For parts I, II, & III, see "Henry J. Kaiser, Entrepreneur", "Henry J. Kaiser, The War Years", and "Henry J. Kaiser, Industrialist"
Late in life, Henry J. Kaiser became one of the earliest and biggest
boosters of the Hawaiian tourist industry. He built the territory’s
first destination resort, the Hawaiian Village Hotel. He built a large
housing development named Hawaii Kai. He encouraged the airlines to
increase flights to Hawaii. And he bought television and radio stations,
both in Hawaii and on the mainland, to promote tourism.
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Kaiser’s
Hawaiian Village resort in the early 1960s. The pink on the right are
catamarans; the radio tower at left is probably for Kaiser’s station,
KHVH. |
Because of his cement interests, Kaiser had visited Hawaii before the
war, but — ever the workaholic — he wasn’t much interested in
vacationing. In 1951, however, his wife Bess died. Less than four weeks
later, Kaiser stunned his colleagues and shocked Oakland social circles
by marrying Bess’ nurse, who was just half his age. Alyce “Ale” Kaiser
opened his eyes to new ventures and ideas.
When they visited Hawaii together in 1953, he saw it through the eyes of
a young person looking for adventure. They quickly bought a home in
Hawaii, and, true to form, Kaiser began looking around for investments,
particularly ones that could create jobs for chronically unemployed
Hawaiians.
Hawaii in the first half of the twentieth century was dominated by the
“Big Five,” a group of companies that owned much of the islands’ land.
These companies raised sugar cane on most of the land, providing work
for residents that was strictly seasonal. The Big Five resisted
unionization as well as any potentially rival employers for island
workers.
So picture this: Kaiser is 71 years old. He is nominally in charge of a
huge conglomerate of industries on the mainland, including an auto
company that is hemorrhaging money. He is a newcomer to Hawaii, a
traditionally insular society, and his goals are directly opposed to
those of the most powerful interests in the islands. His top lieutenants
are busy running his mainland companies and have no time to help him in
Hawaii.
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Never hesitant
about product placement, Kaiser rented Jeep Surreys to hotel guests.
Rumor had it that the hotel painted many things pink because that was
Ale’s favorite color. In fact, it was just a successful marketing tool. |
Undaunted, Kaiser sets out to create almost from scratch an entirely new
industry, one that would provide year-round work for thousands of
residents. After considering several possibilities, he decided that
tourism was the best choice. So, in partnership with Fritz Burns — the
southern California developer who helped Kaiser build Panorama City —
Kaiser built the Hawaiian Village Hotel, a destination resort extending
over 22 acres of beach front in Waikiki. The resort included both
low-rise and high-rise hotel rooms, cottages, and various restaurants
and meeting rooms.
A few stories about the hotel illustrate Kaiser’s working principles.
When acquired by Kaiser, the site of the resort already had several
cottages rented to tourists. These were relocated to make room for the
main hotel buildings. One Friday, a city inspector told Kaiser’s foreman
that two of the cottages are 19-1/2 feet apart, when the city building
code requires that they be 20 feet apart. The inspector hinted that, for
a small bribe, he will overlook the code violation.
When told about the problem, Kaiser directed that work crews spend all
weekend removing six inches from one of the cottages. Next Monday, the
foreman informed the inspector, “You must have made a mistake in your
measurements.” The inspector was increasingly puzzled as he repeated the
measurement over and over. Later, the crew let him know what happened.
The lesson for island officials: Kaiser would not pay bribes.
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Publicity photo of thatched cottages and pool from a 1955 brochure. |
The 22 acres on which the hotels were to be constructed were covered
with many graceful palm trees. Kaiser issued orders that not a single
tree would be killed during construction. Instead, as buildings went up,
scores of trees were dug up and replanted in other parts of the resort.
As construction continued, a local union organizer informed Kaiser that
he planned to invite Kaiser’s employees to join the union. Kaiser
responded that he had no problem with that if they wanted to join. When a
majority joined, the organizer returned to ask Kaiser to negotiate a
contract.
“Just bring me a contract that you think is fair to both sides,” Kaiser
said, “and I’ll sign it.” When the organizer brought the contract,
Kaiser turned to the last page to sign.
“Aren’t you even going to read it?” asked the organizer.
“No, I asked you to write a fair contract, one we could look each other in the eye and not be ashamed of,” said Kaiser.
“I just had my boys draw it up,” the organizer hastily responded. “I better check it before you sign.”
A few days later, he returned with the contract, which Kaiser signed
unread. After the organizer left, Kaiser handed the contract to his
staff, saying, “Better see what I got us into.” It turned out that the
contract was fair to all concerned except for one part. In the event of a
dispute, most contracts call for an arbitration committee. This one
read, “In case of any dispute, Henry Kaiser shall be the sole arbiter
and his decision shall be final.”
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The lagoon shown in the 1957 postcard was made by bringing in hundreds of tons of beach sand. |
To enhance Waikiki beach, only a portion of which was naturally sandy,
Kaiser proposed to import hundreds of tons of sand. While most of the
new beach would be public, he asked permission to close a portion of the
beach directly in front of the hotel to all but hotel guests. This was
somewhat controversial, but one long-time member of the legislature told
Kaiser he would guarantee approval in exchange for a $5,000 bribe.
Kaiser politely told him to vote for or against the measure strictly on
its merits. The measure was approved.
The hotel finally opened with a gala celebration in September, 1955. But
fall is not the prime tourist season in Hawaii, so after the grand
opening occupancies were a disappointing 10 percent. This led a
73-year-old Kaiser to travel to the mainland and personally present a
slide show to dozens of leading travel agents to sell them on the hotel.
Occupancies soon greatly increased. To prod the airlines into
increasing service to Hawaii, he threatened to start his own airline — a
threat that, coming from him, would have to be taken seriously.
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Looking a
little out of place in a tropical setting, the Kaiser aluminum geodesic
dome was a popular venue for music and theatre for 42 years. |
Soon after the hotel opened, Buckminister Fuller began publicizing
geodesic domes. Always intrigued by new building concepts, Kaiser
ordered his aluminum works to provide the materials for a 49-1/2-foot
high, 149-foot diameter dome. These were shipped to the resort and
erected in just 20 hours in 1957. Considered the first geodesic dome
ever built, the dome was used as an auditorium and theatre for the next
four decades. Not surprisingly, Kaiser Aluminum supplied many more
geodesic domes for buildings all over the U.S.
To help promote the Hawaiian Village, Kaiser also bought radio and
television stations (including KHVH for Hawaiian Village Hotel),
selected and promoted singers and other entertainers, and held various
sorts of events such as cooking contests, boat races, and movie
premieres. One of the first events in the Kaiser geodesic dome was the
Hawaiian premiere of the movie, Around the World in 80 Days, attended by
director Michael Todd and his wife, Elizabeth Taylor.
When the Kaiser-sponsored television show Maverick went off the air, TV
executives tried to interest him in a detective series. He agreed —
provided it was located in Hawaii, and Hawaiian Eye, which naturally was
set at the Hawaiian Village Hotel, was born. (Ironically, he refused to
sponsor Dr. Kildare or Ben Casey because he thought hospital shows were
depressing.)
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The Kaiser Permanente Hospital in Honolulu. |
When Kaiser started building the Hawaiian Village resort, the Hawaiian
medical association asked him not to bring his Kaiser health care
program, which many doctors then considered “socialized medicine,” to
Hawaii. He agreed provided that local doctors would start their own
prepaid health-care program. Of course they did not, so in 1958 he built
and staffed a Kaiser hospital in just 11 months.
Eventually, his attention turned to other things, and in 1961 Kaiser
sold his half interest in the Hawaiian Village to Conrad Hilton. Hilton
later bought out Fritz Burns and still owns and operates the resort
today (but tore down the geodesic dome in 1999). Last year, Hilton
itself was purchased by the Blackstone Group, an investment company that
also owns La Quinta Inns.
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Henry Kaiser above Hawaii Kai in the early 1960s. |
In 1959, Kaiser started his next big project: Hawaii Kai, a $350 million
model city on 6,000 acres about 12 miles from downtown Honolulu. “Kai”
means ocean in Hawaii, and the development featured a marina, beaches,
underground power lines, cable television, some of the nation’s first
condominiums, thousands of single-family homes, and of course schools,
shopping centers, homeowner associations, and all the other essentials
for a modern self-contained community of around 30,000 people.
One problem was that the two-lane Kalanianaole Highway between Honolulu
and Hawaii Kai was inadequate for the number of people Kaiser planned to
live at the development. When the state requested proposals for a study
to see whether it should expand the road to four lanes, Kaiser went to
the governor and offered to build the four-lane road for the proposed
cost of the study. The governor agreed but said the state would have to
open up the project to bids. Kaiser got the low bid and within four
months the highway was complete for less than the cost of the study.
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Hawaii Kai in
1988. Though Kaiser had planned for an eventual population of 50,000
people, urban-growth boundaries have limited the population today to
about 30,000.
Flickr photo by Alan Light. |
Hawaii Kai sales started slow, but the development was clearly a success
by 1967, when Kaiser died at his home in Hawaii at the age of 85. His
New York Times obituary reported that Kaiser Industries employed nearly
100,000 people making more than 300 different products at 180 plants and
projects in 32 states and 40 foreign countries. The Hawaiian Advertiser
reports that his personal worth was $2.5 billion, which — after
adjusting for inflation — would put him among the twenty wealthiest
Americans today.
Next: "Kaiser’s Legacy"
Randal O'Toole wrote this piece for The Anti Planner published by The
Thoreau Institute, a non-profit organization that seeks ways to protect
the environment without big government. The Institute has prepared
comprehensive analyses of the Forest Service, Park Service, Bureau of
Land Management, more than 150 state land and resource agencies, dozens
of transit systems, and more than a dozen metropolitan planning
organizations.
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