The Worst Deal Ever!


The biggest and at the same time (for Russia!) worst real estate deal of all time comes to an end on March 30, 1867:

The Russian Empire sells "Russian America" (Alaska) to the USA!



Alaska has been part of the Russian Empire for about 100 years and is particularly exploited by fur traders...:











On that March 30th, 1867, two men across the Atlantic rub their hands in satisfaction.

The one, William Henry Seward ...



... because, as US Secretary of State, he signed the biggest deal of all time for his country.

The other, Russia's ambassador Eduard Andrejewitsch Stoeckl ...



... because he received 25,000 rubles in commission and a hefty annual pension through the said sale and, by the way, had replenished the notoriously ailing treasury of his country.

The two diplomats had negotiated all night before signing the treaty at dawn on March 30, 1867.

In the following picture, Stoeckl proudly lays his hand on Alaska in the foreground, while Seward (2nd from right) seems to be hiding in front of the camera ..:



Here is the title page of the Russian copy of the contract ...:


The purchase price: $ 7.2 million for a piece of land the size of half Western Europe - that's exactly $ 4.74 per square kilometer!

The Russians initially think they have made a great deal! They think that they got what could be got out of the country - besides trees, and there were enough of those in Siberia itself.

In fact, the Russian fur traders and trappers had wiped out almost everything they had taken possession of the land about 100 years earlier - especially the sea otters.

Although there was an abundance of fish and forests, any thought of profitable use vanished in view of the seemingly endless distance to Moscow or St. Petersburg. In addition, the anger with the indigenous people increased.

The tsar wanted peace and quiet and also urgently needs money.

Incidentally, it is seen in a very similar way on the US side!

The country is renamed "Alaska", which is borrowed from the Aleutian language and means "land towards which the ocean flows"

The US press rages against the purchase and gives the country completely different names, such as "Seward's stupidity" or "Seward's icebox" ... .:



At best, you can imagine Alaska as a convict colony - and above all the government that made the deal ...:



When it comes to the economic perspective, too, the Americans initially agree with the Russians: A newspaper writes that the country is a “worn out orange”.

After heated public debate, the Senate and House of Representatives ultimately approved the deal with a narrow majority.

The payment of the purchase price to the Tsar alone was a long time coming - and with it the commission of the Russian ambassador.

So Eduard Andrejewitsch Stoeckl set out again a year later and finally got the purchase price flowing with Russian bribes. Here is the original treasury note ...:



The Russians (in the next picture on the right) withdrew (many families stayed!), And the Americans hoisted their flags, like here in the then capital Sitka ...:



30 years after the deal, both sides began to see things fundamentally differently:

The great "gold rush" on the Klondike River broke out.

In the first five years of the “gold rush” alone, 50 million dollars were fetched from the earth on the Klondike, which alone was about seven times the purchase price!

At that time, of course, no one could have foreseen that Alaska would play a key geostrategic role in the one-to-one "Cold War", that huge oil reserves lay beneath the Alaskan ice sheet and that climate change at the beginning of the 21st century would offer the prospect of a profitable shipping route through the Arctic Ocean ...

The Kremlin is still tearing their hair over the deal today ...

Well, I have always thought that it was a great bargain!

Good post again Martin. Like Steve says, a great bargain!

Phil