New Delhi: In Alaska, where US President Donald Trump is meeting with his Russian counterpart Vladimir Putin, there is a history of Russian-American real estate. In 1867, the Russian Tsar sold Alaska to the United States for just $7.2 million, or about $160 million in today’s currency. Trump would praise Alaska’s narrative as one of the country’s best land deals.
Alaska is the largest state in the United States and is divided by the frigid Bering Strait, which is where continental America and Eurasia almost meet. President Donald Trump and Russian President Vladimir Putin will meet here on Friday to discuss ways to put an end to the three-and-a-half-year conflict in Ukraine. However, Alaska remained a part of Russia until the 1800s. Trump, who has the instincts of a real estate agent, would not fail to comprehend the real estate saga of how it became a part of the United States.
Given his particular fondness and passion for Russia’s (Tsarist and USSR era) lands, Putin’s journey to the Alaska territory across the strait from Russia may feel like a sad symbolic homecoming.
Before being sold to the United States in 1867 for a pittance of $7.2 million—a steal even by today’s standards—Alaska, which is strategically valuable and rich in minerals, was part of Russia under the Russian Tsar. The sale is a steal since, after accounting for inflation, $7.2 million would be $160 million today.
Nonetheless, the transaction was infamously known as “Seward’s Folly” at the time, in honor of US Secretary of State William H. Seward, who masterminded it. Thanks to its strategic location and natural resources, what was previously thought of as a frozen wasteland is now America’s most valuable asset.
Putin is scheduled to land in Alaska for a crucial summit that will have far-reaching consequences, centuries after Russian forces left the state in 1867.
Alaska’s selection as the conference location is also symbolic. By meeting Trump in an area where the Americas are closest to Eurasia, Putin is able to overcome his geopolitical isolation in the West. For Putin, it’s also closer to home.
Yury Ushakov, a Russian presidential assistant and former ambassador to the United States, stated that the site “does make sense” considering the two countries’ close proximity—they are only 55 miles apart across the Bering Strait.
As stated in a Kremlin news release on August 9, “So it does make sense if our delegation simply crosses the Bering Strait and if such an important and expected meeting between the two leaders takes place specifically in Alaska,” Ushakov stated.
On X, Alaska Governor Mike Dunleavy emphasized the strategic significance of Alaska.
With the Arctic to our north and the Pacific to our south, Alaska is the most strategically important place on earth, situated at the meeting point of North America and Asia. “It’s appropriate that important global conversations happen here,” Dunleavy wrote on X.
It’s worthwhile to review Alaska’s past, including how the area was discovered, how Russia came to control it, and the events that resulted in its sale to the United States, even though it is now unquestionably an American territory.
HOW WERE EARLY RUSSIAN INTERESTS IN ALASKA SHAPED BY FUR TRADE?
In 1728, Danish explorer Vitus Bering crossed the Bering Strait as part of a Tsarist expedition, marking the beginning of Alaska’s Russian history. At that point, he made the Western discovery of Alaska. Although it was inhabited for thousands of years by Indigenous people.
The Russian-American Company was founded by Tsar Paul I in 1799 to take advantage of the rich fur trade, especially from sea otters, which led to its colonization, beginning on Kodiak Island off the southern coast of the archipelago. However, the population of seals and otters was severely reduced due to overhunting. The Russian colony’s economic sustainability failed.
After losing the Crimean War (1853–1856), Russia was in financial distress by the 1850s and unable to protect its isolated Alaskan region, particularly from possible British invasion by neighboring Canada.
Why the Tsar of Russia chose to sell Alaska to the United States
Alexander II, the Tsar of Russia, made the decision to sell Alaska in response to these difficulties.
The territory in Alaska was viewed as a liability. It was vulnerable to British capture, isolated, and expensive to maintain.
The American Civil War postponed the start of the negotiations, which had started in 1859.
Expansionist Seward concluded the agreement with Russian envoy Eduard de Stoeckl in 1867 for $7.2 million, or around 2 cents per acre, for 586,412 square miles.
US critics derided it as “Seward’s Icebox” because they thought America had gained control of a frozen wasteland.
Seward, however, saw Alaska as a key hub for American might and Pacific trade. On April 9, 1867, the Senate approved the treaty, and on October 18, Alaska was officially surrendered.
The Russian flag was lowered to start the event after the men were quickly assembled, brought to a ‘present arms’ at precisely half past three o’clock, and given the command to fire the salute. George Lovell Rousseau, my son and private secretary, raised the American flag as it started to rise. The Russian water battery led off as the salutes were fired once more. The flag was so high that the news of the Ossipee’s large gun echoed from the surrounding mountains as soon as it arrived at its destination. Secretary of State Seward received a letter from US Army General Lovell Rousseau.
“Captain Pestchouroff stepped up to me and said, ‘General Rousseau, by authority of his Majesty the Emperor of Russia, I transfer to the United States the Territory of Alaska’ and in a few words I acknowledged the acceptance of the transfer, and the ceremony was at an end,” Rousseau wrote in his report.
Following the sale, Alaska experienced a prosperous Gold Rush period after years of neglect, which prepared the way for its eventual development into a prosperous US territory and state.
HOW WE OWN ALASKA TURNED FROM FOLLY TO JACKPOT Following the acquisition, Alaska was first given little consideration by the US, receiving little funding and being governed by Treasury and military regulations.
The area remained lightly populated after the majority of Russian residents fled. However, transformation was imminent in the next decades.
Everything changed with the Klondike Gold Rush in 1896.
As the world learned about Alaska’s mineral richness, it brought thousands of people there. Oil and gold finds in the 1950s and 1960s validated Seward’s prediction.
It was a jackpot, not a foolish move.
Due to its closeness to Russia, Alaska gained strategic significance during World War II and the Cold War after becoming an American state in 1959.
Oil, gas, fishing, and tourism are the main drivers of Alaska’s economy today, and the state has significant geopolitical significance that will even influence Friday’s Trump-Putin meeting. Alaska has gone a long way from the much-maligned acquisition to becoming a vital part of the US defense and Arctic edge. When Trump and Putin meet on Friday, they will both be thinking about that.
