreign competitors," Jefferson wrote Astor. "You may be assured that in order to get the whole of this business passed into the hands of our own citizens, and to oust foreign traders, who so much abuse the privilege by endeavoring to excite the Indians against us, every reasonable patronage and facility in the power of the Executive will be afforded."
In July, the president wrote excitedly to Meriwether Lewis in St. Louis, now governor of Missouri Territory, informing his friend and former secretary that a powerful company was being formed to carry on the Indian trade on a large scale with the intention of securing for the United States "exclusive possession of that commerce." This new enterprise would be under the command, Jefferson explained, of "a most excellent man, a Mr. Astor, of New York, long engaged in the business and perfectly master of it."
Copyright © 2003 by Laton McCartney