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Post-Soviet Chaos & Revival: New Russia Seeks the Tunnel
How the collapse of the Soviet Union opened possibilities for East-West cooperation, why the 1990s chaos prevented serious progress, and how rising oil prices and Putin's consolidation set the stage for 2007's official backing
Abstract
On December 26, 1991, the Soviet Union formally ceased to exist. For the first time since 1917, the ideological barrier dividing the superpowers had fallen. The "Ice Curtain" across the Bering Strait—which had split indigenous Yupik and Chukchi families for decades—suddenly seemed an anachronism ripe for elimination. Advocates like former Alaska Governor Wally Hickel and religious leader Sun Myung Moon seized the moment, envisioning a "Peace Bridge" or tunnel that would physically and symbolically reunite continents sundered by Cold War. Yet the 1990s would prove to be the worst possible time to build anything in Russia. Boris Yeltsin's "shock therapy" economic reforms unleashed hyperinflation that destroyed savings overnight, organized crime filled the governance vacuum, life expectancy plummeted, and the 1998 financial crisis sent Russia into default. In this chaos, mega-infrastructure projects were fantasy. Only with Vladimir Putin's rise to power, the stabilization of the early 2000s, and soaring oil prices creating budget surpluses did the Bering tunnel re-emerge as plausible—culminating in the 2007 government-backed proposal examined in our previous paper. This paper traces that journey from Soviet collapse through Yeltsin's catastrophic decade to Putin's consolidation, asking why the end of the Cold War's greatest obstacle—ideological division—paradoxically created Russia's period of minimum capacity to actually build the tunnel.
1. December 1991: The Ice Curtain Melts
For nearly seven decades, the Bering Strait had been more than geography—it was ideology made spatial. The Cold War transformed a narrow waterway into one of Earth's sharpest divides. Big Diomede Island (Soviet) and Little Diomede Island (American), separated by just 4 kilometers and the International Date Line, epitomized this absurdity. Indigenous families were split. Travel between Alaska and Chukotka became impossible. The strait wasn't just a border—it was the "Ice Curtain," the Pacific equivalent of Europe's Iron Curtain.
When the Soviet Union dissolved on December 26, 1991, this seemed to change overnight. Mikhail Gorbachev's resignation, the lowering of the Soviet flag from the Kremlin, and the emergence of 15 independent republics represented what Francis Fukuyama famously (and prematurely) called "the end of history"—the final triumph of Western liberal democracy. If former enemies could cooperate, what barrier couldn't fall?
The Early Optimism
The early 1990s saw genuine thaw in Bering Strait relations:
- 1990: USSR and U.S. exchanged diplomatic notes attempting to settle their maritime boundary dispute
- 1988-1989: "Friendship Flights" between Alaska and Chukotka reunited indigenous families for the first time since 1948
- Early 1990s: Russian scientists and American counterparts began joint Arctic research without Cold War restrictions
- 1994: Civil engineer Tung-Yen Lin updated his Bering Strait bridge proposal, estimating costs at $4 billion—seemingly manageable in an era of Western aid to Russia
The Council for the Study of Productive Forces (SOPS)
In Russia, serious institutional attention turned to the Bering crossing. The Council for the Study of Productive Forces (SOPS), a joint body of the Russian Academy of Sciences and the Ministry of Economic Development, began coordinating multidisciplinary studies in the 1990s under academician Alexander Granberg.
SOPS conducted aerial route surveys, geotechnical mapping, and energy integration concepts. Their work projected benefits from grid integration, massive resource development in the Russian Far East, and potential energy efficiency gains. For the first time since the Tsarist era, Russian institutional capacity was being directed at the Bering crossing not as propaganda but as genuine feasibility assessment.
The American Advocates
In Alaska, former Governor Wally Hickel became the tunnel's most vocal champion. In interviews throughout the 1990s and 2000s, he insisted: "This is going to change the world, and it is easy to do. All it takes is a decision." Hickel envisioned Alaska as a global transport hub, with Fairbanks becoming the crossroads of intercontinental rail.
More controversial was Sun Myung Moon, founder of the Unification Church and the Universal Peace Federation. Beginning in June 2005, Moon promoted what he termed the "World Peace King Tunnel"—an 85-kilometer, $200 billion link he framed as not merely infrastructure but as spiritual unification of humanity. In 2005, Neil Bush (brother of President George W. Bush) traveled with Moon to promote the tunnel concept, though he later downplayed his involvement when questioned during his brother Jeb's 2015 presidential campaign.
These advocates shared a vision: the Cold War's end had created a "historic opportunity" to physically bridge barriers between nations, races, and cultures. The tunnel would be proof that former enemies could cooperate on civilization-scale projects.
2. 1992-1998: The Decade of Catastrophe
The optimism didn't survive Russia's 1990s. What happened in that decade is essential to understanding why the Bering tunnel remained unrealized despite the removal of ideological obstacles.
January 2, 1992: Shock Therapy Begins
On January 2, 1992, Deputy Prime Minister Yegor Gaidar freed prices—the opening salvo of "shock therapy" economic reforms recommended by Western advisors and the IMF. The theory: rapidly transition from centralized planning to market capitalism by liberalizing prices, privatizing state assets, and opening to international trade.
Gaidar predicted prices would increase three to five times. Instead, over the next ten months, prices rose by a factor of thirty. Russians who had saved for decades watched their savings evaporate overnight. Hyperinflation destroyed not just wealth but trust in any economic system.
The Human Cost: Russia's 1990s in Numbers
- GDP collapse: 50% decline from 1991-1998
- Life expectancy: Dropped from 69 to 64 years
- Excess deaths: 5 million additional adult deaths 1991-2001
- Birth rates: Collapsed by 30%
- Industrial output: Declined by 50%
- Inequality: Gini coefficient rose from 0.26 to 0.48
- Poverty: Over 40 million Russians fell below poverty line
The Oligarch Class Emerges
In 1992, the government distributed vouchers to 98% of Russian citizens—paper representing their share of the Soviet economy. Most citizens, desperate for cash amid hyperinflation, sold their vouchers for pennies. Savvy insiders bought them en masse, converting worthless paper into ownership of state enterprises.
The 1995 "loans-for-shares" scheme completed the transfer. The government, desperate for cash to fund Yeltsin's 1996 re-election campaign, auctioned state assets to oligarchs in exchange for loans. The auctions were rigged; assets worth billions went for millions. Russia's crown jewels—oil companies, metals producers, telecoms—concentrated in the hands of perhaps a dozen individuals.
The consequences were profound. Wealth inequality surged. By the 2000s, 35% of Russia's financial assets would be owned by just 110 individuals. Average Russians experienced shock therapy as theft—their shared Soviet inheritance stolen by criminal capitalism.
Organized Crime Fills the Vacuum
With state capacity collapsing, criminal organizations filled the governance void. The police only protected state enterprises, leaving the emerging private sector vulnerable. Criminal gangs offered "protection" (krysha—literally "roof") in exchange for fees. By mid-decade, virtually every business paid someone for protection.
Contract killings became routine. Between 1992-1997, hundreds of bankers, businessmen, and officials were assassinated as gangs fought for control. Moscow's organized crime rate was among the world's highest. The word bespredel—meaning simultaneously "anarchic freedom" and "unaccountable authority"—captured the era's chaos.
Infrastructure Collapse
For infrastructure development, this environment was catastrophic:
- Budget deficits: The government couldn't collect taxes; oligarchs used loopholes, enterprises paid in barter
- Unpaid wages: By August 1998, $12.5 billion in wages owed to Russian workers
- Factory closures: Industrial output collapsed 50%, with many enterprises operating on barter
- Capital flight: Any Russian with money moved it offshore or into dollars
- Foreign skepticism: After witnessing the chaos, Western investors avoided Russia
In this context, spending on a Bering tunnel was absurd. The Russian Far East was hemorrhaging population—down 14% from 1991 levels as residents fled to European Russia or emigrated entirely. Chukotka, the region nearest the strait, lost over half its population. Provideniya, once home to 5,000, became a ghost town of boarded-up apartments and stray dogs.
Why build a tunnel to connect regions people were abandoning?
August 17, 1998: Default and Collapse
The decade's nadir came on August 17, 1998. Facing collapsing oil prices (down 40% year-over-year), capital flight triggered by the Asian financial crisis, and inability to collect taxes, the Russian government abandoned its defense of the ruble, defaulted on $40 billion in domestic debt, and placed a 90-day moratorium on commercial debt payments.
The ruble crashed from 6.29 per dollar to over 20. Russians again saw their savings destroyed. The stock market fell 70%. President Yeltsin, physically ill and politically spent, fired Prime Minister Sergei Kiriyenko and plunged into constitutional crisis as the Duma refused to confirm his replacement.
For anyone still harboring Bering tunnel dreams, August 1998 was the death knell. Russia was bankrupt, politically unstable, and economically devastated. The "end of history" had devolved into chaos that felt more like 1918 than 1991.
3. 1999-2006: Putin's Stabilization and the Return of Ambition
On December 31, 1999, Boris Yeltsin resigned in a televised New Year's Eve address, handing power to his designated successor: Vladimir Putin, the former KGB officer who had served as Prime Minister for just three months. Few outside Russia knew who Putin was. That would change quickly.
The Stabilization Narrative
Putin's rise coincided with—and was enormously aided by—a dramatic reversal in Russia's economic fortunes. Oil prices, which had collapsed to $10 per barrel in 1998, began climbing. By 2000 they exceeded $25. By 2008 they would reach $147.
Putin didn't cause this recovery—oil prices did. But he skillfully positioned himself as the leader who restored order after Yeltsin's chaos. His campaign slogan in 2000, "the dictatorship of law," captured what Russians craved: predictability, order, and an end to bespredel.
Consolidating Power
Putin systematically dismantled the power structures that had emerged in the 1990s:
- Curtailed regional governors: Previously elected, they became appointed by the Kremlin
- Subdued oligarchs: Those who accepted Kremlin dominance (like Roman Abramovich) thrived; those who challenged Putin (like Mikhail Khodorkovsky) were destroyed
- Controlled media: Independent television stations were brought under state control
- Strengthened security services: FSB and military budgets increased dramatically
By 2004, Putin had achieved what Yeltsin never could: genuine political stability. Whether this was "stability" or "authoritarianism" depended on one's perspective, but either way, Russia's government could again contemplate long-term projects.
The Far East Development Imperative
With stability and resources, Putin turned attention eastward. The Russian Far East remained Russia's greatest strategic vulnerability: vast territory, tiny population, massive resources, underdeveloped infrastructure, and a massive neighbor (China) with 20-times the regional population.
In 2002-2004, Russian planners began serious work on Far East development strategies. These included:
- Completing the Amur-Yakutsk Mainline railway (started in Soviet era, abandoned in 1990s)
- Developing oil and gas fields in Sakhalin and elsewhere
- Creating special economic zones to attract investment
- Infrastructure modernization in key cities like Vladivostok
The Bering tunnel fit naturally into this framework. If Russia was serious about developing its Far East, why stop at Yakutsk? Why not extend rail all the way to the Bering Strait and beyond?
2005: Moon and Bush Reignite the Dream
In June 2005, Sun Myung Moon's Universal Peace Federation launched a major push for the Bering tunnel. Moon framed it as the "World Peace King Tunnel" and enlisted Neil Bush to help promote it. Whether one found Moon's spiritual framing appealing or bizarre, his organization had resources and commitment.
More significantly, the Russian government was listening. Moon met with officials. SOPS intensified its studies. Regional leaders in Yakutia and Chukotka expressed enthusiasm. The pieces were aligning.
2006-2007: The Stars Align
By 2006, conditions that had seemed impossible in the 1990s had materialized:
The Perfect Storm (in a Good Way)
- Political stability: Putin firmly in control, no risk of government collapse
- Budget surpluses: High oil prices creating massive government revenues
- Institutional capacity: SOPS and other agencies had completed extensive feasibility work
- Strategic imperative: Far East development was official policy
- Corporate backing: Russian Railways, Transneft, and UES saw opportunity
- International interest: Moon's organization, Alaska advocates, even some U.S. officials expressing openness
This convergence set the stage for April 2007's historic announcement—covered in our previous paper—when Russia officially backed the $65 billion TKM-World Link.
The 1990s had proven that removing ideological barriers wasn't enough. You also need functional government, economic resources, institutional capacity, and strategic vision. By 2007, for the first time since the USSR's collapse, Russia had all of these.
The great irony: just as Russia finally achieved the capacity to seriously pursue the tunnel, the 2008 financial crisis would destroy the economic conditions that made it feasible. Russia would spend 1991-2006 building toward readiness, have a narrow 16-month window of possibility, then watch it slam shut.
4. The Quiet Advocates: InterBering and the True Believers
While governments waffled and economies collapsed, a small group of persistent advocates kept the Bering tunnel dream alive through the wilderness years. Understanding their role reveals how grand infrastructure visions survive decades of practical impossibility.
InterBering LLC
Founded in 2010 (after the 2007 proposal had stalled), InterBering LLC became one of the most detailed and persistent private-sector advocates. Led by George Koumal and later Fyodor Soloview, the organization wasn't content with vague proposals—they produced detailed engineering plans, cost estimates, and route surveys.
Their vision was comprehensive:
- Three parallel tunnels under the Bering Strait (two main tunnels plus service tunnel)
- Multi-level design: conventional rail below, high-speed rail and automotive lanes above
- Future-ready: space reserved for "Airless Maglev Tube Transport" at up to 4,000 mph
- Development corridor: 80 km (50 miles) on each side including power lines, fiber optics, freshwater pipes
- Phased implementation: recognizing it couldn't all be built at once
In August 2014, Soloview received a letter of support from Victor Alferov, Deputy Head of Technical Policy of Russian Railways—lending semi-official credibility to what was ostensibly a private initiative.
The True Believer Phenomenon
InterBering represents a fascinating category: the persistent advocate who keeps impossibly grand visions alive during decades when serious people dismiss them. These advocates serve a crucial function—they maintain institutional memory, refine technical details, and create a ready-made proposal for when conditions shift.
When Russia officially backed the tunnel in 2007, they didn't start from scratch—they drew on decades of work by advocates like InterBering, SOPS, and earlier dreamers. The "true believers" ensured that each revival didn't have to reinvent the wheel.
The Russian American Pacific Partnership (RAPP)
Another key organization, the Russian American Pacific Partnership, evaluated consolidation and extension of northern Pacific trade corridors between the U.S., China, and Russia. RAPP had strong ties to both governments and framed the tunnel not as standalone infrastructure but as part of integrated economic development.
Their approach was more pragmatic than InterBering's maximalist vision. They emphasized:
- Incremental steps: Alaska road connections, small ports, enhanced air service
- Trade development before tunnel construction
- Building trust and regulatory frameworks first
- Learning from smaller cross-border projects
Academic and Technical Studies
Throughout the 1990s and 2000s, academic institutions continued feasibility work despite lack of government funding. Japanese, Korean, and Russian tunneling experts shared knowledge about undersea construction. Climate researchers documented accelerating ice melt. Geologists mapped seismic risks. Economists modeled trade flows.
This work rarely made headlines, but it meant that when governments expressed interest (as in 2007), detailed technical answers existed. The tunnel's engineering challenges were well understood, even if economic and political obstacles remained insurmountable.
5. Conclusion: The Paradox of Possibility
The post-Soviet era presents a profound paradox: the removal of the Cold War's ideological barrier made the Bering tunnel theoretically possible but practically impossible for fifteen years.
In the early 1990s, Russian-American cooperation seemed plausible for the first time in generations. Former enemies were becoming partners. The "Ice Curtain" had melted. Yet Russia's capacity to build anything had collapsed entirely. Hyperinflation, organized crime, GDP contraction, population exodus, infrastructure decay—the 1990s were an era when Russia couldn't maintain existing infrastructure, let alone build transcontinental mega-projects.
Only when Putin stabilized Russia's politics and soaring oil prices restored budget surpluses did the tunnel become conceivable again. By 2006-2007, Russia finally possessed what the early 1990s had lacked: functioning government, available capital, institutional capacity, and strategic vision. For a brief 16-month window (April 2007 to August 2008), all necessary conditions aligned.
Then the 2008 financial crisis destroyed them again.
The post-Soviet era thus taught a crucial lesson about mega-infrastructure: removing political obstacles isn't enough. You also need economic resources, state capacity, trade volumes, and favorable timing. The tunnel required all of these simultaneously—a combination that has proven elusive across 120+ years.
The era also revealed the power of persistent advocacy. Organizations like InterBering, SOPS, and individuals like Wally Hickel kept the dream alive during impossible years. When governments showed interest, detailed plans existed because true believers had maintained them through the wilderness. These advocates understood something important: grand visions require decades of groundwork before moments of possibility arrive.
Whether that moment of possibility will ever return—whether Russia will again achieve the stability, resources, and international trust required for transcontinental cooperation—remains an open question as we move deeper into the 21st century.
In our next paper, we'll examine the Cold War era (1950s-1980s) when the tunnel transformed from engineering proposal to political symbol—the "Kennedy-Khrushchev World Peace Bridge" that represented everything the superpower rivalry prevented.
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