One hundred and fifty-five years ago, on March 30, 1867, Russia handed the vast territory of Alaska over to the United States for the bargain price of $7.2 million, or about 2 cents per acre.
Uncle Sam clearly got the better end of that deal — 50 years after the sale, an Alaskan gold rush generated more than $1 billion in new wealth for the U. S. Also lucrative were the land's abundance of timber, salmon and petroleum. Plus, Alaska became a real strategic asset for the U.S. military once the Cold War arrived.
So why did the Russians part with such a bountiful region? And why didn't the country sell it to Canada, which — unlike the contiguous U.S. — actually borders Alaska?
To answer these questions, we have to look backward to the 19th century when a proto-Cold War emerged. Historians call it "The Great Game." And like a certain HBO series, more than a few thrones were involved.
Russia Claims Alaska
From 1829 to 1907, the empires of Russia and Great Britain shared a mutual hostility. Each wanted to expand its influence in Central Asia, as well as across the Pacific Ocean. Thus, a rivalry was born. The animosity sparked or intensified several military conflicts, most notably the Crimean War (1853-1856), which pitted Russia against the allied forces of Britain, France, Sardinia and the Ottoman Empire. Ultimately, Russia was defeated. By some estimates, the czarist empire suffered 800,000 casualties or more.
Although this war was restricted to Eurasia, it had major ramifications across the Pacific. Among other things, it called into question the future of that magical land, Alaska.
Following decades of exploration, Russia claimed Alaska in 1741. It then founded its first North American settlement there on Aug. 3, 1784. This was established by the Shelikhov-Golikov Co., one of several fur-trading organizations that operated in the area — ostensibly on the empire's behalf. In 1799, Czar Paul I merged several of these into the Russian-American Co. (RAC). A powerful conglomerate, the RAC was given a trade monopoly on Alaskan resources. It was also tasked with creating new settlements and expanding Russia's New World presence.
To this end, company manager Alexander Baranov had his men venture all the way down to northern California, where they set up an outpost called Fort Ross on Feb. 2, 1812. The RAC's grand vision was for this establishment to serve as an agricultural hub, one whose crops would sustain its own settlers and those up in Alaska. With their food supply guaranteed, the colonists in both locations would have an easier time harvesting the Pacific's most profitable commodity: sea otter pelts. Several times more valuable than the coveted beaver and fur seal pelts, these were the lifeblood of the Russian-American economy.
Unfortunately, Fort Ross' farming output was grossly inadequate. And to make matters worse, the Russian fur trappers overhunted those sea otters so badly that the animals nearly vanished from the North Pacific. The Russians therefore gave up on Fort Ross, which was sold to an American frontiersman in 1844.
The Crimean War and Its Role
Then along came the Crimean War, in which Alaska threatened to become a liability. Had the British decided to invade this territory, Russia's overextended military would have struggled to protect it. No such attack ever came, as the Brits chose to stay out of Alaska during the war. Still, many in the czar's government now questioned the wisdom of clinging to a remote, sparsely populated colony whose main source of revenue was disappearing.
In the late 1850s, Russia started entertaining the idea of a sale. Under different circumstances, the Province of Canada might have looked like an ideal buyer, thanks to the 1,538-mile (2,475-kilometer) border it shared with Alaska. But Canada was not yet self-governing and still resided under the United Kingdom's firm control. As such, handing Alaska off to the Canucks would have given Britain an extra chess piece in the Great Game.
But fortunately for Russia, a better candidate presented itself. During the Crimean War, this Slavic empire found a surprising ally. American newspapers were overwhelmingly supportive of the Russian cause. On top of this moral support, the states also gave the czar's troops weapons and other supplies, even though the U.S. government was officially neutral.
Both superpowers saw British imperialism as a threat. Recognizing this, Russia allowed its foreign minister to the U.S., Baron Edouard de Stoeckl, to approach the republic's leaders with an offer to sell Alaska in 1854. The deal fell through, and the topic wasn't seriously discussed again until after the American Civil War.
The secretary of state under Presidents Abraham Lincoln and Andrew Johnson was one William Seward, a talented diplomat who'd been preaching Alaska's merits for years. In 1867, he and Stoeckl struck a deal that would see the U.S. take possession of the territory in exchange for $7.2 million, which is worth over $138 million today. On April 9 of that year, the Senate ratified the transaction (although Congress didn't appropriate the funds until 1868).
On Oct. 18, 1867, Alaska formally became an American territory. Since 1911, residents of the Last Frontier have been celebrating that event's anniversary as a major holiday. Its name? Alaska Day.
Originally Published: Sep 11, 2017