Why Hold Indian Money in Trust

Why are Indian allotments and Individual Indian Money Accounts still held in trust by the federal government after more than 100 years?

While the purpose of the Dawes Act was to promote individual ownership and assimilate Indians into the dominant culture, Individual Indian allotments of property and the Individual Money Accounts (IIMs) at the root of the Indian Trust Case continue to be held in trust by the American government.

Why has this anachronism continued into the 21st century?

Like many outdated ideas, Indian Trust monies have a functional basis. When eastern tribes, like the Lenape, were being removed ever farther west, the government sometimes provided monetary compensation for the confiscated land. Though inadequate to the long-term needs of the tribes, not to mention well below market value for the property, these sums appeared large to those unaccustomed to a monetary economy and were quickly dissipated.

Today, of course, in every other way American Indians participate in the economic system of the dominant culture. They shop at the local Walmart rather than on account at the local trading post. They buy automobiles and gas to fuel them, groceries and sundries. Many are well-educated, yet their land allotments continue to be held in trust and cannot be sold or transferred without the consent of the BIA (Bureau of Indian Affairs). Leases of these allotments for land and mineral rights are also negotiated by the BIA and lease income is held in trust and dispersed as annuities. This is the same whether the allotee is a poor farmer or a PhD in Economics. Thus things we take for granted--attaining a mortgage or business loan and passing property to our heirs--the bases of wealth accumulation in our society are out of reach to many American Indians.

Why, after nearly 100 years, is this outdated policy still adhered to without question?

One reason may be that the system is now an entrenched bureaucracy not easily dismantled. Another may be that few non-Indians even know that the policy still exists. Still another reason may be that leases of trust property to mineral and timber companies are often negotiated by the BIA at much lower rates than leases on non-Indian property. The same is true for rights of way negotiated through tribal lands. Consequently, there is little incentive among those in power to change the system.

Funny how a policy initiated to introduce American Indians into individual ownership and assimilate them into the dominant culture, gave way to a policy of keeping Indians "in their place" and maintaining the status quo.