Howard Hughes (37 page)

IN THE TWA case they’d been trying to subpoena me for six months but they hadn’t been able to find me. I know how to vanish, I’ve had decades to practice. For the most part I was playing golf in Hawaii or traveling with Helga, both activities under another name.

We went to Paris. Helga took me to all the art museums and I developed a taste for the Impressionists. I even bought a dozen Monet, Degas, and Renoir oils, not because I thought they’d go up in value, although I suspect they will, but because I really liked them. I decided not to hang them anywhere – I was sure someone would get wind of it and try to steal them – so I wrapped them up in a lot of cardboard and paper and crated them and stored them in a locker I rented in Orange County, California. They’re not even in my name. I arranged for a bank to pay the rental forever, and I padlocked the storage locker, and I have the key. If I died tomorrow, no one would know what lock that key fit, and those paintings would sit there forever.

You’d better do something about that. You could be hit by a bus, and the world would lose a dozen important paintings.

Yes, I will. Remind me, will you?

Anyway, during that period when I was dodging the lawsuit, and Jean and I had separated, Helga and I rented a little house in France, in a village just outside of Aix-en-Provence. I set out to learn French. It’s one of the few things in my life I’ve tried hard to do where I failed miserably. One of the others is to become friendly with French people. They’re charming, and often cultured, but for a man like me they’re
Martians. And, although they respect my eccentricity, in other respects they regard me as someone from Pluto.

Meanwhile the flood of subpoenas mounted, demanding my presence in court, and eventually I couldn’t ignore them. From Marseilles I flew back to the States and conferred with my lawyers. It was a dollars and cents proposition in many ways. If I appeared I might be able to win the case, or more probably the judgment against me could have been reduced to ten or twenty million dollars. As it was, I knew that if I didn’t appear it would cost me well over one hundred and forty million.

But at that point I rose to the occasion. I felt I had demeaned myself so much by this enormous involvement with the case, and with the fight for control of the airline, that I couldn’t go any further without destroying myself. There was something in me, thank God, that really fought against this self-destructive process that had been the theme of my whole life, and I clung to that something like a drowning man clings to a plank.

When it came time, when I was subpoenaed, the horror of it finally got to me. I made a vow then that I would not only not go into that court, but never go into any court again in my life, either to defend myself or to attack anyone else.

I was fed up with the niggling, mean, unimaginative aspects of the business world. But I had visions of worthwhile things to be done in that world. There was nothing small-minded and petty about those visions, including what I tried to do in Las Vegas. But I’ll get to that in its proper place.

The upshot of the TWA lawsuit, however, was that they got a default judgment against me for $137 million and they threw out my countersuit. It was a judgment with treble damages.

A bond was put up by Toolco. The issue is still in the courts, and it’ll probably stay there as long as I’m alive. I don’t need the money, but those bastards aren’t going to get their hands on it. I’ve got that money earmarked for a nobler purpose.

The lawsuit, in any case, was totally unjustifiable. Of course they did
their damndest to justify it. Ernest Breech made a public statement, just the sort of thing you would expect him to say, to the effect that as the new president of TWA he had an obligation to the stockholders and to the people who worked for the airline to sue me. He felt that was a cardinal principle of American business – the obligation to the stockholders to sue. It was a lot of doubletalk, because he forgot to mention that I was the principal stockholder and he was suing me with my own money.

After I went through the horrors of that lawsuit and the countersuit and the demands that I appear in court, I was totally fed up. I washed my hands of the whole thing.

But you held the stock.

I still liked TWA as an investment, and I liked it until 1966, when I sold it. Everyone has written that Ernie Breech and Charlie Tillinghast, who followed him, did such a great job of managing the airline and therefore made my fortune, or part of it. That’s a lot of crap. Tillinghast did do a good job of managing the airline, but that’s no more than you expect of the president of an airline, and the years between 1960 and 1966, when I was relatively inactive in TWA, using my weight here and there and holding the stock, were boom years in the American economy. Everyone prospered. I fail to see why such great credit should be given to Tillinghast and why everyone should demean me. If I had been running the airline, it would have prospered in exactly the same way, or maybe even better. They were also boom years in the stock market. That was the big bull market – with the exception of the 1962 drop it was just up, up, and away, until the spring of 1966.

I had taken my licking in the stock market back in 1929, just like everyone else, and after that I took the market a little more seriously. On my payroll I had what’s called a technical analyst. A technical analyst doesn’t just look at the value of a company. He looks at the movement and internal conditions of the market as a whole, and he looks at the movement of an individual stock, and he says, based on the price-and-volume movements of that stock, ‘It’s going to go up, or
it’s going to go down.’ He doesn’t care whether it’s TWA flying around the world or whether it’s some company in Dogpatch that makes toothpicks. That toothpick company – if the movement of their stock is healthy, then it’s a buy. And if the price-and-volume dynamics of a stock like Xerox is poor, then no matter how good the company’s prospects look, then it’s a sell.

At the end of ’65 and the beginning of ’66, if you were at all aware of the internal condition of the stock market, you knew it was going to fall on its ass. In my view the market is a law unto itself. Stocks are worth only what people will pay for then. There are many old sayings about this: ‘Don’t fight the tape,’ and so forth – meaning that if you buy a stock and that stock goes down, then you were wrong to buy it, despite the fact that everything may look good for that company and you can’t understand why the price of the stock should sag. The fact that you can’t understand it doesn’t mean a thing, except that you can’t understand it. I once had a talk with Bernard Baruch about this and he disagreed with me. But I’ve made a lot more money out of the market than Baruch ever did. And with him it was a full-time occupation.

In the beginning of 1966, people on the inside and the banks who fix the prime rate of interest knew that the market was headed for a terrific drop. And I knew it, too. Every single technical indicator confirmed it. That’s when I decided to sell. Moreover I had other uses for the money. I didn’t see any sense in it just sitting there in stock certificates when I had already formed a plan – more than a plan, a vision – about the Las Vegas area, for which I needed cash. I’d been thinking about this for several years already. So, to put things as simply as possible, I decided to sell out my block of TWA.

It was the second largest underwriting in history. Merrill Lynch did the job for me, palmed off a lot of the business on other people, spread it around and did a very competent job. I have to give them full credit for that.

Nobody knew whether the fact that I was dumping was of any significance. They could have decided that I knew something that other people didn’t know – and the stock would have plummeted.

Or, as in fact happened, they could have decided that this was a tremendous buying opportunity. TWA had been virtually a privately-held corporation until then. I owned seventy-eight percent of the stock. Wall Street banged the drum that this was a great opportunity for the American public to have a share in a company that had previously been closed to them. The stockbuying public and the mutual funds liked that idea. They came running like chickens to a bag of corn. They bought. An example of mass stupidity.

They bought at $86 a share, which was just about the top, the
all-time
top, for the stock. The underwriters and Merrill Lynch got their cut out of it, you can be sure of that. They never lose. Merrill Lynch made more than $3 million, and there was another fifteen or sixteen million that went to other brokerage houses and all those other guys who dip their fingers in the pie. You know those gravestone ads – this was one of the longest in history, and some very fine firms were associated with it.

The check was placed in my hands for something like $566 million, which was the largest check ever issued to an individual, to my knowledge. I packed the bundles of cash in my suitcase and flew to Las Vegas.

You took that much cash with you?

No, no, that’s just a figure of speech. I rarely have more than a
five-dollar
bill in my wallet. I didn’t have enough money on me the other night to pay you that bet on the baseball game, did I? I’m cash-poor, I’ve told you that.

IN 1965, AS the TWA debacle was winding down, I moved my center of operations to Las Vegas, Nevada. For reasons I’ve never been able to understand, that move, and my residence there, captured the attention of the media more than anything else I’ve ever done, including breaking all those transcontinental and round-the-world air speed records. In the most recent years of my life I’ve received such an extraordinary amount of publicity that if you’d been reading the newspapers and watching television you would have thought I was setting up a separate kingdom in the state of Nevada with the Desert Inn Hotel as its capital.

When I bought a dinky little airline like Air West and changed it to Hughes Air, the business world behaved as though I were trying to take over Pan Am and United Airlines rolled into one. When I tried to get control of ABC you would have thought, if you subscribed to the
Wall Street Journal
, that the Russians and the Chinese were infiltrating the entire U.S. television industry.

And yet, paradoxically, my business life in recent years – and that includes the Nevada operation, which involved an expenditure of close to a billion dollars – was of little interest to me. Because these last years have been a period in my life when, for the first time – up to a point – I was able to let my business operations grow by themselves, so that I could do what I wanted to do, quietly and anonymously, in my private affairs.

I say ‘up to a point’ because of course I couldn’t just abandon the
habits of a lifetime and keep my hands off enterprises that had a
far-reaching
purpose – and into which, incidentally I’d sunk a good part of my fortune. And there were times, I’m sorry to say, when I got involved right up to my eyeballs and beyond. I tried to take over the American Broadcasting Company in 1968, with a tender offer through Toolco for a controlling interest in the stock, about two million shares, but ABC management opposed me. It was the same old story – I was going to do the company irreparable harm. Get the logic of this. The stock was selling for about $58 a share before I made the offer. I offered $74 a share. Naturally the stock jumped to over seventy. That’s what they call ‘irreparable harm.’ They ran ads begging their stockholders to turn me down, and I came up 400,000 shares short.

With that, and other endeavors, I had to do a hell of a lot of organizing, because once I’d fired Noah Dietrich I was alone up there on the top of a pretty big heap. And then came the plunge into Las Vegas.

How did you manage to keep your affairs in order with your
right-hand
man gone?

Call him my left-hand man. I was always my own right-hand man. But I have to admit that it was a problem. The first person I turned to was Bob Gross. I tried to get him to take over the stewardship, I guess you’d call it, of the Hughes empire. He was still president of Lockheed. He didn’t want to give that up.

And in 1961 he died, which was a terrible blow for me because he was the best friend I’ve ever had since my youth. I’m not being egoistic when I say it was a blow for me. For Bob it was simply a quick finish.

When you’re alive you fear death, but when you’re dead, you’re dead and you don’t know a goddamn thing about it. I never feel sorry for anyone who dies. I feel sorry for the ones they leave behind and, all too often, alone. I mourn, if I ever mourn, for the living. They suffer. The dead just decompose.

I was no stranger to Las Vegas. The first time I went there was just after I’d gone on a little riding trip in Death Valley with Ruth Elder, my pilot pal. That was around 1930. We’d been away for a long weekend and ridden out into the desert, under a blue sky without a single cloud,
although it was baking hot. Then we had an accident. Ruth’s horse was bitten by a rattlesnake, and panicked. Ruth held on, she was an excellent horsewoman, but the poison went through that horse like crap through a goose. He fell dead before he’d gone a hundred yards. Ruth landed clear, but that kind of took the bloom off the day, and we left Death Valley.

We spent the night in Las Vegas – my first sight of the town, which was just a pimple in the desert, with probably not more than five thousand people living there. Gambling was illegal. There were some tinhorn joints downtown but no one in his right mind would go in there.

Later I visited again, flying out from Hollywood. I flew over the whole state of Nevada ten or fifteen times. Every time I looked down I’d say, ‘What the hell is that? That wasn’t there before!’ The towns seemed to be leaking out from the center – Las Vegas in particular. And I got interested in it. First of all, I liked clean, dry desert air. Germs can’t live well, I thought, in that kind of air.

Later on I wanted to locate the avionics division of Hughes Aircraft there and I had business meetings in Nevada with Bob Gross and Zeckendorf and dozens of other men. In 1950 I rented a bungalow out there. By then the town was moving right along. But I still had no real interest in buying in. I did pick up a little real estate – fifty or sixty thousand acres here and there. I did that in Arizona, too, in Scottsdale, because I could see that area had the potential for tremendous development. I’ve still got that land in Arizona – I’m damned it I know what’s happening to it.

Then, around 1960, I became seriously interested in Nevada. I looked into the future and I saw the tremendous pace with which the airline and the aircraft building industry was accelerating. The SST was an inevitability.

By the mid-1960s I was ready to move. What I lacked then was sufficient liquidity, and that was supplied when I dumped my block of TWA stock on the market. Then I had half a billion dollars ready cash to play around with.

I moved into a hotel, the Desert Inn, rented the top floor, the ninth
floor, and set up headquarters. One day they announced to me that they needed part of the ninth floor for some big gamblers who were coming to Vegas for Christmas, and they always had those rooms, and would I mind giving them up? Well, I did mind, and I already had the Desert Inn on the list of properties I wanted to buy – but this business of their asking me to vacate some of the rooms on the ninth floor seemed to me like a golden opportunity to make one of those gestures that endear you to the hearts of the local citizenry and also throw a bit of a scare into the local politicos. So I said, in effect, ‘No, I’m damned if I’ll move. I’ll buy the hotel before I do that.’

And I bought it for $13 million cash. But it took a while, because the place was owned by a syndicate, and I insulted the head man, some racketeer named Moe Dalitz. I had a private meeting with this guy Dalitz, who I disliked. The meeting took place a short time before Christmas, because he said to me, ‘Mr. Hughes, it’s my birthday in a few days, and I’d be honored for you to come to a little birthday party I’m having.’

I said I’d try to make it. Naturally, I had no intention of doing so. He said, ‘It’s going to be in your honor as well, Mr. Hughes, because I have the same birthday as you.’ I felt a certain sense of revulsion at that idea. I said, ‘I haven’t celebrated my birthday since I was twenty-one years old. Birthday parties are for children,’ and I walked out of the room.

I had the same set-up there in the Desert Inn that I’ve always had where I live. I’m indifferent to my surroundings as long as the basic comforts are there. My own apartment on the ninth floor was sparsely furnished, except that when I first arrived and started buying stuff I somehow acquired a huge Persian carpet that had belonged to Adolf Hitler. It was a beautiful old carpet and it cost thirty thousand dollars. It wasn’t worth that much, of course, but someone in my organization no doubt got a fat kickback. Hitler had eight of them made for him back in the Thirties, woven by eight master weavers from the Arab countries. This one wound up on my bedroom floor in the Desert Inn. I used to pace back and forth on it and sometimes laugh like hell when I realized what I was doing. Good thing the newspapers didn’t know about that. They would have had a field day.

Other than the extravagance of Hitler’s carpet I had my amplifying equipment and closed-circuit television installed. I did have the drapes changed. They were too flimsy. I don’t like the idea of the awareness of time passing, so I had very heavy drapes put in to keep out the light. That’s something I’ve done all my life. I’ve refused to be a slave to time. And one way I’ve been able to get around it is to insulate myself against light from the outside so that, since I have no clocks and no watch, I don’t know what time it is. I run by an internal clock. When I want to sleep, I sleep, and when I want to work, I work. And when I want to pick up the telephone and call somebody, I call them. I don’t know if it’s noon or five o’clock in the morning or what.

That inconveniences a lot of people, doesn’t it? To be called at three and four o’clock in the morning?

I’ve discovered that when I call a man in the middle of the night, wake him out of sound sleep, I’m liable to find out precisely what I want to know, whereas if I ask him in the daytime when he’s
wide-awake
and prepared, he’ll be more guarded. I’ve got a lot of interesting answers out of people at four o’clock in the morning, much closer to the truth, because they’re befuddled, and their defenses are not up to par. You may think that’s unsympathetic and Machiavellian of me, but it’s a fact that truth comes out more readily from a man’s lips between the hours of midnight and dawn.

This also applies to some of my business deals which were concluded after long sessions in uncomfortable surroundings, when my opponent, I’ll call him that, was exhausted and broken down and gave me concessions which I couldn’t otherwise have obtained. I realized after several meetings with a man at three or four o’clock in the morning, the poor guy would be beat up and exhausted, and undoubtedly say to himself, ‘I can’t stand another one of these meetings with this Hughes guy, I’ve got to close this deal right now,’ and he’d close it more or less on my terms to avoid another session and another series of phone calls. Men are slaves to sleep. It’s a terrible weakness.

Please don’t think I always plan it that way. I’m not cruel. I’m oblivious to time. And I never twist anyone’s arm. Zeckendorf and
Rockefeller bitched forever about those meetings in Las Vegas, but nobody put a gun to their heads and forced them to come.

The idea of the Desert Inn hideaway was to live simply. I saw very few people. My apartment was stocked with food and medicines for a month’s stay if I wanted to be alone, and there were many times that I did. Fresh foods and mail and books would come through the door in a special arrangement we had. Weeks would pass when I would refuse to see anybody or even answer memos. When I made telephone calls nobody knew where the hell I was telephoning from. I didn’t need newspapers. If I want the news, if I want to know what a mess the world is in, I turn on the television.

What about the maids?

If you don’t sleep in a bed, you don’t need a maid. Anyway, I’m used to making the bed myself. I’m nearly sixty-six years old and I’m not an acrobat, but I’m not helpless. You think I want dirty hands touching my sheets? If anyone makes my bed other than me, it’s someone I know very well. And he or she is wearing white gloves.

I’ve got no interest in gambling joints and gin palaces, except that they provide an interesting theater to observe human foolishness, but after the Desert Inn I bought a controlling interest in the Sands, and then the Castaways and the Silver Slipper, and eventually the Landmark, and one or two other places, including the Krupp Ranch, and a couple of little airlines around there, like Alamo Airways. Oh, sure – also Harold’s Club in Reno. I also bought a few mining properties. I got my people well set up vis-a-vis the local officials in the gambling department of the state. Governor Laxalt made a public announcement that I was the greatest thing ever to happen to the great state of Nevada.

It was impossible to do this discreetly. In fact, it was not my purpose to do it discreetly. My decision was, if I was going to succeed in my overall purpose, the image of Las Vegas had to be changed. Now, it’s totally impossible to root out all the corruption in a place like that. I didn’t even try. But since the American people think almost entirely in images, and you can convince them that red is blue and black is white
if you drum it at them hard enough, we worked at it diligently. We couldn’t erase the idea that Las Vegas was the sin capital of the United States, but we could certainly erase the idea that it was
Mafia-controlled
. And it no longer is. It’s Hughes-controlled.

Around that time, didn’t you provoke Frank Sinatra into an argument, and have him thrown out of the Sands Hotel?

He got annoyed because I’d cut off his credit at the Sands.

You don’t call that provocation?

We adopted a strict policy of cash on the line for the slow payers, of which Sinatra was definitely one. I didn’t see myself in the role of a private loan institution for freeloaders and aging glamor boys. I had nothing against Sinatra personally, although he may have born a grudge against me from the time I helped Ava Gardner escape his clutches. I guess he did try to make peace – he once sent me a television set as a Christmas present, which astounded me, and I gave it to one of the Jamaican maids in the Beverly Hills Hotel. I had no relationship with the man. He was just a loudmouth blusterer, a crooner who liked to play tough guy. Lost his voice, which is why he retired. Now he pumps himself full of Jack Daniels sour mash and silicone. He has hair planted in his scalp, like grass on a lawn in a heat wave. What can you say about a man like that except that he’s an idiot who can carry a tune?

To get back to my purchases: all of them were minor and preparatory.

My over-all purpose in Nevada had to do with the coming of the SST, the supersonic transport. I wanted Las Vegas to be the western port of entry to the United States for the SSTs. In order to accomplish that I had to have some clout in the state of Nevada. That’s why I bought all those properties, the hotels and the mines, to establish myself and my people as a fixture and an asset before I set the wheels in motion on the major project. I saw the SST as an inevitability – and I still do – but I didn’t believe, as most other people did, that the inevitable west coast port of entry was the Los Angeles area. When you’re dealing with the size and speeds of aircraft like the Concorde and the Tupolev and the new Boeing – the three SSTs that are in
various stages of manufacture and design at the moment – you’re dealing with entirely new concepts, and it’s fatal to think along conventional lines.