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Treadwell GoldAN ALASKA SAGA OF RICHES AND RUIN
By SHEILA KELLY
University of Alaska PressCopyright © 2010 University of Alaska Press
All right reserved.
Chapter OneCatalyst for Alaska Development Treadwell's stimulative effect upon mining and tributary industries created a freight movement which enabled a steamship company to inaugurate regular trips and then blossom to ... lucrative excursion service.-U.S. CENSUS, 1890
The treadwell story is an important chapter in the early history of an American Alaska, which began with Secretary of State William H. Seward's 1867 purchase of this large swath of land in the northwest corner of the continent from Russia. Americans called it "Seward's Folly," even though he got it for a bargain price-$7.2 million for 586,412 square miles, or about two cents per acre. The public mocked it as "Seward's Icebox," a remote and barren region, a frozen frontier of questionable value.
There was some basis for public skepticism. The new district could be accessed only by ocean, and ice blocked the western and northern parts of the vast territory for months each year. The Russian occupiers had concentrated on the limited seasonal fur trade, so there were few port facilities or navigational aids along a coast that was largely uncharted.
The most direct way from the lower United States to the southeast section of Alaska was a picturesque and perilous thousand-mile waterway from Puget Sound to Glacier Bay. The Inside Passage wove through narrow, winding, tide-swept channels, around forest-carpeted islands, towering rocks, and unpredictable icebergs. The shores were subject to peculiar currents and treacherous tides in unpredictable gales.
Travel to the area began slowly after the Purchase. In order to transport U.S. occupation troops, cargo, and mail, regular monthly boat services ran from United States ports to Sitka. Occasionally an intrepid sightseer joined the trip, although an 1872 Appleton guidebook predicted that "Alaska was not likely ever to be much frequented by travelers." But as early as 1875, several steamship lines were making the trip, and the reports of unparalleled scenery lured the excursionist crowd, that wealthy leisure class ever in search of someplace new and different.
The mystique of Alaska struck a chord with adventurous tourists and entrepreneurs alike, and by the mid-1880s the skeptics had been won over by the twin lures of gold and tourism.
Treadwell lay in the middle of a mineral-rich belt that stretched over 125 miles along the coast of southeastern Alaska, from Berner's Bay in the north to Windham Bay in the south.
The first discovery in this area, in 1870, was placer gold that washed down from mountainous quartz veins and came to rest in the gravel beds of the streams. In 1880, prospectors Joe Juneau and Richard Harris, with the help of a man named Kaa wa.ee of the Auk Tlingit tribe, found gold in the coastal streams and in Silver Bow basin, behind the town that became Juneau. When word got out, crowds of eager gold seekers rushed to the area hoping to make a strike.
Wanderers and adventurers from all over the American West flocked northward, completing the march that had been going on since the 1848 California Gold Rush. Many hopeful miners learned about prospecting in California. From there, they trudged north through British Columbia and southeast Alaska to the Yukon. "Men with pans and picks slowly inch[ed] their way along the mountain backbone of North America from Sierra to the Stikine, through the canyons of the Fraser River, the snow fields of the Cassiars [along the coastal gold belt of Southeast Alaska], to the threshold of the sub arctic." These men were in search of placer gold-that pure gold that could be recovered by hand, picked up in streams and gravel beds, ready to sell, with no additional treatment necessary.
By 1882, another kind of gold rush was under way across the Gastineau Channel from Juneau. At the Treadwell mine site on Douglas Island, the discovery of a huge lode of low-grade ore locked in quartz set in motion a gold-based enterprise that could only happen with capital, scientific expertise, and a skilled workforce. This site drew a different kind of speculator and required an infusion of money from stock sold on the Paris and London stock exchanges. A complex process was required to extract, capture, and refine the gold. With operations at such a grand scale, the Treadwell Company offered secure employment with dependable wages and a company town to live in.
But the appeal of this type of steady work of the modern-day wage slave was lost on the pick-and-shovel prospector. Placer mining was a poor man's shot at getting rich-on his own terms. He needed little or no capital to work a claim. His nature was to scorn the path of corporate mining. He wanted to be his own master, where the fruits of his labor-gold nuggets and dust-were his alone. Prompted by gold discoveries in British Columbia and Alaska, in 1881 the Pacific Coast Steamship Company (PCSC) of San Francisco began to run three ships a month to southeast Alaska. The following year, the Treadwell mines began operation and the commerce and development that flourished there for four decades fueled enterprise and increased settlement in far reaches of the vast new territory of the North.
The lure of gold and a fascination with America's industrial adventures easily enticed the leisure class to try this new destination. Steamship lines promised new experiences of breathtaking scenery, Native villages, and the Treadwell gold mines, "where fabulous riches lie underfoot, and man's ingenuity is tapping the treasure house with hard work and modern invention."
The word was out. In 1884, two thousand excursionists made their way up the coast. In the first Alaska guidebook, author Eliza Scidmore held up the Treadwell mines as a local site as thrilling as glaciers and totem poles. In 1890, the steamships delivered five thousand curious tourists to the dock at Treadwell where 240 thumping stamps were at work. These well-appointed floating hotels for the tourists joined marine traffic up and down the Inside Passage as steamships from around the world brought the coal and iron, food and clothing, managers, miners, and skilled workers required by the expanding venture. That year, commercial shipping topped thirty-five thousand tons, a level "far beyond that to be naturally expected of a region so remote and unknown as Alaska."
The 1890 Census, which presented the first in-depth documentation of the United States' newest acquisition, credited the presence of the Treadwell mines for spurring the development of Alaska: "Treadwell's stimulative effect upon mining and tributary industries created a freight movement which enabled a steamship company to inaugurate regular trips and then blossom to ... lucrative excursion service which has done more than any means toward ... attracting capital for investments."
The growing population in Treadwell, Douglas, and Juneau welcomed the tourists coming up the Inside Passage. In 1890, the combined population at the Treadwell mine and the town of Douglas was only 402. In the next decade, the number of residents more than tripled to 1,347, and doubled again by 1910 to 2,944. By then, the mine had a payroll of 2,000 workers.
The shipping industry was ripe for competition. In 1894, Charles Peabody incorporated the Alaska Steamship Company, ending the Pacific Coast Steamship Company monopoly. Expecting a bonanza from the ever-increasing stream of miners heading north, the two shipping lines engaged in a freight rate battle. Based on news leaking out of the Klondike, they knew they were competing for something big. They were right. When ships carrying tons of gold from the Klondike arrived back in Seattle and San Francisco in 1897, the rush was on. During the summer and fall of 1897, more than eight thousand people headed for Alaska, and they were all frantically in search of passage by any mode available.
On July 11, 1897, Jack Carr, wearing gold nuggets for buttons, arrived in Juneau on his dogsled. He had sped out of Dawson, a remote part of the Canadian subarctic, thirty-five days earlier to be one of the first to take the news to the "Outside" of a bonanza gold strike in a place called the Klondike.
The next week, on July 17, the SS Portland, crammed with newly rich prospectors, steamed into Seattle, and the SS Excelsior arrived in San Francisco with another load of jubilant Klondikers. The Seattle Post-Intelligencer headline shouted GOLD! GOLD! GOLD! "... a ton of gold onboard." Later a correction noted that the ship's cargo, in trunks and boxes, bottles and jars, bags and pockets, was closer to two tons of gold.
Unlike earlier gold rushes, the Klondike stampede did not begin slowly and build up over time. Craziness erupted the instant the ships landed. Droves of workers from every trade and profession quit jobs, left families, and grabbed passage to Alaska and Canada on any seafaring mode possible. Ships going north had trouble coming back south because their crews had deserted to join the ranks of prospectors. Along the West Coast any commerce not related to the Klondike came to a standstill. Whalers and cannery workers turned their boats over to the new more profitable cargo, Klondikers. The stampede that overran the north was out of proportion to the amount of gold present in the Klondike. Three other rushes richer than the Klondike had already happened in the nineteenth century, in California, Australia, and South Africa. But none moved the world like the Klondike. The news spread faster, expectations were higher, railroads and water transportation were in place to move large masses of people, and everyone could get on board. "Hurrah for the Klondike!" was the rallying cry. Of the one hundred thousand who set out for the Klondike, mostly were impetuous young men in their twenties, although one in ten was a woman. Thirty to forty thousand reached the burgeoning town of Dawson at the juncture of the Yukon and Klondike Rivers. Less than half even looked for gold, and probably four thousand found some. A few hundred got rich and of those, only a handful kept their wealth. It could be argued that nearly forty thousand men wasted $1,000 each in their futile pursuit. That loss was someone else's bonanza: By March 1898, the gold seekers had spent $60 million purchasing rail and ocean transport and getting "outfitted" to take on the Klondike.
Dawson, a town that mushroomed at the mouth of the Yukon and Klondike rivers-the center of the Klondike bonanza-went from bleak to boom to bust in a little over three years. Five months into the gold rush, the town ran low on food and other supplies. The arctic winter was setting in, the sun had vanished, rivers were frozen solid, and trails were impassable.
After the ice thawed in the spring, supplies got through and the prospectors poured in again. By July, with a population close to forty thousand, only slightly smaller than Seattle, Dawson was being hailed as the San Francisco of the North. For twelve months Dawson was a metropolis "with almost every amenity available to civilized cities the world over. In the shadow of the arctic circle, more than 4000 miles from any city of comparable size, the town had telephones, running water, steam heat, electricity, hospitals, fine hotels and restaurants, motion picture theatres, men in tailcoats and women in Paris gowns attending symphonies."
But the bust came as suddenly as the boom. The Klondike had been oversold and the supply of gold could in no way meet the demand of the hordes swarming that frozen outpost. Many in Dawson desperately searched and hoped for another miraculous bonanza, and once again, in midsummer 1899, an incredible discovery fired their resolve. A fortune in fine gold dust was found in the sands of the remote beaches along an area called Cape Nome. These riches had been lying hidden at the ocean outlet of an obscure little river just across the Bering Strait from Siberia.
For Dawson entrepreneurs lusting after the next bonanza, the glitter of gold uncovered in Nome set them off again. "Here was the stuff of legend-gold from the sea."
In a single week in August 1901, over half the remaining population deserted Dawson, jumping on boats and heading out to Nome. The great Klondike stampede ended as quickly as it had begun. In the summer of 1898 there had been tens of thousands of people in Dawson. By 1901, there were fewer than one thousand.
While the Klondike's fortunes rose and fell, Treadwell's population and profit continued climbing steadily. For those willing to stay put, the Treadwell mines plodded along as usual, pulverizing, producing, profiting, and paying its "wage slaves." Many in Treadwell worked through the winters, saved up their wages, took the summer off, went farther north to try their hands at prospecting, and then came back to the underground drudgery to accumulate earnings for the next summer's expedition.
Treadwell management, always on the lookout for discovery of that mother lode of hard-rock gold that could be mined like Treadwell, offered free ore assays to all prospectors. The Treadwell store found another kind of mother lode: outfitting prospectors on their way to the Klondike. Touting itself as the best, cheapest, and closest source for doing this, the Treadwell Company staged a campaign to compete with the aggressive and wildly successful outfitters marketing in the port of Seattle.
Other Gastineau Channel entrepreneurs knew the money was not in finding gold but in supplying miners' needs. Some found the gold in rubber boots. Climbers staggering with overweight loads up the Chilkoot Trail toward the Yukon would lighten their packs at every opportunity, discarding their heavy rubber boots after getting downriver to Dawson. Two young lads retrieved the mountain of footwear to take back to Juneau for resale to newer arrivals. As a result, hundreds of pairs of the same boots went up over the passes time after time.
More than a decade before the Klondike discoveries, the presence of the Treadwell mines had helped launch a lucrative Alaska shipping industry, bringing in materials and shipping out gold bullion. The gold rush accelerated development of the marine highway because the Inside Passage offered a major route to the overland staging areas for the goldfields. The glut of prospectors joined tourists seeking adventure, missionaries setting up schools, and corporate employers building mines and canneries, along with the steady stream of job seekers and settlers. And for more than two decades after the Klondike ballyhoo faded, the mines of the Juneau gold belt, led by Treadwell, expanded the stream of commerce flowing into Alaska. By 1899, Treadwell's 880 one-ton stamps had pulverized over 664,000 tons of ore and produced close to $1.7 million worth of gold, with gold valued at $20.67 an ounce.
The Treadwell gold display was the centerpiece at the 1904 Lewis and Clark Centennial Exposition in Portland, Oregon. The exhibit showed a gold foil-covered cube representing the $7.2 million price paid for Alaska in 1867. Next to it a stack of fabricated "gold" slabs showed the 1904 value of the Alaska Treadwell Gold Mining Company: $21,817,296. In its first twenty-two years of production, the Treadwell mines had repaid the Alaska Purchase three times over.
Treadwell citizens prided themselves on being at the frontier but not in the wilderness. They aspired to a level of material well-being that late-nineteenth-century Americans were growing to expect. They looked to the company to keep them sheltered and well fed, providing cottages, bunkhouses, dining halls, medical care, and entertainment. Staying connected to the modern world was important; ferries and steamships provided daily transport across the channel or down to Seattle. True, the gold seekers got a lot of attention, but most immigrants to Alaska sought jobs. The Treadwell enterprise was the first developmental surge in Alaska's history to provide appreciable numbers of jobs that promised to be long term. The town boasted that the extraordinary mother lode of gold-bearing quartz, dependable stream of money from investors around the world, and ever-advancing technology made Treadwell immune to the boom-and-bust cycle of placer bonanzas.
Excerpted from Treadwell Gold by SHEILA KELLY Copyright © 2010 by University of Alaska Press. Excerpted by permission.
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