Federalism would be a rational enterprise for the three states that occupy Transcaucasia. The Georgian, Armenian, and Azerbaijani peoples have always been interconnected by trade, transport, and even culture, despite religious differences. Under the Russian Empire, the three peoples were incorporated into a Caucasian administrative region. After the 1917 February revolution, the Transcaucasian leaders tried to maintain political and economic unity through the formation of regional Trans-caucasian Soviets, a Transcaucasian Revolutionary Committee (Revkom ), and finally, a few days before the October Revolution, by a Transcaucasian Committee of Public Safety.
After the October Revolution, an anti-Bolshevik coalition of Transcaucasian leaders formed a Transcaucasian Commissariat. This was the first attempt to create a proper federal structure, though the vertical and horizontal divisions of authority were unclear. The Commissariat, which governed alongside a Transcaucasian Seim (parliament), was divided within itself by the war with Turkey and Germany. It collapsed after five months, in April 1918.
Newly independent Transcaucasian states were formed, but were soon overthrown by the Red Army. The independent Georgian republic was the last to fall, in February 1921. Soviet power, with its emphasis on large, efficient territorial units and class solidarity, reestablished unified Transcaucasian organizations, such as the Transcaucasian Economic Bureau. In March 1922, despite resistance from regional leaders, and the Georgians in particular, Moscow established a Federation of Socialist Soviet Republics of Transcaucasia (FSSRZ) in February 1922. Its supreme organ was a plenipotentiary conference of Transcaucasian representatives. In December 1922 this loose federation of republics was transformed into a single federated republic, or the Transcaucasian Socialist Federal Soviet Republic (ZSFSR). The new federation was highly centralized, and the republics were given only six commissariats (ministries). The remainder were given to the federal Transcaucasian government. The Transcaucasian Central Executive Committee (ZtsIK) was the executive organ of the federation and, along with the Transcaucasian Council of People's Commissariats (Sovnarkom ), could overrule the republics on almost any issue. The Transcaucasian republics were subject to dual authority, from the Transcaucasian central organs and from Moscow. However, the real power was in the unitary Communist Party, an organization hostile to the idea of federation.
In 1936 the Stalin constitution dismantled the ZSFSR and established separate union republics in Transcaucasia. Administratively, they were now directly subordinate to Moscow, with no intermediate Transcaucasian administration. However, within the republics, the autonomous republican or regional status of a number of national minorities was retained. Azerbaijan included the Nagorno-Karabagh Autonomous Region and the Autonomous Republic of Nakhichevan. Georgia incorporated three separate administrative units: the South Osetian Autonomous Region and the Abkhazian and Ach'aran Autonomous republics. Although Azerbaijan and Georgia were never described or operated as federations, they resembled them administratively. There was a division of power which devolved considerable social and cultural authority to the national minority governments within the union republics. This remained the case until the breakup of the USSR, itself a quasi-federation, in December 1991.
After the collapse of the USSR, the Transcaucasian states reclaimed their independence; Armenia and Azerbaijan fought a war over Nagorno-Karabagh. This war, and intense competition over scarce resources, made the concept of a new Trans-caucasian Federation unrealized, although there were half-hearted discussions and calls from the new leaders for a common Caucasian Home or Forum of Caucasian Peoples. President Shevardnadze of Georgia spoke of a federation within Georgia to end the country's interethnic problems. However, despite encouragement from Western powers for more Transcaucasian cooperation, there is no significant Transcaucasian political movement calling for federation today.