On January 3rd, 1959 Alaska became the 49th member of the United States of America.
Roughly 100 years earlier, the territory was purchased from Russia for roughly $7 million
dollars, which today would only be about $120 million dollars.
And yet, despite paying pennies per acre, some economists today say that the US government
has never actually seen profit on the purchase.
At the time, the deal was ridiculed in Congress and the press.
Fast forward to today; just how powerful is Alaska?
Well, Alaska is actually the second newest US state, and the largest by far.
It is roughly 663,000 square miles, which means that it comprises more than a sixth
of the entire United States.
Alone, Alaska would be the 18th largest country on earth.
And yet, with a population of less than 750,000, it is also the least densely populated state.
Roughly 400,000 people live in the Anchorage Metropolitan Area, so most of the state is
pretty barren.
However, Alaska’s population is unique in that about 15% is made up of Native Americans
or Alaskan Natives.
Although both of these groups are indigenous to the US, they are dealt with separately
within some pieces of legislature.
For example, although many Native American tribes are able to collect taxes from business
conducted on their tribal lands, Alaskan Natives cannot do so.
This is because the Alaska Native Claims Settlement Act of 1971 eliminated all but one Alaskan
reservation, an island in the southeast.
In addition to a sparse population and a somewhat unfair shake for the Native peoples, Alaska
is also not very wealthy.
Their state GDP is around 54 billion dollars, ranking them 45th among US states.
For comparison, the smallest state in the US, Rhode Island, ranks two spaces higher.
And yet, despite such a relatively low total yield, Alaska has the fifth highest number
of millionaires per capita in the US.
Why?
Concentrated oil wealth.
Oil and gas make up nearly all of the state’s revenue, with seafood and tourism very distant
secondary sources.
One of the largest oil fields in North America is located in Alaska, and the petroleum industry
accounts for a third of Alaskan employment.
Alaska also has one of the highest costs of living in the country due to difficulties
transporting goods, particularly in rural regions.
So, just how powerful is Alaska?
Well, with a low density population, singular oil economy, high wage inequality, and high
cost of living, unfortunately Alaska’s gargantuan size is a bit deceiving as to it’s relatively
powerless state.
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