The Formation of the Alaska Commercial Company

The Tides Shift

When the Russians closed the Bering Sea and their northern settlements to all outside interests, whalers and sealers ignored their protests and continued to poach and outright traverse the 'mare clausum'. Fur traders and gold seekers encroached from the British boundaries into the Yukon River, on the Beaufort Sea, and down to the islands off the coast of British Columbia. Unable to repel these incursions militarily or diplomatically, the Russian government determined that they would rather proactively dispose of the territory than have it simply taken from them by the tide of the times.

Two wars, the Crimean War involving the Russians and the Civil War of the Americans, prevented any fruitful action. Ultimately, it was the decision of the Russian government to cede their territory to the United States as a political strategy to avoid losing it to the British after the Frasier River gold rush. The idea blossomed on the fertile ground of the prior decade and upon the various individual commercial and lobbying efforts.

By the 1860s the United States had expanded its boundaries to encompass the Oregon Territory and all of California; efforts were seriously underway to annex the Sandwich (Hawaiian) lslands in the Pacific Ocean as well as the Philippine lslands. Following the gold rush of 1849, California merchants, including a number of enterprising Jewish entrepreneurs, looked north for profitable investments. Individually, they began to pursue the issue through the political process.

Principals of the Alaska Commercial Company.

Left to right: Capt. Gustave Niebaum, Louis Gerstle and Louis Sloss in the company office at 310 Sansome Street, San Francisco. Photograph from Johnston, Samuel P., Ed. Alaska Commercial Company.

ACC office in San Francisco, 1904.

 Left to Right: H. McIntyre (Seal Islands agent for the Treasury), Capt. M.C. Erskine (scientific explorer and author of the Coast Pilot series), Professor George Davidson, and Apt. Gustave Niebaum. Photograph from Johnston, Samuel P., Ed. Alaska Commercial Company.

The Lobby for Purchase

A few companies (Irish, English, and Quaker) had small contracts with the Russian-owned Russian American Company (RAC) in Sitka, Alaska to transport commodities such as furs, food, and ice. The Hudson Bay Fur Company, along with numerous other companies from Boston to the Oregon Territory, sought a piece of the action. The RAC had a contract with the Hudson Bay Fur Trading Company, which lapsed in 1863. It also had a contract to sell ice from Kodiak to another San Francisco business sector operated by Jewish entrepreneur Louis Goldstone. Louis Sloss and John Miller, later associated with Alaska Commercial Company, were among those seeking to establish business contracts with the RAC. Some who were actively pitching American commerce in the region included Perry Collins, who inspired the Western Union Telegraph Company overland cable effort; Joseph L. McDonald who created a fishing enterprise and actively sought the participation of the Russian consul and California's Senator William Gwin; and Louis Goldstone who sought a sublease for furs from the expiring contract of the Hudson Bay Company. All sent their reports to California Senator Cornelius Cole.

The Jewish merchants and financiers of the 1860s in San Francisco had many ties to the fur trade that they helped develop. Foremost among the exporters of furs on the Pacific West Coast was the Russian American Company. While there existed no organized Jewish effort per se to purchase Alaska from the Russians, the Jewish merchants of California contributed their voices to opening the region. One company, whose major stockholders were the Jewish merchants Louis Sloss and Lewis Gerstle, did lobby in all senses of the verb for a monopoly on Alaskan fur seal skins beginning in 1868. They succeeded in 1870 and this trade formed the foundation of the successful Alaska Commercial Company.  

The ACC was founded as a California corporation in October of 1868 by a group of prosperous merchants who collectively possessed all the talent and know-how needed to create a flourishing enterprise. Formed in two phases, the Hutchinson, Kohl & Company first took possession of the departing Russian American Company’s business assets and infrastructure located in over 50 locations across the Territory of Alaska in 1867. A melee of rogue seal hunters that descended on the seal rookeries of St. Paul and St. George in the Pribylov Islands in the summer season of 1868, impelled the merchants to build on the prosperity of the first company and to protect its profitability. By the fall of 1868, the principals of the Hutchinson, Kohl & Company merged their business with the San Francisco merchants into the Alaska Commercial Company. They lobbied Congress for an exclusive 20-year seal islands lease, granted in 1870, and developed the former Russian fur stations into a hugely successful enterprise.

From the RAC to the ACC

Jewish merchant-pioneers, including Louis Sloss and Lewis Gerstle, appealed to Senator Cornelius Cole of California (a school friend of William H. Seward, the U.S. Secretary of State) to obtain from the Russian government through diplomatic channels the right of succession to the assets of the RAC.  It was because of this lobbying effort through Cole that Seward decided to purchase Russian America. This timed perfectly with the public announcement of the Russian government’s intention to sell. By the time that Hutchinson, Kohl & Company acquired ownership of the Russian American Company holdings, the RAC had nominally ruled Alaska for over a century.

The above consortium of merchants, whose members were predominantly of Jewish backgrounds, became the Alaska Commercial Company (ACC) one year after the purchase. Their focus was on establishing a foothold in Alaska due to the rich potential of the Pribylov Island fur seal trade. Eventually, this goal was realized, and for the next two decades, the ACC enjoyed a near monopoly on not only the fur seal trade but also transport, comestibles and other supplies marketed within Alaska. As many as 86 trading posts studded the “Westward,” as Alaska north and west of Sitka was known. Posts included Kodiak, Unalaska, and St. Michael. The Alaska Commercial Company was the most far-reaching mercantile empire during the formation of Alaska's American period as Alaska evolved from colonial status to statehood.

Seattle Pier 4.

Note: During the gold rushes of the late 1890s, the Alaska Commercial Company sailed out of Seattle, ‘Gateway to the Klondike’, at Pier 4 where crowds of hundreds gathered for each voyage.

Special Collections, University of Washington Libraries.

Note: The Jews who arrived in pre-Gold Rush San Francisco were primarily Germans from Bavaria where antisemitic bigotry dating from the Middle Ages still existed. Bloody anti-Jewish riots had taken place as recently as 1819, and Jews were oppressed by punitive taxes and an infamous law called the Matrikel, which allowed only the oldest son in a Jewish family to marry. Starting in the 1840s, these repressive laws led to a wave of German Jewish immigration to the United States. No fewer than 200,000 German Jews would leave for what was known as the Golden Land where they encountered less bigotry than they would have in New York and other U.S. cities. Indeed, San Francisco was “a new city devoid of a status quo. There was no establishment to draw up ranks against perceived outsiders: everyone was an outsider.” (Gary Kamiya, San Francisco Chronicle August 18, 2017). As historian Hugh Bancroft wrote in California Inter Pocula, “All nations having come hither, shades of color, of belief, peculiarities of physique, of temper and habit were less distinctly marked.” Perhaps Jews at that time understood, from personal experience, the pain of prejudice and mistreatment inherent in the structural violence model where certain ethnic groups are not considered worthy

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