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Foshay built utilities empire and Minneapolis’ tallest building, but lost it all

Wilbur Foshay

In 1932, singer Bing Crosby had a major hit with his recording of E. Y. Harburg and Jay Gorney’s song “Brother, Can You Spare a Dime?” Its lyrics could have been the story of Wilbur B. Foshay: “Once I built a tower up to the sun, brick and rivet and lime/ Once I built a tower, now it’s done/ Brother, can you spare a dime?” Foshay built a fortune, built a tower in Minneapolis—and then lost it all in the stock market crash of 1929.

Wilbur Burton Foshay was born December 12, 1881, to Joseph and Julia Foshay of Ossining, New York. He graduated from the Mount Pleasant Military Academy of Ossining. In his mid-twenties, he worked as timekeeper, gas piper and electrician for the United Gas Improvement Company of Tarrytown, New York.

The utilities field was a growing business in the early twentieth century. Electricity and indoor plumbing were still relatively new. Thomas Edison’s Pearl Street Station in New York City, the nation’s first centralized power plant, had begun generating electricity in 1882. Rural communities were eager to have the home appliances and conveniences already enjoyed by city dwellers.

In 1906, Foshay was hired to manage the local power-and-light company in Hutchinson, Kansas. In 1907, he married the owner’s daughter, Leota Hutchinson Fox, a divorcee three years his senior. During the next few years, the couple moved around the Midwest and West Coast, as Foshay chased utilities jobs. His wife gave birth to two children, William and Julianne.

In 1915, the Foshays settled in Minneapolis. There, Foshay worked for Page and Hill, a manufacturer of electric-light poles and telephone poles. But soon he decided to go into business for himself. In 1916, he borrowed $6,000 and bought the Ponca Electric Company of Nebraska. In August of the following year, he incorporated the W. B. Foshay Company, a public utilities holding company. A holding company’s purpose is to buy shares of existing companies. They gain control over them but do not run the day-to-day business. Foshay would spend the next decade buying up utilities companies.

By 1928, he was a prosperous man, at least on paper. His company owned utilities in thirty states, the then-territory of Alaska, Canada, and Central America. The W. B. Foshay Company had become big enough that Foshay figured it deserved its own skyscraper. He wanted his headquarters to be the most beautiful, and tallest, building in downtown Minneapolis.

What he got was a thirty-two-story Art Deco monolith modeled after the Washington Monument in the nation’s capital. This was not only the city’s tallest building but also the tallest between Chicago and the West Coast. The proud builder celebrated the Foshay Tower‘s opening with a three-day event over Labor Day weekend in 1929.

Two months later, the stock market crashed. The utilities magnate lost everything. His company filed for bankruptcy. In 1931, the U.S. Department of Justice indicted Foshay on charges of mail fraud. He had used the federal postal service to advertise and sell stock in his company, some of which might have been overvalued.

Foshay and his right-hand man in the company, Henry H. Henley, were tried in a much- publicized 1931 court case. The first trial ended without a unanimous verdict after the only female juror, Genevieve Clark, held out for Foshay and Henley’s innocence. Prosecution lawyers later learned that Clark had briefly worked for Foshay’s company. She was charged with contempt of court for not revealing the association.

Foshay and Henley were tried again and, this time, were convicted. They began serving fifteen-year sentences at Leavenworth Federal Penitentiary in Kansas in May 1934. A vigorous letter-writing campaign moved President Franklin Delano Roosevelt to free the pair in 1937. Ten years later, President Harry S. Truman pardoned both men.

Once out of prison, Foshay worked for chambers of commerce in Colorado and Arizona. Penniless, he returned to Minnesota early in 1957 to move in with his son and daughter-in-law. Foshay suffered a stroke that April. He died in a nursing home near Minneapolis on September 1-the twenty-eighth anniversary of the Foshay Tower’s debut.

For more information on this topic, check out the original entry on MNopedia.

Comments (3)

  1. Submitted by Todd Hintz on 12/10/2013 - 11:36 am.

    Drum Trap, Please

    What’s the joke about the IDS tower? That’s the box the Foshay came in.

  2. Submitted by Jon Kingstad on 12/10/2013 - 01:28 pm.

    Changing times. . . .

    Apparently in Mr. Foshay’s time, selling fraudulently watered securities would be a criminal offense. Today, he’d be given few hundred million in stock bonuses and asked to serve on some prestigious corporate and foundation boards. The pity is not that Mr. Foshay died broke and penniless; it’s that people who commit the kinds of crimes he did do not anymore. They are left to believe it’s okay to loot pensions, banks or what have you.

    • Submitted by RB Holbrook on 12/11/2013 - 08:43 am.

      Little has changed

      Mr. Foshay was pardoned largely because of the perception that what he did was pretty common stuff back in the heady days of unregulated markets. His misfortune was to lose everything that he owned. If he had somehow managed to stay wealthy, he would have remained a free man.

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