Bowes on Nichols, 'Engines of Diplomacy: Indian Trading Factories and the Negotiation of American Empire'

David Andrew Nichols
John Bowes

David Andrew Nichols. Engines of Diplomacy: Indian Trading Factories and the Negotiation of American Empire. Chapel Hill: University of North Carolina Press, 2016. 270 pp. $85.00 (cloth), ISBN 978-1-4696-2889-9.

Reviewed by John Bowes (Eastern Kentucky University) Published on H-AmIndian (May, 2017) Commissioned by F. Evan Nooe

Trade and Empire in the Early American Republic

Contemporary scholars writing about the development of American Indian policy in the early American republic have had a limited supply of books on which they could rely within the historiography. If one needed an introduction to the topic or a citation for the origins of the Trade and Intercourse Acts, for example, it was simply a matter of locating a copy of Reginald Horsman’s Expansion and American Indian Policy, 1783-1812 (1967), or perusing the more expansive works of Francis Paul Prucha. Herman Viola’s nearly fifty-year-old biography of Thomas McKenney provides one lens into the subject, as do Anthony Wallace’s and Bernard Sheehan’s respective examinations of Thomas Jefferson and his thoughts and policies regarding American Indians. 

The work that these historians have done is laudable, and any scholar would be wise to consult them before entering into an examination of the topic. However, it is possible to become too comfortable with such sources and to depend on them too much. Of course it can be difficult to know exactly what is missing until you read something that highlights the inadequacies of the historiography. This is the case for Engines of Diplomacy, David Andrew Nichols’s analysis of the factory system that was a significant part of American policy from 1795 to 1822. It is a book that might best be described as a crucial sinew in the historiography of Indian policy in the early American republic. This is a book that will long hold the field together in a way that few books do, for it should be the source to which all turn when needing to discuss or understand the trading factories. Nichols makes a substantial contribution to the field with this work.

The basic interpretation of the factory system is that it was created by the federal government as a tool to undermine the influence of private traders, both British and Spanish, who seemingly held undue sway over Indian affairs in North American territories claimed by the United States at the conclusion of the American Revolution. The factories were government trading posts at which federal employees bought furs at higher prices and sold desired goods at lower prices than their European competitors. The consensus narrative was that the factories were poorly planned and supplied, and ultimately failed to compromise the machinations of foreign interests because their competitors had distinct competitive advantages. 

Engines of Diplomacy displaces that narrative. Over a concise 171 pages organized into eight chapters, Nichols demonstrates the more complicated and successful world of the factories that operated over the course of nearly three decades from the Gulf of Mexico to the lower Great Lakes. As he points out, the nearly thirty-year existence of the system points to a level of success that belies the explanations for its demise that have prevailed for so long. Instead, the factory system as a whole operated as a critical element of the young country’s empire by serving the needs of both trade and diplomacy. Each factory responded to local needs even as it served the purposes of the larger whole, and though the system survived events like the War of 1812, it could not survive the growth of private American trade companies. Once the diplomatic piece of the trading factories became less relevant, their existence became less necessary.

Rather than innovation, the trading factory system represented continuity, for what George Washington’s administration proposed mirrored similar enterprises during the colonial era. The idea to conduct trade as a political enterprise similarly depended on the understanding that trade and diplomacy were intertwined within the world view of Native communities. And by the mid-1790s the young American nation was eager to find a way to maintain peace and stability without the expense that military action required. As Nichols discusses in the second chapter, however, the factories were shaped more by local political realities than by the intentions of federal officials. “In practice,” he observes, “conditions in the borderland exerted a greater influence on the early factories than vice versa” (p. 37). This held true even as the administrations changed from the Federalist viewpoints of Washington and John Adams to the Democratic-Republican administration of Thomas Jefferson. The politics of the nation’s capital might shift following elections, but the events and people in the environs of each factory more powerfully shaped the trading posts’ respective realities.

In the six chapters that follow these foundational points, Nichols uses both the local specifics and the national developments to illustrate the manner in which the factory system operated. Accommodating the needs of the customers was always a bigger priority than profits, and this meant that the Native traders often had good reason to welcome the presence of the factories. In addition, however, the factories also served as places for both informal interactions and formal treaties. They were physical sites of American expansion as much as they were outposts of American trade, and that fact made their retention important as well.

In the end, however, the War of 1812 served as a key transitional point in the life of the system. Though the factories survived the conflict and the financial difficulties that went along with it, they faced a more difficult time in the war’s aftermath. The conclusion of the war coincided with a decline in the relative power of Native American nations east of the Mississippi River. In addition, the late 1810s witnessed population shifts as tens of thousands of American citizens moved westward, to and across the Mississippi River. Such changes made the diplomatic purpose of the factories less necessary, and the costs of their operation more susceptible to criticism. Once the American Fur Company under John Jacob Astor grew in size and wealth, the need for a government trading system appeared even more outdated. Despite the efforts of Thomas McKenney to connect the maintenance of the trading factories with the civilization program promoted by members of Congress, the system finally came to a close when funding was pulled in the early 1820s.

One of the strengths of Nichols’s approach also becomes one of its weaknesses. Each chapter addresses an array of factories and regions to support a larger point, ranging from the commercial ecology of the posts to the impact of the War of 1812. The research underlying these analyses is strong and any reader will find substantial reward in reading about the materials stocked by the factories and what they can tell us about the Native communities they served. However, the coverage of so many trading posts, while providing a strong foundation, also creates a somewhat choppy narrative. In the service of creating a history of a substantive system in only 171 pages, Nichols has at times limited the glimpse the reader gets into each factory. 

Let it be said, however, that a review that turns to such stylistic issues for critique may just be grasping for something to criticize. Overall, this is a worthy book on a subject that needed this focused treatment. It will be invaluable for those working on federal Indian policy in the early American republic for decades to come.

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Citation: John Bowes. Review of Nichols, David Andrew, Engines of Diplomacy: Indian Trading Factories and the Negotiation of American Empire. H-AmIndian, H-Net Reviews. May, 2017. URL:

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