In 1867, the United States purchased the American territories of the Russian Empire. The new land was named the Department of Alaska and placed under the jurisdiction of the US Army. However, the acquisition was very controversial in Washington and many politicians thought it was foolhardy. Consequently, the US Congress determined to spend as little money on the new Department of Alaska as it possibly could. Americans wanting to settle there had to make their own way.

Over time, the Alaskan government evolved into what could only be considered a bureaucratic demilitarized zone. Over time, no less than 52 agencies received plenipotentiary authority in one area or another and they all took orders from Washington, never even from the Presidentially-appointed commissioner. The Department quickly became the scene of interagency turf wars and getting anything done proved nearly impossible.

Gold and other resources were discovered at the beginning of the 20th century, and although they attracted American settlers, the Department did not interest Congress which was then still trying to deal with the smoldering embers of the Civil War. Alaska became a tax haven by default and unfettered, laissez-faire capitalism flourished along with lawlessness. Over time, a nationalistic spirit developed and many American settlers began to regard Alaska as an adopted new country rather than an extension of their old one.

Gradually through the 20th century, continued governmental and legislative inefficiency along with social and economic progress coalesced to produce a perfect storm of separatism. As the 1970s ended and the 1980s dawned, public opinion in Alaska was divided on a knife edge over become independent or becoming an American commonwealth or state. In 1982 a referendum was held, which Washington promised would be the one and only. Under the slogan of "Now or Never!" Alaskans ironically voted to become independent 51% to 49% on July 4.

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