January 17, 1917: US Buys Virgin Islands from Denmark

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A Brief History

On January 17, 1917, the United States added another real estate coup to its already impressive history of buying land at a bargain when the Virgin Islands were purchased from Denmark for only $25 million, joining other famous American real estate purchases such as the Louisiana Purchase (1803, $11.25 million), Alaska (1867, $7.2 million) and the Gadsden Purchase (1854, $10 million).  If you throw in the Dutch buying Manhattan for “$24” worth of trinkets, and the island ending up as US property, there is one more terrific deal we benefited from.  (Do not think the tribe that sold Manhattan was cheated!  The Native people that sold the island to the Dutch did not even really own it, so they basically got free stuff!)  Besides, the value of the trinkets would be over $1000 today.  Darn inflation!

Digging Deeper

The US Virgin Islands are an unincorporated territory of the United States and the 100,000+ people there are native born American citizens (like Puerto Rico, Guam, etc.).  Consisting of 3 main islands (St. Croix, St. John, and Saint Thomas, the island group includes numerous other small islands as well.  Charlotte Amalie, the capital city, is located on Saint Thomas.    Charlotte Amalie has a population of about 18,000+.  Saint Croix is the largest of the 3 main islands and boasts about half the US Virgin Islands’ population.  Total land area is about 133 square miles, about the size of Detroit, Philadelphia, Portland (Oregon) or Las Vegas.

Location of United States Virgin Islands (circled in red).  Map by TUBS.

The Virgin Islands were previously known as the Danish West Indies and had been the property of The Kingdom of Denmark-Norway prior to Denmark splitting from that union.  The people of the US Virgin Islands are largely engaged in the tourism industry, with about 40% of the population so employed.  The average public sector (government) employee makes and average annual income of over $52,000 and the average private sector employee makes around $34,000 per year.  The islands were devastated by the 2017 hurricanes (Irma and Maria), causing over 3000 residents to move to the mainland United States.  The US Virgin Islands are found about 40 miles East of Puerto Rico and with the British Virgin Islands to the other side.  Saint Thomas and Saint John are volcanic islands, while Saint Croix is formed by coral, giving that island a flatter topography.

When White people (Europeans) first landed on what is now the US Virgin Islands, the islands were populated by Native American people of the Ciboney, Carib, and Arawak tribes.  Today, the overwhelming majority (76%) of the population is mixed race people of mostly African descent.  The major sea going European powers took turns seizing the Virgin Islands, including England/Britain, Spain, The Netherlands, France and finally Denmark-Norway before the United States purchase the islands.  The first European to “discover” the US Virgin Islands was Christopher Columbus himself.   Europeans used the Virgin Islands for their ports and strategic location, as well as farming sugarcane on plantations worked by African slaves.  Danish Governor Peter von Scholten abolished slavery in the Virgin Islands on July 3, 1848.  Of course, with a crop of sugarcane, Rum became another logical product. Slave rebellions were not unusual in the Caribbean islands, and the Virgin Islands were no exception.  A particularly persistent revolt occurred in 1733 when slaves (from Africa’s Gold Coast) actually took over the island of Saint John for 6 months until the rebellion was put down by the Danes with French assistance.  The Native people of the islands were also enslaved by the Europeans, and the slave population usually outnumbered the colonial Europeans by a large margin, generally about 5 to 1.

The Høgensborg estate on St. Croix, Danish West Indies, 1833

Denmark apparently tired of administering the Virgin Islands and tried to negotiate a sale to the Untied States in 1867 (when the US bought Alaska from the Russian Empire) and again in 1902.  Finally, with World War I bringing the threat of German submarines to the Caribbean, the US got serious about buying the islands before the Germans could seize them and create bases for their submarines.  The necessary negotiations took place and were finalized on January 17, 1917, and the US had a nice vacation spot in the sun!  The United States did not actually take possession of the Virgin Islands until March 31, 1917, and this date is a local holiday known as Transfer Day.

(Note: Dr. Zar and Major Dan had the opportunity to visit Saint Thomas and found the place of great natural beauty, with clean white sand and clear water.  The people were also very personable.)

Charlotte Amalie, St. Thomas.  Photograph by Sunil Pereira.

With a stable tropical climate of an average high temperature of 85 to 90 degrees Fahrenheit every month, the islands are right for all water and beach sports such as swimming, snorkeling, fishing and lounging in the sun.  (The average low temperature ranges from 72 to 78 degrees Fahrenheit.)  Aside from tourism and its associated retail and service businesses, the main product of the US Virgin Islands is Rum.  The per capita income of the islanders is only around $13,000+ annually (compared to the US average of $33,000+), with about a third of the population below the poverty level.  Agriculture is mainly sugarcane grown for the production of Rum, and food is generally imported.  Energy costs are the high, leading to a considerable cost of living status, as all oil is imported, and no natural sources of energy are available.  (Perhaps solar and wind energy can be developed to change this situation, we do not know.)  The closing of a major oil refinery in 2012 hurt the local economy severely.

The US Virgin Islands is a great place to visit, with the use of the US dollar, the English language, nice summery weather and beautiful beaches.  Plus, you do not need a Visa or Passport because the islands are in the United States!  One strikingly odd fact about the US Virgin Islands is that all automotive traffic drives on the left side of the road as they do in Britain (and China and Japan), even though the cars almost all have normal (for the mainland United States) steering wheels on the left side of the dashboard.  Go figure!

A map of the United States Virgin Islands

Questions for Students (and others):  Have you ever been to the US Virgin Islands?  Have you been to any other Caribbean islands?  Would you like to visit the US Virgin Islands?  Were you previously familiar with the US Virgin Islands?

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Historical Evidence

For more information, please see…

Alger, Oliver. United States Virgin Islands History: Discovery and settlement, Exchange of ownership of the Islands, inhabitants origin and settlement, Culture and tradition. CreateSpace Independent Publishing, 2016.

Boyd, John. Fantastic St. Croix: Too much to do in one vacation.  CreateSpace Independent Publishing, 2017.

Lipsitz-Flippin, Alexis. Frommer’s EasyGuide to the Virgin Islands. FrommerMedia, 2014.

The featured image in this article, a map of the United States Virgin Islands is in the public domain because it contains materials that originally came from the United States Central Intelligence Agency‘s World Factbook.

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About Author

Major Dan

Major Dan is a retired veteran of the United States Marine Corps. He served during the Cold War and has traveled to many countries around the world. Prior to his military service, he graduated from Cleveland State University, having majored in sociology. Following his military service, he worked as a police officer eventually earning the rank of captain prior to his retirement.