Module V - American Period: Alaska's Economy

Essential: What have been the major components of the Alaska economy during the American period of 1867-present?

http://content.lib.washington.edu/cdm4/item_viewer.php?
CISOROOT=/nowell&CISOPTR=169&CISOBOX=1&REC=7

In 1867 the United States bought Alaska from Russia.  At the beginning of the American period, the economy picked up where Russians had left off.  Americans began trapping furs.  By 1870, the Alaska Commercial Company dominated the fur trade.  They had taken over many of the former Russian trading posts and drove the North American Trading and Transportation Company out of business.  The fur trade had dominated Alaska’s economy, with high and low points, until 1959 when Alaska became a state.  At this time the Alaska Department of Fish and Game took over management of wildlife resources.  Also the state Board of Fish and Game limited trapping seasons, required licenses, and prescribed permissible trapping methods (Trading and Trapping).  

Treadwell Gold Mining Co. - Douglas Island, Juneau, AK

http://miningartifacts.homestead.com/Alaska-Mines.html

While fur trading was on a decline in Alaska, mining became the base of the economy.  In 1861, Buck Choquette found placer gold on the Stikine River and news of his strike spread rapidly among prospectors.  It wasn’t until 1896, when Tagish Charlie, Skookum Jim, and George Carmack made their famous strike on the Klondike River, that mining in Alaska really took off.  For about the next 90 years, miners dug up Alaska in search for gold.  However, after World War II the prices in gold fell and many mines were shut down.  By 1984 only a few gold mining operations continued to function.

Mining in Alaska did not stop there.  Prospectors sought out and found other natural resources including copper, coal, silver, mercury, platinum, tin, oil and gas.  In 1945, Alaska’s first oil reserve was drilled and in the 10 years that followed, navy contractors located two oil fields and a large gas field in the reserve.  In 1968 the United States largest oil field was discovered and tapped in Prudhoe Bay.  Oil production has continued to be a large part of Alaska’s economy (Mining). 

Kachemak Bay fishermen show off their halibut catch.
http://www.americaslibrary.gov/es/ak/es_ak_fishing_1.html

Americans had been fishing in the Alaska waters before Alaska was bought from Russia.  However, it wasn’t until canneries were introduced in 1878 that commercial fishing became such an economic stronghold (Fishing and Sea Hunting).  By the 1890s the industry produced millions of cases of salmon every year, and was Alaska's leading industry.  Today commercial fishing makes up about 5% of Alaska’s economy.  The Alaska salmon fishery is world renowned (Modern Alaska). 

Through the American period, the Alaskan economy has been driven by trapping furs, mining, drilling, fishing, hunting, tourism, agriculture, and so much more.  Alaska’s economy has been and will continue to be as diverse as its land and people.

Examine: How were the reasons for purchase and the reasons for moving to Alaska connected to the development of Alaska's economy?

The signing of the Alaska Treaty of Cessation on March 30, 1867. L-R: Robert S. Chew,
 Secretary of State William H. Seward, William Hunter, Mr. Bodisco,
Russian Ambassador Baron de Stoeckl, Charles Sumner and Frederick W. Seward.
http://www.findingdulcinea.com/news/on-this-day/March-April-08/
On-This-Day--The-United-States-Purchases-Alaska-.html

According to Chapter 4-1 of Alaska’s Heritage, there were four reasons why the United States bought Alaska.  “These were: (1) to maintain Russia's friendship (England's government had been sympathetic to the Confederacy during the recent American Civil War, France had sent troops and set up a dictator in Mexico during the same war, and Russia was a potential ally against either country); (2) to facilitate acquisition of British Columbia; (3) to derive economic benefit from Alaska's resources; and (4) to move closer to the markets of Asia.”  

In the same chapter of Alaska’s Heritage it was written that, “Individual Americans, however, appear to have come to Alaska right after the 1867 purchase for three more personal reasons. Some came because the government sent them. Soldiers, sailors, and other government officials fell into this category. Some came because they wanted to earn livelihoods in trade and commerce. Merchants, traders, and smugglers fell into this category. Some came because they wanted to earn livelihoods exploiting Alaska's natural resources. Catchers and salters of fish, fur hunters, prospectors, and miners fell into this category.”

If we look back to the Essential question above, we can see that many of the reasons for purchasing and for moving to Alaska are directly connected to the development of Alaska's economy.  The majority of Alaska’s economy is solely based on its natural resources.  From fur trading to fishing, the United States has certainly derived economic benefit from Alaska's resources.  This benefit would not be possible without the people who moved to Alaska.  Many of them moved there with trading, hunting, fishing, and prospecting in mind before they even left the lower 48.  These people and their ideas have made Alaska’s economy what it is today.  

Extend: Describe the economic base for your area of Alaska and share any current issues confronting the local residents.

Being that I have only lived in Wrangell for one and a half years, this question was difficult for me to answer.  To better understand the economic base for Wrangell, AK I turned to the City and Borough of Wrangell, Economic Development Director, Carol Rushmore.  She stated that commercial fishing is a huge part of Wrangell’s economy which is a change in the last 10 years from the historical emphasis on timber products.  Carol was unable to tell me the exact percentage of the economic base fishing accounts for because the numbers obtained from the state, as far as jobs and employment stats, reflect only the commercial processors. The individual fishermen are self employed so their revenue and the jobs they have created are not included in the figures.  

http://wrangellalaskagolf.com/welcome-to-wrangell/

While fishing is a large part of Wrangell’s economy, Carol also mentioned that tourism as one of the big economic drivers for Wrangell.  Tourism in Wrangell is based on the independent traveler not the cruise industry.  When I first moved to Wrangell, I was talking to an elder in our community and she mentioned the tourists.  She said it was exciting when they came to visit in the summer and she participated, with other people from the community, in welcoming the tourists as they came off of the cruise ships.  

Wrangell’s economy took a hit when the timber mill closed in the mid 1990‘s.  Many people left the community to find new jobs.  Even today the community still faces the challenge of reusing the large industrial site.  Carol stated that the mill site is privately owned but the community is interested in working with landowner to sell or develop the property to create jobs.  Other issues currently confronting the community of Wrangell include finding a way to increase the tourism industry without having an impact on residential quality of life, utilization of the 134 acres of great real estate which was once the Wrangell Institute, maintaining transportation to and from the island, and obtaining the necessary services and infrastructure for the aging population.  Overall, the economy of Wrangell has balanced itself out again and the population has slowly risen over the past 15 years.  

Evaluate: Write a brief paragraph reflecting on the content, style, and usefulness of this first module.

Module V was packed full of so much wonderful information.  I really enjoyed learning about Alaska’s economics.  While reading Modern Alaska, I came across the following quote.  I know everyone had read this (because it was assigned) but it stood out so much I would like to end this post with it. “Some have suggested that the greatest potential for expanding the economic base is education. A well-educated populace may generate new perspectives and ideas that might reduce the state's economic dependency.”  

http://www.eed.state.ak.us/edsummit/home.html

Resources: 

Alaska History & Cultural Studies. (2012). Alaska’s Heritage: Americans come to Alaska. Retrieved from http://www.akhistorycourse.org/articles/article.php?artID=166 

Alaska History & Cultural Studies. (2012). Alaska’s Heritage: Fishing and Sea Hunting. Retrieved from http://www.akhistorycourse.org/articles/article.php?artID=181 

Alaska History & Cultural Studies. (2012). Alaska’s Heritage: Mining. Retrieved from http://www.akhistorycourse.org/articles/article.php?artID=180 

Alaska History & Cultural Studies. (2012). Alaska’s Heritage: Trading and Trapping. Retrieved from http://www.akhistorycourse.org/articles/article.php?artID=179

Alaska History & Cultural Studies. (2012). Modern Alaska: Alaska Economy & Resource Development. Retrieved from http://www.akhistorycourse.org/articles/article.php?artID=262


The City and Borough of Wrangell Alaska. (n.d.). Timber and Wood Products. Retrieved from http://www.wrangell.com/economicdevelopment/timber-and-wood-products  

Colleague Blogs:

Brenda’s Alaska Blog: Brenda chose to write about Alaska’s present economy instead of the past economy which is what I wrote about.  I am choosing to note her blog because I think if we were to combine our answers we would have a nice summary of the entire period from 1867 to the present.  

The Alaskan Adventure: Lane’s blog was fun to read!  I have so many questions about his village.  He said there is no real economy because the historic oil spill wiped out their fishing industry.  It begs me to ask the question, why do people continue to live there?  

Crossing Alaska: Kristi’s blog is visually appealing.  In her evaluation of Module V, she compared Alaska to Idaho.  I liked reading about both states and making these comparisons.