Mark Steyn has a great article out, "The Death of Mother Russia." He sums up Russia's problems fairly well:
The Alaska option is unlikely but intriguing (but after recent events, let's keep them out of Congress for a while).
Russia’s export of ideology was the decisive factor in the history of the last century. It seems to me entirely possible that the implosion of Russia could be the decisive factor in this new century. As Iran’s nuke programme suggests, in many of the geopolitical challenges to America there’s usually a Russian component somewhere in the background.
...Russia is literally dying. From a population peak in 1992 of 148 million, it will be down to below 130 million by 2015 and thereafter dropping to perhaps 50 or 60 million by the end of the century, a third of what it was at the fall of the Soviet Union.
Most of the big international problems operate within certain geographic constraints: Africa has Aids, the Middle East has Islamists, North Korea has nukes. But Russia’s got the lot: an African-level Aids crisis and an Islamist separatist movement sitting on top of the biggest pile of nukes on the planet.
What would you do if you were Putin? What have you got to keep your rotting corpse of a country as some kind of player? You’ve got nuclear know-how — which a lot of ayatollahs and dictators are interested in. You’ve got an empty resource-rich eastern hinterland — which the Chinese are going to wind up with one way or the other. That was the logic, incidentally, behind the sale of Alaska: in the 1850s, Grand Duke Konstantin Nikolaevich, the brother of Alexander II, argued that the Russian empire couldn’t hold its North American territory and that one day either Britain or the United States would simply take it, so why not sell it to them first? The same argument applies today to the 2,000 miles of the Russo–Chinese border. Given that even alcoholic Slavs with a life expectancy of 56 will live to see Vladivostok return to its old name of Haishenwei, Moscow might as well flog it to Beijing instead of just having it snaffled out from under.
That’s the danger for America — that most of what Russia has to trade is likely to be damaging to US interests. In its death throes, it could bequeath the world several new Muslim nations, a nuclear Middle East and a stronger China. In theory, America could do a belated follow-up to the Alaska deal and put in a bid for Siberia. But Russia’s calculation is that sooner or later we’ll be back in a bipolar world and that, in almost any scenario, there’s more advantage in being part of the non-American pole. A Sino–Russian strategic partnership has a certain logic to it, and so, in a darker way, does a Russo–Muslim alliance of convenience.
What do you do with a giant, virtually unpopulated but resource-rich region of a dying country? Trying to keep it open to the world simply through business engagement seems unlikely after the Yukos affair. Japan should generally share our concerns, but the EU is still stuck trying to figure out itself, not to mention Turkey, the successor to the original Sick Man of Europe. The development needed by Siberia requires political and legal stability that is currently nowhere to be seen.
The Great Powers of Europe grappled with an incredibly similar problem just a century ago. Can we do better, or at least not do worse?
Western policymakers would do well to dust off their history books and reread the sections dealing with the terminal decline of the Ottomans. After the "new start" of 1908, the reform movement faltered and the government drifted. Giddy optimism among Ottoman subjects turned into bitterness and a sense of betrayal. Finally, the reform movement came to an end when the empire's former subjects humiliated it in the Balkan Wars of 1912-13. A frustrated young Ottoman officer, Enver Pasha, seized power in a coup on Jan. 23, 1913. Thirsting to restore the empire's greatness, he plunged Ottoman Turkey into World War I the following year. The "Eastern question" that dominated diplomacy in the late-19th and early-20th centuries--managing Ottoman decline--was finally answered with the dismemberment of Enver's dream state in the world's first global blood bath.So how about this - instead of rebuilding an underwater city, let's buy Siberia. It's big, and it's above sea level.
For more on the economic problems and promise of Siberia, check out "Siberia: Russia's Economic Heartland and Daunting Dilemma."