A first-generation American born to poor German immigrants, Henry John Kaiser worked hard and studied hard, taking advantage of every opportunity to better his situation until he became one of the country’s leading early-twentieth-century industrialists. In many ways, he embodied the American Dream. His work ethic led to the construction of Hoover, Bonneville, and Grand Coulee dams, and his fierce patriotism was evidenced by the prolific number of U.S. warships his shipyards built for World War II. At the time of his death on August 24, 1967, at the age of 85 in Honolulu, Hawaii, Kaiser was still working 12-hour days and managing his multiple business ventures. Better still, rather than simply improving his own lot in life, Kaiser used his power and influence to create a long-lasting healthcare legacy that continues to have a positive impact on hundreds of thousands of men, women, and children each year.
Early Business Ventures
Henry John Kaiser, who would become a giant in American industry alongside the Rockefellers, Carnegies, and Vanderbilts, entered the world under the most modest of circumstances. His father, Franz Kaiser, a shoemaker, had emigrated to the United States from Steinham, Germany, in 1872, settling first in Canajoharie, New York, with the Yops family, who had a daughter named Anna Marie. Franz and Anna Marie soon married and relocated to neighboring Sprout Brook, New York, a tiny community about 60 miles west of Albany, where they changed their names to Frank and Mary. The couple became the parents of three girls – Elizabeth, Anna, and Augusta – and finally a son, born May 9, 1882, and baptized as Heinrich Kaiser, who later went by Henry. Frank opened a cobbler’s store and Mary worked in a cheese shop before becoming a part-time nurse, possibly introducing young Henry to the developing world of healthcare.
Frank Kaiser likely found it difficult making and selling shoes in a small town, and the family soon moved to the larger community of Whitesboro, New York, just outside of Utica. The couple did their best to instill in their children a strong work ethic and a love of learning. Friends of young Henry used words like "bright," "outgoing," and "energetic" to describe him, and it became clear that he was in a hurry to begin working. At age 13, just after his 8th grade year, he quit school entirely and began looking for ways to contribute to the family income. His father, mother, and three sisters already were bringing home paychecks. Understandably concerned about her son dropping out, Mary encouraged Henry to continue his studying by reading with him every evening.
Because the country was still rebounding from the financial Panic of 1893, it took Henry three weeks before he was able to secure his first job, as a stockroom delivery boy for a dry goods store in Utica. Walking to and from work daily and bringing home $1.50 a week, he worked there for three years, eventually getting promoted to sales clerk and later traveling salesman. But despite taking a correspondence course in salesmanship, he eventually grew weary of selling dry goods. Fortunately for Kaiser, in addition to his affinity for work in general, he had a second love, photography, which he discovered when he obtained his first Kodak camera just prior to dropping out of school. With visions of becoming a professional photographer at a time when Eastman-Kodak was making technological leaps toward the consumer market, Kaiser landed jobs using his considerable sales skills selling photography supplies for studios around the state of New York.
He may have gone on to have a respectable career in studio photography and supply sales had his beloved mother Mary not died suddenly at the age of 52 in 1899. Kaiser, still a teenager, was crushed. His father’s health was beginning to decline as well, leaving Henry with the perceived burden that the duty to support the family would now fall to him. Learning that a photography studio in nearby Lake Placid was looking for a partner, he cobbled together funds and promised owner W. W. Brownell that he would triple the studio’s business within a year. Brownell accepted the partnership offer, learning quickly that Kaiser was not only a man of his word, but a man destined for bigger things. Within another year, Kaiser had purchased the business from Brownell. Kaiser soon opened four more photography studios, in Daytona Beach, Jacksonville, St. Augustine, and Palm Beach, Florida.
While rotating between his summer and winter businesses in 1905, he met the 19-year-old daughter of a wealthy lumberman from Virginia when she came into his Lake Placid studio to purchase film. Henry was smitten with Bess Fosburgh and asked for her hand in marriage not long after. Bess’s father Edgar, being wary of the instability of the photography business, placed three conditions on Kaiser before he would allow his daughter to marry: Kaiser had to obtain a position earning at least $125 a month, save more than $1,000, and build a house for he and Bess to live in.
Go West, Young Man
Not one to shy away from a challenge, Kaiser sold his photography studios to relatives and employees in the summer of 1906 and moved to Spokane, then an up-and-coming railroad town with untapped business potential. The future materials and manufacturing mogul was rejected by scores of businesses before he landed a job with McGowan Brothers Hardware. According to one source, Kaiser proved his salesmanship skills to James McGowan after a fire in the store damaged much of the inventory. Kaiser brought in workers to clean and polish whatever could be salvaged and resold, leading McGowan Brothers Hardware to promote him from clerk to store manager. After several raises and another promotion to wholesale sales manager for all of Spokane, Kaiser had fulfilled two of his future father-in-law’s requirements for permission to marry Bess: he had saved and was earning the requisite amounts. However, he was still living in a small house on Fourth Avenue while a home he was having built for his bride-to-be was being constructed. In the spring of 1907, 10 months after arriving in Spokane, Kaiser boarded an eastbound train, determined to meet Edgar Fosburgh’s challenges.
Kaiser and Bess Fosburgh married in Boston on April 8, 1907, and returned to Spokane, where Kaiser’s career had begun to take off. He took out an $8,000 loan at 8 percent interest to purchase property and build a bigger home on South Hill at the corner of Grand Boulevard and Sumner Avenue. He supervised much of the construction personally, and the custom home was designed by architect W. W. Hyslop. The only thing remaining today [2024] is the concrete staircase leading up from Grand Boulevard to the triangular-shaped property owned by the neighboring Cathedral of St. John the Evangelist.
From 1907 to 1914, Kaiser worked for several companies in the Spokane area, selling construction materials, helping to build roads, and learning how to manage civil-engineering projects. He developed a reputation as a respectable, honest, and trustworthy businessman, something not often found in early-twentieth-century industrial circles. While working for the J. F. Hill Company in 1913, he was reportedly asked to lie about the results of reporting in favor of the company or be fired. He refused, and his paychecks stopped coming. Nevertheless, committed to seeing a project through on behalf of his customers, Kaiser worked an additional four months until the job was finished, cementing his reputation as a man of stalwart integrity. While further honing his business acumen during this time, he and Bess welcomed their first child, Edgar, in 1908, then a daughter who died at birth, and later their second son, Henry Jr., in 1917.
Business is Good
As Kaiser traveled more frequently for business, he saw the rapidly developing need for more and better roads. Automobiles were gaining in popularity, and in 1914, while working for a Canadian construction company that suddenly found itself filing for bankruptcy, Kaiser pounced on the opportunity to purchase the business for himself. After convincing a Canadian bank to loan him $25,000, he named it the Henry J. Kaiser Company, Ltd., hired a number of his former colleagues, and finished out the contract.
The Kaiser Company began winning construction bids for road projects all over the West Coast of North America, and Kaiser soon sold his home in Spokane and moved to Vancouver, British Columbia, and then to Oakland, California. Thanks to his early investments in new technology such as advanced road-paving machinery – an expensive gamble that paid off – Kaiser's company could finish most projects under budget and ahead of schedule, undercutting the bids of nearly all of its competitors. The Kaiser Company’s reputation for speed and efficiency became known nationwide, leading to numerous state and federal contracts during the economic boom years of the 1920s.
Kaiser also developed a reputation for treating his workers well, often working with them side by side on projects. He was never afraid to grab a shovel and dig, or jump into the seat of a bulldozer in order to help keep a project on deadline. This kind of empathy led to an enthusiastic and devoted workforce that wanted to succeed not just to earn a paycheck but to see their company and its founder succeed as well. That reciprocal relationship likely had a lasting impression on Kaiser, who would later build one of the largest healthcare systems in the country.
The Kaiser Company won numerous small and mid-size contracts up and down the West Coast. One of its first large-scale projects came in early 1927 when a conglomerate of business interests that included Warren Bechtel, founder of one of the world’s largest construction and engineering firms, contracted with Kaiser to build hundreds of miles of roads and more than 400 bridges across Cuba. The nearly $20 million subcontract was worth more than all the work Kaiser had done since selling his Florida photography studios, and it was enough to prove himself and his company capable of performing at a preeminent level. Kaiser and Bechtel worked together on a number of high-value contracts following the successful completion of the Cuba project, including Boulder Dam (later renamed Hoover Dam, which was completed nearly two years ahead of schedule, but at an incredible loss of life); Bonneville Dam and Grand Coulee Dam in Washington, as well as a number of tunnels, bridges, ports, and jetties around the U.S. Kaiser was often given a governmental liaison role on these projects and spent much of his time in Washington, D.C., using his salesmanship skills to prevail upon political interests in favor of his business associates.
During construction of Grand Coulee Dam between 1933 and 1942, Kaiser's eldest son, Edgar learned of a doctor named Sidney R. Garfield who had developed an employment-based healthcare model he had successfully implemented at two remote job sites and convinced his father to bring the man to Washington. Under Garfield’s plan, the employer – in this case, the consortium of companies enlisted to build Grand Coulee Dam – would foot the bill for a small medical facility on the site, while each of the workers would submit to having a small deduction from their paychecks, knowing they could visit the facility at any time. Workers, in turn, would generally visit the hospital more frequently and earlier, when symptoms of illness could be more effectively treated, and thereby the employee could return to work faster. Thanks to Kaiser and Dr. Garfield, the company seemed to have stumbled onto something beneficial for both employee and employer.
Warships Aplenty
As the U.S. watched Europe descend into World War II, Kaiser – who prided himself on looking several steps ahead, as he did with the roads needed for the advent of automobiles – foresaw a need for ships for the coming war effort. Even prior to the Japanese bombing of Pearl Harbor, he saw that the British were dangerously short of military vessels, and that the ones they had were being sunk at a furious rate by German U-boats. U.S. shipbuilders on the East Coast were assuring bureaucrats in Washington, D.C. that they were fully prepared to enter the theater when called upon, and were actively dissuading politicians from contracting with The Kaiser Company. Undeterred, Kaiser found a partner in Todd Shipyards in 1940 to produce 30 ships for the British at its new facility in Richmond, California. However, Todd was unable to keep pace with Henry Kaiser, and he soon left the partnership entirely.
Rather than scrambling to find a replacement, Kaiser, now entirely in charge, doubled down on his project, bringing in thousands of workers from across the country, building them houses, schools, a credit union, hospitals, and other services to make his workers more comfortable while they built the new wartime support vessels, dubbed "Liberty" and later "Victory" ships. As he had at Grand Coulee Dam, Kaiser brought in Dr. Sidney Garfield to implement a Health Maintenance Organization to keep workers healthy and on the job as much as possible. Kaiser also liked to encourage healthy competition among his employees, which led to a reduction in shipbuilding time from 244 days in the first instance to an average of about 40 days due to new welding methods and production techniques. In late 1942, workers at the Richmond shipyard set a record by starting and finishing a Liberty ship, the Robert E. Peary, in just 4 days, 15 hours, and 30 minutes.
After the U.S. entered the war and the U.S. Maritime Commission expanded the merchant marine fleet under the Emergency Shipbuilding Program, Kaiser added shipyards in Portland, Oregon, and Vancouver, Washington. He recruited workers from around the country and built for them their own city on the Columbia River’s southern bank – Oregon’s second largest city during the war – called Vanport, located between the two shipyards. Kaiser's Vancouver shipyard was one of the most versatile of the war effort, churning out 141 vessels of five different types during its nearly four-year operation. Included in the final tally were 10 Liberty ships, 30 tank-landing ships, 50 escort aircraft carriers (known as "baby flattops," they could carry and launch 37 planes each), 31 troop transports and eight cargo ships among several others. Tens of thousands of men and women served as welders, shipwrights, painters, riveters, shipfitters, machinists, electricians, and crane operators, helping to build these ships in the 12 bays that released their vessels on rail lines to the waiting Columbia River. Visitors to Vancouver’s Kaiser Memorial Shipyards observation tower today can still see remnants of that monumental effort by looking in just the right places.
"Industrial Hero"
In the war’s later years, Kaiser became so well-known that hundreds of magazine articles bore his name and his picture. He was sometimes called an "Industrial Hero" or a "Miracle Man" by the media, and President Franklin Roosevelt even considered naming Kaiser his vice-presidential running mate in the 1944 election. By the time the war ended, Kaiser's shipyards had produced nearly 1,500 ships for the war effort, ensuring his legacy as one of the most prolific shipbuilders the country had ever known. However, that kind of success doesn’t come without a price, and many of his competitors had been lobbing accusations of collusion and favoritism for years. After Roosevelt's death on April 12, 1945, Kaiser found most of his D.C. access cut off. He soon turned to his ever-growing repository of business ideas.
Kaisr knew that Americans were eager to return to normalcy in a postwar era, and that meant they likely wanted to restore their purchasing power and consumer-driven lifestyles. At the center of that was the automobile, and The Kaiser Company first teamed up with Joseph W. Frazer to produce Kaiser-Frazer vehicles from 1946 through 1951. When sales lagged enough for Frazer to pull out of the deal, Kaiser purchased the Willys-Overland company, which made the successful Jeep models, and moved operations outside of the U.S. A restructured version of the Kaiser-Frazer Company, Kaiser Industries, sold Jeeps until the line was purchased in 1970 by American Motors Corporation.
During the war, Kaiser had begun to recognize the American need for greater industrial strength. He had often been quoted as saying that "problems are only opportunities in work clothes," and he seemed to live by that mantra. Seeing that his fellow industrialists were unwilling to expand to meet what he believed would be a surge in postwar demand for raw materials, he opened his own magnesium plant in 1941 in Permanente, California; a steel plant in Fontana, California, in 1942; and an aluminum plant in Mead, near Spokane, in 1946, among several others. Many of these industrial sites generated enormous profits for The Kaiser Company and subsequent owners, while simultaneously creating seemingly insurmountable environmental disasters for states and neighboring residents in the decades following the plants’ closures. According to the Washington State Department of Ecology, "Waste handling practices used by the Kaiser Aluminum Company from the 1940s to the late 1970s led to cyanide and fluoride contamination in part of the Spokane-Rathdrum Prairie Aquifer and the Little Spokane River" ("Kaiser Mead ...").
Lasting Legacy
Though Kaiser is remembered for many contributions to American development during the twentieth century – most, arguably, for the betterment of humanity – many of his less-notable ideas were still brought to fruition in an attempt to make them profitable. Hawaiian resort communities, trans-Pacific shipping, manufactured housing, aerial cargo transportation, small-airport construction, geodesic domes, and home appliances and products were all arrows in Kaiser's seemingly bottomless quiver of business ideas. Some he tried and failed, others – as was the case with the aerial cargo transportation – literally never got off the ground.
His wife Bess, who had been suffering from a long illness, died March 14, 1951, at age 64, leaving Kaiser a widower at 68. It wasn’t a title he held for long, however; he married again less than a month after his wife’s death, to Alyce Chester, the 34-year-old nurse who had been caring for Bess in her final days. The couple jetted off to Jamaica for a two-week honeymoon, and permanently relocated to Hawaii in 1954. Not one to kick back and relax despite the tropical environment, the aging Kaiser continued to generate business ideas in his new surroundings, eventually building and operating a hotel resort near Honolulu. After he sold it to Hilton in 1961, that company used it as the location for Elvis Presley’s movie, Blue Hawaii.
Though he had suffered several heart attacks and was significantly overweight, Kaiser could legitimately say he had never stopped working by the time he finally died in his sleep at 84 years of age on August 24, 1967. The experimental gamble he had taken on Dr. Sidney Garfield while building the Grand Coulee Dam, and later at his other businesses, had grown and evolved over his lifetime to become the paramount benefit his companies offered their employees, and soon Kaiser Permanente, as it became known, opened to the general public. As of 2023, it served members in California, Colorado, Georgia, Hawaii, Maryland, Oregon, Virginia, Washington, and Washington, D.C., operated 39 hospitals and more than 700 medical offices, and employed more than 300,000 personnel, including more than 87,000 physicians and nurses.
