Probably the most mysterious, elusive and downright bizarre billionaire the world has ever known, Howard Hughes is commonly remembered as an eccentric recluse who was horrified of germs and spent the last years of his life shrouded in secrecy. Subsequently before being devoured by his eccentricities, Hughes was an entrepreneur who achieved remarkable accomplishments as a movie producer, an aviator, and an industrialist. In Nevada, however, many saw the obsessive recluse as a cure for Las Vegas’ woes in the gaming industry…the mob.

It was 1966. The mob didn’t know it at the time, but there was a new sheriff in town, and his dice were loaded. The mobsters were still skimming the Vegas casinos and “shoe box money” was still traveling to the east coast, but a billionaire had arrived quietly and began buying up casinos and real estate. The eccentric billionaire, it was speculated, was on a mission. He would de-mob Las Vegas and make the city safe for legitimate business. Mob activity declined during Howard Hughes’ four years in Las Vegas, partly because he bought out many of the old-timers, but also because the federal government was turning up the heat on organized crime in Nevada. Many of the mob looked at it as a “win-win situation”, because they had the Feds on their backs, and along comes this guy that wants to buy them out…legit.

Just by showing up, Hughes changed Las Vegas forever. If one of the richest men in the world, one of the nation’s largest defense contractors and a genuine national hero, was willing to invest in Las Vegas, it must not be such a sordid, evil place after all. He cleaned up the image of Las Vegas. Several heads of large corporations would never have dreamed of coming to Sin City before Howard Hughes came.
Howard Robard Hughes, Jr., was born December 24, 1905, in Houston, Texas. Hughes was born into wealth. His father, an ex-outlaw and oil wildcatter developed a revolutionary two-cone roller drill bit, which allowed rotary drilling through solid rock for petroleum in previously inaccessible places. Howard R. Hughes, Sr. made the shrewd and lucrative decision to commercialize the invention and used the resulting fortune to found the Hughes Tool Co. Howard Junior’s mother, Allene Stone Gano, came from a prosperous family, as well. They were considered to be “monarchs of Dallas society.” The Gano family were descendants of Owen Tudor, the second husband of Catherine of Valois, Dowager Queen of early 15th century England.

Though he grew up in a wealthy household, Howard Hughes, Jr., had difficulty focusing on school and changed schools often. Rather than sitting in a classroom, he preferred to learn by tinkering with mechanical things. Howard demonstrated a great aptitude in engineering at an early age. He built Houston’s first radio transmitter when he was 11 years old. At the age of twelve, he was photographed in the local newspaper as being the first boy in Houston to have a “motorized” bicycle. Young Hughes had built the bike himself from parts taken from his father’s steam engine. He was an indifferent student with a liking for mathematics, flying, as well as things mechanical. He took his first flying lesson at fourteen and later auditing math and aeronautical engineering courses at Caltech.

Tragically, Howard Hughes was orphaned at a young age. His mother Allene Hughes died in March 1922 from complications of an ectopic pregnancy, Howard was only 16 at the time. His father followed her to the grave two years later; the cause of death was heart failure. This left Hughes an estate worth $871,000 and the patent for the drill bit that brought large revenues to the Hughes Tool Company. Their deaths apparently inspired young Hughes to include the creation of a medical research laboratory in his will that he signed in 1925, at age 19. Because Howard Sr.’s will had not been updated since Allene’s death, Hughes inherited 75 percent of the family fortune. Hughes left high school to take control of the company, using its profits to finance a variety of projects which he hoped would make him a legend in his own time. On his 19th birthday, he was declared an emancipated minor, enabling him to take full control of his legacy.

The lion’s share of Howard Hughes’ fortune came about when he hired Noah Dietrich, an ex-race car driver and accountant, to run the Hughes Tool Company. Noah Dietrich is often credited as the “mastermind” behind the Howard Hughes Empire. Many biographers say it was 80 percent Noah Dietrich’s genius and 20 percent Howard Hughes’ taste for gambling that created the fortune. Whatever the situation was, they became a dynamic combination, and together they soared. In a short while Noah had turned a million into 60 million.

At this point in Howard Hughes’ career it is best to take a step back and review the financial circumstances surrounding his life. He, of course, became world famous and was best known as an aviator, movie producer, and eventually one of the wealthiest men on the planet. But he had one heck of a jump start. 60 million is a tidy sum even by today’s standards, but in the mid 1920s, it was astronomical. For example, a Model T Ford cost $290 in 1925 and according to the Consumer Price Index the relative value of $60,000,000.00 at that time would be worth approximately $746,000,000.00 in today’s economy. Close to three quarters of a billion dollars. Howard had a bit of an advantage and, as any professional gambler knows, it’s the players with the largest grubstake that have a better chance at the game of risk.

Howard and his then wife, Ella Botts Rice, moved to Hollywood, where in Hughes fashion, he enthusiastically entered into the movie business producing such films as: Everybody’s Acting (1927) and Two Arabian Knights (1928), both financial successes, the latter winning the first Academy Award for Best Director of a Comedy Picture. The Racket (1928) and The Front Page (1931) were also nominated for Academy Awards. Hughes then spent $3.8 million (the most ever spent on a movie at that time) to make the flying film Hell’s Angels (1930). He produced another hit, Scarface (1932), a production delayed by censors’ concerns over its violence that eventually became big box office. The Outlaw (1943) which featured Jane Russell, also received considerable attention from industry censors, this time owing to Russell’s revealing costumes. Hughes, always the engineer, had designed a special uplifting bra for his leading lady…the Hollywood Bra.

Hughes’ wife returned to Houston in 1929 and filed for divorce. Hughes was fodder for many of the tabloids of the day as he openly dated many famous women, including Billie Dove, Bette Davis, Ava Gardner, Olivia de Havilland, Katharine Hepburn, Ginger Rogers and Gene Tierney.

Hughes was a lifelong aircraft enthusiast, pilot and aircraft engineer. He set many world records and designed and built several aircraft himself while heading Hughes Aircraft. Hughes H-1 Racer set many airspeed records and achieved a new transcontinental airspeed record by flying non-stop from Los Angeles to New York City in 7 hours, 28 minutes and 25 seconds. The plane featured a number of design innovations: it had retractable landing gear and all the rivets and the joints set flush into the body of the aircraft to reduce drag. On July 10, 1938, Hughes set another record by completing a flight around the world in just 91 hours (3 days, 19 hours), beating the previous record by more than four hours. He also had a hand in the design and financing of both the Boeing 307 Stratoliner and Lockheed L-049 Constellation. Hughes received many awards as an aviator, including a special Congressional Gold Medal in 1939 in recognition of the achievements in advancing the science of aviation.

In 1939, at the urging of Jack Frye, president of Trans World Airlines (TWA), Hughes quietly purchased a majority share of TWA stock for nearly 7 million dollars and took control of the airline. Upon assuming ownership, Hughes was prohibited by federal law from building his own aircraft. Seeking an aircraft that would perform better than TWA’s fleet of Boeing 307 Stratoliners, Hughes approached Boeing’s competitor, Lockheed. Hughes had a good relationship with Lockheed since they had built the aircraft he used in his record flight around the world in 1938. Lockheed agreed to Hughes’ request that the new aircraft be built in secrecy. The result was the revolutionary Constellation and TWA purchased the first 40 of the new airliners off the production line.

In 1946, Howard Hughes’ life took a terrible and irreversible turn. While testing a new aircraft in the skies over Los Angeles, his plane lost power and crashed into a Beverly Hills home. Hughes was dragged from the burning wreckage by a passing marine and it was later determined that he had broken nearly every bone in his body. Hughes eventually recovered physically, but his spirit would never be the same. During his recovery, he needed so much codeine to tolerate the pain that he became addicted to the painkiller and would remain so for the rest of his life.

In 1956, Hughes placed an order for 63 Convair 880’s for TWA at a cost of 400 million. Although Hughes was extremely wealthy at this time, outside creditors demanded that Hughes relinquish control of TWA in return for providing the money. In 1960, Hughes was ultimately forced out of TWA, although he owned 78% of the company and battled to regain control. In 1966, Hughes was forced by a U.S. federal court to sell his shares in TWA because of concerns over conflict of interest between his ownership of both TWA and Hughes Aircraft. The sale of his TWA shares netted him a profit of 547 million.

To avoid paying taxes in California, Hughes moved to Las Vegas. He was seriously drug-addicted by then and in total isolation. Robert A. Maheu, a former FBI special agent, was regularly taking assignments, thwarting blackmailers, spying on Hughes’ girlfriends, and increasingly, acting as personal emissary. In 1966, the Desert Inn rented Howard Hughes the entire top floor of its high roller suites, and the floor below it, for 10 days only. Checkout time came and went and Howard Hughes did not move. Moe Dalitz and Ruby Kolod, co-owners of the Desert Inn, were furious. New Year’s, one of Las Vegas’ busiest holidays, was looming, and the suites had been promised to high rollers. “Get the hell out of here or we’ll throw your butt out,” barked Kolod. “This is your problem,” Hughes told Robert Maheu. “You work it out.”

Maheu called in a favor from Teamsters Union President Jimmy Hoffa, who phoned the Desert Inn boys and asked them to leave “my friends” alone. The reprieve lasted into the new year of 1967, when Maheu told the boss he had played out his options with the Desert Inn guys. “If you want a place to sleep, you’d damned well better buy the hotel,” Maheu told Hughes. For most investors negotiating a purchase is the means to an end. For Howard Hughes, it was recreation. After months of give-and-take, Hughes and Dalitz agreed on a price of $13.25 million. Months before his arrival in Las Vegas, the IRS taxed Howard’s money from the TransWorld Airlines deal as “passive” income, at a higher rate than “active” or “working” income. After the purchase of the Desert Inn, Hughes discovered the gross receipts of a casino are considered “active” income. Ecstatic, he called Maheu. “How many more of these toys are available?” he demanded. “Let’s buy ‘em all.”

It was said that Howard Hughes would use every gimmick in the book to avoid the IRS. He’d pay someone half a million dollars if they could help him avoid paying $10 worth of Federal taxes. One time, Johnny Rosselli, known as the mob’s ambassador to Las Vegas and Hollywood, approached Robert Maheu and told him who was going to be the new casino manager. Maheu told him to go to hell. “Not only was Howard Hughes not in bed with the mob,” claimed Maheu, “he was actually working quietly to ease them out of town.”

Hughes’ purchases were of valued properties at good prices. They were excellent investments and not an accident. There was a study commissioned by former Attorney General Robert Kennedy, a blueprint for exorcising the mob from Las Vegas. In the study, the places that needed to be cleaned up were identified. Of course, the best way to clean them up was by purchase. Gathering all the elements together, who else was better equipped to buy, than Hughes? Howard happened to be in the right place at the right time. In order to be licensed as operator of the Desert Inn, Hughes would have to undergo an extensive background check. He also would have to appear before the state Gaming Commission, which he had no intention of doing. Well-connected Las Vegas attorney Thomas Bell was hired to handle the licensing and would stay on as Hughes’ lobbyist in Carson City. The new governor, Paul Laxalt, persuaded the commission to allow Maheu to appear as Hughes’ surrogate. Governor Laxalt saw Hughes as a better option than the mob. He was the sugar daddy Las Vegas needed.

Over the next four years, Howard Hughes purchased several other hotels and casinos, a local television station, Alamo Airlines and nearly 25,000 acres of property surrounding Las Vegas. These new properties, combined with Hughes Tool and other real estate holdings in Arizona and California, gave Hughes an estimated net worth of $1 billion. His next purchase was the Sands, then a Strip showplace. Moe Dalitz was consulted and said that it, “would be a good acquisition.” Howard paid 14.6 million for the Sands, which included 183 acres of prime real estate that would become the Howard Hughes Center. That was followed by two smaller places, the Castaways and the Silver Slipper, then the Frontier. All three had one thing in common: they came with enormous parcels of empty land. He made a deal to buy the Stardust for 30.5 million, but was prevented from closing by the U.S. Securities and Exchange Commission which was worried about Hughes holding a monopoly on Las Vegas lodging.

Hughes also purchased the local CBS affiliate, KLAS-TV, from Las Vegas Sun publisher Hank Greenspun because, as a night owl, he wanted to control which old movies it ran in the wee hours. Once he was in both the gaming and hotel business, Hughes didn’t want anyone to become bigger in the industry. He tried to stop Kirk Kerkorian from building his mega-casino. Kerkorian’s International Hotel (now the Las Vegas Hilton) began to rise in early 1968. So did Howard Hughes’ anxiety. He announced plans for a $100 million “Super Sands”, hoping Kerkorian would flee into the desert at the news. He didn’t. Hughes saw the solution to “the Kerkorian problem” in the Landmark. The tower, a fat concrete cylinder topped with an oversized saucer, rose in the early 1960s, but sat dark most of the decade. Its problem was its design. It had too few rooms, too little casino space. But at 31 stories, it was slightly taller than the International. For that reason, Hughes wanted it.

Kerkorian’s people had announced that the International would open on July 2, 1969. Hughes wanted the Landmark opening date left flexible. The International’s opening act would be Barbra Streisand. Hughes’ ideas bordered on fantasy: he suggested a Bob Hope-Bing Crosby reunion or getting the Rat Pack together for a “Summit at the Landmark.” Hughes obsessed endlessly over names on the guest list. Robert Maheu would send him a list and Hughes would return it with all but one or two names crossed out and a couple added. The guest list made dozens of trips from Hughes’ suite to Maheu’s office.

Although one of the country’s most generous campaign donors, Hughes was apolitical. He backed whichever candidate he felt would do him the most good, but always hedged bets by spreading plenty of cash among incumbents and challengers alike. Nixon had cost him millions. During Hughes’ time in Las Vegas, donations were disbursed by his attorney Bell, who had a knack for sizing up new political candidates, assessing their chances and proffering an appropriately sized bankroll. “All the money came from the cage at the Silver Slipper,” Maheu once said.

In his own way Howard Hughes was having fun. He was like an Adrian Monk with an open check book and a monarchy. He didn’t expect much for his largesse. He simply wanted to control every aspect of Nevada public policy. He gave his attorney Bell a legislative shopping list. He wanted to prevent dog racing from becoming legal; repeal the sales tax as well as gasoline and cigarette taxes; stop the integration of Clark County schools; prevent communist bloc entertainers from appearing on Nevada stages; pass a special law exempting him, Howard Hughes, from being forced to appear before any court or board and a bill to outlaw rock festivals in Clark County. He also wanted to prohibit governmental agencies from realigning any streets without first consulting him. The list went on.

Hughes was especially wary of civil rights legislation. Howard Hughes was Afrophobic. He had been a child in 1917 when one of the nation’s worst race riots broke out in Houston, his home town, leaving 17 dead. Maheu, a tennis devotee, had managed to bring the Davis Cup championship to the Desert Inn. Promising to fill the hotel with well-heeled guests, Robert Maheu felt pleased with himself. However on the night before the tournament, Hughes discovered that one contender was tennis superstar Arthur Ashe, a black man. Hughes wanted the match canceled, fearing the Desert Inn would be invaded by “hordes of Negroes.” Maheu quelled his fears, and the match went on.

As it was, no one could quell his fear of disease and germs, his mother’s most profound phobia. If Howard sniffled or coughed, he was rushed to a doctor, lavished with attention and sympathy. Allene Gano Hughes saw every playmate as a disease carrier, and discouraged her only son from socializing. The Southern Nevada Water Project was the culmination of some 30 years of work by state leaders, and literally made it possible for Las Vegas to grow to its current dimensions by bringing water over the mountains from Lake Mead. Hughes wanted it stopped at once. His objection was that while Las Vegas drew water from the lake, it also discharged treated waste water back into it. Hughes drank only bottled water, but was concerned for his customers. “Nevada must not offer its tourists water from a polluted, actually stinking lake,” Hughes wrote. “This water is, in truth, nothing more or less than sewage, with the turds removed by a strainer so it can be pumped through a pipe.” Gov. Paul Laxalt listened politely on the telephone to a Hughes harangue, and promptly dismissed the whole nutty notion.

During all his years as a recluse, there were only a handful of people who saw him personally each day. This was the so-called “Mormon Mafia,” which took orders from Bill Gay, chief of Hughes’ Los Angeles office. Its mission consisted of feeding Hughes occasionally and drugging him regularly. On Nov. 5, 1970, Hughes was carried from the Desert Inn and put on a jet for the Bahamas. According to Maheu, it was a coup. “The reason I know, is that that they tried to get me to join on two occasions,” said Maheu. In April 1976, Hughes died at age 70 aboard a plane en route to Houston, ostensibly of kidney failure. However, his dehydration, malnutrition and the shards of broken hypodermic needles buried in his thin arms suggested other factors. “If sheer neglect qualifies as a weapon,” said Maheu, “they killed him.” Because no Hughes’ will was ruled legitimate, his empire was divided among his many cousins…a sad ending for the man that de-mobbed Sin City.

THE REAL “IRON MAN” Stan Lee (creator of the hero “Iron Man” with artist Don Heck) admits that “Iron Man” was a thinly disguised version of the Howard Hughes billionaire industrialist and extreme recluse: “Howard Hughes was one of the most colorful men of our time. He was an inventor, an adventurer, a ladies’ man and finally a nutcase. Without being crazy, (Iron Man) was Howard Hughes.”

THE LADIES’ MAN The ladies in Hughes’ life were too numerous to have an accurate count, but what we do know is that this lady-killer’s first love was the “most beautiful girl” in Ziegfeld Follies history – Billie Dove; the classical opera singer and actress Kathryn Grayson was proposed to by Howard 3 times; had violent lover’s quarrels with the fiery and temperamental actress Ava Gardner; supposedly wept when actress/dancer Ginger Rogers left him; had a major love affair with actress Faith Domergue whom Hughes discovered and had as a mistress during her teenage years until she turned 20; was smitten by actress Elizabeth Taylor and offered $1 million if she would marry him, but she refused; had a very secret love affair with actress Rita Hayward who became pregnant with him but aborted since they were not married; married the wealthy woman Ella Rice who was from a prestigious family, divorced her; married the beautiful actress Jean Peters while having an affair with starry-eyed teenage singer Yvonne Schubert, divorced Peters; possibly had a secret marriage to actress Terry Moore, who claims to have been married to Hughes in a secret ceremony though she was unable to show proof of their marriage, and when she sued Hughes’ estate after his death she received an out-of-court settlement; and shared a love for flying with one of his greatest loves – 4-time Oscar winner Katharine Hepburn, whose love letters were kept by Hughes until he died. SLV

The Men Who Made Las Vegas is a twelve-part series by Byron Craft chronicling the growth of Sin City and the men who made it possible.

Issue 63 featuring: Cassidey, Renee Perez & Monique Alexander