ABSTRACT

In 1867 William Seward, the US secretary of state, signed a deal in the remote settlement of Sitka that many Americans referred to at the time as “Seward’s folly.” He paid the Russians the sum of US$7.2 million for all their possessions in Alaska, and Sitka, hitherto the capital of Russian America, became the outpost of the US federal government in its newly acquired territory. As it turned out, Seward’s deal amounted to something close to a gambler’s dream: for a minimal pay-out, it was to yield vast profits.The Russians had plundered one natural resource—decimating the sea otter, bearer of an exquisite and highly prized pelt—but they had made only cursory use of the region’s forests and minerals. Soon after the Russians left there was a gold rush, and a century later wealth-bestowing oil began to flow freely along the trans-Alaska pipeline. Indeed, Seward’s perspicacity, or at least that of his government, led to the enrichment of both the US Treasury and the Alaskan people: each individual, from the most industrious to the least deserving, now receives an annual oil dividend of around US$2000.