Next thing I knew, Spyros called me and said, ‘William Zeckendorf, the urban developer and the owner of the Chrysler Building in New York, and Laurance Rockefeller, the family’s venture capitalist, want to come out and visit you. They’re interested.’
‘Interested in what?’
‘Buying you out. You told me you wanted to sell, didn’t you?’
‘Oh, sure,’ I said. ‘Send them out.’
Now, I thought, I can get a free price on the whole thing – Toolco, the aircraft division, RKO, TWA. I even threw in the brewery. Spyros arranged a meeting. I gave them the full treatment. I didn’t want anyone to know that I was meeting with William Zeckendorf and Laurance Rockefeller, because that would have provoked all sorts of rumors, so I told Zeckendorf he was to meet my people at such-and-such a street corner and then transfer to another car. We talked there for a while. Then I thought they might like a plane ride. I flew them down to Las Vegas in my B-19 bomber, which I’d outfitted with a bed and big easy chairs, a bar, even a partners’ desk.
Sometimes I use this so-called eccentricity of mine to my advantage in business dealings. If you move people around enough, make a cloak-and-dagger operation out of it, that throws them off balance. I was also concerned that we were being spied on in Los Angeles, and therefore Vegas would be safer. So I told them to meet me at Santa Monica Airport at one o’clock in the morning on a runway, and wear dark clothes. White shirts are very conspicuous at night.
Was there a deal in the works by the time you arrived in Las Vegas?
There was an offer. They were serious, except that Zeckendorf wanted to make part of the payment with California real estate, and I already had plenty of that. They started out around a billion and change, and eventually I worked that up to around a billion and a half.
I said, ‘I’ll think about it.’ I wanted to see if they’d jack it up to $1.8 billion which is roughly what I figured it was worth – what I hoped it was worth. But one and a half wasn’t bad, either. It got bogged down somewhere up around there. They went back to New York, and finally I told the switchboard at 7000 Romaine that if Zeckendorf called, I couldn’t be found. I think it was around then that I went to Cuba to see Ernest Hemingway.
Zeckendorf yapped to the newspapers – he was insulting, said it was unpardonable of me, and I was a man without a conscience for having changed my mind that way. That was a baldfaced lie, because I’d never changed my mind – my mind was made up from the beginning that I had no intention whatever of selling. As I said, it all sprang from a misunderstanding on the part of Spyros Skouras, because he was a Greek and couldn’t speak English very well and I got bored listening to him and just nodded and said, ‘Yeah, sure.’ Zeckendorf must have known about the Dillon Read deal falling through in 1948. He wouldn’t meet my price, and I certainly didn’t feel sorry for him. It was me who paid the hotel bills in Las Vegas.
After Zeckendorf and Rockefeller had made their offer, I realized that I owned an exceedingly valuable property, and I certainly wasn’t going to sell it, despite the fact that this would have pleased my managers, who didn’t like the Hughes method of doing business. They wanted a more conventional establishment. They didn’t realize it was the unconventionality of my approach that made Hughes Aircraft possible. I had given these men free rein, they had put together a highly productive team, and now they were going to smash it all up.
Things really came to a head when Noah Dietrich found that the inventory accounts were overcredited with several million dollars worth of parts and we were unintentionally defrauding the government by overcharging them. Profits were supposed to be limited to 11% of our cost, and if our cost figures were way out of line, then we were making more money than we were entitled to – it was a matter of only five million bucks.
Eventually we paid up, and the government got their money. And eventually I managed to piece together the true story – because, as it turned out, that $5 million repayment to the Air Force was only the first installment. That was a repayment on one contract only.
The full amount of the repayments eventually totalled $43 million, and Noah Dietrich called in a team of auditors from Haskins-Sells. They got to the heart of the trouble. A couple of the top people on the managerial end got bonuses based on the profits of the company, so that if Hughes Aircraft could make an additional $43 million they were in line for bonuses of close to two hundred thousand each.
I knew nothing. I was in Cuba at the time. It all split apart when Noah reached over the generals’ heads and fired the comptroller, Then George quit; he was the administrative head. Tex Thornton quit. Woolridge left, and Simon Ramo, and a whole flock of their top men with them, and it looked as though the company was coming apart at the seams.
The Secretary of the Air Force, Harold Talbott, asked for an appointment with me. I had to grant it, and we met in my bungalow at the Beverly Hills Hotel. Talbott had a bad temper and he gave me the rough side of his tongue. Of course each time he said something I didn’t like, I pretended I didn’t hear him. He threatened to put me out of business. The Air Force would cancel all our contracts, every goddamn one of them.
I kept saying,’ What? What? I can’t hear you,’ because I figured that after a while he’d cool down.
But he didn’t. The best I could get from him was ninety days to straighten out the mess. Talbott insisted that at the end of that time I’d either have to sell to Lockheed or I’d have to accept a new management appointed by the Air Force. I finally accepted the new manager. They put in William Jordan, who had been president of Curtis-Wright. They had to make sure these fire-control and other devices kept coming off the assembly line – we were in the Korean War. It was tapering off, but they knew they would have to find another war to take its place, and they were already casting their eyes on Vietnam. Without a war every now and then, those goons are out of business.
They had me so scared they were going to take the business away from me that Tom Slack, one of my lawyers, came to me one day with an idea. He said, ‘Howard, you want to make a safe haven for the aircraft company where the government can’t get its hands on it.’ It was his idea that we create the Howard Hughes Medical Institute and turn Hughes Aircraft over to it. I thought at the outset to start this up in Texas, in Houston, where that big medical complex existed already, and for a while that was under discussion. But it leaked to the papers, and everybody was talking about how Howard Hughes was going to give $125 million to the Texas Medical Complex. They were drooling at the mouth in Houston. But by that time I was fed up with Texas, and I felt that the last place I would put my money would be with those people who threw me out of the state.
I may be exaggerating. They didn’t throw me out of the state. But they didn’t want me back. They wanted the jobs I could provide. But they didn’t want me personally. I was too funny a duck to paddle around in Texas among those beautiful Texas swans. I was the ugly duckling, even though I laid the golden eggs. And so my lawyers and I organized the Hughes Medical Institute in Florida and put the Hughes Aircraft company under its wing.
This had one drawback, which didn’t turn up until later. Noah explained that if I needed money at some time in the future, I couldn’t use the aircraft company assets for collateral or put them up for sale, because it was now a public trust. But I didn’t think a situation like that would come along, and besides, I had plenty of money stashed away by then in Switzerland and similar places, for a rainy day. But from that point on I stayed out of the aircraft company’s affairs. All my ideas get funneled into the company through Toolco and various people. We’ve got an order backlog of close to a billion dollars and this year, as I understand it, we’ll sell another billion dollars worth of equipment. It’s the finest company of its kind in the United States. We just developed something called the Lasermatic. That’s a laser beam, controlled by a computer – it cuts cloth. Sold them to Genesco, and that’s going to revolutionize the garment industry.
What about the Medical Institute? The Pat
man report accused it of being a tax dodge.
Don’t parrot back that garbage to me. The Institute’s done some fine things. They’ve sent research scientists to Harvard, Yale, Johns Hopkins, everywhere, and I’ve never gotten any personal benefit out of it in the way of treatment. I’ve never even been there. Never laid eyes on the place. They never even gave me an aspirin.
Then as far as you’re concerned it’s not a tax dodge.
It’s every man’s privilege to avoid paying taxes. That’s the European attitude and that’s the one I subscribe to. I don’t want to discuss it anymore.
Early on, when you were talking about Zeckendorf, you mentioned that you had real estate in California. Does it amount to anything?
It amounts to quite a lot – in value, at least. And it also at that time amounted to a headache. In the middle fifties, Los Angeles wanted to build the Playa del Rey Marina, and they needed land. I had twelve hundred acres adjoining the site – the last big chunk of land in the Los Angeles metropolitan area. I had bought it many years before. I own hundreds of thousands of acres of land, in all parts of the United States, that I bought at various times. I don’t know where half of it is.
I’d bought this land in California for about $1,500 an acre. That’s cheap. And by 1955 it had gone up in value considerably, but I thought it was going to go up still further and I didn’t want to sell it.
I told Noah, ‘Don’t sell any of it to those marina people. I’m not interested.’
‘But suppose they offer a good price? How much would you consider selling for?’
‘Not for less than fifty thousand an acre,’ I said.
I hadn’t kept in close contact with land values. I only named that price because I didn’t want to sell the land. It was a ridiculous price. But they pulled a fast one on me. The city filed condemnation proceedings against me in order to force me to sell them the land they needed for the marina. It’s the same as if you have a house in the middle of a proposed highway route; they file condemnation proceedings and that’s it. You take what they give you, and you get out. I was in the same position.
Meanwhile I’d gone out of sight, and my lawyers were holding up the proceedings by employing the usual delaying tactics. It would have taken a good long time before anything would have happened with the condemnation procedure, but in the meantime Noah continued some quiet negotiations.
Finally he came to me and said, ‘Howard, I had to sell them an acre and a half, just to keep them off your back a while.’
‘For Christ’s sake,’ I squawked, ‘I told you I didn’t want to sell any of that land for less than $50,000 an acre. How much did you get?’
‘I got $62,000 an acre,’ Noah said.
That took the wind right out of my sails. ‘All right, an acre and a half. But don’t sell them any more. Got to pay taxes on all that profit.’
However, once the thing got going, it was like a snowball rolling downhill, and I sold them about 120 more acres. I realized after a while I must have taken a screwing when they bought the first lot for sixty-two thousand. I operate under the principle that if a man accepts my offer I must have offered him too much, and if a man agrees to pay what I ask him for something, then I’ve set the price too low. So I wound up asking $77,000 an acre. ‘Take it or leave it,’ I said.
They took it. That’s not bad, is it?
23
Howard receives a black eye from a football star, evades marriage with Lana Turner, and reveals a dark secret from his love affair with Billie Dove.
MY PRIVATE LIFE during those years was a swamp of complications. I was swimming as best you can when you’re in a swamp – from woman to woman, getting involved and then getting uninvolved, and it sapped a good deal of my energies. There’s no satisfaction in that way of life, and certainly no salvation.
I had an affair at that time with Terry Moore, the movie star. It started in 1950 and it lasted quite a while. It was interrupted when she married Glenn Davis. He was the West Point football star, the Mr. Outside of the combination that won all those games for Army. Mr. Inside was Doc Blanchard. Terry wasn’t really interested in Davis in spite of the fact that they got married. It was one of those harebrained things that happen, particularly in Hollywood. And later, when she came back to Los Angeles, we took up where we left off. That is, back in the sack, making whoopee.
Things worked between me and Terry. She had a straightforwardness which I appreciate. The problem was her husband, Glenn Davis. After she left him and came back to me, he arrived ranting at my bungalow in Malibu. When we opened the door he walked up to me and belted me on my ass without another word. I’m tall, but I was skinny – I wasn’t a football player – and he knocked me flat on my back. I walked around with a big black eye for days afterward.
He accused me of breaking up his marriage, which was a lot of horseshit, because the marriage was broken up long before that night. I didn’t bring Terry at gunpoint, she came to my bed all willing. So this obviously wasn’t my doing.
What other women did you know in those years?
There was Gene Tierney, the actress, a beautiful woman – that was another time I got hit. I met her at a party given by William Randolph Hearst; he was always giving big parties up at San Simeon and throwing women at me. Gene was married to Oleg Cassini, the designer, and one afternoon when I brought her home from a walk on the beach Cassini was hiding in the garage waiting for us. He leaped out and clipped me. I ran away. The next time I saw him was at a Hollywood party and he threatened to brain me with a cut-glass decanter. I had to hide in an upstairs bedroom and call for help. Ginger Rogers was another one, although I can’t remember who she was married to. At least he never jumped out at me. I stopped going to parties after the Cassini assault. It was too dangerous.
Did you get a kick out of involvement with married women?
The truth is, I didn’t hunt for them, they hunted me, and I guess during that period I enjoyed the company of attractive and witty women and I didn’t duck their attentions. Obviously none of them was in what I would call a good marriage. And in one sense it was safer than an involvement with a single woman who was looking for a husband – although as I’ve mentioned, there were physical risks.
Before Terry and Gene and Ginger, and after, I was involved with Lana Turner. A story went the rounds that Lana had her sheets embroidered H.H. because she thought I was going to marry her. I was supposed to have said, ‘Well, go marry Huntington Hartford.’ But that wasn’t true. I would never be so crude. I just told her, ‘In a pinch, you can always sell them to Huntington Hartford.’
There were plenty of women who were under the impression that I wanted to marry them, although I never said so or even hinted. For a while I was taking out some of these society girls, and they’d announce to the papers every other week that wedding bells were going to ring in the spring. That’s what they would say – really – that’s how their minds worked. ‘Wedding bells may ring in the spring for Howard and me.’ I’m talking about Gloria Baker and Tim Lansing and Meg Lindsay, and a few others. There was nothing really happening there. I suppose I did see Gloria Baker somewhat more than the others. I flew her once from New York to Los Angeles, and by the time that flight was over and she’d chewed my ear for fifteen hours I thought, God, I’d rather hear wedding bells in the spring with a female baboon than this girl’s voice every day of my life, and I ended the relationship right there at the airport.
Usually I let these girls think whatever they wanted to think. I never put anything in writing. My father once told me: ‘Do right, and fear no man. Don’t write, and fear no woman.’ That was wise advice and I followed it, especially the last part. You know, they’d say, ‘Wouldn’t it be wonderful, Howard, if we were married?’
And I would say, ‘Uh, uh, uh… yes, maybe… who knows?’ And if they ever got more serious than that I’d complain of an earache.
With Tim Lansing once, I had trouble with her parents. I had met her in Palm Springs and her parents came
down to get her out. I think it was all a plot on her part to get me to marry her. They said she’d told them I’d told her I was going to marry her, and we’d even set a date.
I said, ‘I don’t remember it. You know I’m deaf. I obviously misunderstood.’
They didn’t pressure me any further. I don’t think they thought I was such a great catch. They thought I was a little crazy. That’s another reason why they’d come down to rescue their daughter.
What did it mean to you to have such a succession of quick affairs, on and off, as you put it?
My behavior was based on one of those fallacies that are common to most men’s lives. When you’re young, assuming you’re not a fairy, you think that women are essential to your life. You waste an awful lot of time wooing them or putting the make on them. This is a hangover from adolescence, I suppose, when you’re yearning for a girl and you can’t get one because you don’t know how. My adolescence, and yours too, probably – although maybe not the adolescence of the kids today.
But I went through that as a very young man, and then as a grown man, up to thirty-five or so, and then the physical thing, which had never been very big with me, tapered off. But the habit didn’t. The habit of seeing women, squiring them around, and the apparent need for feminine company. In those years when I had solved most of my problems with women, when I was supposedly a mature man, I still had this hangover from the earlier years, this habit of wanting women around, of wanting their company and treating them ultimately as sexual objects rather than as people who happened to be female.
Howard Hughes Page 29
