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Navajo Trading Posts

By Lauren Gray

Though the Spanish and later the Mexican government had their own delicate relationships with traders in the Southwest and New Mexico, the American trader has had arguably the greatest impact on Navajo indigenous economy, livelihood and culture. Over the past 150 years, the traders’ presence has become widespread on the Navajo reservation.

Part III of the U.S. Treaty with the Navajos of 1849 states that the “Government of the said States having the sole and exclusive right of regulating the trade and intercourse with the said Navajoes, it is agreed that the laws now in force regulating the trade and intercourse, and for the preservation of peace with the various tribes of Indians under the protection and guardianship of the aforesaid Government, shall have the same force and efficiency, and shall be as binding and as obligatory upon the said Navajoes, and executed in the same manner, as if said laws had been passed for their sole benefit and protection; and to this end, and for all other useful purposes, the government of New Mexico, as now organized, or as it may be by the Government of the United States, or by the legally constituted authorities of the people of New Mexico, is recognized and acknowledged by the said Navajoes; and for the due enforcement of the aforesaid laws, until the Government of the United States shall otherwise order, the territory of the Navajoes is hereby annexed to New Mexico.”

The first recorded incursion into Navajo country by government-sanctioned traders was in 1852. Individuals, or traders “in groups of twos and threes,” slowly began the process of shaping the Navajo landscape and economy. The first permanent trading post was located at Bosque Redondo in 1865. In that same year, the Commissioner of Indian Affairs began issuing licenses for traders who wanted to set up shop on reservation land. To trade without a license issued by the government incurred severe penalties, and there were few cases of such illicit trading within the reservation. A $500 fine and the confiscation of all trade goods accompanied this infraction.

Anglo-American traders have historically been involved with supplying the Navajo both on and off the reservation with articles that they could not produce themselves, namely, Anglo-American goods and food stuffs. The trader typically provided flour, coffee, sugar, salt, baking powder, and canned items, such as tomatoes, peaches, pears and corned beef. Commodities such as gum, candy, cookies, rice, cheese, etc. were also available at some trading posts. Velveteen for the women’s clothing was also stocked, as were shoes for men, women and children, hats, and horse gear (saddles, bridles, etc., though not in great abundance). “To put it simply,” trader Walter Gibson said in 1994, recounting his days working at the Mexican Water, or Nakai Toh, trading post, “we traded goods, food stuffs, clothing, etc. for wool, lambs, hides, rugs and furs, during the winters.”

Although trading posts provided a variety of goods, and services to the Navajo, legislation made it illegal to sell or trade weaponry (guns) and liquor (whiskey). However, these laws only impacted traders inside the Navajo reservation: there was no authority or legislation to prevent its sale or trade outside of the reservation.1858 military accounts report that the Navajo still used bows and arrows during battle. However, by 1883, Indian Service Agent Dennis Riordan commented that the Indians “are all armed and well-armed,” most with the new brand of Winchester rifles either provided by traders or stolen in raids.

Traders who operated outside the reservation were blamed for inciting the Navajo to leave in search of whiskey and guns, and because there were no laws against such outside trades, trading posts along the boundaries of the Navajo reservation sprang up in abundance. By 1889, approximately thirty trading posts were in operation on the Navajo reservation borders, with only nine traders operating inside the reservation.

After the Treaty of Guadalupe-Hidalgo was signed in 1848, the United States began to occupy their newly won territory. The railroad enabled Anglo-American settlement, and military outposts were built to protect the new settlers. The military camps were generally good sources of whiskey and firearms that made their way into the various trade networks of New Mexico and the greater Southwest. The term “railroad Indian” was coined during this period and was associated with thievery, fornication, but most predominantly drunkenness. Many traders who operated specifically with Native Americans avoided selling whiskey, but others complained that they could not conduct a successful business enterprise without it.

Early on, many traders were seen only as sellers of liquor and firearms. However, as more stock items were added to the trade list, most traders began to refuse to sell or trade whiskey. Still, whiskey remained a high demand commodity on the reservation that was readily available from the military encampments outside the reservation. Aside from the whiskey and gun laws, there were few restrictions imposed on traders, especially those who also catered to Anglo-American customers. Supply and demand along with competition between traders usually provided effective regulation and generally superseded government legislation.

“Anyone can establish a trading post within a quarter of a mile [of the borders or agency] and be outside the control of the agent,” Agent Alex Irvine remarked in 1876. “And one party who has such a trading post informed me that no one could prevent his trading with the Indians and getting such prices as he pleased.” A system of barter and credit-line became prevalent in trader/Indian negotiations.

It became common practice for the Navajo to pawn their hand-made Concho belts, silver bridles, bracelets and turquoise, and even guns for necessary items (food stuffs, etc.) during the winter. In the spring they traded their sheep wool to regain their personal items, which were held by the trader for a period of six months or more. This was an accepted practice continuing well into the twentieth century. If the credit amassed during the winter was greater than the sum of the wool brought in during the spring, then the valuables were either kept, or an exorbitant interest fee was imposed on the Navajo. Before the cash economy became prevalent on the reservation, Navajo handmade arts and crafts were used to trade for staples at the trading posts. The concept of “trading” became entrenched in reservation culture and remains active on most reservations.

Agent C.E. Vandever commented in 1889 that “the proximity of trading posts has radically changed their native costumes and modified many of the earlier barbaric traits, and also affords them good markets for their wool, peltry, woven fabrics, and other products….Firearms have almost entirely superseded the primitive weapons, and silver ornaments of their own manufacture are worn instead of copper and brass….” While the material value of their goods may have increased, Vandever failed in most aspects to recognize the cultural impact of Anglo-American trading on Navajo culture and the inequality of transactions. The trading post as an institution on the reservation was the subject of a 1969 study done by eight Navajo college students working for Southwestern Indian Development, Inc. (SID). These students found that the gross annual income of traders operating on the Navajo reservation was approximately $17,223,338. The average annual income of Navajo families that same year was $1,500, well below the poverty line.

The impact of the trader has been hotly contested, with groups such as SID claiming the trader is solely responsible for Navajo poverty. In their 1969 study, SID attempted to understand the relationship between the practices of Navajo traders and the marketplace by interviewing both Anglo-American traders and their Navajo clients. SID’s results serve to illuminate the cultural difference inherent in the dynamics of trade as understood by the two groups.

As the role of the Anglo-American trader developed over time, their position as store keep and trader also came to include postmaster, banker, and creditor. SID found that the trader is often an unofficial contact to various government agencies including the Welfare Department. Oftentimes, the trader receives his customers’ paychecks or government checks, and then distributes the funds accordingly. SID researchers found that some traders were guilty of exploiting their roles and had been known to withhold checks to force their customers to run up credit to the trader thus spending their pay before actually receiving it. This situation often locked Navajo people into a debt-relationship with the trader.

Certainly, not all traders were underhanded in their dealings with their Navajo clients and many were honorary family members who dealt fairly with the Navajo and went out of their way to help them when they could. Many traders became knowledgeable about Navajo culture and understood the value of retaining traditional Navajo culture. In June of 2000, Mark Winter, who currently leases the Toad Lena trading post, hosted a rug display that he hoped would help to revitalize the Two Grey Hills weaving style of rugs, which was in jeopardy of becoming extinct. His efforts are typical of many traders, who see their lively hood dependent on the development and continuation of Indian culture. Winter encourages weavers to create the finest woven textiles that have value both as art pieces and as a continuation of Native culture. The trading posts and the traders rely on their Navajo customers for their own income and livelihood and the two are historic partners in areas that are often remote and isolated from the mainstream economy.

The trader Walter Gibson, writing about his experiences at the Mexican Water trading post, believed that the Navajo:

“were not only our customers; but also our friends. Through the years, we have accumulated some beautiful pieces of jewelry such as necklaces, beads and bracelets. We admire the artistic ability of these Navajo people. In addition, we greatly admire the talents of the silversmiths, weavers and other artists. However, as much as we cherish these items, they are secondary to our real treasures. That is, the memories of these people, the times, and events we shared with them, which will forever be in our hearts and minds.”

On the reservation, when social contact is often limited because of the spatial distances, it is sentiments such as the one above that create a bond between the trader and his customers, affording them both a mutually beneficial relationship.

Sources Used:

Gibson, Walter. Nakai Toh: My Days with the Finest People on God’s Green Earth. Utah: Family History Publishers, 1994.

McNitt, Frank. The Indian Traders. Norman: University of Oklahoma Press, 1989.

Newcomb, Franc Johnson. Navaho Neighbors. Norman: University of Oklahoma Press, 1966.

Roberts, Willow. Stokes Carson: Twentieth-Century Trading on the Navajo Reservation. Albuquerque: University of New Mexico Press, 1987.

Traders on the Navajo Reservation. Arizona: Southwestern Indian Development, Inc., 1969.

Watson, Nancy. “Trader Puts Rugs on Display.” Gallup Independent. 16 June 2000.

Navajoland Trading Posts, Traders, and Maps by Klara Kelly and Harris Francis