Howard Hughes His Life & Madness

CHAPTER 9 BREAKDOWN

MYSTERIOUS MARRIAGE

IF any one word might be used to describe Howard Hughes in the years prior to 1960, that word would be unpredictable. He hardly ever behaved as others behaved. In late 1956 he proved that once again. With the jet financing still unsettled, the fight with Dietrich at a high boil, and his life turning inward, Hughes married a second time. The choice of partner, Jean Peters, was not as surprising as the event itself. Howard had met Jean in 1946 and they were an off-and-on couple for many years. In one of the off periods Jean had married Stuart W. Cramer III, a wealthy socialite-businessman, and very quickly separated from him, filing for divorce. The relationship with Hughes resumed as before, and about the time the decree became final Hughes asked Jean to marry him.^*

Also unexpected was the site of the ceremony—Tonopah, Nevada, an all-but-abandoned silver-mining town two hundred miles northwest of Las Vegas. Jean had never heard of Tonopah and she had “no idea” why the wedding ceremoney was to be held there.¹ Nor, apparently, did she ask. On the morning of January 12, 1957, a curious wedding party gathered for the flight. Years later, Jean could not remember all of their names. “I know Marty Cook was there and [George] Francom, and I think Roy Crawford [and] perhaps Levar Myler,” she said, referring to four of Hughes’s personal aides.² Apparently no women accompanied Jean to her wedding. Most of the aides did not know why the trip was taking place. (George Francom only learned of the marriage on the return flight to Los Angeles.)³ Boarding one of Hughes’s Constellations, piloted by a TWA captain and a copilot, they flew the short distance to Tonopah, landing at an abandoned army air base outside of town, and were met there by James Arditto, a Hughes lawyer from Los Angeles who had made arrangements for the marriage. Howard and Jean sat in the front seat next to Arditto while he drove the thirty minutes or so into town, to a nondescript motel, whose name, too, is lost, and led the couple through the lobby, up a flight of stairs, and into a second-floor room where a justice of the peace was waiting to perform the ceremony. For privacy’s sake the couple used assumed names, as is legal in Nevada—G. A. Johnson for Hughes and Marian Evans for Jean.⁴ The ceremony over, everybody returned to the abandoned airfield, boarded the Constellation, and flew back to Los Angeles. The entire operation took about three hours.

Jean Peters, Hughes’s second wife.
Bettmann Archive

When the Hughes-Peters marriage was disclosed, Hollywood hailed it as the perfect union. The two were obviously fond of each other, or so it seemed, given the number of times their names had been romantically linked. Also Hughes, so long identified with glamorous actresses, would of course marry one of Hollywood’s loveliest women. It also seemed natural that Jean, who still commanded a wholesome, all-American image at the age of thirty, would choose a husband cut from a heroic mold rather than some shallow Hollywood type. Hughes had said he would not remarry until he was fifty; he had just turned fifty-one.

Still, it was in most ways a strange time for Hughes to take such a step. For months he had been absorbed by the TWA and Dietrich dilemmas. Why remarry now after almost thirty years of bachelorhood? Perhaps he had promised Jean. Perhaps he was afraid of losing her again. Perhaps it was only an impulse. Much evidence points, however, not to these apparent and all-too-human possibilities, but to an interpretation that the marriage was one of convenience, prompted by a special set of circumstances.

At the bottom of it was Hughes’s already apparent mental instability, a condition Hughes was well aware of. By late 1956, Hughes was fearful that Noah Dietrich was about to have him declared mentally incompetent. The evidence is sketchy as to whether Dietrich was in fact exploring this possibility, but there is no doubt that Hughes’s mental condition had become a subject for concern within the empire. A confidential 1958 memorandum written by Raymond Cook, one of Hughes’s Houston lawyers, said Dietrich had told Cook that he had been approached by two people—one, a Hughes lawyer otherwise unidentified, and the other, Dr. Verne Mason, Hughes’s Hollywood physician—about cooperating in a move to have the industrialist committed.⁵ Although it is not clear who actually initiated the discussion, Hughes apparently believed it was Dietrich. Such a move by Dietrich, if successful, would wrest control of his empire from Hughes. What better way to counter the move than to marry? An involuntary commitment, or a court-supervised guardianship, would be difficult if not impossible to arrange without the cooperation of Jean.

In any case, the life of the newlyweds after their return to Los Angeles strongly confirms that the marriage was based on something other than passion. They continued to live separately, Hughes in one bungalow at the Beverly Hills Hotel and Jean in another. They visited occasionally and sometimes traveled together. But it was hardly a close marriage.

In the weeks following the marriage, the feud with Dietrich intensified. Dietrich hardened his demands that Hughes arrange the TWA financing and give him a stock option. Hughes procrastinated. A bitter impasse developed. Then, on the evening of May 12, 1957, a Sunday, Hughes asked Dietrich to stop by the Beverly Hills Hotel. When Dietrich arrived, Hughes refused to see him. Instead, according to Dietrich, Hughes asked him over the telephone to go to Houston at once. His mission: to increase the tool company’s profits, a crucial assignment in view of Hughes’s need to raise capital for the TWA jets. Reluctantly, Dietrich agreed, but only on condition that Hughes sign an agreement granting the long-sought stock option. “You’re holding a gun to my head,” Hughes protested.⁶ Dietrich said that unless the agreement was signed, he was through. “Starting when?”⁷ Hughes countered. “Right now,” answered Dietrich.⁸ A moment later, both hung up.

Hughes quickly called Bill Gay at home, told him he had just fired Dietrich, and ordered him over to Romaine Street immediately to seize Dietrich’s papers and change all the building’s locks.⁹ At Romaine, Gay and Nadine Henley called together secretaries, accountants, and others who worked under Dietrich and told them that Hughes had fired their boss. They were to pledge their loyalty to Hughes as a condition of staying on the payroll. Thus, with a swift and brutal efficiency was the thirty-two-year-long association of Howard Hughes and Noah Dietrich, an association that dated almost from the day of Hughes’s arrival in Los Angeles, brought to an end. As far as is known, the two never saw or spoke to each other again.

Although he had been ruthless in its execution, Hughes was traumatized by the break with Dietrich. He had come to rely heavily on the gruff-talking little man sixteen years his senior. Dietrich had played such a unique role in his life, a combination business manager, restraining hand, and father figure, that over the years he had become almost indispensable, particularly for the most delicate assignments. As Hughes’s majordomo, Dietrich had performed a variety of them, as he later acknowledged, from smuggling liquor into California to making a $100,000 payoff to the Democratic party to kill a criminal investigation of one of Hughes’s companies. Now, during the gravest business and financial crisis of Hughes’s life, Dietrich was suddenly gone; and there was no one to take his place.

Rather than face the impending financial chaos, Hughes decided to get away for a while. Less than two weeks after the break, he flew to Montreal with an entourage of staff men. Although he and Jean had been married only four months, she did not go. Ostensibly, the reason for the trip was to test-fly two turboprop airliners, the Vickers Viscount and the Bristol Britannia, which Hughes was considering for TWA. As a buying trip it made no sense, however, since Hughes had not yet arranged to raise the $400 million for the TWA jets and engines already on order. As usual, Hughes said little to his aides about the purpose of the trip, but he did assure them it would be brief. Once the plane was purring toward Montreal, Hughes stepped out of the cockpit and walked back to the cabin to talk to Bill Gay and two other Romaine Street aides, John Holmes and Charles Woodcock.¹⁰ “You guys are always worried about me hijacking you,” he told them. “This trip won’t take more than seven to ten days at the most.”¹¹

In Montreal, at the Ritz-Carlton Hotel, Gay acted as liaison with Romaine while Holmes and Woodcock looked after Hughes’s personal needs, serving his carefully prepared food, supplying newspapers and magazines, and attending to other errands. When Woodcock burned himself severely under a sunlamp and had to return to Los Angeles, the job of waiting on Hughes fell exclusively to Holmes, an anonymous-looking little man with a salesman’s gift for conversation. This was a good opportunity for Holmes, who was gradually moving into prominence on Hughes’s staff. He had lived his entire life in Southern California, graduating from Los Angeles High School in 1935 and then attending Loyola University for a few months before dropping out to become a cigarette salesman for P. Lorillard Company. During the war, Holmes tested guns on Douglas Aircraft’s A-20 attack bomber, then became a Johnson’s Wax salesman. He went to work for Hughes Productions in 1949, and like most at Romaine Street, began by chaperoning starlets, taking them shopping, to dinner or drama lessons, often accompanied by his wife. In one way, however, Holmes was different from the others at Romaine. He was not a Mormon, but a Catholic. And he smoked. Despite these handicaps, he was a quick student of Hughes’s ways and by the time of the Montreal trip, Hughes increasingly liked to have Johnny Holmes around.

In Montreal, Hughes, always fastidious, grew more so, particularly about his food. One day, while eating a dish of French vanilla ice cream, his favorite flavor, he spied a trace of strawberry. Immediately the dish was sent away and a change of brand decreed.¹² To assure that his steaks were prepared on a newly cleaned grill, he instructed waiters to oversee the cooking. The cart on which his dinner would be wheeled into the suite was to remain outside the kitchen while the meal was prepared; Hughes feared it might pick up a sticky substance on the kitchen floor and arrive with a cockroach or some other insect clinging to its wheels.¹³

The “seven-to ten-day” Montreal excursion lengthened into weeks, then months. While Jean remained in Los Angeles, however, Hughes was not without a female companion. Yvonne Shubert, one of the attractive young women Hughes had promised to make a star, flew in for a visit. Finally, in August, after three months, Hughes made plans to leave, not west for Los Angeles, but south to the Bahamas.

In Nassau, where he lived in a suite at the Emerald Beach Hotel, the weeks again slipped by. Ignoring the financing crisis that awaited him back in the States, he weighed the possibility of making real estate investments in the islands. Although the source of the money for any new business venture was not apparent, Hughes nonetheless brought Robert Maheu to Nassau to serve as his envoy to the “Bay Street boys,” the bankers, lawyers, and real-estate brokers who controlled the islands, where a real-estate boom was just beginning. Jean Peters even flew in for a time, and she and Hughes went out to look at houses, giving rise to speculation that Hughes might relocate in the Bahamas. But nothing came of the house hunting and Jean returned to California. And nothing came of Hughes’s proposed Bahamian investments either. In November, after a six-month absence from California and no nearer to a solution for the jet-financing crunch, Hughes and his crew flew back to Los Angeles.

CRISIS

Once again he lived in the Beverly Hills Hotel, this time in Bungalow 4. Jean was already at the hotel, but in another part of the compound, in Bungalow 19. She thought they should live in the same bungalow, but Hughes told her it was not possible for the moment—he was too preoccupied with TWA and other business matters. Hughes’s entourage leased a series of bungalows nearby to house the burgeoning support crew he now required. Bungalow 1-C was for the cooks and waiters. Bungalow 1-A, the storage house, was piled high with cases of Poland water and cartons of Kleenex. Another bungalow was occupied by a crew of messengers, doormen, and assorted helpers—whom Hughes called the “third man” detail.¹⁴ This unit delivered whatever Hughes demanded—newspapers, magazines, Kleenex. When Hughes did not want John Holmes with him, Holmes camped out in Bungalow 1-C. Holmes supervised the preparation of the meals and also began taking dictation, a task performed almost exclusively by Gay until he had become ill in the Bahamas.¹⁵

The “third man” came under the supervision of Roy E. Crawford, another rising aide. A Mormon, Crawford was in charge of a Romaine Street division called “Special Services,” whose duties consisted in good part of sealing Hughes’s new residences with masking tape to keep out dust. With a 1937 degree from Wooster College, where he majored in geology, Crawford was one of the few with a college degree on Hughes’s personal staff. He had been a navy flight instructor during the Second World War, and a salesman for a refining company in Southern California before going to work at Operations as a telephone operator for seventy dollars a week in 1950.

Hughes rarely left his bungalow now except to fly or to watch movies late at night with Jean at the Goldwyn Studios in Hollywood. While guards kept everyone else out, the couple would watch as many as three films before being driven back to their separate bungalows. On many nights Hughes returned to the studio to “screen” more movies—he always used the Hollywood term “screen”—and sometimes stayed in the studio for several days straight.¹⁶ This continued until Hughes learned that the all-black cast of Porgy and Bess, then being filmed at Goldwyn, was using the same screening room. He never went back,¹⁷ but he and Jean began instead to use the private screening room of the producer Martin Nosseck on Sunset Boulevard in West Hollywood.¹⁸

As pressure mounted on Hughes to solve the TWA financing dilemma, he retreated further from reality. One night, after escorting Jean back to her bungalow, Hughes returned to the Nosseck screening room and told his aides that he planned to live there for a while. And so he did, for several months. Attended around the clock by aides, guards, and projectionists, seated in his own white leather chair, Hughes never left the studio. He spent his time talking on the telephone to lawyers or bankers about TWA, screening movies, rearranging half a dozen Kleenex boxes into various geometric shapes on an end table beside him, or sitting in the bathroom.¹⁹

His menu remained constant—“fresh whole milk, Hershey bars with almonds, pecan nuts and Poland water,” delivered in a brown Kraft paper bag each day by John Holmes, and presented ritually.²⁰ At a signal, Holmes

would walk into the studio and walk down the right-hand side to the right of Mr. Hughes’ chair. He would stand immediately along side of the chair. He would stop there until such time Mr. Hughes looked over and recognized him or said something to him. At that point he would walk over and stand in front of Mr. Hughes and would roll back the outer edges of the bag and would bend over, hold the bag at approximately a 45-degree angle from his body and at that time Mr. Hughes would take Kleenex and reach into the bag and pull out the contents one by one.²¹

For weeks, Hughes wore the same white shirt and brown slacks. Then one day he discarded his clothes and went about naked. He told his small group of retainers that they were not to talk to him; anything to be communicated must be written down.²² Because he refused to touch doorknobs, when he wanted to leave the studio to go the bathroom in the lobby, he walked to the door and kicked it, a signal for one of the aides in the projection booth to come out and open the door. Suffering from severe bouts of constipation, most likely as a result of his prolonged usage of codeine, Hughes sat in the bathroom for long periods, once for twenty-six hours. He was as likely to urinate on the floor as in the toilet, but he refused to allow the janitors to clean, choosing instead to spread paper towels around and to wrap “all of the porcelain parts of the bathroom fixtures in the paper towels.”²³ He also banned his projectionists and guards from the bathroom, suggesting they use milk cartons to relieve themselves.

Hughes did not tell Jean where he was. He called her often, but denied he was living at Nosseck’s, and on one occasion told her that he was ill, in a hospital undergoing treatment for an undiagnosed disease.²⁴ Late in the summer of 1958, Hughes abruptly moved back to the Beverly Hills Hotel.

There, in the seclusion of Bungalow 4, he suffered his second, and most damaging, mental breakdown. In addition to a total disregard for personal hygiene—he now urinated against the bathroom door—Hughes threw tantrums and babbled incoherently, beyond reach until one night, in desperation, Holmes telephoned Jack Real, a Lockheed executive Hughes had known for twelve years and with whom he had hit it off.²⁵ For hours Hughes and Real discussed over the phone the intricacies of aircraft engines and airplanes. It became a pattern, repeated nightly, as the technical chatter with Real became a form of much-needed therapy.²⁶ With his second collapse, Hughes ceased virtually all contact with the outside world. He no longer met bankers or businessmen, no longer drove to clandestine negotiating sessions in such remote locations as the city dump or a deserted street in the hills. Even women were shut out of his daily life. He did not see Jean for months. And the only other woman in his life, Yvonne Shubert, came to the bungalow only once, on December 24, 1958, his fifty-third birthday.

The white leather chair had been moved back to the Beverly Hills Hotel, and Hughes spent almost all his time sitting naked in it in the center of the living room—an area he called the “germ-free zone”²⁷—his long legs stretched out on the matching ottoman facing a movie screen, watching one motion picture after another. The furniture had been pushed back against the walls and the floor was piled high with stacks of old film cans, magazines, and newspapers. Although he rarely read anything, Hughes insisted on receiving every edition of the Los Angeles dailies. As newspapers accumulated, aides stacked them so as to leave aisles just wide enough for one person, crisscrossing the room. Each day Hughes painstakingly used Kleenex to wipe “dust and germs” from his chair, ottoman, side table, and telephone. Sometimes he spent hours methodically cleaning the telephone, going over the earpiece, mouthpiece, base, and cord with Kleenex, repeating the cleaning procedure again and again, tossing the used tissues onto a pile behind his chair.²⁸

By now, Hughes’s obsessive-compulsive behavior—his fear of germs and contamination and the rituals he devised to deal with those fears—was dominating his life. He dictated a torrent of memoranda aimed at preventing the “backflow” or “back transmission” of germs to him. In one, three pages long and single-spaced, he explained how he wanted a can of fruit opened: “The equipment used in connection with this operation will consist of the following items: 1 unopened newspaper, 1 sterile can opener; 1 large sterile plate; 1 sterile fork; 1 sterile spoon; 2 sterile brushes; 2 bars of soap; sterile paper towels.”²⁹

Hughes outlined nine steps for opening the can: preparing a table, procuring of fruit can, washing of can, drying the can, processing the hands, opening the can, removing fruit from can, fallout rules while around can, and conclusion of operation. Hughes detailed how each step was to be accomplished. In Step No. 3, “Washing of Can,” he wrote:

The man in charge then turns the valve in the bathtub on, using his bare hands to do so. He also adjusts the water temperature so that it is not too hot nor too cold. He then takes one of the brushes, and, using one of the bars of soap, creates a good lather, and then scrubs the can from a point two inches below the top of the can. He should first soak and remove the label, and then brush the cylindrical part of the can over and over until all particles of dust, pieces of paper label, and, in general, all sources of contamination have been removed. Holding the can in the center at all times, he then processes the bottom of the can in the same manner, being very sure that the bristles of the brush have thoroughly cleaned all the small indentations on the perimeter of the bottom of the can. He then rinses the soap from the cylindrical sides and the bottom of the can.³⁰

When the fruit was dished onto the plate, Hughes wanted “fallout rules” in effect: “Be sure that no part of the body, including the hands, be directly over the can or the plate at any time. If possible, keep the head, upper part of the body, arms, etc. at least one foot away from the can of fruit and the sterile plate at all times.” During the procedure, there must be “absolutely no talking, coughing, clearing of the throat, or any movement whatsoever of the lips.”³¹

To make absolutely certain that, with a few authorized exceptions, no one would come in contact with any of the supplies stored in an adjoining bungalow for his use, Hughes issued explicit orders:

No matter how extreme the emergency, no matter how unusual the circumstances may be, no matter what may have arisen, it is extremely important to me that nobody ever goes into any room, closet, cabinet, drawer, bathroom or any other area used to store any of the things which are for me—either food, equipment, magazines, paper supplies, Kleenex—no matter what. It is equally important to me that nobody ever opens any door or opening to any room, cabinet or closet or anything used to store any of my things, even for one-thousandth of an inch, for one-thousandth of a second. I don’t want the possibility of dust or insects or anything of that nature entering.³²

Anytime an aide, an aide’s spouse, or someone close to Romaine Street contracted anything resembling a contagious disease, he or she was immediately placed in “isolation”—off-limits to all Romaine Street personnel. When Hughes learned that Cissy Francombe, a former wardrobe mistress of Jean Peters, had hepatitis, he was terrified.

“Although we have had reason to put into effect a program of isolation before,” he wrote Bill Gay,

I want this to be ten times as effective as any we have ever set up before. With the present condition of my business affairs, which in my opinion are in a state of danger and hazard, I am sure if Jean, myself, you, or anyone else important in our organization were to acquire this disease, I just cannot even contemplate the seriousness of what the result might be. I therefore want a system of isolation with respect to Cissy, the doctors attending her, nurses, or anyone in the past or future coming in contact with her, set up that is so effective and complete that anything we have done in the past will be nothing compared to it. I want this to go through the eighth or tenth generation, so to speak. This is one case where incrimination by association is definitely to be recognized. I want this situation to be investigated to see who has been near Cissy in the immediate past and those people are to be included in the program. I consider this the most important item on the agenda, more important than our TWA crisis, our financial crisis or any of our other problems.³³

Even Bill Gay was placed in isolation in the summer of 1958 after Hughes found out that Gay’s wife Mary had a contagious disease. Hughes ordered Gay to work at home so as to avoid passing germs to other staff members and thence to Hughes.³⁴ But unbeknownst to Hughes, Gay rented offices at 17000 Ventura Boulevard, about six blocks from his Encino home, and with the help of fellow Romaine Street Mormons Richmond Anderson, Rand Clark, Gil Reed, and Hal Tucker, established a satellite operations center, the very existence of which remained a secret to all but a handful of people in the Hughes empire for years to come.³⁵ Hughes kept Gay in isolation long after Mary Gay had recovered. In fact, it was not until 1973—fifteen years later—that Hughes allowed Gay in his presence again.

Hughes drafted special orders for the drivers and aides to follow that covered almost every conceivable situation. When escorting Jean Peters to the movies, they were instructed, “If [it is] necessary to open the doors entering the theater or closing the doors, do so with the feet, not the hands. If it is necessary or common procedure to enter the theater with her to lower the seat for her, do so with Kleenex.”³⁶ In going to and from assignments, they were directed not to stop for anything—“a package of matches, cigarettes, papers, groceries, drug supplies and so forth.”³⁷ This meant, they were told, “that if they are stopping for a red light and there is a boy selling papers in the street and even though he might have many papers and they feel like they will not waste any time getting the paper by picking one out from the center of the pile, HRH does not want you to do this either.”³⁸ In any houses that were rented for possible future use by Hughes, he warned that “there is to be no meat grinder of any kind either as a separate unit or in connection with a mixing unit in any house. Any such grinders are to be boxed separately and stored in a location away from the premises.”³⁹ There were even special procedures to be followed in removing his hearing-aid cord from the cabinet where it was stored:

First use six or eight thicknesses of Kleenex pulled one at a time from the slot in touching the door-knob to open the door to the bathroom. The door is to be left open so there will be no need to touch anything when leaving the bathroom. The same sheaf of Kleenex may be employed to turn on the spigots so as to obtain a good force of warm water. This Kleenex is to then be disposed of. A sheaf of six to eight Kleenexes is then to be used to open the cabinet containing the soap, and a fresh bar of soap that has never been opened is to be used. All Kleenex used up to this point is to be disposed of. The hands are to be washed with extreme care, far more thoroughly than they have ever been washed before, taking great pains that that the hands do not touch the sides of the bowl, the spigots, or anything in the process. Great care should also be exercised when setting the soap down on the soap dish or whatever it is set on to assure that the hands do not come in contact with anything. A sheaf of fifteen to twenty fresh Kleenexes are next to be used to turn off the spigots and the Kleenex is then to be thrown away. (It is to be understood that while each Kleenex tissue as it is normally pulled from a box consists of a double thickness actually, when one Kleenex is referred to, one of these double Kleenexes is meant). The door to the cabinet is to be opened using a minimum of fifteen Kleenexes. (Great care is to be exercised in opening and closing the doors. They are not to be slammed or swung hastily so as to raise any dust, and yet exceeding care is to be exercised against letting insects in). Nothing inside the cabinet is to be touched—the inside of the doors, the top of the cabinet, the sides—no other objects inside the cabinet are to be touched in any way with the exception of the envelope to be removed. The envelope or package is to be removed using a minimum of fifteen Kleenexes. If it is necessary to use both hands, then fifteen Kleenexes are to be used for each hand. (It is to be understood that these fifteen Kleenexes are to be sterile on both sides of each tissue with the exception of the very outermost edge of the tissue. The center of the tissue only should come in contact with the object being picked up). If something is on top of the package to be removed, a sterile instrument is to be used to lift it off.⁴⁰

ASYLUM

If Howard Hughes had had a friend in the world in 1958, that person would now have encouraged or arranged psychiatric care for him before it was too late. But, always the loner, Hughes had no true friends and no close family ties, no one to say, “Howard, you need help.” Instead, those around him did just the opposite. They encouraged his wildest obsessive-compulsive actions and indulged his fantasy that the greatest threat to the empire was indeed an invisible army of death-dealing germs.

Ever so slowly, but ever so surely, Bungalow 4 at the Beverly Hills Hotel had become Howard Hughes’s private mental institution—his very own asylum. The aides were attendants, men who came in shifts to bring him chocolate bars, Kleenex, water, newspapers, and movies. They catered to his every demand, no matter how bizarre, no matter how irrational, no matter how degrading, no matter how foolish or injurious to his personal or corporate well-being, and they helped create the make-believe world in which he lived. In the years to come the asylum would change locations. But Hughes would remain very much within its confines for the rest of his life.

Like any mental hospital, the Hughes asylum had its own rigidly enforced rules. But unlike a legitimate institution, where the rules are designed to assist the patient to recognize and overcome his disorders in thought and behavior, the Beverly Hills asylum had rules that served only to move Hughes along on his journey into madness. Romaine Street meticulously developed a “procedures manual” that set down instructions on how, in a “sterile” manner, to set a table, guard an airplane, deliver cans of film. In addition to promulgating its own procedures—every bit as divorced from reality as those of Hughes—Romaine Street recorded, word for word, every directive of Hughes, however irrational, and added it to the ever-expanding operations manual. The patient was writing the rules, and the asylum staff was not only following them to the letter but helping him to make them up.

The practice of codifying Hughes’s every thought into a body of corporate law for the empire, begun a few years earlier, grew more precise, more bizarre with each year. It had started innocuously enough. When Hughes expressed an interest in some subject, whether a crowd scene in a film or the food he was eating, Romaine Street immediately produced a memorandum. So it was the day Hughes indicated that he especially liked a grilled cheese sandwich he had just eaten, calling it “the best he’d ever tasted.”⁴¹ Under the subject heading “Grilled Cheese Sandwiches,” Romaine Street issued this report:

Sandwiches were procured from Huff’s, 7920 Sunset Boulevard (Hollywood 7-7324), which is open twenty-four hours a day. Two grilled whole-wheat cheese and tomato sandwiches and one grilled whole-wheat sandwich without tomato were ordered—the tomato slices to be skinned. The waitress and cook were requested to be certain that any knife or cutting board, anything touching the sandwiches, be free from the odor of onion. The bread used looked like the usual bakery wheat bread and may not have been entirely whole-wheat. To make a grilled cheese sandwich, the grill cook followed this procedure: two pieces of heavily buttered bread were placed separately on the grill, buttered sides down and a slice of cheese was placed on each. Then, after sufficient grilling, the two slices were joined to form one sandwich. For a tomato and cheese sandwich, the same process was followed, except that skinned tomato slices were placed on one of the grilling bread slices, on top of the cheese. When grilled enough, the other slice of bread was put on top of the slice with the tomato.⁴²

Romaine Street was now matching Hughes bizarre memorandum for bizarre memorandum. When Hughes asked John Holmes to arrange for the delivery of some clothing stored at Romaine Street, Holmes prepared an “operating memorandum”—subsequently “placed in a confidential file for future use”—that spelled out the steps a Romaine deliveryman was to follow in obtaining and bringing three boxes of shirts, trousers, and shoes to the Beverly Hills Hotel. As set forth by Holmes, the operation called for “a brand new knife, never used,” a fresh box of Kleenex, and a newspaper to be placed “on a table or a desk as your working area.”⁴³ After slicing open the Kleenex box with the sterile knife, the deliveryman was to build two stacks of fifty Kleenexes each on the newspaper. The twin stacks of tissues, officially designated as “paddles,” then were to be used to handle the boxes, thereby ensuring that the deliveryman’s skin would not come in contact with the boxes that contained the clothing, let alone the clothing itself. Throughout the procedure, the deliveryman was instructed to hold his head “at a 45-degree angle” so as not to breathe on his “paddles” and other equipment. As Holmes cautioned,

The thing to be careful of during the operation so as not to breathe upon the various items would be things like the knife, the box of Kleenex, the virgin newspaper, the sheets of Kleenex themselves, or the two paddles, the boxes you are to handle and the other boxes you have to handle to get at the boxes you need and also the unopened newspaper which you will be putting in the back seat of your car.

When the deliveryman arrived at Holmes’s location, he was instructed: “You are to open the door but we are not to talk. I might do this in two or three operations. I will then use some paddles I have made for taking these up to the boss.”⁴⁴

On another occasion, Hughes asked Bill Gay to conduct a survey of grocery stores and devise a germ-free method to buy groceries that would “result in the best sanitation possible.”⁴⁵ Hughes had laid down some specific guidelines, including the use of a three-man detail—“one man who drives the car and pays for the items, another man who handles the goods, and the third man who would open doors.”⁴⁶ Hughes directed Gay to exclude from the survey stores that sold meat—he believed meat, especially pork products, was contaminated. If Jean Peters wanted soup, he suggested the grocery detail should not “buy the product of the company which also puts meat products in other cans.”⁴⁷ And at wholesale stores, he warned, “it is possible that a case of meat might have spilled and the contents spread around by being carried on the feet of the workers and get into the area where no meat products are stored.”⁴⁸

Gay responded by producing a memorandum of high concern with supermarket germs. Listing the stores that would best fulfill Hughes’s requirements, Gay recommended a market in Loma Linda on the campus of the College of Medical Evangelists:

This market is owned and operated by Seventh Day Adventists. One of the tenets of this faith is to refrain from eating any meat of any kind. The clientele they serve are almost entirely non-meat-eaters, and all food stuffs they handle are carefully screened to eliminate any meat, meat products, meat stocks in soups, pork baked in beans, etc. No other food or meat stores in close proximity to this market. Their produce is not organically grown.⁴⁹

If canned goods and staples were to be purchased wholesale, Gay recommended Smart & Final:

Their head canned foods buyer states that what few meat products they handle are canned back in the midwest. Their fruits and vegetables are obtained by contract with a number of different canning plants on the west coast, and he knows no cannery where fruits and vegetables are packed that also packs any meat products. With a store room set-up, these cases could be obtained, using all of our procedures, and then individual cans could be taken out and used as needed.⁵⁰

Working with Hughes, Romaine Street compiled hundreds of individual instructions that drivers were required to follow: “When driving special HRH passengers,” an operating memorandum directed,

the following driving rules should be religiously followed: The party being driven is to be seated in the back seat (except in cases of car sickness). The party should be properly escorted to the car and from the car at destination and given proper assistance when entering and exiting the car. The speed of the car should not exceed thirty-five miles per hour at any time and then this speed should be governed only by perfectly smooth roads. Ample time should be allowed in order that this speed limit be adhered to at all times. When crossing any bump, dip, swale, ditch, railroad track or any uneven part of any road the speed should be reduced to such a minimum speed that the car can move over the uneven part of the road with no violent motion that would tend to disturb the position of the party. (Two miles per hour has been suggested as such a speed going over rough or uneven roads).⁵¹

The reduction of speed to two miles an hour on bumpy roads was especially important when the passenger was a woman, usually one of Hughes’s erstwhile actresses, because that any jarring motions at a higher speed would damage the breasts.

For a driver delivering film to the bungalow, the rules were equally exacting:

Park one foot from the curb on Crescent near the place where the sidewalk dead-ends into the curb. Get out of the car on the traffic side. Do not at any time be on the side of the car between the car and the curb. When unloading film do so from the traffic side of the car, if the film is in the rear seat. If it is in the trunk, stand as close to the center of the road as possible while unloading. Carry only one can of film at a time. Step over the gutter opposite the place where the sidewalk dead-ends into the curb from a point as far out into the center of the road as possible. Do not ever walk on the grass at all, also do not step into the gutter at all. Walk to the bungalow keeping as near to the center of the sidewalk as possible. Do not sit the film cans down on the sidewalk or the street or anywhere else, except possibly on the porch of the Bungalow area if the third man is not there. While waiting for the third man to arrive, do not lean against any portion of the bungalow or the furniture on the porch, but remain there standing quietly and await his arrival. When the third man clears the door, step inside quickly carrying the can (single) of film, just far enough to be inside. Do not move and do not say anything and do not sit the film down until you receive instructions where to sit it. If possible, stay two feet away from the TV set, the wire on the floor and the walls. When leaving, kick on the door and step outside quickly as soon as the third man opens the door.⁵²

As in any mental hospital, there were strict rules at the Hughes asylum governing drugs, but they were quite different from the rules found in a legitimate institution. These rules spelled out how drugs and narcotics, and even medications for legitimate medical reasons, were to be acquired through fraudulent prescriptions. The purpose of the regulations was to insure that Hughes’s use of drugs was kept secret from the world at large.

Indeed, only a very few trusted lieutenants within the Hughes organization were aware of Hughes’s drug habit, notably Bill Gay, Kay Glenn, John Holmes, and Roy Crawford. Whenever possible, a messenger service was used to deliver a prescription to a specially selected drugstore. The messenger would leave the prescription at the pharmacy—he was paid by the drugstore, which added the the charge to the prescription bill—and one of Hughes’s trusted aides would pick it up. Naturally, when the order was placed with the messenger service, there was no mention of Hughes, anyone employed by Hughes, or any address that could be connected to the Hughes organization.

According to the “operating memorandum” on drug acquisition, prepared at Hughes’s direction, the following procedure was in force:

If Kay or Bill is masterminding the deal, then have Roy handle the delivering and filling of the prescription (make sure that nobody knows the name or address that is connected with the prescription, or the company’s name). When you are talking to the messenger service, tell him: “This is Dr. Hawkin’s secretary calling, (Do not use Roy’s or any of our people’s name) would you please go to such and such address and pick up a prescription and take it to Horton & Converse drug store at such and such address. They will pay you and just put the amount on our bill.” Then, Roy should go over and supervise the filling of the prescription. If Roy is out of town, then maybe before he goes he should leave instructions with Kay or Bill, or both, as to the name of drug store and the clerk who does this service for him and also get the name of the messenger service from Roy, as Roy has been doing this for some time now.⁵³

There were special orders for Roy Crawford, who had assumed increasing responsibility for the drug buying. Hughes did not want Crawford used indiscriminately. “If the prescription is for Jean, then Roy isn’t used at all,” the operating memorandum directed, but “if it is for HRH then Roy will do the whole thing, telephoning, supervision and delivery. Do not ever use Roy in a dry-run operation, in other words, if you are trying out a fake operation, do not use Roy in that operation.”⁵⁴ As for the names placed on the prescriptions, Hughes ordered, “if it is for me, then use the names that Roy has been using. [The name was that of the wife of a low-level Romaine Street functionary.] If it is for Mrs. Hughes, then I would use the name of her aunt….”⁵⁵

The decision to pander to Hughes’s phobias and obsessions, and to carry out the unlawful chores he assigned, was a conscious one. It was made by Romaine Street, most likely by Bill Gay, who had established Operations and hired the men who manned it. No one else had such an intimate knowledge of Hughes’s deteriorating mental condition and growing dependence on drugs and narcotics, having waited on him almost daily for ten years before being placed in “isolation.” The men Gay hired, first for Operations and then the asylum staff, proved ideal for the task of looking after the inmate. Almost without exception they were cut from the same mold—former truck drivers, construction workers, mechanics, salesmen—men who stood little chance of rising or making big money in a conventional company, but who in Hughes’s topsy-turvy world had the opportunity to do both. By becoming willing participants in Hughes’s fantasies, they assured themselves of fabulous salaries, lavish expense accounts, the fringe benefits of a corporate executive, and secure financial futures far beyond what their talents would command in the ordinary business world. By going along with Hughes’s aberrant behavior, they also made certain that he would never emerge from his asylum. The process now underway would eventually lead to his complete mental deterioration. For the present, Hughes was an inmate in his institution as well as its superintendent, a position that demanded obedience, for he determined who was hired and fired, and how much everyone was paid. In time, he would be only the inmate.

SHOWDOWN WITH WALL STREET

Throughout the time that Hughes was sitting in the bungalow in his white leather chair, naked, unwashed for months, his hair falling down his back, his beard unkempt, his toenails and fingernails grotesquely long, he communicated by telephone with Wall Street investment houses, bankers, and lawyers, sending one and all on a variety of missions he hoped would rescue his failing empire. Hughes’s mental illness was such that he could one hour dictate a completely irrational memorandum sealing off Romaine Street from germ-bearing letters and the next hour a rational memorandum on a financing plan for TWA. It was as though half of Hughes’s brain cells were functioning, the other half dead or defective. His illness now determined the amount of time he devoted to business affairs. If he was especially preoccupied with one of his continuing skirmishes against contamination, he thought of little else. When the germ fears subsided, he would turn once again to business. It was a pattern that would hold over the years.

By 1958, Hughes’s jet-financing problems had been compounded. Carter Burgess, tired of Hughes’s erratic conduct, had walked out as TWA’s president in December of 1957 after only eleven months on the job. Now TWA was leaderless again. And the bills were coming due: TWA’s jets would start rolling off assembly lines in early 1959, each costing about $4.5 to $6 million. The first Boeing plane was scheduled for delivery in March, and TWA would begin receiving one or more a month thereafter.

To make matters worse, Hughes’s personal financial condition was grim. In the more than two years since he had ordered the jets, he had been dipping into his own resources to avoid having to go to East Coast bankers and investors. But he was fast running out of money, and the tool company’s profits, which he had been employing to the maximum in a stop-gap effort to pay for the jets, had plunged in the wake of a worldwide downturn in oil drilling that reduced demand for the Hughes bit. For the first time in his life, Howard Hughes would shortly be unable to pay his bills.

So, he finally made a decision: he would try to borrow some money. Using Jack Real as an intermediary, Hughes turned to another business acquaintance, Robert Gross, the chairman of Lockheed, to sound out the eastern financial establishment. It was not the best time for Hughes to be tapping Wall Street for capital. His lackadaisical attitude toward TWA had alienated potential investors. After Carter Burgess resigned in December of 1957, Hughes did not appoint a new president until the following July. In the interim, TWA lost more than $10 million. Burgess’s successor was another former Pentagon official, Charles S. Thomas, secretary of the navy under Eisenhower, who before his government service had made a career of rescuing ailing businesses. Although more accommodating than the hard-nosed Burgess, Thomas was still very much his own man and he was excited by the challenge of trying to revive TWA. Hughes agreed to give him free rein in all areas except the jet financing and advertising. Thomas accepted the job on the basis that after two years, if Hughes wanted him to stay, he would be given a stock option in TWA. It all sounded very familiar.

Despite Wall Street’s coolness toward Hughes, Gross soon put two investment houses—the First Boston Corporation and Merrill Lynch, Pierce, Fenner & Smith—in touch with Hughes. Under senior executive George Woods, First Boston drafted a proposal to raise capital from Hughes Tool’s assets. As Woods’s study advanced, he passed word to Hughes that he was prepared to fly west and discuss it in person. Days passed without word. Then one night Hughes called Woods at his home in New York and asked him to put some of his ideas on paper and forward them. “That is not the way I do business, Mr. Hughes,” Woods told him. “I am accustomed to dealing with a face, not a voice.”⁵⁶ That was the end of the First Boston plan.

The Merrill Lynch assignment was no less difficult, but potentially more volatile. The investment firm was to develop a plan for the public sale of the Hughes Aircraft Company, no simple task, since Hughes had already given the company’s stock to his Miami-based, tax-exempt medical institute, supposedly “to benefit mankind.” A team of Merrill Lynch specialists, headed by William Forrester, Jr., moved into a suite at the Beverly Hills Hotel in December of 1958. There, Forrester never saw Hughes, but he did spend hours on the telephone discussing the plan with Hughes, who was living in his bungalow a hundred yards away. Eventually, the Merrill Lynch plan also fell through.

Hughes had lost more time. It was now February of 1959, just a month before delivery of the first of TWA’s thirty-three 707s. There was nothing to do but return to Wall Street. Hughes called an acquaintance, Fred Brandi, a senior partner at Dillon, Read & Company, the investment bankers that represented two consortiums formerly interested in buying the Hughes Tool Company. Would Brandi devise a plan enabling Hughes to raise the capital needed for TWA’s jets? Brandi agreed to try.

When not watching movies, Hughes now was constantly on the telephone exploring options from his bungalow at the Beverly Hills Hotel. As usual, Raymond Cook, the intelligent, amiable Houston lawyer, was his main emissary to the financial community in New York. He was also the chief target of Hughes’s long-winded calls and soaring paranoia. Hughes believed the only safe telephones in New York were in the Waldorf-Astoria Hotel. When he had orders for Cook, he told Operations, “Get him into a room where he is completely private and with empty rooms on either side with the doors closed on both sides of the empty rooms.”⁵⁷ Poor Cook was exhausted from shuttling between Wall Street and his hotel rooms.

Two other men Hughes regularly telephoned, usually early in the morning, were Raymond M. Holliday, the vice-president and chief financial officer of the Hughes Tool Company in Houston, and Milton H. (Mickey) West, Jr., his Houston tax lawyer and a partner of Raymond Cook’s in Andrews, Kurth, Campbell & Jones. Since Dietrich’s departure, the quiet, self-effacing Holliday had inherited the task of advising Hughes on the company’s financial picture. A onetime grammar school principal, he had gone to work at the age of twenty-three as a clerk in the tool company’s accounting department, just in time to meet Hughes as he toured the Houston plant after his around-the-world flight. Holliday never forgot the thrill: “I thought how lucky I was to be able to work for such an interesting man.”⁵⁸ Like Holliday, Mickey West also found it stimulating, although sometimes wearing, to work for Hughes. A specialist in income-tax law, West, a big, rawboned product of rural Texas, had become one of Hughes’s closest advisers over the years, meeting periodically with his client in old cars or secluded hotel rooms to talk over tax questions in hushed tones. In any complex financial transaction, Hughes was sure to call on West for advice.

By March, two possible financial plans had taken shape in New York. One, the Dillon, Read plan, was a conventional arrangement that called for banks and insurance companies to supply $165 million and Hughes Tool to take subordinated debentures of $100 million to round out a $265-million jet-financing package. The second proposal was mostly Hughes’s own brainchild. Known as the lease plan, it envisioned creation of a Hughes Tool subsidiary to acquire the jets and lease them to TWA, enabling Hughes to write off the jets’ depreciation costs against the tool company’s profits as he had wanted to do all along. As in the case of the Dillon, Read proposal, the banks and insurance companies would supply most of the capital.

Only the lease plan appealed to Hughes because of its obvious tax advantages. Conversely, it was damaging to TWA since it would leave the airline without title to its most vital assets, its airplanes, deprive it of the tax advantages of aircraft ownership, and thus substantially increase the cost of the jets. Charles Thomas, TWA’s new president, vigorously opposed the lease plan, setting in motion a decline in his relations with Hughes. When the plan was formally vetoed by the Equitable Life Assurance Society, TWA’s chief creditor, it collapsed. The first serious talks between Hughes and Wall Street had ended on a sour note.

Later that same month, TWA’s first Boeing 707 rolled off a Seattle assembly line. Thomas quickly pressed it into service, inaugurating a transcontinental jet flight between New York and San Francisco with spectacular results. Travelers flocked to fill seats on the newly scheduled flight. As more jets arrived, Thomas introduced the faster service on other routes with equal success. Best of all, the planes were not only popular, but also fabulous moneymakers compared to the old piston-driven Connies.

That was the good news. The bad news, at least for Hughes, was that the last of his capital was being used for the jets. The Equitable Life Assurance Society, which insisted that TWA and not the tool company should own the jets, vetoed any TWA lease fees to Hughes. Thus, Hughes was really in a squeeze, paying out millions of dollars and getting back nothing in return.

It was just like Hughes, at such a critical time, to retreat into some unrelated, frivolous subject. Thus, in the midst of his ongoing financial crisis, he fantasized about making movies again, even though he had not produced a motion picture in years. Concluding that he needed some attractive new talent to signal his return to filmmaking, Hughes called Washington and instructed Bob Maheu to go to Atlantic City to sign “ten of the Miss America contestants to movie contracts.”⁵⁹ Maheu, accustomed to unusual assignments, was becoming a valuable operative for Hughes. He had served as a counterespionage agent for the FBI in the Second World War and as a corporate sleuth thereafter, enmeshed in intrigue from London to the Persian Gulf. For one of his clients, Greek shipping tycoon Stavros Niarchos, Maheu spent several months in the Middle East scuttling a lucrative oil deal negotiated by Niarchos’ rival, Aristotle Onassis. A gifted conversationalist, Maheu could be both diplomatic and persuasive, and he was especially skilled in talking the language of politicians. Maheu still owned his own public-relations agency in Washington, but by 1959 his intensifying relationship with Hughes required that he live part of the year in California. Hughes repeatedly urged Maheu to join his staff full time and to become his “alter ego” so that Hughes, as Maheu later explained, would never have to appear before a government agency. Wary of working solely for Hughes, Maheu had always declined, but he was weakening.

The Miss America project was one of Maheu’s more curious assignments. The outlook for making any of the beauty queens a movie star for Hughes was certainly not promising. Romaine Street already had under its wing a number of young women who had been promised stardom in a Hughes movie. With visions of the fame that lay ahead, the young women submitted to drama and singing lessons, designed, they were told, to turn them into polished actresses. Some received contracts from Hughes Productions; others, like Gail Ganley, a twenty-year-old singer and dancer, were not so fortunate.

Told by a talent scout that Hughes wanted to “make her a star,” she willingly gave up her budding singing career in exchange for a long-term drama-coaching program.⁶⁰ The terms were strict—she would refrain from appearing as a singer, dancer, or actress during the training period, she would keep her arrangement with Hughes a secret from all but her immediate family, and “hold herself” ready to meet with Hughes at any time to discuss her career.⁶¹ In return, she was promised a contract paying $450 a week and expenses. A driver from Romaine called for her each day and drove her to the home of a drama coach in Beverly Hills. As months passed and Miss Ganley received neither her contract nor the weekly salary, she began to worry. When she broached the matter to Hughes’s aides, they told her not to worry; Hughes had simply been too busy to sign her contract. Miss Ganley was not persuaded. Pressing hard for money and clearly not to be put off, she received instructions finally to drive to Romaine Street and honk her horn three times, whereupon expense money would be provided. Following orders, she pulled up outside Hughes’s legendary command post and sounded the horn, at which signal, much to her surprise, a second-floor window opened and a man lowered an envelope on a string.⁶² Inside the envelope was money. This ritual was repeated periodically, but in the end, after almost two years of drama lessons, Gail Ganley never did receive a signed contract. She later sued Hughes and accepted an out-of-court settlement.

With this collection of young women waiting for stardom in Hughes’s movies, Maheu’s Miss America assignment was dubious. Still, he packed his bag, headed for Atlantic City, and even interviewed several contestants. But his heart was not in it. Only one contestant was persuaded to sign a contract with Hughes. Like all of Hughes’s other young women of the 1950s lured by dreams of glory, she never played so much as a bit part. By 1959, Hughes’s Hollywood days were behind him. He would never produce or direct another film.

If movies were fantasies, TWA’s predicament of 1959 was all too real. As much as Hughes may have wanted to ignore or shut it out, events would not let him do so. Paying out millions of dollars a month for newly arriving airplanes and getting nothing back in lease fees from TWA, Hughes was heading for catastrophe. That June, in a desperate move to forestall the inevitable, he sold six of the Boeing 707s that he had ordered for TWA to Pan American, TWA’s chief overseas rival. The sale all but crippled TWA on the North Atlantic route, where it competed directly with Pan Am.

Hughes’s longtime lawyer Tom Slack once told a friend “Howard’s no genius, he’s just lucky,” but by the fall of 1959 Hughes was fast exhausting his most precious commodity.⁶³ Only through luck had he managed to avoid ruin, scraping together the last of the resources to pay Boeing, still refusing to negotiate sincerely with lenders, apparently waiting for a miracle to save him from the financiers. Now that he really was running out of time, disquieting word came from San Diego. At Convair, production on TWA’s 880s was right on schedule. Each plane would cost Hughes about $3.5 million and delivery would start in a few weeks. To TWA, which needed the jets, it was the best of all possible news. To Hughes, who could not pay for them, it was a disaster.

Hughes reacted to the latest crisis in his own inimitable way. On October 5, he dispatched a force of armed guards to the Convair assembly plant in San Diego. There, the tight-lipped guards surrounded aircraft No. 5, the first 880 scheduled for delivery to Hughes, then in the final stages of assembly, and refused to allow workers to complete it.⁶⁴ A few days later, Hughes’s army also took up vigil over TWA’s next 880 and shut down work on it, too.

The seizure of the second aircraft was particularly frustrating to Convair. Shortly before its capture, Convair had installed in it a seat intended as a prototype for all the 880s. But after the takeover, Hughes’s guards would not allow Convair workers even to remove the seat and the company was therefore forced to design and construct another model.⁶⁵ Shortly afterward, Hughes’s guards seized two more planes and then the four aircraft were towed away from the Convair plant to an apron adjoining the runway.

Convair workers watched in amazement as the uncompleted jets were pulled out of the hangar. But Hughes’s desperate act was not without purpose. By preventing Convair from completing the planes, he had postponed the day of reckoning. TWA would be damaged, no doubt. But TWA’s financial health was the least of Hughes’s concerns; his control of the airline took precedence. Parked outside, exposed to the salt air, the 880s’ jet engines began to corrode. J. William Bew, who was overseeing the purchase contract for TWA, pleaded with Bill Gay to preserve the engines.⁶⁶ But when technicians approached the aircraft, they were turned back. Although angry, Convair took no action against Hughes. He remained the company’s prime customer and it still hoped to sell planes to him once the current unpleasantness passed. Convair responded to the 880s’ seizure merely by removing the rest of Hughes’s planes from the assembly line. That was another blow to TWA. The airline had been the last major carrier to order jets, and now even those planes would not arrive on schedule.

TWA’s loss, however, did not compare to what lay ahead for General Dynamics, Convair’s owner. The company’s ill-starred venture with Hughes led to what Fortune called “the biggest product loss ever sustained by any company anywhere.”⁶⁷ Due largely to Hughes’s interference, Convair rolled up losses of $490 million, more than double what the Ford Motor Company lost in its notorious Edsel fiasco.

By seizing the 880s, Hughes had bought time. But time for what? Despite all his maneuvers, he was still faced with a debt he could not satisfy without the aid of Wall Street. And still he delayed. As TWA’s condition worsened for lack of jets, Charles Thomas took matters into his own hands. At a March 1960 TWA board meeting, Thomas persuaded the Hughes-controlled board to approve the long-dormant Dillon, Read plan for conventional financing which would raise a total of $265 million from banks, insurance companies, and the Hughes Tool Company. To everyone’s surprise, Hughes accepted the board’s action on March 29. The lenders immediately began to draw up the voluminous loan papers.

From the outset of Hughes’s dealings with the financiers, he had harbored dark fears that “unnamed forces” were plotting to take TWA away from him.⁶⁸ Now he became convinced of it. Increasingly wary of Hughes’s erratic ways, the lenders inserted into the loan documents an undisguised threat to Hughes’s rule. As the price for their $165-million loan, they warned Hughes that if he defaulted or forced any change in TWA’s management, he would be required to place his airline stock in a ten-year voting trust that gave the lenders the right to select a majority of the trustees. Those trustees then would assume responsibility for management of the airline.⁶⁹ Hughes’s interference in TWA’s internal affairs was legendary. Thomas was the airline’s fifth president in a dozen years. The lenders were warning Hughes flatly that if he forced Thomas out, he might lose control of TWA. They set July 28 to close the financing.

It was not the only deadline Hughes faced that month. Thomas had taken over as TWA’s president in the summer of 1958 with the understanding that Hughes would give him a stock option in TWA two years later. Now that time was near. Hughes opposed the concept of stock options for his executives and he was not about to change his ways, least of all for Thomas, who had antagonized him by championing the Dillon, Read plan. But if he refused the request, he might lose Thomas and thus control of TWA.

As early as April of 1960, Thomas began trying to reach Hughes by telephone to discuss his future at TWA. Hughes refused to return his calls until July, when he put forth a counterproposal to Thomas’s request for a stock option. To Thomas’s astonishment, Hughes insisted that he resign as TWA’s president and run the airline as “an employee of the Tool company.”⁷⁰ In all his years of badgering and cajoling TWA’s presidents, Hughes had never made such a demand. Thomas knew full well that such an arrangement would place him more than ever under Hughes’s thumb, and he refused. The first conversation in months between the two men broke off in acrimony. Rejecting Thomas’s demand for a stock option, Hughes voiced a familiar refrain: he refused to negotiate at the “point of a gun.”⁷¹

Once again, Hughes had mishandled a serious personnel situation. Unlike most Hughes executives, Thomas could not be pushed around. With a large private income, he had little need of his $60,000-a-year TWA salary, much of which was eaten up by income taxes. Indeed, he had wanted a stock option as a way to reduce his annual tax bill. As Thomas pondered his future during a vacation at Pebble Beach, an enticing offer arrived—management of the sprawling 93,000-acre Irvine Ranch development outside Los Angeles. At odds with Hughes, Thomas saw no choice but to leave TWA.

More than any other single event, Thomas’s resignation on July 23 turned Wall Street firmly against Hughes. TWA’s mysterious proprietor had committed the unpardonable sin. The lenders looked upon Thomas as something of a savior for TWA. With him gone, they immediately canceled the closing on the $265-million jet deal and prepared to wait and see what Hughes would do about naming a successor.

If Hughes sensed the enormity of his blunder, he did not confide it, but he certainly felt the financial vise closing around him. Secluded in Room 395 on the third floor of the Beverly Hills Hotel—where he had recently moved temporarily from the bungalow—he was jumpy and ill at ease. Imagining a knock on his door late one afternoon, he picked up the telephone and screamed at Operations: “Did you send somebody up to knock on my door?” Even after the operator protested innocence, Hughes continued to scold him, warning that no one had better knock on his door “unless there is a helluva good reason for it.”⁷²

For Hughes, in a crisis, there was always something unimportant to worry about—if not someone knocking on his door, then the precise time that one of his executives planned to go to bed. One night he called Operations and gave orders for a memorandum to be sent to Bob Rummel and one of his assistants, who were standing by at a hotel awaiting orders:

If they feel they could go to sleep now or sometime soon, then I would suggest they go right ahead and try to do so and I will call them tomorrow at any hour they would prefer to have me call. On the other hand, if they do not feel they could go to sleep for quite a while yet, in that event I wonder if they could tell you what time they think is the earliest that they will be able to sleep or call [Operation] when they get sufficiently sleepy so that they think they can go to sleep. On the other hand, if they can go to sleep now, fine, I will call them in the morning; but if they think they cannot go to sleep, or if they have no way of knowing this, then why don’t they just relax and look at the Tokyo riots on TV so they can tell me about it, and call [Operations] whenever they feel that they are sufficiently sleepy that they could go to sleep. If I had not been able to call them by then, I will call in the morning.⁷³

No doubt thoroughly confused, and possibly bemused by Hughes’s communication, Rummel opted for an easier course. He told Operations to tell Hughes “he can call any time during the night and not worry about upsetting our sleep too much.”⁷⁴

Hughes was not the only one under pressure. Raymond Cook was in New York dealing with TWA’s creditors and bankers after Thomas’s departure. Cook tried repeatedly, without success, to get through to Hughes, who remained incommunicado in the Beverly Hills Hotel. At 3:30 on the morning of August 3, however, Hughes dictated a rambling memorandum to Operations to be transmitted to Cook.

Apologizing for his failure to return Cook’s calls, Hughes said, “I’m extremely sorry, but have been unable to sleep for a combination of reasons for 60 hours now and I’m not going to kill myself and get sick again.”⁷⁵

Hughes had good reasons for sleepless nights. On September 1, two earlier loans from the banks and insurance companies totaling $54 million were due, and he did not have the cash to pay them. Sixty days later, he would need $14 million more to retire the principal on a long-standing, although unrelated note from the Irving Trust Company. Hughes had borrowed the money years before to consolidate his hold on RKO. At the time, he routinely pledged his tool company stock as collateral, never dreaming that the great property itself would ever be endangered by such a move.

Hughes had maneuvered himself into an incredibly vulnerable position. If he failed to pay off the notes, the lenders could foreclose and throw him into bankruptcy. Luckily for him, foreclosure was such a mighty weapon that the lenders were fearful of wielding it. To foreclose on Hughes would bring down TWA as well, jeopardizing their own investment in the airline. The September 1 deadline came and went with no action taken.

In the following weeks, Hughes cast about for an alternative to the Dillon, Read plan, vowing to one banker that he would “go into receivership” rather than go through with it.⁷⁶ First, he tried to make a deal with a group of banks and General Dynamics. But General Dynamics, weakened by Hughes’s own inability to pay for the Convair 880s, was unable to raise the cash. Then Hughes eyed Hughes Aircraft again, claiming that he would “get some money out of [his] charity one way or another.”⁷⁷ That, too, fell through.

Seemingly trapped, early in October Hughes reluctantly agreed to the Dillon, Read plan once again. Only now the lenders imposed harsher terms. In addition to requiring Hughes to place his TWA stock immediately in a ten-year voting trust—which would remove his control of the airline—they insisted on a stiff prepayment penalty if he paid off the loans before March 31, 1962. When Hughes heard that, he was furious and once more began looking for a way out.⁷⁸ He turned to Colonel Henry Crown, a Chicago industrialist, who was General Dynamics’s largest stockholder. Through a new scheme backed by a Bank of America loan and the sale of TWA debentures, Hughes hoped to raise the millions he needed. This plan also was aborted when investment bankers warned Hughes that they could not guarantee it would raise the amount he needed.

After the collapse of the Crown deal, Hughes, certain that Wall Street was conspiring to take TWA away from him, telephoned Maheu and ordered him to put all the lenders under “surveillance.”⁷⁹ Hughes thought, Maheu later recalled, that the financiers had conspired to exert pressure on other bankers with whom Hughes was negotiating, and had succeeded in “scuttling the financing that he was trying to put through.”⁸⁰ The Dillon, Read plan still looked like the only way Hughes could save himself, but he was as opposed to it as ever. In an October 28, 1960, memorandum to William Forrester, Jr., the Merrill Lynch executive, Hughes poured out his venom against the Dillon, Read plan and the man he considered responsible for it, Charles Thomas, the mild-mannered, conscientious ex-TWA president who had happily washed his hands of the Hughes mess three months before.

“Tell Forrester,” Hughes instructed Operations,

that Charlie Thomas negotiated and developed the deal with Dillon Read… without my authority or encouragement from me; he forced it down my throat then at a Board meeting at which time he created a coalition of my directors and turned them against me and faced me with a mass resignation of all but one of the TWA directors. I have never liked this plan; I have never been in favor of this plan; I have fought it from the beginning and I am still fighting it and I assure you that if it is employed it will be over my dead body.⁸¹

By early November, it looked as if Hughes might actually be prepared to “go into receivership” rather than submit to the Dillon, Read plan. The situation was so grave that the CAB’s staff in Washington alerted the agency’s five-member ruling board that the “crisis stage” had been reached at TWA.⁸² Alarmed, a CAB staff attorney warned Cook on November 23 that unless the CAB had “definite assurance” of TWA’s financing within a week, he would recommend a full investigation to determine if it was in the public’s interest for Hughes to control the airline.⁸³

Hemmed in, Hughes capitulated in late November and agreed for the third time to go along with the Dillon, Read proposal. Turning again to Fred Brandi at Dillon, Read, he asked if the plan could be reactivated. Brandi reported back that it could, but on even stiffer terms. The lenders now laid down a series of humiliating conditions aimed at making it virtually impossible for Hughes to back out again. They demanded that Hughes personally, as an indication of good faith, sign letters agreeing to their terms.

A furious Hughes went along reluctantly. But no sooner had he accepted Wall Street’s tough conditions than he fired Raymond Cook, his diplomatic Houston lawyer, who had managed to keep relations between his mercurial boss and the staid financiers on an even keel. Why Hughes fired Cook is not clear. Hughes said he was “shocked and amazed” when Cook failed to show up in Los Angeles early the day after Thanksgiving to review certain papers.⁸⁴ Cook had flown home to Houston for the holiday. But Hughes’s displeasure over that incident was probably only symptomatic of the ill-will he felt toward all who had played an intimate role in this defeat.

With Cook’s departure, Hughes seemed resigned to going through with the financing and submitting to the voting trust. He dispatched a replacement to the East, Greg Bautzer, a tall, handsome, Hollywood attorney who had represented Hughes on motion-picture business. Bautzer alarmed the lenders when he briefly made another effort to push for financing without the voting trust. Like all the others, this scheme failed. On December 3, both the TWA and tool company boards approved the $265-million financial package put together by Dillon, Read. Four days later, Bautzer announced that Hughes had personally signed the letters of agreement. On December 15, 1960, Raymond Holliday, acting for the tool company, and the lenders unceremoniously executed the voting trust agreement. After fifteen years as its undisputed master, Howard Hughes had lost control of TWA.