Russia sells Alaska #3: Goodbye America

In this final look at Russia’s short-lived presence in Alaska, we’ll examine the deciding factors that ultimately turned a land of opportunity into a money-leaking liability. The downturn started in earnest with the departure of Alexander Baranov (1818) and things only got worse from there. Let’s explore, below.

Deciding factors

The once-prosperous fur trade began to falter as the 1850’s approached, largely through over-exploitation of Alaskan sea-otters. Soon, adult numbers were dwindling alarmingly and the remaining young were not large enough to be hunted for pelts.

The greed-borne decision to pay the natives less for their furs had backfired; local tribes simply hunted and killed more otters to bridge the deficit, forcing them into near extinction and hastening the fur trade’s decline.

This mainstay of the Russia – America enterprise was failing, with no viable replacement. As noted last week, secondary trading measures failed to stop  the rot. The Alaskan colony, once a source of wealth for Russia, became an increasingly distant, dependent relative, propped up by imports from the motherland.

As a result, and with the hardships of everyday living, the viability of the endeavour looked increasingly uncertain. Problems of a larger magnitude would soon be felt back home too – with dire repercussions for the whole Alaskan enterprise.

Crimea

In 1853 the Crimean War broke out, with a declaration from European allies against Russia’s perceived expansionism, privileges of Russian Orthodoxy abroad and Russia’s attempts to protect an Orthodox Turkish minority’s access to the Holy Land. Britain, France, the Ottoman Empire, and (for the final year of conflict) Sardinia combined to devastate the Russian forces, and in doing so stripped the Black Sea of a Russian naval presence, leaving her southern sea borders unsecured and vulnerable.

The consequences of Russia’s ultimate loss in 1856 were severe. Over 450,000 Russian troops died during the conflict – roughly half of those sent into battle, and over double the amount of allied losses from a smaller European pool of 600,000.

This was a disaster that highlighted the urgent need for revisions to Russia’s administration, military prowess, infrastructure, technology, education and more. A wake-up call, should Russia seek to stand as a future player on the world stage.

Decisions

With the loss of military forces on both land and sea, and with the conquering enemy now in control of sea routes, the viability of defending (or even supplying) a struggling Alaskan colony of less than 700 individuals was reduced to practically zero.

Pressure was increased by British and American incursions into Alaskan waters and Russia’s inability to counter them. Russia was also concerned about the prospect of a gold rush overwhelming the Alaskan colony with unwelcome interlopers, while the motherland sat unable to police the situation from afar. Alaska’s transformation from golden opportunity to outlying liability was complete.

Signatures and beyond

On 30th March 1867 William Seward and Eduard Stoeckl signed the deal, transferring Alaska into American ownership in exchange for 7.2 million USD, that’s roughly 2 cents per acre. America had supported Russia during the Crimean War; both in terms of press coverage and in the export of arms. The price could have been even less, as The National Archives reveal:-

“Seward suggested $5 million, or “perhaps $5.5 million, but no more.” …Stoeckl decided… that he would try to get $6.5 million or at least $6 million… Seward … asked for authority to pay Russia $7 million for Alaska… Seward told Stoeckl that …he could offer no more than $6.5 million. But Seward also wanted to buy …the Russian-American Company, and he wanted a treaty before Congress adjourned in April. Stoeckl asked for $7 million and Seward agreed.”

The new United States seemed a good partner to do business with: still hostile to imperialist England after the War of Independence (1775-83) and perhaps a potential ally for the future.

Almost three decades after the transfer of Alaskan ownership, the Klondike gold-rush exploded (1896) over a dynamic 2 year period that saw up to 100,000 prospectors invade the region. It added roughly 1 million USD to the American economy.

One hundred years after Seward and Stoeckl’s ink had dried on their agreement, the Prudhoe Bay oil field was discovered on Alaska’s North Slope (1967); the largest in the USA, producing (to date) 16 billion barrels – and counting.

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