Source.—A Paper by Sir Donald Smith (now Lord Strathcona), read to the Royal Colonial Institute in April, 1897. The Company's territories were taken over by the Dominion of Canada in 1869.
The principal business of the Hudson's Bay Company was the purchasing of furs from the Indians, in exchange for arms and ammunition, clothes, and other commodities imported from the United Kingdom. Its prosperity depended upon good relations being maintained with the aborigines. Its officers were able to travel everywhere with freedom and safety, and could rely upon the friendliness of the red men. Advances made to the Indians for their hunting outfits or in times of scarcity were nearly always repaid. On the other hand, the Indians knew that any notes they might receive upon the trading posts, from peripatetic officers a thousand miles away from headquarters, would be honoured on presentation. The foundation of these friendly relations was confidence, and the knowledge the Indians acquired of the white man and his ways during the long administration of the Company made the transfer of the territory to Canada comparatively easy when the time for the surrender arrived. Its policy, which has been followed by successive Governments of Canada, has enabled the country to avoid those Indian wars which were of frequent occurrence in the early days of settlement in the western parts of the United States. Even in the half-breed disturbance in 1869 and 1870 already referred to, and in that of 1885, none of the Indians, with a few exceptions, could be induced to take arms against the forces of law and order. The fur trade over such an immense area was necessarily important; but at the same time, from natural reasons, it was bound to diminish in the more accessible parts where settlement in the future was regarded as possible. There was always a tendency on the part of the Indians to kill as many animals as possible, simply for the skins. They held the belief, some people say, that the more they killed the more rapidly would the animals multiply. Their motives therefore may have been conscientious, but I am afraid they were not altogether unconnected with the prospect of immediate profit. There is not much large game now in the regions traversed by the Canadian Pacific Railway, except perhaps in the more inaccessible districts between the Lakes and Hudson's Bay, and in the territory north and north-west of the river Saskatchewan. The buffalo, which used to furnish the Indian with food, shelter, and raiment, is almost extinct, and it is possible to travel over the prairie for hundreds of miles without seeing any wild animals larger than coyotes and gophers. Deer of various kinds are found occasionally, and bears still less frequently, and it may be said with truth that hunting in Canada, whether for pleasure or for trade, now entails a good deal of hard work....
In former times for trading purposes the unit of value was the beaver skin. The price of everything was calculated at so many skins, and they were the sole medium of exchange. In return for the skins the Indians received pieces of stick prepared in a special manner, each representing a beaver skin, and with these they were able to purchase anything they wanted at the Company's stores. Later on, about 1825, the Company established a paper currency. The highest note was for £1, the next for 5s., and the lowest for 1s. They were known as "Hudson's Bay Blankets," and no fears were ever entertained as to the soundness of the bank. It has been urged against the Hudson's Bay Company that it obstructed the development of the great North-West. On the contrary, it was engaged for two centuries in important pioneer work. Any corporation of the kind with exclusive privileges and rights was bound to make enemies; but no single province of Canada could have undertaken the administration or development of the country before confederation, and neither men nor money were available locally to permit of its blossoming out separately as a Colony or as a series of provinces. Whatever may have been the faults of the Company, history will record that its work was for the advantage of the Empire. The Company explored this vast territory, prepared the way for settlement and colonisation, fulfilled an important rôle in the history of Canada, and had not a little to do with the consolidation of the Dominion, and with the development the western country has witnessed in the last thirty years.