A sure cure for depression

— The following is the second of two excerpts from Wesley Earl Dunkle: Alaska’s Flying Miner, recently published by University Press of Colorado. The 274-page book was written by Charles Caldwell Hawley, a geologist who spent 37 years working in various mines in Alaska. The book retails for US$34.95 in hardcover and is available at Chapters and Indigo bookstores, as well as Amazon.com.

Mobility provided by airplane and dollars supplied by the Lucky Shot and Pardners Mines gave Dunkle the opportunity to pursue other mining ventures in a period when most of America was paralyzed by economic depression. Primarily he sought gold. For the first time in several decades, U.S. gold was as valuable as that priced on the world market. In Alaska the paucity of docks, railroads, and roads generally precluded development of coal, iron, and copper, which were valuable as bulk commodities. Gold valued at tens of dollars per ounce was one of the few commodities that could be developed almost anywhere it was found in sufficient quantity and grade.

Regardless of his own success, Dunkle was a powerful engine dedicated to keeping Alaska from the economic doldrums of the 1930s. He was assisted by Alaska itself, the huge resource-rich state whose economy tends to be counter-cyclical to that of the rest of the nation. The depression years from 1929 until 1941 are a case in point.

In general, Alaska was much better off economically than the rest of the nation. Although a few Alaskan industries, such as copper mining, were seriously affected (Kennecott closed its Alaskan mines during one period in the early 1930s), others prospered. Alaska’s canned salmon was an inexpensive staple in the diet of many Americans. The more economical gold mines could operate even before the price of gold was increased to 35 dollars per ounce. Federal largesse, always a factor in Alaska’s economy, expanded from its Alaska Railroad base as the Depression-era economic-stimulant programs kicked into gear. Alaska received Works Progress Administration (WPA) funds. The federal-owned RFC subsidized some Alaskan mining projects.

Mining matters and metal prices for both gold and silver often made the news. The same day that the Anchorage Daily Times noted the expenditures for the Matanuska Colony, a new world silver price, equal to that of the U.S. Treasury, was announced. Gold was consistently newsworthy, and Dunkle was often in the headlines of newspapers in Anchorage and Fairbanks.

From 1931 until 1941, Dunkle apparently never kept fewer than one hundred men working at his mines. At the high point, in the mid-1930s, the total number of employees on Dunkle mining projects must have exceeded two-hundred; seventy-five more worked for Star Air Lines. As Peter Bagoy Sr. explained, “In the ’30s, if you weren’t working for Dunkle you weren’t working.” Pete knew this was an exaggeration because he himself had worked for the Alaska Road Commission, which was an even larger employer.

The Alaska Railroad and Fairbanks Exploration Co., a subsidiary of U.S. Smelting, Refining & Mining Exploration Co., employed more men than Dunkle did. Many hundreds of people were employed at the canneries and in the fishing industry. Few single individuals, however, kept as many people working in rural mainland Alaska as Dunkle did during the 1930s. The jobs also had quality. Dunkle had learned during his apprenticeship with Kennecott Copper Corp. that well-housed and well-fed employees were also productive employees. The miners’ wages of about eight dollars per day now sound minuscule, but Dunkle’s pay rates were more than competitive for that time.

Dunkle’s direct contributions through payroll and purchases of supplies and equipment were augmented by economic multipliers. Trade accounts with heavy-equipment dealer Carrington & Jones, Anchorage grocery wholesaler W.J. Boudreau, Northern Commercial Co., A.A. Shonbeck, and many others supported other jobs and spread wealth in Anchorage and back through Seattle to coterminous America.

Some Dunkle dollars moved outside Alaska via the purchase of airplanes, automobiles, bulldozers, and draglines in New York, Detroit, Peoria, and Milwaukee. Other Dunkle contributions to the economy were made through his investments in local stocks and his loans. Dunkle loaned H.I. Staser $10,000 in startup money for a mine north of Girdwood, Alaska. He told Staser: “I never expect to see the money again. Your area is geologically unsound.” Dunkle was proved right when Staser’s vein was cut off by a fault, but not until after Staser had mined 4,000 ounces of gold and had repaid Dunkle within the first month of the operation.

As in the Kennecott years, Dunkle looked at many more prospects than he attempted to develop. During the 1930s, Dunkle’s area of prospecting activity extended from the Brooks Range to the panhandle of southeastern Alaska. He extended his range through the observations of other engineers, including a young James Stanford and an experienced Bert Nieding, who had been a general manager at Kennecott Copper Corp. In 1935, Dunkle looked at grassroots properties in the Goodpaster region east of Fairbanks, where a 1934 gold discovery had prompted a minor gold rush. He was in the area soon after the discovery and covered much of the ground with prospectors Bill McConn and Carl Tweiten. Dunkle believed he had firm options on some of the ground through an Alaskan character named Jack McCord. McCord, however, either reneged or lacked control over the options, and Fairbanks Exploration Co. moved in to undertake the first underground development. Perhaps because of its remoteness, the district never prospered. (In 1995, only a few miles downstream, a tenacious geologist drilled a hole that intersected a rich gold vein several hundred feet below the surface. By the fall of 2000, drilling had blocked out more than five million ounces of high-grade lode gold at the Pogo prospect.) Dunkle also looked hard at the Oracle mine northwest of Moose Pass, which was part of a widespread gold belt in the Chugach Mountains. He spent more than $25,000 on the prospect in 1933 and 1934 but abandoned it shortly afterward.

One district, Flat (Iditarod), was not abandoned so quickly. Dunkle decided that the district, in southwestern Alaska, was worth a major effort because of its size and richness. Since 1909, Flat has produced more than 1.5 million ounces of placer gold, second only to Fairbanks and Nome in terms of Alaskan placer productivity. Although a few other placer fields were discovered later, a discovery on Otter Creek on Christmas day in 1908 led to the last great gold stampede in Alaska.